News & Trending Tax News

Over 60? Don't Miss These 7 IRS Credits That Can Cut Your Tax Bill

Seniors can increase their savings by taking advantage of the tax deductions and credits the federal government offers.

By Chris Kissell

Edited by Amanda Machado

Updated Jan. 15, 2026

Overlooked and unexpected tax breaks are one of the perks of getting older. Tax deductions and credits aimed specifically at seniors can reduce how much you owe to the government, helping you stretch savings in retirement.

If you are over 60, you can avoid wasting money in retirement by taking advantage of these tax breaks.

Get instant access to hundreds of discounts

Over 50? Join AARP today— because if you’re not a member you could be missing out on huge perks like discounts on travel, dining, and even prescriptions.

Get 25% off membership — just $15 for your first year with auto-renewal — and a free gift if you join today.

Become an AARP member now

New OBBB senior deduction

Seniors who are 65 or older can enjoy a new deduction of an extra $6,000 when they file a federal return. You can take this deduction whether you use the standard deduction or itemize on your tax return.

The new perk became law as part of the One Big Beautiful Bill Act Congress passed in 2025. This tax break will be in place for all tax years between 2025 and 2028, and is available to each senior who is 65 or older.

Couples this age will receive an extra annual deduction of $12,000 over the next few years. However, the deduction begins to phase out if you are single and have a modified adjusted gross income over $75,000, or are married filing jointly with an income above 150,000.

Who really has the cheapest auto insurance in your area? Check your zip code here.

Extra standard deduction

In addition to the expanded deduction that recently became law, those who are 65 or older can continue to take the existing extra standard deduction.

For the 2025 tax year, single taxpayers who are at least 65 can take an extra standard deduction of $2,000. For married couples filing jointly, the extra standard deduction is $1,600 per qualifying spouse.

The expanded standard deduction for seniors can be combined with the new senior deduction that is available for the 2025 to 2028 tax years.

Credit for the elderly or disabled

Some seniors who are disabled may be eligible to take a tax credit of between $3,750 and $7,500. To qualify, you must be at least 65, or retired on permanent and total disability, and be receiving disability income that is taxable.

In addition, your income levels must fall below specific thresholds. You can learn more in IRS Publication 524, Credit for the Elderly or the Disabled.

Resolve $10,000 or more of your debt

National Debt Relief could help you resolve your credit card debt with an affordable plan that works for you. Just tell them your situation, then find out your debt relief options.¹ <p>Clients who complete the program and settle all debts typically save around 45% before fees or 20% including fees over 24–48 months, based on enrolled debts. “Debt-free” applies only to enrolled credit cards, personal loans, and medical bills. Not mortgages, car loans, or other debts. Average program completion time is 24–48 months; not all debts are eligible, and results vary as not all clients complete the program due to factors like insufficient savings. We do not guarantee specific debt reductions or timelines, nor do we assume debt, make payments to creditors, or offer legal, tax, bankruptcy, or credit repair services. Consult a tax professional or attorney as needed. Services are not available in all states. Participation may adversely affect your credit rating or score. Nonpayment of debt may result in increased finance and other charges, collection efforts, or litigation. Read all program materials before enrolling. National Debt Relief’s fees are based on a percentage of enrolled debt. All communications may be recorded or monitored for quality assurance. In certain states, additional disclosures and licensing apply. ©️ 2009–2025 National Debt Relief LLC. National Debt Relief (NMLS #1250950, CA CFL Lic. No. 60DBO-70443) is located at 180 Maiden Lane, 28th Floor, New York, NY 10038. All rights reserved. <b><a href="https://www.nationaldebtrelief.com/licenses/">Click here</a></b> for additional state-specific disclosures and licensing information.</p>

Medical expense deductions

The IRS allows you to deduct from income qualifying medical expenses that exceed 7.5% of your adjusted gross income. You must itemize your deductions on your tax return to qualify for this tax break.

Technically, this deduction is available to all taxpayers, regardless of age. However, seniors may be in an especially good position to take advantage of it, since their incomes may be lower and their health expenses higher compared to younger folks.

Qualified charitable distribution

If you are at least 70 1/2, you can lower your tax bill by making a qualified charitable distribution. This allows you to transfer up to $108,000 directly to the charity of your choice without the amount being included in your taxable income.

This strategy is most effective for those who have reached the age of 73 and whose retirement accounts are now subject to required minimum distributions. Because the money is not included in your income, these distributions can help lower your tax bill.

IRA and 401(k) contributions after retirement

If you are over 60 but still working, you can lower your tax bill by making contributions to a traditional IRA or 401(k) plan.

For 2026, 401(k) contribution limits are $24,500. In addition, those who are 50 can make a catch-up contribution of $8,000. Those who are between the ages of 60 and 63 can make an even larger catch-up contribution of $11,250.

IRA contribution limits are $7,500, plus a catch-up contribution of $1,100 for those who are 50 and older.

Make Money: 8 things to do if you're barely scraping by financially

Health savings account contributions

If you have not yet reached the age of 65 and enrolled in Medicare, you can still contribute to a health savings account (HSA). For 2026, HSA contribution limits are $4,400 for self-only coverage and $8,750 for family coverage. In addition, those who are at least 55 can make a catch-up contribution of $1,000.

HSAs are triple tax-advantaged. You pay no taxes on contributions, the money grows tax-deferred, and withdrawals are tax-free as long as they are used to pay qualified medical expenses.

Bottom line

The IRS offers several federal tax breaks for those who are 60 or older. Your state also may offer more. For example, Iowa taxpayers who are at least 55 can exclude all retirement income from Iowa state taxes. In Pennsylvania, seniors who are at least 65 may qualify for up to $1,000 in property tax rebates.

Talk to your tax professional to find out if your state offers extra tax breaks for those over 60. Use the money you save from these tax breaks to build your savings, crush your tax debt, or take a nice vacation.

More from FinanceBuzz:

Benefits

Card Details

$0 annual fee
Intro APR on purchases and balance transfers
Apply Now

INTRO OFFER: Unlimited Cashback Match for all new cardmembers. Discover will automatically match all the cash back you’ve earned at the end of your first year! There’s no minimum spending or maximum rewards. You could turn $150 cash back into $300.
Earn 5% cash back on everyday purchases at different places you shop each quarter like grocery stores, restaurants, gas stations, and more, up to the quarterly maximum when you activate. Plus, earn unlimited 1% cash back on all other purchases.
Redeem cash back for any amount. No annual fee.
Get a 0% intro APR for 15 months on purchases. Then 17.49% to 26.49% Standard Variable Purchase APR applies, based on credit worthiness.
Terms and conditions apply.

Discover <span class='whitespace-nowrap'>it<sup>®</sup></span> Cash Back

4.7

Apply Now

on Discover’s secure website

Read Card Review

Intro Offer

Discover will match all the cash back you’ve earned at the end of your first year.

Annual Fee

Why we like it