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Are There Special Tax Breaks for Retirees?
Source:
fool.com
- Nov 11, 2016
Many retirees experience a drop in income when they stop working and start living off savings and Social Security. Thankfully, there are a number of special tax breaks available to seniors. Retiree taxes can be tricky to navigate, so it pays to explore the different tax deductions, exemptions, and tax credits that are unique to senior citizens.
Though many older Americans wind up itemizing their tax returns, for many seniors, it pays to take the standard deduction. This especially holds true if you don't have much in the way of charitable contributions, mortgage interest, or business expenses to write off. Since many retirees see their income go down once they stop working, the IRS offers a bit of tax relief in the form of a higher standard deduction. You can take advantage of this higher deduction if you're 65 or older by Dec. 31 of the tax year in question. For 2016, a single tax filer under 65 gets a standard deduction of $6,300, while a single filer 65 and older gets $7,850 -- a $1,550 difference. And if you're married filing jointly, you'll get an extra $1,250 if one of you is 65 or older.
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Category: General Business
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