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Senate Tax Proposal Seen As Better For Older US Taxpayers

by Mike Godfrey,, Washington

20 November 2017

The American Association of Retired Persons has praised the tax bill proposed by the US Senate Committee on Finance, saying it will be better for older Americans than the House version.

"We are pleased that the Senate tax proposal includes some important improvements over the House bill," said AARP Executive Vice President Nancy LeaMond.

The Senate proposal would preserve the medical expense deduction, which the House bill proposes to eliminate. The Senate bill would also maintain the extra standard deduction for those ages 65+, which could help older taxpayers to avoid a tax hike, it said.

Both the House and Senate bills offer additional benefits for older taxpayers, including the rejection of caps on 401(k) retirement plans, and the preservation of the Child and Dependent Care Tax Credit. However, AARP also urged Congress to consider the bipartisan Credit for Caring Act, introduced in May, which would offer a USD3,000 annual credit to family caregivers.

AARP said that both the House and Senate should ensure that sufficient revenue is produced from the new system to fund welfare priorities including Medicare, Medicaid, and other programs that are important to older Americans. The group also called for the adoption of the bipartisan Seniors Tax Hike Prevention Act, introduced in October by Senators Rob Portman (R-OH) and Sherrod Brown (D-OH). The Act would protect seniors with high health care costs by extending until 2019 the rule that permits taxpayers above the age of 65 to deduct medical expenses exceeding 7.5 percent of adjusted gross income.

"As Congress continues its consideration of tax legislation, we continue to urge the House and Senate to work in a bipartisan manner to maintain tax incentives that promote retirement savings, retirement security, and help offset the high out-of-pocket health care costs of older Americans," said LeaMond.

TAGS: tax | tax incentives | retirement | health care | legislation | tax reform | Retire | Tax

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