How much seniors can save with the new tax deduction

A new tax deduction for seniors could cut your bill or boost your refund by hundreds of dollars. Here’s who qualifies and how to claim it.

If you're 65 or older, you could have a bigger tax refund coming your way this year thanks to the new senior deduction. Not everyone will qualify, but those who do will pay taxes on $6,000 less this year ($12,000 for married couples), and that could result in significant savings.

While the exact amount you'll save will vary based on your income and which other deductions you qualify for, we already have a rough idea of what kind of difference this new senior tax deduction will have on the average person's retirement taxes.

The new $6,000 senior tax deduction will give the average qualifying senior an extra $670 in after-tax income, according to a June 2025 report from the Council of Economic Advisors. Married couples where both spouses qualify for the deduction will wind up with twice as much − $1,340.

Keep in mind, this deduction stacks on top of the standard deduction for your tax filing status and the additional standard deduction for seniors. For the 2025 tax year, the latter is worth $2,000 for single adults or $1,600 per married senior.

Together with any other tax deductions and credits you qualify for, this could exempt a significant portion of your annual income from taxation. That, in turn, could lead to a smaller tax bill or a larger refund for you.