by Boise, Idaho – Seniors across Idaho often look for ways to reduce their taxable income, and the extra standard deduction available for individuals aged 65 and older offers a meaningful opportunity. With recent federal updates and Idaho-specific rules, understanding how these deductions work is essential for retirees planning their finances in 2025.
Federal Extra Standard Deduction for Seniors
At the federal level, the IRS grants an additional deduction to seniors who are at least 65 years old. For the 2025 tax year, single filers or heads of household can claim an extra $2,000, while married couples filing jointly can claim $1,600 per qualifying spouse. If a filer is both 65 and blind, these amounts double—meaning up to $4,000 for single filers and $3,200 per spouse for joint filers.
These additional deductions are applied on top of the regular standard deduction, reducing taxable income and potentially lowering overall tax bills.
The New Senior Bonus Deduction
Beyond the long-standing extra standard deduction, the 2025 “One Big Beautiful Bill” (OBBB) introduced a special senior deduction aimed at easing the tax burden for retirees. Seniors aged 65 and older can now claim an additional $6,000 deduction, or $12,000 for married couples filing jointly, provided their income falls below the set thresholds.
- Single filers qualify if income is $75,000 or less.
- Married couples qualify if income is $150,000 or less.
This deduction phases out gradually at a 6% rate and disappears completely when income exceeds $175,000 for single filers or $250,000 for joint filers.
Importantly, this deduction is available whether seniors take the standard deduction or itemize their returns, giving flexibility in how they file.
Idaho’s State-Level Tax Benefits
On top of federal deductions, Idaho provides its own state-level tax relief for seniors. Social Security and Railroad Retirement benefits are fully exempt from Idaho state income tax, ensuring that retirees keep more of their benefits.
In addition, Idaho offers a Retirement Benefits Deduction for certain qualified pensions, including military and federal civil service retirement. Seniors 65 and older—or disabled individuals 62 and older—may claim this deduction, though the eligible amount is subject to annual updates by the Idaho State Tax Commission.
Combining Federal and State Relief
For Idaho residents, the combination of deductions can make a noticeable difference. A 67-year-old single filer with income under $75,000 could potentially claim:
- $2,000 extra federal deduction for age
- $6,000 OBBB bonus deduction
- Idaho’s exemption on Social Security income
- Possible state retirement benefits deduction
Altogether, these provisions can substantially reduce taxable income, often shifting seniors into lower brackets and lowering the amount of tax owed.
Filing Tips for Seniors in Idaho
Seniors filing in 2025 should keep a few strategies in mind:
- Ensure your age status (65+) is marked correctly on federal and Idaho tax forms.
- If your income is close to the $75,000 (single) or $150,000 (joint) limit, consider timing retirement distributions to stay eligible for the full senior bonus deduction.
- Don’t forget to claim the Idaho Retirement Benefits Deduction if you qualify.
- Stay aware that the OBBB bonus deduction is scheduled to expire after 2028, which could affect future planning.
Read Also: Understanding the Alaska Extra Standard Deduction for Seniors Over 65
Final Thoughts
For seniors in Idaho, the federal extra standard deduction, the new OBBB senior bonus, and state-level exemptions all combine to create significant opportunities for tax savings. Understanding and leveraging these benefits can help retirees stretch their retirement income further and enjoy more financial security in their later years.
What do you think about Idaho’s approach to senior tax relief? Should other states expand deductions like this? Share your thoughts in the comments at ibwhsmag.com.
