On July 4th,2025, like many Americans I was celebrating our Nation’s Independence Day. Butas I was relaxing by the grill, I was also diving into some articles on the One Big Beautiful Bill Act (OBBBA), which was signed by the President that day. I have clients on either end of the political spectrum, and there was a lot to love or hate in the bill depending on your political affiliation. I’m happy to leave the politics to others and focus on how my clients are impacted. For my clients at or near age 65, there is one change that should grab their attention.
2025 Standard Deduction Changes for Seniors
Starting in2025, Seniors will benefit from a significant increase in their standard deduction. The One Big Beautiful Bill (OBBBA) introduces an additional $6,000deduction per eligible senior, expanding the total deduction amount and creating new tax planning opportunities.
Phase out:
There is a phase-out range for this additional deduction: Single filers with over $75,000of (modified adjusted gross income) MAGI and married filers with over $150,000of MAGI, but the majority of American seniors will get the full benefit of this additional deduction.
Client Impact & Planning Opportunities
So, what should you do with this information? Well, first off you should be asking yourself if your financial advisor is thinking about you and your financial planning strategies when changes like this happen! If you aren’t working with a TruStone Wealth Management advisor, feel free to reach out for an initial consultation.
If you are working with us already, here are a few possible ways this change could benefit you:
· More room for Roth conversions before entering higher tax brackets.
· Potential to reduce the taxable portion of Social Security benefits.
· Greater opportunity to avoid Income-Related Monthly Adjustment Amount surcharges on Medicare premiums.
· Higher deductions reduce the need to itemize in most situations.
This new deduction opens a strategic four-year window (2025–2028) to act on tax planning. We’ll incorporate these changes into your next review and identify ways to take advantage.Ready to learn more? Get started by
requesting a complimentary initial consultation whenever it’s convenient for you.
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