A Guide On Tax Breaks for Seniors In 2026

Navigating taxes in retirement can be complex, but knowing which tax breaks for seniors you qualify for can make a meaningful difference. The IRS defines a senior as someone age 65 or older, and at this stage, you may be eligible for valuable deductions, credits, and exemptions that help reduce your tax burden. These can include senior-eligible expenses, medical and dental deductions, specific federal or state credits, and considerations for estate planning to help preserve your assets for your loved ones.

Key federal and Illinois tax breaks may be available to older adults, along with property tax programs that can provide additional savings. Understanding these opportunities can help support confident financial decision-making during retirement.

Note: Every financial situation is different. Be sure to consult a certified financial professional before making tax or financial decisions.

At Wyndemere, we understand that peace of mind in retirement comes not only from vibrant living, but also from staying informed—and we’re here to support you in both.

Federal Tips On Tax Breaks for Seniors

There are several federal tax breaks for seniors that can help reduce taxable income and maximize savings. Understanding these opportunities allows older adults to take full advantage of deductions, credits, and other benefits available under federal tax law. Key areas include higher standard deductions, credits for the elderly or disabled, medical and dental expense deductions, and qualified charitable distributions.

Higher Standard Deduction

For 2025–2026, taxpayers age 65 and older receive an additional standard deduction amount on top of the base standard deduction. This protects more of your income from federal taxation.

• Single: Base standard deduction plus an additional amount for age 65+
• Married filing jointly: Base standard deduction plus additional amounts for each spouse 65+

Credit for the Elderly or Disabled

Medical and Dental Expenses

Medical care is one of the largest areas of expense for seniors, and many costs may be deductible if they exceed 7.5% of your adjusted gross income (AGI). Deductible expenses generally include:

• Diagnosis, treatment, mitigation, or prevention of disease, or for affecting any structure or function of the body

• Transportation primarily for and essential to medical care

• Qualified long-term care services

• Insurance premiums, including Medicare Part B and supplemental medical insurance, and qualified long-term care insurance

• Inpatient hospital care, including meals and lodging if the main reason for the stay is medical care

• Other eligible medical expenses such as medications, nursing services, and certain pre-paid medical costs

For residents of Life Plan Communities (formerly Continuing Care Retirement Communities), a portion of the entrance fee and monthly service charges may qualify as a medical expense deduction. The deductible amount is generally calculated annually based on the community’s cost for providing care services.

Qualified Charitable Distributions (QCDs)

If you’re 70½ or older, you can make qualified charitable distributions (QCDs) from an IRA directly to a qualified charity. QCDs can satisfy required minimum distributions without increasing taxable income.

Illinois State-Specific Tax Tips

In addition to federal benefits, Illinois offers several tax breaks for seniors designed to reduce state income and property taxes. These programs can help older adults keep more of their retirement incomes and manage living expenses. Key benefits include exemptions for Social Security and retirement income, the Senior Citizen Homestead Exemption, and the Senior Citizen Real Estate Tax Deferral Program.

Social Security and Retirement Income

In Illinois, Social Security benefits are not taxed, and most other retirement income—including pensions, IRAs, and 401(k) withdrawals—is also exempt from state income tax.

For federal taxes, Social Security benefits may be partially taxable depending on your filing status and combined income. Generally, if half of your Social Security benefits plus other income exceeds certain thresholds, a portion of your benefits may be included in your gross income for federal tax purposes. However, Supplemental Security Income (SSI) and certain lump-sum death benefits are not subject to federal income tax.

These rules allow many seniors to keep more of their retirement incomes while still complying with both state and federal tax requirements.

Property Tax Exemptions for Seniors

Illinois offers several property tax programs that can help older adults reduce expenses:

• Senior Citizen Homestead Exemption: Homeowners age 65+ may qualify to reduce the equalized assessed value (EAV) of their primary residences.

• Senior Freeze (Assessment Freeze): Freezes the EAV for qualifying low-income seniors.

• Senior Citizen Real Estate Tax Deferral Program: Allows eligible seniors to defer payment of property taxes until the home is sold or ownership changes, helping preserve monthly cash flow.

Eligibility rules and income limits vary by county. Contact your county assessor or treasurer for local application requirements.

Eligibility and How to Apply

To take full advantage of federal and Illinois tax breaks for seniors, it’s important to understand eligibility requirements and the steps needed to apply.

1. Confirm your age and filing status. Ensure you meet the IRS and Illinois requirements for senior benefits, including age 65+ or qualifying disability, and determine your federal and state filing status.

2. Gather supporting documentation. Collect relevant records, such as medical receipts, long-term care invoices, retirement income statements, property tax bills, and proof of residence.

3. Complete federal forms. File the appropriate IRS forms to claim deductions and credits, such as Schedule R for the Credit for the Elderly or Disabled and Form 1040 for itemized medical expenses.

4. Apply for Illinois property tax programs. Submit applications for the Senior Citizen Homestead Exemption, Senior Freeze, or Senior Citizen Real Estate Tax Deferral Program through your county assessor or treasurer’s office.

Filing tax returns and navigating deductions can feel overwhelming. While IRS forms and publications are available online, every situation is unique, and professional guidance can be invaluable. Seniors may access free assistance through several programs:

• AARP Tax-Aide Program: Offers free tax help to seniors age 60 and older. Call 1-888-227-7669 for site locations.

• IRS Volunteer Income Tax Assistance (VITA) and Tax Counseling for the Elderly (TCE): Provides free federal tax assistance for low-income seniors. Contact your local IRS office for site information.

For additional guidance, refer to IRS Publication 554 under “Preparing and filing your tax return” to access forms, instructions, and other resources. Taking advantage of these programs ensures seniors can confidently claim the tax breaks they are entitled to while minimizing errors and stress.

Taking the Next Step: Living Confidently at Wyndemere

Understanding tax breaks is just one part of planning for a secure, enjoyable retirement. At Wyndemere, we support seniors with practical guidance and a welcoming, maintenance-free lifestyle designed for living fully and confidently.

Why Wyndemere Is a Great Choice

• Maintenance-free living in beautifully designed residences
• Wellness and fitness programs that keep you active and engaged
• Dining with flexible venues and nutritious options
• Dynamic social programming including clubs, classes, and cultural outings
• Compassionate on-site care and smooth transitions across levels of support
• Lifelong learning opportunities through lectures, classes, and enrichment
• A welcoming campus with gardens, walking paths, and gathering spaces