What actually happened with Trump and Social Security taxes

During his 2024 campaign, Donald Trump said he would eliminate taxes on Social Security benefits if re-elected. He did not sign legislation doing this before leaving office in January 2021, and as of now no such law exists. What he said during the 2024 campaign and what Congress has actually passed are two different things.

Social Security benefits are currently taxed for some people depending on their income level. If your combined income (wages, interest, and half your Social Security) exceeds certain thresholds, you owe federal income tax on a portion of your benefits. These thresholds have not changed since 1984. Trump's statements were about what he said he would do if elected, not about changes that have already taken effect.

Key Takeaways

  • Trump made campaign statements about eliminating Social Security taxes but did not sign any law doing this before his first term ended in January 2021.
  • Social Security benefits are currently taxed for beneficiaries whose combined income exceeds $25,000 (single filers) or $32,000 (married filing jointly).
  • Any change to how Social Security is taxed would require Congress to pass a new law and the president to sign it.
  • You should continue to report your Social Security income on your tax return as you do now unless the law changes.

How Social Security is taxed right now

The current rules have been in place since 1984. The IRS taxes your Social Security benefits based on your "combined income," which is your adjusted gross income plus nontaxable interest plus half of your Social Security benefits. If you are single and your combined income is between $25,000 and $34,000, you may owe tax on up to 50 percent of your benefits. If your combined income is over $34,000, you may owe tax on up to 85 percent of your benefits.

If you are married filing jointly, the thresholds are $32,000 and $44,000. If you are married filing separately, you almost always owe tax on your benefits. These income limits have not been adjusted for inflation since they were set in 1984, which means more people pay tax on their benefits now than did when the rule started.

What would have to happen for the law to change

For Social Security taxation to change, Congress would need to pass a bill that removes or modifies the tax, and the president would need to sign it. Campaign promises are not the same as law. Many proposals are made during elections that do not become law because Congress does not pass them, or because the two chambers disagree, or because the president's priorities shift once in office.

Currently, no bill eliminating Social Security taxes has passed either the House or Senate. If you want to know whether such a bill is being considered, you can search Congress.gov by typing "Social Security tax" in the search box. This shows you every bill introduced and its current status.

Why Social Security is taxed at all

Social Security was originally designed so that benefits would not be taxed. In 1983, Congress changed this as part of a fix to keep the Social Security trust fund solvent. The change was meant to be temporary, but it has remained in place for over 40 years. The tax applies only to people with income above the thresholds, so lower-income beneficiaries do not pay tax on their benefits.

The revenue from taxing Social Security goes back into the Social Security trust fund, not to the general Treasury. This means that removing the tax would reduce the money available to pay benefits in the future, unless Congress found another way to fund the program.

What you should do about your taxes now

Continue to report your Social Security income on your federal tax return as you do now. You will receive a Form SSA-1099 from Social Security each January showing how much you received in the previous year. You report this on your tax return, and your tax preparer or tax software will calculate whether any of it is taxable based on your other income.

If you prepare your own taxes, the IRS worksheet for calculating taxable Social Security is in the instructions for Form 1040. If you use tax software, it will walk you through the questions needed to calculate this. If you use a tax preparer, bring your SSA-1099 along with your other income documents.

Frequently Asked Questions

If Trump is elected again, will Social Security taxes go away automatically?

No. Even if a president wants to change a tax law, Congress must pass a bill first. The president cannot change tax law by executive order. Any change would require both the House and Senate to vote on and pass a bill, then the president to sign it.

Do I have to pay tax on all of my Social Security?

No. The maximum amount of your benefits that can be taxed is 85 percent. If your combined income is below the thresholds ($25,000 for single filers, $32,000 for married filing jointly), you owe no tax on your benefits at all.

What is combined income?

Combined income is your adjusted gross income plus any nontaxable interest plus half of your Social Security benefits. It is not the same as your total income. Your tax preparer or software will calculate this for you using the IRS worksheet.

Will the income thresholds ever change?

They could change if Congress passes a law to adjust them. Currently they are frozen at the 1984 levels. Some proposals have suggested adjusting them for inflation, but no such bill has passed.