What Floridians Need To Know About 2025 Social Security Tax Changes?

Florida is a state where millions of seniors and people rely on social security support. It is estimated that one of every five men, women, or children who live in Florida receives some income from the Social Security program. And for seniors aged 65 or older, almost 8 out of 10 receive the checks. 

This Independence Day, Congress passed the “Big Beautiful Bill”, presented by President J. Donald Trump. This bill contains many major implications, but we are focusing on its impact on Social Security taxes.

We will also explore how these updates affect Florida residents not receiving disability benefits or disability professionals, to give you a complete picture.

Let's get started.

What Is “One Big Beautiful Bill”?

The One Big Beautiful Bill means that a majority of seniors (65+) who receive social security benefits will no longer pay taxes. If a single senior gets the average Social Security benefit (around $24,000 per year), they will get tax deductions that are bigger than their taxable Social Security income.

If a married couple both receive $24,000 from Social Security (totaling $48,000), the deductions they get will be larger than their taxable Social Security income, so they won’t pay any taxes either.

However, it’s important to note that this reduction is not an automatic elimination of all taxes. Instead, it is the result of a new $6,000 tax deduction for seniors aged 65 and older (or $12,000 for married couples), in addition to the standard and existing senior deductions.

However, one must also note that the eligibility depends on a few factors:

• Age: You must be 65 or older.
  
• Itemized Deductions: You must itemize your deductions to claim it, which may not be ideal for everyone.
  
• Income Limits: The deduction starts phasing out at $75,000 for single filers and $150,000 for joint filers, fully phasing out at $175,000 and $250,000, respectively.

Implications Of The Bill For Disability Professionals

The bill does not affect disability professionals like lawyers directly. However, understanding the new 2025 laws is crucial when advising clients on Social Security Disability Insurance (SSDI).

The $6,000 deduction lowers the tax bills for seniors, but only if they meet the age and income criteria and itemize the deductions. So, professionals must understand the update to guide their clients on whether itemizing makes sense for their clients or not.

What Is The Impact Of “One Big Beautiful Bill” On People Not Receiving Benefits?

Here are some ways this bill may impact people who are not receiving social security benefits: 

1. The Deficit Might Increase: 

There will be $30 billion yearly loss from the deductions, and it could raise the federal deficit. This may lead to higher taxes or cuts to services for non-beneficiaries.

2. Future Social Security Risk: 

Younger workers might see lower benefits in the future if the social security trust fund runs out. They may need to save more on their own.

Conclusion

The "One Big Beautiful Bill" offers a valuable opportunity for many Florida seniors to reduce taxes on their Social Security benefits through a new $6,000 deduction. However, the need to itemize and income limits mean it’s not a one-size-fits-all solution.

Disability professionals should stay informed to help clients navigate these changes, while also keeping an eye on privacy laws in Florida and other regulations.

For personalized advice, consult a tax professional to ensure you’re making the most of this temporary benefit.