Exclusive: The House of Representatives' top tax authors argue that President Donald Trump's “big, beautiful bill” will also be “big” for American taxpayers, including seniors.
Jason Smith, R-Mo, chairman of the House Ways & Means Committee. , and other Republicans spent months negotiating behind closed doors on how to enact Trump's tax policy.
Among them is the $4,000 deduction added to Americans over the age of 65. Elderly people under $75,000 as single filers and older people under $150,000 as co-filer will be eligible for the full deduction and will then begin to phase out.
“So, in addition to their guaranteed deductions, it's per person, and it's going to be done entirely for anyone with a total income of less than $75,000 a year. So, all low- and middle-income seniors will pay zero social security on social security.”
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President Donald Trump urges Republicans to hand over his “big, beautiful bill.” (AP Photo/Mark Schiefelbein)
Republicans use the budget settlement process. This lowers the Senate threshold for passing from 60 to 51 votes from certain fragments of fiscal law, and advances a huge bill full of Trump's priorities on taxes, immigration, energy, defense and government bonds.
As the House already runs under a simple majority, the settlement allows political parties to pass swept legislation while standing by the other side, in this case Democrats.
Trump has directed Republicans in Congress to permanently extend the 2017 Tax Cuts and Employment Act (TCJA) and implement a new policy that eliminates taxes on tips, overtime salaries and social security for retirees.
However, the legislation that established the settlement process, the 1974 Congressional Budget Act, prohibited direct changes to social security, particularly through the process.
Smith said he added a $4,000 tax credit as a way for Republicans to make them “fully.”
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Jason Smith, R-Mo, Chairman of the House Ways & Means Committee. helps in creating the tax portion of the bill. (Tom Williams)
But Smith said instead of seeing that tax relief every month, it comes in people's annual tax returns.
He argued that it was more beneficial for low-income elderly people as well, giving additional relief to people too low to pay Social Security Tax in the first place.
“Under the rules of settlement, you cannot be directly exposed to Social Security. What we did is ensure tax relief for older people who earn less than $75,000 a year,” Smith said. “That's not that we don't want to do that, it's not possible under the rules of settlement, or it's not qualifying for the 51 vote threshold in the US Senate.”
“But the tax cuts they receive are additional tax cuts, which will compensate for what they paid with Social Security tax.”
The White House also approved Smith's plan despite a departure from Trump's first campaign pitch.
“The large and beautiful bill will not only provide permanent tax cuts and greater pay, but also ensure historic tax cuts for seniors on social security,” said White House spokesman Anna Kelly. “This is another promise, and after suffering under four years of BidenFlation, our older adults who deserve much needed tax cuts,” he said.
The $4,000 tax credit valid for the 2025-2028 tax year is in addition to the higher standard credits that people over the age of 65 have already received.
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It is not a tax credit, but directly reduces your tax liability regardless of the scope of the tax system. The deduction reduces taxable income and depends on the taxpayer's tax rate.
But it will provide some relief to millions of taxpayers across the country to ensure that single seniors making up to $75,000 and married seniors under $150,000 will qualify for the $4,000 deduction.
“It's going to be a wash over what their social security tax was,” Smith said later in the interview, “Failure is not an option. We'll do this.”
