As the Trump Administration approaches the end of its first year, questions remain regarding the future of its proposals for Social Security. Two of the most prominent pledges made by President Donald Trump involve eliminating federal taxes on Social Security benefits and utilizing oil and gas revenues to support the program. However, the likelihood of these proposals becoming law by 2026 appears slim.
Tax Elimination on Social Security Benefits
During his campaign, President Trump frequently highlighted the elimination of taxes on Social Security benefits as a key promise. Following his inauguration, the White House asserted progress on this front, claiming that under the “One Big Beautiful Bill,” approximately 88% of senior citizens receiving Social Security would pay no tax on their benefits. This assertion was backed by an analysis from the Council of Economic Advisers.
Despite these claims, the reality remains that no substantive changes have been made to the federal tax structure governing Social Security. Although an additional $6,000 deduction for eligible seniors was introduced, this relief applies to all seniors, regardless of whether they collect Social Security, and is set to expire in 2028. Furthermore, the income threshold for taxing benefits has not been adjusted, impacting a growing number of seniors, with nearly 50% now facing tax obligations on their benefits. Consequently, experts predict that the chances of legislation addressing these taxes before 2026 are exceedingly low.
Funding Social Security Through Oil and Gas Revenues
In addition to tax elimination, President Trump proposed funding Social Security using revenues from oil and gas resources. He emphasized that it would be unnecessary to cut benefits, stating, “You don’t have to touch Social Security” during a town hall event on December 2023 with Fox News host Sean Hannity.
However, organizations such as the Committee for a Responsible Federal Budget have challenged the viability of this approach. They argue that even if all federal land were opened to drilling, the revenue generated would only cover approximately 4% of the projected shortfall in Social Security funding. Without concrete proposals to tap into these resources and given the lack of bipartisan support for increased drilling, this promise is also unlikely to materialize by 2026.
As the current political landscape evolves, the focus on Social Security reform is diminished. With President Trump’s popularity waning, a narrow majority in both chambers of Congress, and priorities shifting towards issues such as tariffs and immigration, significant changes to Social Security appear improbable in the near future.
Looking beyond 2026, the potential for these promises to become reality will largely hinge on the outcomes of the upcoming elections in 2028 and the administration’s priorities during the remainder of Trump’s term. For now, retirees may benefit from the temporary tax deduction, but the critical funding issues facing Social Security remain unresolved.
