WASHINGTON — President keeps saying that Republicans' mega legislation will eliminate taxes on federal benefits.
It does not.
At best, Trump's “no tax on Social Security” claim exaggerates the benefits to seniors if either the House or Senate-passed proposals is signed into law.
Here's a look at Trump's recent statements, and what the proposals would — or would not — do.
What Trump said
Trump repeatedly told voters during his 2024 campaign that he would eliminate taxes on Social Security. As his massive legislative package has moved through Congress, the Republican president has claimed that's what the bill would do.
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Trump said on a recent appearance on Fox News’ “Sunday Morning Futures" that the bill includes “no tax on tips, no tax on Social Security, no tax on overtime.”
Temporary deduction
But instead of eliminating the tax, the Senate and House each passed their own versions of a temporary tax deduction for seniors aged 65 and over, which applies to all income — not just Social Security.
Not all Social Security beneficiaries will be able to claim the deduction. Those who won't be able to do so include the lowest-income seniors who already don’t pay taxes on Social Security, those who choose to claim their benefits before they reach age 65 and those above a defined income threshold.
A Social Security card is displayed on Oct. 12, 2021, in Tigard, Ore.
The Senate proposal includes a temporary $6,000 deduction for seniors over the age of 65, contrasted with the House proposal, which includes a temporary deduction of $4,000.
The Senate proposal approved Tuesday would eliminate Social Security tax liability for seniors with adjusted gross incomes of $75,000 or less or $150,000 if filing as a married couple.
If passed into law, the tax deduction would last four years, from 2025 to 2029.
The deductions phase out as income increases.
White House touts impact
Touting a new , the White House said Tuesday that “88% of all seniors who receive Social Security — will pay NO TAX on their Social Security benefits," going on to say that the Senate proposal’s $6,000 senior deduction “is estimated to benefit 33.9 million seniors, including seniors not claiming Social Security. The deduction yields an average increase in after-tax income of $670 per senior who benefits from it.”
Garrett Watson, director of policy analysis at the Tax Foundation think tank, said conflating the tax deduction with a claim that there will be no tax on Social Security could end up confusing and angering a lot of seniors who will expect to not pay taxes on their Social Security benefits.
“While the deduction does provide some relief for seniors, it's far from completely repealing the tax on their benefits,” Watson said.
Economic effect
The cost of actually eliminating the tax on Social Security would have massive impacts on the economy.
University of Pennsylvania’s Penn Wharton Budget Model estimates that eliminating income taxes on Social Security benefits “would reduce revenues by $1.5 trillion over 10 years and increase federal debt by 7 percent by 2054" and speed up the projected depletion date of the Social Security Trust Fund from 2034 to 2032.
Discussions over taxes on Social Security are just part of the overall bill, which is estimated in its Senate version to increase federal deficits over the next 10 years by almost $3.3 trillion from 2025 to 2034, according to the Congressional Budget Office.
Administration officials claim the cost of the tax bill would be offset by tariff income.
Recently, the CBO separately estimated that Trump’s sweeping tariff plan would cut deficits by $2.8 trillion over a 10-year period while shrinking the economy, raising the inflation rate and reducing the purchasing power of households overall.
The Social Security data breach compromised 'billions' of accounts. Here's how to protect yourself.
The Social Security data breach compromised 'billions' of accounts. Here's one easy, free way to protect yourself.
In early 2024, background checking service National Public Data was hit by a massive cyberattack that potentially compromised the sensitive, personal information of millions, or possibly even billions, of people around the world, including U.S. residents.
A year later, new security threats have gained traction. While artificial intelligence has transformed the ability to prevent, detect, and rapidly respond to cyberattacks, the malicious use of AI has also exploited new vulnerabilities. As AI systems evolve, so does the sophistication and scope of cyberattacks. In the hands of bad actors, AI capabilities have increased the scale and efficiency of attacks, including identity theft, fraud, and data privacy violations, according to a report on AI and cybersecurity.
In the financial sector, for instance, deploying a form of algorithmic manipulation known as data poisoning to increasingly sophisticated machine learning models could significantly impact AI. That, in turn, can lead to biased or harmful results, undermining fraud detection or credit scoring models.
analyzed resources from the and the three credit bureaus to compile tips on how to secure your identity in the aftermath of last year's unprecedented data breach and prepare for potential threats in the future.
