Experts warn that Trump's plan to reduce Social Security taxes may jeopardize benefits.

• Donald Trump, the former president, reiterated his proposal to remove taxes from Social Security benefits for elderly individuals.
• Experts warn that the plan could speed up the insolvency of the Social Security and Medicare trust funds.
• According to the Social Security Administration, about 40% of Americans who receive Social Security benefits pay federal income tax.

This week, former President Donald Trump reiterated his proposal to remove taxes on Social Security benefits for seniors. However, policy experts caution that the plan may drain Social Security and Medicare trust funds more quickly.

During a "Fox & Friends" interview on Wednesday and a press conference at his Mar-a-Lago club in Palm Beach, Florida, on Thursday, the Republican nominee advocated for "no tax on Social Security for seniors."

The unemployment insurance program is not ready for a recession, according to experts.

Experts have raised concerns about the federal budget deficit and the solvency of Social Security and Medicare trust funds, criticizing Trump's plan.

A recent analysis from the Committee for a Responsible Federal Budget shows that repealing the tax could increase the budget deficit by $1.6 trillion to $1.8 trillion through 2035.

In a blog post, Garrett Watson, a senior policy analyst and modeling manager at the Tax Foundation, characterized the plan as "unsound and fiscally irresponsible."

The Tax Foundation reports that Trump's plan could delay insolvency for Social Security, including the disability program, by two years, from 2035 to 2033. Additionally, Medicare's insolvency could be moved up six years, from 2036 to 2030.

President Trump has pledged to safeguard Social Security and Medicare in his second term, as he did in his first term, according to Karoline Leavitt, the Trump campaign national press secretary.

She stated that Trump would enhance the U.S. economy and fortify Social Security, "while simultaneously abolishing taxes on Social Security for America's rightful seniors."

Cutting tax primarily benefits higher earners

"According to Howard Gleckman, senior fellow at the Urban-Brookings Tax Policy Center, in the short run, Trump's plan will provide a modest benefit to Social Security beneficiaries on average. However, nearly all of this benefit will go to high-income retirees who do not truly need it."

According to a Tax Policy Center analysis released in August 2021, households could see an average tax break of $90 with income between $32,000 and $60,000 or no benefit with earnings of $32,000 or less. For 2025, the tax break could save U.S. households an average of $550.

Several states collect taxes on Social Security, while roughly 40% of Americans who receive benefits pay federal income tax.

The federal income tax calculation incorporates "combined income," which encompasses your adjusted gross income, non-taxable interest, and half of your Social Security benefits.

If your combined income is between $25,000 and $34,000 or $32,000 and $44,000 for married couples filing jointly, up to 50% of your Social Security benefits may be taxable. However, once your combined income exceeds these levels, up to 85% of your Social Security benefits could be subject to tax.

According to Gleckman, the thresholds do not account for inflation, which affects middle-income individuals with Social Security benefits, pensions, or 401(k)s.