U.S. tax laws can be complicated at any age, but they can be even more confusing as you get older. Your tax return can impact your retirement planning and everyday life. That makes it important to have the information you need to take advantage of tax credits and tax deductions for seniors and avoid costly surprises.
To help you get started, here’s some guidance on how senior taxes vary from the taxes of other age groups. Since some topics may affect taxpayers differently, you should consider hiring a certified financial advisor to prepare your taxes. You may even choose one with a designation specific to income tax for older adults.
Before you start filing your taxes, especially if you are newly retired, you may wonder if you need to file a tax return. For taxpayers who are 65 or older by the end of 2024, the filing threshold — whether you need to file — has changed from last year. If you’re a single filer age 65 or older and have a gross income of $16,550 or higher, then you need to file a tax return. If you’re a married couple, both ages 65 or older filing jointly with a combined income of $32,300 or higher, or if you’re a married couple with one spouse under the age of 65 filing jointly with a combined income of $30,750, you also must file.
However, if you receive under $50,000 a year in Social Security benefits, and it’s your only income, you likely don't have to file a federal income tax return.
If you don’t itemize your deductions, you can get an extra standard deduction if you and/or your spouse are 65 years old or older. These are $1,950 for single filers and $1,550 for married individuals filing jointly. Add these amounts to the 2024 standard deductions to receive total tax deductions for seniors of $16,550 (single) and $32,300 (married).
Many seniors are surprised to learn that Social Security benefits above specific amounts are subject to federal income taxes, says Harry Daniels, certified public accountant and certified financial planner at Duggan, Joiner & Company Certified Public Accountants. Social Security benefits could put you in a higher tax bracket and increase the amount of taxes you owe by thousands of dollars. The Internal Revenue Service (IRS) provides a Social Security taxable benefits worksheet. Plus, IRS Form 1040 and Form 1040-SR can help you calculate how much of your Social Security benefits are taxable.
When determining which form to use, 1040 versus 1040-SR, choose 1040-SR if you plan to do your taxes using a pen or pencil, versus the computer. This form features larger print and boxes and provides a standard deduction table for your reference.
At age 50, and especially after age 65, you may qualify for additional tax breaks, such as:
If you turned age 65 or older before the end of 2024, you may qualify for the Credit for the Elderly or Disabled. This tax credit for seniors ranges from $3,750 to $7,500. You may determine your eligibility and credit amount using Schedule R, which you will submit with your tax return.
You can still make tax-deductible contributions to your retirement accounts even when retired or semi-retired. Adding to your retirement account lowers your taxable income for the year and helps you defer or avoid taxes on more money. In your fifth decade of life, you can contribute more than you were previously allowed. Your maximum contributions for 2024 are:
Once you reach the age of 70.5, you can make certain charitable donations — known as qualified charitable distributions (QCD) — of up to $105,000 each year from your IRA. Starting at the age of 73, you must make mandatory annual withdrawals — or required minimum distributions (RMD) — from your IRAs. In some instances, a QCD may count towards your RMD, which would allow you to reduce your taxable income. However, it will not count as a charitable contribution or among tax deductions for seniors.
Your sale of capital assets, such as real estate or stocks, can affect your income tax return. In the event you lost money in their sale, you may be able to deduct that capital loss against your capital gains on your tax return. This is known as tax-loss harvesting. While limits on these tax deductions do apply, you still lower the amount of income taxes you may be liable for. Net capital losses over the limit allowed also can be carried forward to future tax returns.
Over 40% of older adults report spending 10%–24% of their average monthly budget on health care, but some of these expenses may be tax deductible.
When you itemize your deductions, you may be able to deduct some of what you paid for medical and dental care during the calendar year. To be eligible, your qualifying medical expenses must be greater than 7.5% of your adjusted gross income.
However, if the standard tax deduction is higher than your itemized deductions, this may not apply to you.
Your budget may not support paid professional advice, but you can have free access to reliable resources for tax planning, preparation, and filing. These may include:
This IRS-funded program offers free tax help for seniors ages 60 and up. Get assistance from trained volunteers in preparing your tax return from January 1 to April 15 or get answers specific to income tax for older adults year-round. You can search for tax help available through Tax Counseling for the Elderly (TCE) using this locator tool.
Another IRS-funded program, Volunteer Income Tax Assistance (VITA), offers free tax preparation to anyone with taxable income below $67,000, making it ideal for seniors. VITA volunteers, certified and trained by the IRS, handle basic tax return preparation and may be able to answer questions related to tax credits for seniors. However, if your financial situation is complex, the IRS recommends hiring a paid tax professional instead.
Look for VITA volunteers near you using the TCE locator tool or search the list of organizations coordinating 2024 tax help.
For taxpayers over the age of 50, AARP offers free tax assistance through its AARP Foundation Tax-Aide program. Whether an AARP member or not, you can make an appointment with an IRS-certified volunteer to get your tax return prepared or questions answered. The window to receive help through this program — February to mid-April — is shorter than the others, which means appointments may fill up fast.
IRS Free File gives taxpayers who have annual incomes of $79,000 or less access to free filing software from several select tax preparation partners. IRS Free File opens January 2025 for you to prepare your tax return. Browse your options and determine your eligibility on the IRS website. Should you exceed the maximum income to use IRS Free File, you may still use the online fillable forms available.
Local IRS offices have a Taxpayer Assistance Center (TAC). Check the IRS site to find the closest location to you and to schedule an appointment. You may also get help from IRS representatives online or by phone.
Take note of what works and what doesn’t this tax season. Perhaps you want to use a different filing software or get professional help. Make plans well in advance to ease the process for next year. Here are some tips to help you be successful:
Think about whether you will itemize deductions or take the higher standard tax deduction for seniors. If your combined taxes (real estate, income, etc.), qualifying amount for medical expenses, and mortgage interest will exceed the 2025 standard deduction of $17,000 for single filers or $33,200 for married couples, then itemize.
If you choose to itemize, it may be beneficial to hire a tax professional for help. However, when choosing the standard deduction, a free option available through the IRS may be your best decision.
The IRS has already released maximum contribution amounts for 401k plans, IRAs, and HSAs in 2025, making it easy to plan for the New Year. Also, consider whether you will make a charitable donation and, if so, whether you are eligible to use your required minimum distribution to do so, while lessening your taxable income.
These may include a Social Security benefit statement; your W-2, if working part-time; forms for interest, dividends, and distributions; medical and dental bills; and receipts for charitable donations, among others. You may keep them in a physical folder or envelope or save them in a folder on your computer.
Be aware of attempts made by phone, email, and text to steal your personal information. If you receive communication from someone claiming to be the IRS, but never received official mail from the IRS, do not respond to requests. Instead, contact the IRS by calling phone numbers provided on its website.
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