Support for Social Security and Medicare
Alongside the announcement of retirement savings initiatives, President Trump made commitments to bolster support for Social Security and Medicare.
“We’re also making it easier for Americans to save for retirement, and under this administration, we will always protect Social Security and Medicare,” he stated.
Polls indicate that Social Security enjoys significant popularity among various age groups and political affiliations. As we approach January 2026, around 70 million Americans are expected to receive Social Security payments, which includes about 54 million retirees and 7.1 million individuals living with disabilities. The average monthly benefit for retirees was reported to be $2,019 as of January.
The chief accountant for the Social Security Administration warns that the surplus in the trust fund for retirement and survivor benefits could be exhausted by the latter half of 2032 if Congress does not take action to bolster public finances, which could involve benefit reductions, increased revenue, or a mix of both. Even after that point, Social Security may still manage to cover approximately 80 percent of the payments, and there are various options available for Congress to address this funding shortfall. Although President Trump did not directly address this issue, Congress has multiple avenues to explore.
During his speech, President Trump also highlighted new tax credits for seniors found in the One Big Beautiful Bill, the comprehensive tax legislation that Congress passed in July 2025. While this bill did not eliminate taxes on Social Security benefits, it introduced a $6,000 credit aimed at potentially reducing or completely offsetting taxes for millions of older Americans receiving Social Security income.
This provision is applicable to individuals who will be 65 or older by the end of 2025, provided they meet specific income thresholds.
Individual filers with a modified adjusted gross income (MAGI) of up to $75,000, or married couples filing jointly with a MAGI of up to $150,000, are eligible for the full $6,000 deduction. Those with incomes reaching $175,000 for single filers, or $250,000 for married couples, may qualify for a reduced deduction.
The temporary deduction will be available until the end of the 2028 tax year. AARP expressed support for the inclusion of such tax credits in the OBBB.
