With a new year, a new set of lawmakers, and plenty of speculation flying around, it’s essential to stay informed about the upcoming changes to federal tax law and how they might affect your retirement plans. These changes could have significant implications for both current retirees and those preparing for retirement.

One of the most notable changes is the proposed elimination of federal income tax on Social Security retirement benefits¹. This change, if enacted, would provide substantial relief for retirees, especially those who receive other types of taxable income, such as wages or distributions from retirement accounts.

Currently, up to 85% of Social Security benefits are taxable at the federal level, so this change has the potential to significantly increase the disposable income for many retirees.

Additionally, SECURE Act 2.0 continues several provisions aimed at helping Americans save more for retirement². For instance, workers near retirement age will be able to make larger catch-up contributions to their employer-sponsored retirement plans.

Federal tax season is just around the corner and there is plenty of speculation about what could change – or remain the same – in the near future. The historically low tax rates established by the Tax Cuts and Jobs Act of 2017 are set to expire this year, but it is widely expected that the current Congress will push to extend those cuts or move to make them permanent³.

Being proactive and adaptable in your retirement planning can help ensure financial stability. Call us at 678-539-9518 to consult with a financial advisor and tailor tax awareness and strategies to your needs and circumstances.

1. https://www.kiplinger.com/taxes/will-tax-on-social-security-benefits-be-eliminated
2. https://www.55places.com/blog/tax-laws-retirement-changes
3. https://www.firstcitizens.com/wealth/insights/tax-planning/white-house-2025-tax-plans

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