Seniors age 65 and older can claim a temporary federal deduction of up to $6,000 ($12,000 for married couples) only by filing a new IRS Schedule 1‑A. Eligible people and income limits are as follows.
What you need to know about the tax system in 2025
Learn how the 2025 tax brackets work and what it means for your income taxes this season.
- For example, if your marginal tax rate is 12%, the $6,000 enhanced senior credit for a single taxpayer age 65 or older will result in a $720 tax savings.
- The new enhanced deduction for seniors on your federal income tax return applies whether you itemize deductions like mortgage interest or claim the standard deduction.
Seniors facing a financial crisis may be pleased to learn that the 2025 federal income tax return offers a way for people age 65 and older to receive an even larger tax refund.
To qualify and claim the special tax credit, be sure to file a new Schedule 1-A.
A new temporary “senior bonus” will allow many taxpayers age 65 and older to deduct up to $6,000 of income on their federal returns. However, many rules and restrictions apply, so not everyone in that age group will qualify.
However, if you qualify, you could potentially see a larger tax refund or significant tax savings.
For example, at a marginal tax rate of 12%, a $6,000 deduction for a single taxpayer age 65 or older would result in a tax savings of $720.
The new enhanced deduction for seniors applies whether you itemize deductions like mortgage interest or claim the standard deduction on your 2025 federal income tax return.
This is also an additional deduction on top of the existing additional basic deduction for taxpayers age 65 and older who do not itemize. The additional standard deduction for seniors for tax year 2025 is $2,000 for single taxpayers and $1,600 for each qualifying spouse for married couples filing jointly.
New tax reductions for the elderly will be introduced with the 2025 tax return.
“There’s currently a lack of awareness that this credit exists,” said John Hischta, senior vice president of campaigns for AARP, which supports the newly enhanced senior citizen credit and has been working to spread awareness about the new tax cut.
Here are three things you should know about the new “Expansion of deduction for the elderly” on page 2 of Appendix 1-A.
What is the income limit for the new elderly deduction?
Income limits apply: The deduction will begin to phase out for seniors with modified adjusted gross incomes of $75,000 for single filers and $150,000 for joint filers, meaning higher-income seniors will receive smaller or no tax breaks.
This deduction is phased out at a rate of 6% per $1,000. It will be completely phased out at $175,000 for single filers and $250,000 for joint filers.
You are dealing with modified adjusted gross income. This is calculated by adding your income to your adjusted gross income. Schedule 1-A re-adds income from Puerto Rico that we excluded from AGI, as well as income related to certain U.S. nationals from Form 2555 related to foreign housing and foreign earned income, and income related to tax relief from Form 4563 to exclude income from bona fide residents of American Samoa.
The White House Council of Economic Advisers estimated that those eligible for the enhanced senior citizen tax credit could see their after-tax income increase by an average of $670 thanks to the new tax cut. The deduction is estimated to be a boost for 33.9 million seniors, including those who have not claimed Social Security benefits.
The amount of deduction depends on your income.
Can I qualify even if I am 62 or 63 years old?
Age is important: For example, if you’re currently 62 or 63, forget about the enhanced senior tax deduction on your 2025 return. This tax reduction only applies to people age 65 and older. For the 2025 return, the elderly exemption applies to those born before January 2, 1961.
Eligible couples who are both 65 or older can claim up to $12,000 in additional deductions.
The enhanced senior citizen deduction is only available for four years: 2025, 2026, 2027, and 2028. For example, someone who turns 65 in 2029 will no longer receive that deduction in the future unless the tax system changes again.
Which line do I use to claim the enhanced senior citizen exemption?
A new form is required. Tax expert Tom Oseven warned that the newly enhanced deduction for seniors could be an often-overlooked deduction, especially for seniors who file simple returns and have not previously required additional schedules.
He cautioned that many seniors will think the new deduction will automatically increase, similar to the long-standing additional basic deduction for taxpayers 65 and older. But what we’re talking about here is a new boost that requires additional paperwork. You will also need to file Schedule 1-A to claim the enhanced senior citizen exemption.
The enhanced senior citizen deduction can be found on page 2 of Schedule 1-A. See lines 31 through 37 of Schedule 1-A.
Bonus tip: Couples will not be able to file separately to claim the new deduction for seniors, which many argue will alleviate growing financial worries.
Contact personal finance columnist Susan Tompol: stompor@freepress.com. follow himr X @tompor.
