Social Security recipients were hoping for a tax break — they’re unlikely to get one. Here’s why.

The latest Republican-backed legislation making its way through the House includes several tax breaks that were promised by President Trump during his campaign. These tax breaks include eliminating taxes on worker tips and overtime pay, as well as significantly lowering rates on corporations. However, one tax break that is notably missing from the bill is Trump’s suggestion from last year that seniors should not have to pay income taxes on their Social Security benefits.

During an August campaign rally in Harrisburg, Pennsylvania, Trump stated, “Seniors should not pay taxes on Social Security and they won’t.” Despite this promise, the provision to eliminate taxes on Social Security benefits was not included in the bill approved by the House Ways and Means Committee. This bill aims to make Trump’s 2017 tax cuts permanent while also introducing additional temporary reductions.

The exclusion of the Social Security tax break is due to a limitation on making changes to the retirement program through the reconciliation process, which Republicans are utilizing to pass the bill. Maria Freese, the senior legislative representative at The National Committee to Preserve Social Security and Medicare, explained that attempting to change the Social Security program through reconciliation would violate the Byrd rule, a rule that restricts what can be included in reconciliation bills.

Instead of eliminating taxes on Social Security benefits, the House bill introduces a new tax break for senior citizens in the form of an enhanced deduction for seniors. This deduction allows filers who are 65 and older to claim an additional $4,000 deduction, benefiting those who itemize deductions as well as those who take the standard deduction.

Currently, around 40% of Social Security recipients, approximately 27 million people, pay federal income taxes on their benefits. While the exclusion of the tax break may disappoint many seniors, the bill aims to provide some relief through the enhanced deduction.

The fiscal outlook of Social Security benefits has evolved over the years, with taxes on Social Security income being introduced in 1984. The revenue generated from these taxes supports both the Social Security and Medicare programs, providing approximately $50 billion in annual revenue. Eliminating taxes on Social Security benefits could have long-term consequences, potentially depleting the trust funds for both programs earlier than projected.

While scrapping taxes on Social Security may seem beneficial in the short term, it could ultimately weaken the stability of the programs and lead to automatic cuts for beneficiaries. Freese expressed concerns about the potential impact of such a decision, describing it as a “bait and switch” that could result in across-the-board cuts for all seniors in the future.

In conclusion, the decision to exclude the tax break on Social Security benefits from the House bill reflects a complex balancing act between providing immediate relief to seniors and ensuring the long-term financial stability of the Social Security and Medicare programs. The bill’s focus on introducing an enhanced deduction for seniors aims to offer some form of tax relief while navigating the challenges of maintaining the programs’ fiscal health.