Bill to Eliminate Taxes on Social Security Benefits Introduced in the House

Rep. Thomas Massie has reintroduced the Senior Citizens Tax Elimination Act, H.R. 1040, to eliminate federal taxes on Social Security benefits. The bill, backed by 29 Republican co-sponsors, seeks to restore the tax-free status of Social Security benefits, which were first taxed in 1984. Massie argues that taxing benefits amounts to double taxation, as retirees have already paid payroll taxes on their earnings.

The proposal would save the average senior household about $3,000 per year but could cost the government $1.6 to $1.8 trillion in lost revenue by 2035, potentially advancing Social Security insolvency by over a year. The Social Security Administration projects trust fund depletion by 2033, potentially leading to a 21% benefit reduction.

Separately, Senators Roger Marshall and Marsha Blackburn have introduced the Retirees First Act, which would lower Social Security taxes by raising income thresholds and indexing them for inflation. This bill aims to prevent bracket creep and simplify tax rules while redirecting funds from non-essential government spending.

Both bills aim to provide financial relief for seniors, but concerns remain about their impact on the federal budget and Social Security’s long-term solvency.

For more information see Tracey Longo “Bill To Eliminate Social Security Taxes Introduced In The House“, Financial Advisor, February 13, 2025.  

Special thanks to Joel C. Dobris (Professor of Law, UC Davis School of Law) for bringing this article to my attention.