The Social Security Administration (SSA) sends out benefit checks to about 70 million Americans each month. The amount each person gets is based on things like how much money they made while working and when they started claiming benefits. But for July, some people might get a smaller check than they expected because of a new rule from the Internal Revenue Service (IRS).
Here’s what you need to know about this possible decrease and what to do if your benefit is reduced. Surveys done by Gallup over the last 23 years show that around 80% to 90% of retirees rely on their monthly Social Security check to pay for important things. So, knowing exactly how much they’ll get each month is really important.
A sudden drop in the amount could cause money problems for these people. The possible decrease in July benefits is connected to new IRS rules. These rules, which started earlier this year, have begun to affect certain retirees.
This could lead to them getting less money. The updated tax rules won’t change the checks for all Social Security recipients in July. Specifically, the IRS rules will impact:
– Retirees who have federal taxes taken out of their Social Security benefits (people can choose to have 7%, 10%, 12%, or 22% withheld for federal income tax).
irs rule affects social security payouts
– People who have other sources of taxable income (like pensions or money taken out of IRAs). – Those in higher tax brackets because of how much total income they have.
It’s important to note that people who get Supplemental Security Income (SSI) won’t be affected by the tax withholding, because SSI is not taxable. The IRS gave advice early in 2025 to help people with multiple income sources report their taxes correctly each year. Because of this, some Social Security recipients have been put into higher tax categories.
This prompted the SSA to change how much tax they withhold. If you notice a lower amount on your July check, sign in to your SSA account and look at your IRS Form W-4V. You can either fill out a new form or choose not to have federal taxes withheld.
It may also be helpful to talk to a tax advisor. The actual amount taken out of your check depends on your income and tax bracket. This adjustment could happen again in August and later months based on federal and state tax policies.
Even though the SSA sends out checks on the same date each month, the amount you get may change. For more information, please check the official SSA or IRS websites.