No tax on Social Security? Not quite.

Marketplace Morning Report

American Public Media

News, Business

4.5 • 808 Ratings

🗓️ 2 July 2025

⏱️ 9 minutes

🔗️ Recording | iTunes | RSS

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Summary

The House of Representatives could vote as soon as today on President Donald Trump’s big tax and spending bill. Trump says the legislation gets rid of taxes on Social Security benefits, but it’s not quite that simple. We'll unpack. Then, we’ll discuss this morning’s surprisingly weak private payroll data. And, we'll travel to London ahead of the city's Pride festival, which has been hit by declining corporate sponsorship.

Transcript

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0:57.0	We'll update Congress's plans on taxes on social security benefits.
1:02.1	I'm David Brancaccio in Los Angeles. The House of Representatives could vote as soon as today on the big tax and spending bill, one strand.
1:10.6	President Trump says the legislation gets
1:12.6	rid of taxes on social security benefits. The details are more complex. Here's Marketplace's
1:18.8	Nancy Marshall-Genser. The legislation creates a new temporary extra tax deduction for people
1:24.2	over age 65. It's $6,000 in the Senate version and $4,000 in the House bill.
1:30.4	The House will be voting on the Senate version of the legislation. The temporary new deduction
1:34.9	applies to all of the seniors' income, not just Social Security. It phases out for higher
1:40.4	income taxpayers. The lowest income seniors won't be affected because they already pay
1:45.5	no taxes on their Social Security benefits. The White House Council of Economic Advisors
1:50.7	estimates that if the bill passes, 88 percent of seniors receiving Social Security won't pay
1:56.4	any taxes on their benefits. But those taxes go toward funding Social Security. And the
2:02.0	Committee for Responsible Federal Budget estimates the new bill would speed up the insolvency
2:06.8	of Social Security and Medicare by a year to 2032, causing an across-the-board cut to benefits of
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