Trump wants to cut Social Security taxes for seniors. It's not as good as it sounds.
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- Former President Donald Trump proposed ending Social Security taxes for older adults.
- Experts warn the policy could increase the deficit by $1.6 trillion, depleting Social Security and Medicare.
- Millions of American boomers are already struggling to get by on limited savings and fixed Social Security incomes.
America's older adults could see tax cuts under a new Trump Administration — but the policy risks shrinking Social Security funds sooner than expected.
In a Wednesday interview with Fox & Friends, the Republican presidential nominee said he plans to eliminate Social Security taxes for older adults. The taxes currently apply to all individuals with a household income above $25,000. This group pays income tax on 50% of their benefits, and people with a higher income are often taxed more.
Trump's proposed change aims to help older adults living on a fixed income by ending the income tax on their monthly checks.
"We can do a lot of things to help the people," Trump told Fox & Friends. "People on Social Security are being killed, and one of the things I'm doing is no tax for seniors on Social Security, and I'll get it done quickly."
Trump had previously pitched his plan to eliminate taxes on Social Security, writing on his social media platform Truth Social on July 31: "SENIORS SHOULD NOT PAY TAX ON SOCIAL SECURITY!"
Some experts have criticized the plan. The Tax Foundation's Garrett Watson published a blog on August 2 calling the proposal to remove income taxes from Social Security "unsound and fiscally irresponsible," arguing that doing so would increase the deficit by about $1.6 trillion over 10 years and cause the Social Security and Medicare trust funds to dry out quicker.
According to the latest Social Security and Medicare Trustees report, the program will be able to pay out full benefits for 11 more years, after which they will shrink if Congress doesn't act. The average monthly Social Security check in 2024 is about $1,780 a month, and some boomers rely on Medicare as their only source of health insurance.
Business Insider has heard from boomers without retirement savings, many of whom are falling behind on bills or forgoing retirement entirely. According to the Census Bureau's Population Survey, over half of older adults in the US have an annual income of $30,000 or less.
While tax breaks might help in the short term, boomers are scared their Social Security benefits could be significantly cut in the next decade. With Trump's proposed policy, it's a risk.
"It scares us to death because we'll still be here, God-willing," a boomer in Illinois previously told BI. "How are we to survive?"
Trump has vowed not to cut Social Security
Trump has previously taken a strong position on Social Security — at times conflicting with members of his own party who have faced criticism from Democrats for calling for Social Security cuts. For example, Trump said in January 2023 that "under no circumstances should Republicans vote to cut a single penny from Medicare or Social Security."
"Cut waste, fraud and abuse everywhere that we can find it and there is plenty, there's plenty of it," he said in a video message. "But do not cut the benefits our seniors worked for and paid for their entire lives. Save Social Security, don't destroy it."
Additionally, Trump's platform that was adopted by the Republican National Committee vowed to preserve Social Security and Medicare benefits while ensuring there would be no cuts or changes to the retirement age. Older adults can start collecting Social Security at age 62 right now, and the official retirement age is typically 67, though it varies slightly by birth year.
Even with Trump's pledge to protect retirees' benefits, Democratic lawmakers have continued to criticize the GOP and some of their proposals to change the program by raising the retirement age.
"As long as I am President, I will keep strengthening Social Security and Medicare and protecting them from Republicans' attempts to cut benefits Americans have earned," Biden said in a May statement.
Vice President and Democratic nominee Kamala Harris has not yet released a policy outline on Social Security, but she is expected to continue Biden's work to expand Social Security benefits, as well as protect Medicare and the Affordable Care Act.