RETIREES FIRST Act
Sponsored By: Senator Marsha Blackburn
Introduced
Summary
Provides targeted retiree tax relief by raising the thresholds that trigger taxation of Social Security benefits and funding the change through cuts to non-security discretionary spending. This bill would make more Social Security income exempt from federal taxable income and cover the cost by rescinding certain discretionary funds.
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- Families and retirees: It would limit the taxable portion of Social Security to the lesser of 85% of benefits or 85% of the excess amount, and raise the base amounts to $34,000 for single filers and $68,000 for joint filers. Married taxpayers filing separately who live with their spouse would still have a $0 base amount.
- Social Security and Railroad Retirement funds: It would require the Treasury to appropriate each year an amount equal to the reduction in transfers to those funds so the trusts are held harmless from the tax change, with the change applying to tax years after 2025.
- Federal programs and spending: For fiscal year 2027 and later, it would rescind, pro rata, non-security discretionary appropriations equal to the total cost for that year, while exempting security-category discretionary spending. The Office of Management and Budget must report annually on those rescissions beginning January 1, 2028.
*The bill is structured to pay for the retiree tax relief by redirecting non-security discretionary spending rather than adding uncovered new federal outlays.*
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Bill Overview
Analyzed Economic Effects
2 provisions identified: 0 benefits, 0 costs, 2 mixed.
Non-security cuts to back Social Security
If enacted, the bill would require annual, pro rata cuts to non-security discretionary funding to cover the cost of the Social Security tax changes, starting in fiscal year 2027. The rescission would be taken from amounts made available through regular appropriation Acts but would not apply to discretionary appropriations in the security category. The Treasury would determine the total cost and the bill would appropriate Treasury funds to make affected Social Security and Railroad Retirement trust funds whole. OMB must publish an annual report on the rescissions, with the first due by Jan 1, 2028.
Higher Social Security tax thresholds
If enacted, the bill would raise the dollar cutoffs used to decide how much Social Security is taxed. The base amounts would be $34,000 for most single filers and $68,000 for joint filers. For certain married people who file separately and lived with their spouse all year, the base would be $0. Starting with tax years after Dec 31, 2025, those dollar amounts would be indexed for inflation and rounded to the nearest $1,000. The bill would also change the taxable portion rule so includible Social Security equals the lesser of 85% of benefits received or 85% of a calculated excess, for taxpayers who meet the subsection (b) conditions.
Sponsors & CoSponsors
Sponsor
Marsha Blackburn
TN • R
Cosponsors
Roger Marshall
KS • R
Sponsored 2/3/2025
Roll Call Votes
No roll call votes available for this bill.
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