Video script:
I’m Julia Tierney.
For taxpayers age 65 and older, the new law introduces a temporary boost to the standard deduction.
Starting this year until 2028, individuals in this age group can claim an additional $6,000 deduction per person, or $12,000 for a married couple filing jointly.
This provision is especially helpful for those who don’t itemize their deductions.
Put simply, this change means that less of your income is subject to tax.
But here’s the catch.
The benefit comes with income limits.
The full benefit is available if your modified adjusted gross income is under $75,000 as a single filer or $150,000 as a married couple.
Once you cross those thresholds, the deduction starts to phase out.
From a planning standpoint, this temporary deduction opens up some valuable opportunities.
It could be a great window to complete Roth conversions or strategically realize capital gains, for example.
It may be modest in size, but this deduction can still have a meaningful impact, especially when it’s integrated into your overall financial plan.
