There are some important changes to tax rules in 2025. And now you can save more money. But it will only applicable for people who is 65 or more.
These changes may not seem huge. But they can make a difference, especially for people who are retired.
The IRS is making some changes that can help people over 65 pay less in taxes in 2025. There is a standard deduction.
And you can subtract a certain amount of money from your income before you have to pay taxes on it. And for the older adults, there is an extra deduction that helps reduce your taxes even more.
This extra deduction for single people is going up from $1,950 in 2024 to $2,000 in 2025. It is a small increase, but every bit helps. Especially if you are retired and living on a smaller income.
Suppose you are married and both you and your spouse are 65 or older. You will also see a small increase. The extra deduction for each spouse goes up from $1,550 in 2024 to $1,600 in 2025. That is an extra $100 in tax savings.
If you are 65 or older and also blind. You will get double the extra amount. For single this means $4,000 instead of $2,000. And for married couples it is $3,200.
There is a new law called the One Big Beautiful Bill (OBBB). People over 65 can get an extra bonus deduction. This bonus deduction gives you an extra $6,000.
For this, the income for singles must make less than $75,000. And for married couples the income must be less than $150,000.
This deduction will last from 2025 to 2028. So if you qualify, make sure to take advantage of it.
- For Single People (65 and older): You can claim a total of $23,750 in deductions. This includes:
- $15,750 (Regular standard deduction)
- $2,000 (Age based deduction)
- $6,000 (Bonus deduction)
- For Head of Household (65 and older): The total is $31,625, including:
- $23,625 (Regular standard deduction)
- $2,000 (Age based deduction)
- $6,000 (Bonus deduction)
- For Married Couples (Both 65 and older): The total is $46,700, includes:
- $31,500 (Regular standard deduction)
- $3,200 (Age based deduction)
- $12,000 (Bonus deduction)
These increases will help lower the amount of your income tax. So it is important to understand how they affect you.
These changes may be very small. But they can help people who are retired or living on a fixed income.
For example, if you qualify for the new bonus deduction, you can save a lot. A single person can get a deduction of $23,750 And a married couple can get $46,700.
These new rules are to help older adults. They can pay less in taxes and keep more of their money.
You can check your eligibility for this deduction. If you will be able to get these deductions, you can save a lot of money.
In case you are not sure about your tax planning, please consult with a tax professional for help. Then you can be able to understand how these changes will affect you.
For more information please visit the official website of IRS: https://www.irs.gov/