The group taking credit for the breach targeting NPD calls itself USDoD, a moniker that mirrors the name of the federal government agency responsible for the country's security. The group reportedly sold the vast trove of user data on the dark web for $3.5 million.
In a , which does business as National Public Data, the House Committee on Oversight and Accountability said the attack "likely represents one of the largest cyberattacks ever in terms of impacted individuals." The letter was sent to request a hearing and alert the owner to the committee's investigation of the security event, alleging that the company failed to notify consumers of the breach in a timely and detailed manner.
The breach is concerning not only because of its possible scope but also because of the information compromised, which includes Social Security numbers.
A Social Security number can be used to steal someone else's identity. This allows criminals to fraudulently open new lines of credit, apply for loans, and even receive government benefits, which happened during the COVID-19 pandemic when states were providing additional unemployment pay.
If you don't already pay for an identity theft monitoring service, you can still take advantage of free tools offered by the main credit bureaus to prevent criminals from defrauding you.
The process is called freezing your credit. While it is the most secure option to prevent fraud, industry surveys estimate that only a small percentage of Americans use the service. Depending on the scope and circumstances, consumers could benefit from freezing their credit after a major data breach. Read on to learn more about how to protect your information and set up a credit freeze.
Have I been impacted by the NPD data breach or any others?
The simple fact that a person hasn't experienced the repercussions of identity theft, like credit card fraud, isn't always a sign that their personal data wasn't compromised. Personal info can sit in public spaces for some time before it's purchased or found and used by someone with criminal intent.
Every U.S. state and multiple territories have laws that require that businesses notify stakeholders when their data has been accessed by an unauthorized actor. However, not every company is forthright about breaches. NPD is now facing a class action lawsuit in which at least one victim claims they didn't know about the breach until their own identity theft service notified them.
Many identity theft services will notify you when your personal info is found in public or on marketplaces used by criminals. For the NPD breach, specifically, cybersecurity firm Pentester has released a free web tool that by only providing your name, state, and birth year.
After you've confirmed any exposure, a credit freeze can help protect you from future fraud attempts.
What is a credit freeze?
A credit freeze is a free service that restricts access to your credit report through the major credit bureaus. You can temporarily pause the freeze when needed, such as when applying for a loan or credit card. A credit lock can similarly block access to your credit information, but it usually comes with a monthly fee and offers additional features, such as immediate deactivation and reactivation of the lock.
When you turn on a credit freeze, all credit report requests will be denied, even if it's a legitimate lender processing your application for a loan or credit card. This simultaneously secures your information but also adds an extra step for you to remember when applying for new credit. (More on that later.)
The three credit bureaus—Experian, Equifax, and TransUnion—all provide the service for free. Create an account on each bureau's website and turn on fraud alerts. Be wary of offers for paid tiers of services from each of these companies—you may want to purchase their additional services or a credit lock, but you should not need to pay to freeze a credit file.
Comb through accounts tied to your personal information within each bureau's credit report, and be on the lookout for credit cards and other items you didn't personally apply for. The presence of an unrecognizable account could be evidence of identity theft.
Then, request that each bureau place a freeze on the credit file. This can also be done by phone at:
- Experian: 1-888-397-3742
- TransUnion: 1-888-909-8872
- Equifax: 1-800-685-1111
NPD and the FTC also encourage consumers to report identity theft when they're alerted to it at or call 1-877-438-4338.
What if I want to access my credit?
The freeze stays in place until the owner of the credit file requests to lift it temporarily or permanently.
A freeze might be lifted for a few days if the person anticipates applying for a mortgage or credit card within a specific set time. The process provides peace of mind that the window for fraud is limited should they forget to request a freeze again.
Though freezing your credit is an easy and effective step to prevent fraud, it only protects against the creation of new, fraudulent accounts. Any existing credit account can still be compromised, so keep an eye out for your monthly statements and any suspicious charges.
Experts also recommend securing all other types of online accounts in today's age of near-constant cyber threats. Aside from bank accounts, platforms like social media and even streaming service accounts can provide criminals with access to your credit card information and ways to impersonate you. Most websites offer a security service called multifactor authentication that works similarly to a credit freeze, pinging the user via a secure channel like a personal phone number to confirm the login activity is coming from them and not an impersonator.
Story editing by Carren Jao. Additional editing by Kelly Glass. Copy editing by Tim Bruns. Photo selection by Ania Antecka.
originally appeared on and was produced and distributed in partnership with Stacker Studio.
