It can be hard to keep up with all the tax changes that kick in every year, but not being aware of them can end up costing you come Tax Day. There are several changes new for this year that affect seniors in particular, including a new bonus deduction that could lower taxable income — but only if retirees file correctly.
Learn More: What 2026 Senior Tax Deduction Means for Social Security and Retirement Planning
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Before Tax Day is here, take a look at an important tax change retirees should be aware of — and the costly tax filing mistakes to avoid in 2026.
Tax Change Affecting Retirees in 2026
“As a result of the most recent tax changes in 2026, a lot will change for retirees and the way they file their taxes,” said Bethany Dever, CFP, vice president and relationship manager at Rockland Trust.
New for seniors is the $6,000 bonus deduction per eligible individual, which will apply for tax years 2025 through 2028. To qualify, you must be age 65 by the last day of the year, and if you are married, you must file jointly to claim the deduction.
Phase-outs also apply and begin at $75,000, with a complete phase-out at $175,000 for single filers. For joint filers, phase-outs begin at $150,000, with a complete phase-out at $250,000.
“This additional deduction can be used whether itemizing or claiming the standard deduction, and is in addition to the preexisting standard deduction for seniors and the visually impaired,” Dever noted.
While the new rule creates opportunities for tax savings, it also introduces new ways retirees can misstep at filing time.
Find Out: Maximize Your Tax Refund by Avoiding This Common Mistake
Common Tax Filing Mistakes Retirees Should Avoid in 2026
With these new dynamics to consider, there are some common misconceptions and mistakes that retirees should be aware of to help them navigate this transition smoothly. Dever shared the most common mistakes to avoid this year.
1. Cutting Back Withholding
“Some retirees are making knee-jerk reactions based on their 2025 tax outcome by cutting back tax withholding, not realizing the bonus deduction is temporary,” Dever said.
2. Not Opting Into the Deduction
“Some assume the deduction is automatic and fail to enter information carefully, leading to errors,” Dever said.
3. Overlooking Age Requirements
“Married couples filing jointly may overlook that both spouses must be age 65 to qualify,” Dever said.
4. The New Deduction Won’t Change Your Social Security Taxes or IRMAA
“The One Big Beautiful Bill Act didn’t change the formula for calculating whether tax on Social Security benefits or [Medicare premiums] (IRMAA) will apply, but the bonus deduction for seniors could provide an offset,” Dever said. “As this is a ‘below the line’ deduction, it will not reduce AGI or MAGI, which is an important factor to keep in mind.”
How Retirees Can Maximize 2026 Tax Savings
The new deduction offers potential tax savings — but only if you fully understand how it works.
“Given these nuances, seeking professional tax advice is especially important when filing taxes this year,” Dever said.
For retirees, the key takeaway is simple: The new deduction can reduce taxes, but only with careful filing. Understanding how it interacts with withholding, eligibility rules and other income thresholds can help prevent tax surprises.
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This article originally appeared on GOBankingRates.com: 2026 Tax Change Retirees Must Know Before It’s Too Late To Avoid Costly Filing Mistakes
