Key Points
Millions of seniors saw their Social Security benefits increase significantly as a result of a 2025 law change.
They could be at risk of paying a large Social Security benefit tax this filing season.
The new senior tax deduction could offset at least a portion of this for some beneficiaries.
- The $23,760 Social Security bonus most retirees completely overlook ›
Millions of Americans saw a Social Security benefit boost last year thanks to the Social Security Fairness Act. If you were among them, you probably got a permanent increase to your checks as well as a one-time payment for benefits going back to January 2024.
That extra money has likely been a huge help as living costs continue to rise. But it could also lead to a major shock when you file your 2025 tax return.
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Brace yourself for Social Security benefit taxes
You’re at risk of owing Social Security benefit taxes if your provisional income — adjusted gross income (AGI), plus any nontaxable interest and half your annual Social Security benefit — exceeds $25,000 for a single adult or $32,000 for a married couple. This could require you to pay ordinary income tax on up to 85% of your checks.
If you haven’t owed benefit taxes in the past, you could encounter them for the first time when you file your 2025 return. If you have owed them before, they may be higher this year, especially if you received a large benefit increase.
This could result in a greater tax liability than you were expecting and possibly a tax bill. However, this could be partially or completely offset by the new $6,000 senior tax deduction for qualifying Americans aged 65 and older.
What to do if you’re worried about owing the IRS
If you owe a tax bill you can’t pay in full right now as a result of your Social Security benefits increasing, reach out to the IRS to discuss your options. You may be able to work out a payment plan or make an offer in compromise (OIC). This is where you offer the IRS the amount you could pay. If it accepts, you’re off the hook for the rest.
You may pay less in Social Security benefit taxes in 2026 and beyond since you likely won’t receive a large retroactive payment like many seniors did in 2025. But as average benefits and living expenses rise, Social Security benefit taxes will become increasingly common.
You can prepare for them by setting aside money to cover these taxes. Or you could request that the Social Security Administration withhold money from your checks for these taxes. If it takes too much over the year, you’ll get the extra back as part of your tax refund. This reduces your risk of a surprise bill at tax time, but it also means you have to get by on less money during the year.
Consult with a tax professional if you have questions about your specific situation. They should be able to advise you about how much you may owe in benefit taxes and the best way to handle that.
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