AARP Eye Center
I'm reaching out to encourage everyone to contact their representatives and support President Trump's proposal to eliminate income taxes on Social Security benefits.
Here's why this matters:
Key Points to Consider
Currently, up to 85% of Social Security benefits can be subject to federal income tax1
About 67 million U.S. households receive monthly Social Security benefit checks3
The proposal would primarily help middle-income seniors who currently pay taxes on their benefits
Action Steps
Contact your local congressional representatives
Emphasize support for Trump's plan to remove Social Security benefit taxation
Highlight how this would provide financial relief for seniors
Important Caution
While the proposal sounds appealing, financial experts warn it could potentially harm the long-term sustainability of Social Security. The Congressional Budget Office estimates this tax cut could reduce Social Security revenue by approximately $950 billion between 2026-20353.
Recommended Communication Points
Express support for tax relief for seniors
Request careful consideration of long-term program funding
Ask for transparent analysis of the proposal's financial impact
Let's work together to ensure our voices are heard and our financial security is protected!
Would eliminating this tax on benefits be ok with you IF we reduced the benefits that everybody is receiving to make up for this loss in income to the Trust Fund - that is exactly what will happen come around 2030 or so. OR maybe that reduction in the benefit amount would be built into the Elimination of the Tax on Benefits legislation.
By all means letโs get rid of the tax on benefits - we would just be losing even MORE money in the Trust Fund causing the time of insolvency to even come much earlier- maybe it will be a 25% reduction instead of closer to 20% - but we can plan ahead - RIGHT?
In 2023, taxes on benefits added $ 50.7 BILLION to the Social Security Trust Fund. The reason that this was added was to help out with the Trust Fund since we are no longer taking in enough in FICA taxes to cover benefits thus since 2021 we have been having to pull more and more money out of the Trust Fund reserve to pay benefits. The number of workers paying into the system has been greatly reduced with the advent of technology.
See table 2 - Old-Age, Survivors, and Disability Insurance Trust Funds Income
Would you also support increasing the contribution rate for everybody who is working? The younger generations might think you are only looking out of yourself.
You could just think of these taxes as paying for a benefit you got while working - mainly the matched contributions paid by your employer for you.
If you say, just remove the tax max cap - I will scream because just doing this isnโt solving the insolvency problem because the tax max cap relates directly to capping the maximum benefit.
SSA.gov- Contribution and Benefit Base
Congress just repealed the Windfall Elimination and Government Pension Offset - Per the CBO this adjustment in benefits for those involved will COST the Trust Fund $200 BILLION over 10 years - now you want to even do more harm to the Trust Fund by elimination this tax on benefits.
I think I also read that more beneficiaryโs DONโT pay taxes on their benefits than those that DO - so I donโt think those that DONโT pay taxes on their benefits will be supportive of pulling an income source from the Trust Fund.
Keep working on reducing the income going into the Trust Fund and we will all have to be tightening our belts.
Here's an idea: Eliminate taxes on SS benefits and tax 100% of the beneficiary's assets (e.g., home, life insurance, savings) upon death. This will recoup the cost of the lost taxes and increase the likelihood that the SS Trust Fund will have enough money to continue to pay living retirees.
This wouldn't be much different than the federal estate recovery rule, which requires states to put a lien on Medicaid recipients' assets (e.g., home, life insurance, vehicle) to recoup the cost of providing care so taxpayers don't have to shoulder that burden.
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