As part of the human nature, we strive hard to pay the minimum tax. Such is in the case of seniors and retirees, paying income tax can become a liability with specifically having a fixed income. However, the government offers benefits in the form of certain senior tax breaks for retirees.

Getting the benefit of larger standard deduction
As per the IRS protocol, you get an advantage of not paying as much taxes as the rule lets you take an extra deduction as when you turn 65 years. In the current scenario of 2020, an additional amount of $1650 can be added to the standard deduction. All this and more rules let you pay a very nominal tax on a smaller amount of income. This benefit is perfectly ideal for all those who wish to save more money and all who have paid off their mortgage.

The benefit of high filling edge
As you turn 65 years and older, you have an added edge to file a tax return and so you have a better chance to fill your wallet with extra cash. A good $13000 and above can be all yours with an added advantage of not including benefits in case there is a social security. In case of a couple, you are not far to earn a whopping amount of nothing less than $24000.

No taxes on having a social security number
As a retiree, you can no longer be entitled to pay tax, which is the biggest senior tax breaks for retirees. This benefit works on the idea that if half of your social security and total of your income is less than $25000 and that you are single, the exemption works. In the case of a married couple, the limit is $32000. The simple formula is to file a joint return and since the threshold is $25000, you need to do as what the protocol says. The interactive tool offered by IRS must be used as it gives a clear idea of whether your social security is taxable or not.

Tax credit
In case you are 65 years on the last day of the tax year, a tax credit is applicable. Also, this is applicable to a US citizen, resident alien or married to US citizen or resident alien. In the case of a couple, it’s advisable to jointly file to claim the credit. Earning too much will not fetch you this tax credit advantage such as in the case of someone who earns $17500 and the status is single, $20000 married, $25000 joint married and $12500 separate married return. No matter how you claim, a good amount of $3750 to $7500 can be expected.

Property tax
In some states, there is a possibility of getting property tax deferrals and exemptions, though it varies from state to state. This senior tax break for retirees is of great use.

401(k)
In case you have access to a 401(K) plan, you could defer paying income tax as long as the amount is $6000 and above. Also, as per 2020, you can contribute starting from $19000 to $25000 and with many tax advantages.

Such senior tax breaks for retirees are instrumental in saving for unexpected costs as well as leisure expenses.