'Big beautiful bill' may help some seniors on Social Security. But it doesn't eliminate taxes on benefits

The "big beautiful bill" includes a $6,000 additional deduction for certain older Americans ages 65 and over

However, the legislation does not end federal income taxes on Social Security benefits

Here's how the changes in the bill may impact current and future retirees

Republican presidential nominee former President Donald Trump speaks at a campaign rally in Asheville, N. , Wednesday, Aug

Matt Rourke | APThe Social Security Administration sent what experts say is a misleading to consumers last week, describing President Donald Trump's "one big beautiful bill" as "long-awaited tax relief to millions of older Americans. "In that and a July 3 press release, the agency said the legislation will make it so "nearly 90%" of Social Security beneficiaries no longer pay federal income taxes on benefits

Tax experts say that is not accurate

The legislation does not, as the agency put it, include "a vision that eliminates federal income taxes on Social Security benefits for most beneficiaries. " Moreover, while the Social Security Administration memo said the law helps tect Social Security, experts say the visions weaken the gram's funding by reducing the tax money it receives. "It's simply not correct to say that there's a vision in this bill that is going to eliminate the Social Security benefit tax for 90% of the population," said Howard Gleckman, senior fellow at the Urban-Brookings Tax Policy Center. "And it's also just wrong to say that this is going to preserve the solvency of Social Security," Gleckman said

More from Personal Finance:What Trump's 'one big beautiful' tax-and-spending package means for your moneyTax changes under Trump's 'big beautiful bill' — in one chart78% say Trump's tariffs will make it harder to deal with debt, survey findsTrump had said on the campaign trail that he planned to eliminate federal income taxes on Social Security benefits

However, the reconciliation cess through which the budget and tax legislation was passed hibits changes to Social Security

The Social Security Administration did not return requests for

The White House deferred to the Social Security Administration

Those tax changes include a higher standard deduction, the existing senior deduction already in effect and the new additional senior deduction or "bonus. "How the $6,000 senior 'bonus' worksThe new tax package includes an additional deduction of up to $6,000 for seniors ages 65 and over

While the additional senior deduction has been called a "bonus" in the legislative text, it is nically a deduction, which reduces the amount of income that is subject to taxes

Notably, that does not necessarily mean seniors will see a $6,000 "bonus" check in the mail or in their refunds at tax time. "This is not what happened during Covid, when the government was writing checks to people," Gleckman said

It will be available to eligible taxpayers regardless of whether they take the standard deduction or itemize their returns

But eligibility depends on income

For incomes above those thresholds, the deduction gradually phases out

Middle-income seniors stand to benefit the most from the change, according to tax experts

How the bonus affects tax on Social Security benefitsA person holds a sign reading ' Our Social Security' in support of fair taxation near the U

Capitol in Washington, D

Tax justice advocates att a rally to speak out against President Trump's tax cuts for the wealthy, and to urge members of Congress to intervene

Bryan Dozier | Afp | Getty ImagesSocial Security benefits are taxed based on combined income, or the sum of adjusted gross income, nontaxable interest and half of Social Security benefits

Those thresholds are not adjusted for inflation, which means that over time more beneficiaries pay taxes on their benefits

Because the new senior bonus is an above-the-line deduction, meaning it is subtracted from gross income to calculate adjusted gross income, it may indirectly reduce tax liability on Social Security benefits

Who may benefit from the senior 'bonus'The additional senior deduction will not affect taxes on Social Security benefits for individuals and couples below those income thresholds, since they already are not subject to levies on their benefits, Gleckman said

Nor will it help people who earn too much to qualify for the new deduction

For taxpayers who qualify, the senior deduction may reduce, rather than eliminate, their taxes on benefits, Gleckman said

The Urban-Brookings Tax Policy Center estimates that fewer than half of older adults will benefit from the senior deduction, he said

Even those who benefit won't necessarily see zero taxes; they'll just see fewer taxes, Gleckman said. "The people who benefit the most, we estimate, are people who made between $50,000 and $200,000," Gleckman said

The legislation may be more generous to seniors than to taxpayers in other age cohorts, said Alex Durante, senior economist at the Tax Foundation. "The enhanced adoptions overall are going to reduce tax liabilities for seniors significantly, and for some people, it will bably wipe out any tax liability they have," Durante said. "But it depends on where they are in the income distributions," he said

How 'big beautiful bill' affects Social Security fundingWhile certain seniors may see financial benefits now, the enhanced senior deduction will cost the Social Security gram, which is already under financial strain

The new additional senior deduction and other changes in Trump's "big beautiful bill" may reduce taxation of Social Security benefits by apximately $30 billion per year, estimates the Committee for a Responsible Federal Budget

That would accelerate the jected insolvency date for the Social Security trust fund devoted to retirement benefits to late 2032, up from the currently jected date of early 2033, according to CRFB

The sooner any changes are enacted, the more time there is for them to be phased in, according to experts. "Every year we delay reforming the gram means those changes will have to be steeper and affect more people closer to retirement age," CRFP President Maya MacGuineas wrote in a recent op-ed.