Good News for Tax Payers Over the Age of 65

Since 2013, much has been discussed by lawmakers concerning simplifying the tax code for senior citizens (over the age of 65). Finally, as of tax year 2019, we have a simpler tax system for all Americans over the age of 65. For most of us, who are passively paying attention to what is going on, we might think "great... Simple is good." But what, in this case, does it imply? How do I know if I am eligible for it (in tax there are always exceptions)? In this post, I want to answer the questions we all might have regarding this change.

First, let's talk about how we got here. As stated previously, this legislation was first introduced back in 2013. The Seniors Tax Simplification Act (as it was called) was introduced to the United States Senate by Marco Rubio (R-FL), Bill Nelson (D-FL), Senators Mike Lee (R-UT), and Tom Carper (D-DE). Despite massive support, the bill was continuously struck down. It wasn't until February of 2018 when President Donald Trump signed the emergency spending bill containing much of the language of the Seniors Tax Simplification Act that the polices were enacted.

So the product of the simplification is Form 1040SR. This is similar and has been compared to Form 1040EZ; however, there are a few key differences. One of which is Form 1040SR's age requirement. In order to file using this form, you must be over the age of 65. No exceptions. If you are retired (collecting social security) and under 65, you are not eligible to file Form 1040SR. Thankfully, being retired isn't a requirement. If you meet the age requirement and have multiple sources of income, fear not, Form 1040SR has you covered.

Also, there is not an income requirement. All taxpayers who meet the age requirement can file Form 1040SR. There is, however, a caveat. If you file Form 1040SR, you must choose the standard deduction. Keep in mind that if you are over 65, you are also entitled to an extra $1,300 in your standard deduction. Currently, this leaves taxpayers who need to itemize their deductions out of the running for Form 1040SR.

A sample of Form 1040SR has recently been released. Check it out here. Keep in mind that this is an IRS preview and is not for the use of filing.

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