Are seniors getting reduced Social Security or a tax break?
Up
to
2
million
Americans
could
see
their
Social
Security
payments
reduced
by
50%
in
late
July
as
the
Social
Security
Administration
(SSA)
is
cutting
payments
to
recoup
the
billions
of
dollars
it
overpaid
to
some
Americans
in
recent
years.
In
April,
the
SSA
announced
that
it
would
begin
recovering
about
$72
billion
in
improper
payments
made
between
2015
and
2022,
resulting
from
either
agency
errors
or
the
failure
of
recipients
to
report
income
changes
that
impacted
their
benefits.
SSA’s
2025
Social
Security
Trustees
Report
found
that
the
program
cost
$1.485
trillion
in
2024
but
only
brought
in
$1.418
trillion,
resulting
in
a
$67
billion
deficit
for
the
year.
According
to
the
same
report,
the
Old-Age
and
Survivors
Insurance
(OASI)
trust
fund
could
be
depleted
by
2033,
at
which
point
Social
Security
would
only
be
able
to
pay
77%
of
its
expected
benefits.
Although
the
Trump
administration
is
overseeing
recent
Social
Security
changes,
the
overpayment
recovery
effort
began
under
former
President
Joe
Biden
after
the
agency
conducted
a
review.
In
2023,
the
SSA
said
it
would
withhold
10%
of
future
benefits
to
recoup
overpayments.
But
in
March
2025,
the
agency
said
it
would
start
withholding
100%
of
benefits
until
debts
were
repaid,
sparking
public
outcry.
The
SSA
later
scaled
that
back
to
50%,
although
many
retirees
say
that
amount
is
still
too
steep.
The
withholding
is
expected
to
begin
with
Social
Security
payments
made
on
or
around
July
24,
2025.
In
relation,
Trump
has
previously
promised
that
his
“Big
Beautiful
Bill”
will
eliminate
income
taxes
on
Social
Security
benefits,
which
some
27.4
million
people
pay
each
year.
Instead,
the
Senate’s
version
of
the
bill
that
was
passed
earlier
this
week
proposes
a
tax
break
of
up
to
$6,000
per
person
instead
of
eliminating
taxes
on
benefits.
It
would
apply
to
seniors
65
and
older
with
annual
incomes
up
to
$75,000
(or
$150,000
for
couples),
and
it
would
be
available
whether
they
itemize
or
take
the
standard
deduction.
Above
those
income
limits,
the
deduction
would
gradually
shrink
and
phase
out
completely
for
individuals
earning
$175,000
or
couples
earning
$250,000
before
expiring
after
2028.
According
to
NPR,
House
Republicans
are
expected
to
pass
the
bill
by
Friday.