A federal tax overhaul is promising major savings for retired homeowners across South Dakota.<\/p>\n
Under the One Big Beautiful Bill<\/a>, a newly created \u201csenior deduction\u201d will eliminate federal taxes on Social Security for most recipients.<\/p>\n That includes an estimated 200,000 South Dakotans over 65 who are expected to qualify.<\/p>\n No More Federal Tax on Social Security\u2014for Most<\/p>\n According to a White House<\/a> analysis, 88% of all seniors receiving Social Security<\/a> will owe no federal income tax on their benefits beginning in 2026. That\u2019s a 24-point jump from the current 64%, representing 14.2 million seniors nationwide who will see their tax burden erased.<\/p>\n The law introduces a $6,000 senior deduction for individuals and $12,000 for couples.<\/p>\n Paired with the standard and existing senior deductions, total deductions could reach $23,750 for individual filers and $46,700 for couples over 65.<\/p>\n South Dakota\u2019s Senior Population Stands to Gain<\/p>\n Of South Dakota\u2019s 919,000 residents, 20.7% of the state\u2019s population is over 65, according to the most recent census data.<\/p>\n An estimated 200,000 retirees in South Dakota are expected to benefit from the Social Security tax exemption in the new legislation, according to the White House metrics.<\/p>\n Alongside the deduction, seniors in the state can expect wage increases between $3,500 and $6,300, with projected take-home pay gains up to $10,000. These changes could help ease the burden of rising housing and living costs.<\/p>\n Not All Seniors Will Benefit Equally<\/p>\n The senior tax deduction<\/a> offers the most benefit to middle-income retirees who still owe federal income tax. In these households, reducing taxable income could eliminate liability altogether and result in real annual savings.<\/p>\n But for retirees already earning too little to owe federal taxes\u2014typically those relying solely on Social Security\u2014the deduction offers no relief. Likewise, high-income seniors may see limited or no benefit: the deduction phases out at $75,000 for individuals and $150,000 for married couples, disappearing entirely above $175,000 and $250,000.<\/p>\n The deduction is also time-limited, currently authorized only through the 2028 tax year. Extension would require congressional action.<\/p>\n Could It Help Seniors Stay in Their Homes?<\/p>\n Even in a relatively affordable state like South Dakota, aging in place isn\u2019t always easy. Seniors are still navigating rising insurance costs, property taxes, and maintenance\u2014especially on fixed incomes.<\/p>\n For those still paying income taxes, the new deduction could reduce or eliminate federal liabilities, helping cover essentials like homeowners insurance or annual property taxes. When paired with the expanded SALT deduction cap<\/a>, retirees in higher-tax counties may see even greater relief.<\/p>\n And with Social Security payments expected to rise due to a likely 2026 COLA adjustment<\/a>, some retirees may experience an unusual convergence: higher monthly checks and fewer taxes due on them.<\/p>\n This article was produced with editorial input from Dina Sartore-Bodo<\/a>, Gabriella Iannetta<\/a>, and Allaire Conte<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"A federal tax overhaul is promising major savings for retired homeowners across South Dakota. Under the One Big…\n","protected":false},"author":3,"featured_media":151871,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[15],"tags":[64,83434,89043,83771,255,711,1124,89044,67,132,68,5223],"class_list":{"0":"post-151870","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-personal-finance","8":"tag-business","9":"tag-federal-income-tax","10":"tag-federal-tax-overhaul","11":"tag-federal-taxes","12":"tag-personal-finance","13":"tag-social-security","14":"tag-south-dakota","15":"tag-south-dakotans","16":"tag-united-states","17":"tag-unitedstates","18":"tag-us","19":"tag-white-house"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@us\/115041431991595148","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/151870","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/comments?post=151870"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/151870\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media\/151871"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media?parent=151870"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/categories?post=151870"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/tags?post=151870"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}