Important Changes to Social Security and Pension Tax Deductions

Last session, I joined my legislative colleagues to pass two provisions (included within the bi-annual budget) regarding Social Security Income Deductions and Retirement Income Deductions designed to provide seniors with much-needed tax relief. The first eliminated the income tax on Social Security and the second will phase out the income tax on pensions over the next few years.

**Social Security Income Tax Deduction

Effective for tax years beginning after 2019, individual taxpayers may deduct 100 percent of Social Security income, if federal adjusted gross income (AGI) is less than:

•  $75,000 for single filers and married taxpayers filing separately;
•  or $100,000 joint filers and heads of household

Taxpayers with incomes equal to or greater than the thresholds qualify for a 75 percent deduction. The income thresholds are increased from $50,000 and $60,000, respectively.

**Retirement Income Tax Deductions

Effective beginning with the 2019 tax year, individual taxpayers may deduct a portion of retirement income that is included in federal gross income, if federal AGI is below:

• $75,000 for single filers, married taxpayers filing separately, and heads of households;
• or $100,000 for married taxpayers filing jointly

To read more about these changes, you can read the Research Report provided by the non-partisan Office of Legislative Research – https://www.cga.ct.gov/2018/rpt/pdf/2018-R-0005.pdf

It is recommended that you consult a certified tax preparer regarding any deduction.