As House Republicans add up deductions for a large package they hope to push to President Trump later this year, Staten Island Representative Nicole Malliotakis floated two proposals Monday that would provide bigger tax savings for older Americans, The Post can report.
In order to increase the deductions on the taxable income of Americans over 65 who receive Social Security benefits, Mallotakis, the only Republican representing New York City in Congress, introduced the Bonus Tax Relief for America’s Seniors Act and the Tax Relief Unleashed for Seniors by Trump (TRUST) Act.
Individuals and married couples would receive additional deductions of $5,000 and $10,000, respectively, under the bipartisan Bonus Tax Relief Act.
Under the TRUST Act, seniors receiving Social Security would have twice as much tax-exempt income, rising from $25,000 to $50,000 for single filers and from $32,000 to $64,000 for married couples.
“Our seniors have worked hard and paid taxes their whole lives and they should be able to keep more of their Social Security and retirement income without Uncle Sam trying to reach into their pockets again,” Malliotakis stated.
“Many of our seniors have been crushed by inflation, and are being forced to stretch their retirement savings further than ever before,” Malliotakis, who sits on the House Ways and Means Committee continued. “The bills I’m introducing today would reduce the tax burden on our seniors, keep more money in their pockets and allow them to retire with greater financial security.”
As part of a single- or multi-bill package, Trump has urged Republicans in Congress to fulfill his 2024 campaign pledges by removing taxes on gratuities, overtime compensation, and Social Security.
He has also asked them to make his 2017 tax cuts permanent.
A budget framework for the president’s legislative priorities on energy and border security was released last week by GOP senators ahead of their Republican House counterparts.
However, House Speaker Mike Johnson (R-La.) is still hoping to fit those line items along with tax provisions into “one big, beautiful bill.”
Extending Trump’s 2017 Tax Cuts and Jobs Act is expected to increase the debt by between $3.5 trillion and $3.9 trillion, according to estimates from nonpartisan organizations like the Tax Foundation and Committee for a Responsible Federal Budget.
Federal revenue is expected to drop by hundreds of billions more if further deductions are added to the elimination of Social Security, overtime, and tip taxes.
The Bonus Tax Relief measure more than doubles the amount of money that is no longer subject to IRS taxation for US seniors, who presently enjoy a deduction on bonus income of $1,950 for single filers and $3,100 for joint filers.
According to Malliotakis’ office, the average married couple earning $85,000 a year would save $2,100 by taking advantage of the proposed bonus deduction.
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As a co-sponsor of the legislation and a member of the Ways and Means panel, Rep. Mike Carey (R-Ohio) stated, “Our seniors on fixed incomes can’t afford a hefty tax bill.”
“By increasing the standard deduction bonus and eliminating the marriage penalty, we can give their budgets some much-needed breathing room.”
Another Ways and Means member who endorsed the Bonus Tax Relief plan, Rep. Jimmy Panetta (D-Calif.), stated that it is critical that seniors be able to “retire with the financial security and dignity they deserve.”
“Too many of our seniors are now struggling to make ends meet, despite having worked, saved, and contributed to our economy throughout their lives,” Panetta continued. “By enabling seniors to retain more of their hard-earned money, this bipartisan legislation can significantly reduce that burden.”
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By adjusting the income requirement to reflect inflation, the TRUST Act aims to help seniors save even more money.
The current tax code makes it difficult to live on retirement income while working a part-time job, cashing pension checks, or surviving on any gains from long-term investments, Malliotakis told last month, expressing her hope that her legislative fixes would further Trump’s “commitment to reduce taxes paid on Social Security.”
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