Do Seniors Ever Stop Paying Taxes?

As tax season approaches, many seniors find themselves wondering if they will ever stop filing taxes. This question is more common than you might think, and the answer depends on several factors, including income level, filing status, and age. While some seniors may qualify for an exemption from filing, others may still need to submit a tax return to claim certain benefits or credits. Understanding the specific requirements and thresholds can help seniors determine their tax obligations. For instance, Social Security benefits may or may not be taxable, depending on other income sources. Additionally, seniors who have income from investments, pensions or part-time work may still need to file.

If you want individualized help preparing for retirement or creating a tax strategy, consider speaking with a financial advisor to see how they can potentially help.

At What Age Can You Stop Filing Taxes?

Taxes aren’t determined by age, so you will never age out of paying taxes. People who are 65 or older at the end of 2025 have to file a return for that tax year (which is due in 2026) if their gross income is $16,550 or higher. If you’re married filing jointly and both 65 or older, that amount is $32,300. If you’re married filing jointly and only one of you is 65 or older, that amount is $30,750.

That said, there is one situation in which you can kiss taxes goodbye. If your only income is Social Security payments, you won’t owe taxes and you probably won’t need to file a tax return. However, you should always consult with a tax professional before knowing how your personal situation applies to anything related to tax liability.

Common Taxes Seniors Pay

If you’re 65 or older, you might also be retired or partially retired and taking distributions from your retirement savings. Retirement savings and investments can have more complex tax rules than income, where you often get taxes deducted automatically from each paycheck and a W-2 at the end of each year. Here are some of the more common taxes retirees face and how they work.

1. Social Security Taxes

If you have significant retirement income other than Social Security, you might have to pay income tax on your Social Security benefits. The percentage of your Social Security benefits that are taxable depends on your combined income. Combined income is defined as your adjusted gross income plus nontaxable interest plus half of your Social Security benefits.

If you file taxes separately and your combined income is between $25,000 and $34,000, you may owe income taxes on 50% of your Social Security benefits. If your combined income is higher than $34,000, up to 85% of your benefits may be taxed.

If you file a joint return and you and your partner’s combined income is between $32,000 and $44,000, you may owe income taxes on 50% of your Social Security benefits. If that number is more than $44,000, 85% of your benefits may be taxed.

2. Common Retirement Accounts

IRAs, 401(k) plans and other popular retirement savings vehicles have different tax treatments. Generally speaking, some are pre-taxed and some are taxed at withdrawal. For example, IRAs that are funded by money that was already taxed – say you take $1,000 from a paycheck and put it in a Roth IRA – won’t be taxed when you withdraw that money in retirement as long as you meet IRS requirements.

On the other hand, 401(k) plans are usually funded with pre-tax money, so you’ll usually owe income tax on withdrawals in the year that you take them.

3. Pension Taxes

Like 401(k) plans, pensions are usually funded by pre-tax money, so you’ll owe federal income taxes on withdrawals in the year you take them. If you take a lump-sum payment rather than annual or periodic payments, you will owe the total tax bill in the year you receive that payment.

In many cases, your employer, through which you have the pension, will withhold taxes as your pension payments are disbursed, which can help mitigate the tax bill.

How to Minimize Taxes as a Senior

at what age do seniors stop paying taxes

Seniors often have different income sources, such as Social Security benefits, pensions, and retirement account withdrawals, which can affect their tax liabilities. Knowing which tax bracket you fall into helps you make informed decisions about when and how much to withdraw from your retirement accounts. This knowledge can also guide you in timing your income to potentially lower your tax rate, ensuring you keep more of your hard-earned money. Here are a few ways to save on your taxes:

Take advantage of the tax credit for the elderly: The Credit for the Elderly and Disabled is worth between $3,750 and $7,500. You can use the IRS’s tool to see if you qualify and how large a credit you might get. Generally speaking, you have to be 65 or older and make less than $17,500 in adjusted gross income if you’re tax filing status is single or head of household – that limit rises to $20,000 if you’re married filing jointly and only one spouse is 65 or older and $25,000 if you’re married filing jointly and both spouses 65 or older.
Use your bigger standard deduction: If you’re 65 or older and you don’t itemize deductions, you are entitled to a higher standard deduction. A single filer over 65 gets an extra $1,950 deduction, a couple filing jointly gets an extra $1,550 for each partner who is 65 or older. So if only one spouse is 65 or older, the extra deduction amount is $1,550, but if both are 65 or older, it’s $3,100.
People 50 or older can make “catch-up” contributions to their retirement accounts: The 2025 contribution limit for a traditional or Roth IRA is $7,000, unchanged since 2024. But if you’re 50 or older, you can contribute an extra $1,000. The 2025 contribution limit for a 401(k) plan is $23,500, up from $23,000 in 2024. Those 50 and older can contribute an extra $7,500, which remains the same in 2024. However, starting in 2025, people between the ages of 60 and 63 can make a “super catch-up contribution” of up to $11,250 instead of $7,500.
You’re not alone: If navigating tax credits or understanding changing catch-up limits feels overwhelming, you don’t have to go it alone. Take advantage of free IRS tax assistance for those 60 and older or free AARP tax assistance for those 50 and older who have a low or moderate income.

Consulting with a financial advisor can provide personalized strategies tailored to your unique situation. Advisors can help you optimize your tax planning, ensuring you take advantage of all available credits and deductions. With professional guidance, you can confidently manage your finances and focus on enjoying your retirement years.

Bottom Line

Unless you have no income outside of Social Security payments, you’ll probably have to keep paying taxes in your elder years. The good news is that there are tax credits and other strategies you can use to help you keep that tax bill low. You may want to work with a financial advisor to make sure you have a clear tax strategy during retirement.

Tips for Saving on Taxes in Retirement

A financial advisor can help you build a retirement income plan with tax efficiency in mind. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
Use SmartAsset’s retirement calculator to make sure your retirement savings will carry you through – or learn how you need to adjust your saving strategy to make your plan work.
Taxes aren’t the only surprise expense in retirement – be sure to account for your Medicare costs as you plan out your retirement income too. Check out SmartAsset’s guide to Medicare Part A, Part B, Part C and Part D.