https://www.democraticunderground.com/10143490887#post6
It makes it sound like there is a big cut in income taxes on Social Security benefits,
PLUS "
Additionally, it provides an enhanced deduction for taxpayers aged 65 and older, "
i.e. a two-fer.
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In
https://www.democraticunderground.com/10143490887#post8
there is a Forbes article which purports to explain it all, but is totally confusing.
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Key questions --
Does the money come out of the Social Security system? #8 kind of says partly. Anyway, it doesn't help seniors for very long if the SS Trust Fund runs out sooner, which, unless Congress acts, will mean an automatic cut in benefits.
If it's a deduction, is it an "above the line" deduction which means you get the deduction even if you take the standard deduction
Or a regular "below the line" deduction, that along with other such deductions, must in total exceed the standard deduction threshold in order to benefit you taxwise (otherwise you are just better off taking the standard deduction as 90% IIRC of filers do).
Is it a deduction or a tax credit?
#6 (the SSA letter) and #7 say its a deduction, while #8 says its a tax credit. Very different.
(If it's a tax credit, is it what they call "refundable", meaning that even if your income tax overall is zero or gets reduced to zero by the credit, you still get the remaining credit mailed to you as a check or deposit, i.e. like a negative income tax.)
Or non-refundable, meaning if your overall income tax is zero or get reduced to zero by the credit, then that's it, you get no further benefit from it.
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