Which federal legislative proposals would change how Social Security benefits are taxed and what is their current status?
Executive summary
Congressional proposals to change how Social Security benefits are taxed currently range from full repeal measures that would remove benefits from taxable income to narrower fixes that raise the income thresholds or create new senior deductions; some narrower provisions were folded into 2025 legislation while full repeal bills remain introduced but not enacted [1] [2] [3]. Analysts warn that full repeal would cut federal revenue and could worsen Social Security solvency unless offset by other changes, whereas the “One Big Beautiful Bill” (OBBBA) enacted in 2025 delivered a targeted senior deduction and higher standard deductions that alter who pays tax on benefits [4] [5] [3].
1. Full repeal bills: the straightforward promise and where those measures stand
Legislation that would entirely remove Social Security benefits from taxable income—most prominently H.R. 904, titled “No Tax on Social Security”—has been introduced in the 119th Congress and would amend the Internal Revenue Code to repeal the inclusion of Social Security benefits in gross income (Congress.gov text of H.R.904) [1]. Dozens of House and Senate cosponsors and staff releases echo similar proposals—Representative Josh Riley’s “You Earned It, You Keep It Act” frames the repeal as immediate relief beginning in 2026 for beneficiaries—but these bills have not become law and would require passage of both chambers and the president’s signature to take effect [6] [2] [1].
2. Threshold and “raise the floor” proposals: RETIREES FIRST and alternatives
Some Republican senators have pursued less extreme alternatives that preserve revenue by shifting tax thresholds rather than erasing taxes altogether; the RETIREES FIRST Act, introduced by Senators Marsha Blackburn and Roger Marshall, would increase the provisional income thresholds that determine whether Social Security is taxed—raising the income floor before benefits become taxable rather than repealing taxation (Kiplinger summary of RETIREES FIRST) [2]. Those threshold-raising approaches aim to reduce the number of retirees who pay tax on benefits while avoiding the full loss of revenue from wholesale repeal [2].
3. The compromise that passed in 2025: OBBBA’s senior deduction and other near-term changes
Congress did not enact a categorical repeal in 2025, but the large tax-and-spending package known colloquially as the “One Big Beautiful Bill” included a new senior deduction that can reduce taxable income by up to $6,000 for eligible taxpayers ages 65 and older and an increased standard deduction that affects filing in 2026; advocates such as AARP supported including the senior deduction in that law (AARP on 2026 changes; IRS summary of OBBBA provisions; CNBC reporting) [3] [7] [5]. That enacted deduction functions as a partial, means-tested relief that shrinks taxable income for many beneficiaries but does not eliminate taxation for all, and the Treasury/IRS has issued guidance and invited comments on implementation [7] [3].
4. Fiscal and solvency stakes: why abolition meets resistance
Nonpartisan and policy analysts flag a tradeoff: exempting Social Security from income taxation would reduce federal receipts and could accelerate depletion of the OASDI trust funds unless offsets are adopted, whereas targeted deductions are less costly and tilt benefits toward middle- and upper-income retirees depending on design (SSA solvency summaries; Tax Foundation analysis comparing full repeal and senior deductions; U.S. News reporting) [8] [4] [9]. The Social Security Administration maintains analyses of various tax and benefit options and their long-range effects on solvency, which policymakers cite when weighing broader repeal against threshold adjustments or revenue offsets [8].
5. Bottom line on current status and what to watch next
As of the latest reporting, the immediate, enacted change is the senior deduction and higher standard deduction from the 2025 OBBBA package that affects 2026 filing and reduces taxable income for many older taxpayers, while full repeal bills like H.R. 904 remain introduced but not passed; other bipartisan proposals such as RETIREES FIRST persist as alternatives in committee and public debate [3] [1] [2]. Close watchers should track congressional committee actions on H.R. 904 and companion Senate measures, Treasury/IRS rulemaking implementing OBBBA deductions, and any offset proposals (such as raising the Social Security payroll wage base) that lawmakers say would pay for broader tax changes [2] [7] [8].