One Big Beautiful Bill: Retirees Can’t Afford to Waste the Next Four Years | The Limitless Retirement Podcast

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The conversation focuses on the recent changes in tax law that significantly impact retirees and those nearing retirement. Danny explains the new tax benefits available from 2025 to 2028, including enhanced standard deductions and a new senior bonus deduction. He emphasizes the importance of strategic planning to maximize these benefits and minimize tax liabilities over the next four years, urging listeners to take action before the opportunity closes in 2028.

One Big, Beautiful Bill: The Four-Year Tax Window Retirees Can't Afford to Miss

A once-in-a-generation tax opportunity just opened—and if you’re 55 or older, the next four years could shape your retirement income for the next 30.

What if you had four years to legally move money into tax-free accounts and harvest gains with little or no tax—and then that door slammed shut forever?

That’s exactly what just happened. A new tax law quietly created the biggest tax planning opportunity retirees have seen in over a decade—and most people don’t even know it exists.

Here’s what you need to know: starting in 2025, retirees will have four years to take advantage of new deductions and tax bracket thresholds that could save tens of thousands of dollars in federal taxes. After 2028? The window closes. No do-overs.

If you’re already retired—or getting close—you cannot afford to waste this.

Key Takeaways

  • The new tax law creates a four-year planning window from 2025 to 2028.
  • Enhanced standard deductions will significantly benefit retirees.
  • The senior bonus deduction offers additional tax relief for those over 65.
  • Strategic Roth conversions can lower future tax liabilities.
  • Retirees should act now to optimize their tax strategies.
  • The window for these benefits will close in 2028.
  • Planning should be spread across all four years for maximum benefit.
  • Every dollar moved to a tax-free account is a dollar saved from taxes.
  • Required minimum distributions can push retirees into higher tax brackets.
  • Understanding these changes is crucial for long-term financial health.

? The Clock Is Ticking: What Changed and Why It Matters

Let’s get right to the point.

The new tax law keeps the lower tax brackets from the 2017 Tax Cuts and Jobs Act permanent—that’s great news. But it also introduces two major enhancements for retirees from 2025 to 2028 only:

  1. An even larger standard deduction

  2. A brand new “Senior Bonus Deduction”

These aren’t minor adjustments. They’re game changers—especially if you plan ahead.

Here’s what that means in numbers:

Standard deduction (2025)

✅️ Married filing jointly: $31,500

✅️ Single filer: $15,750

Additional deduction for age 65+

✅️ Married couples: + $3,200

✅️ Single filer: + $2,000

New Senior Bonus Deduction (2025–2028)

✅️ $6,000 per person over 65

✅️ That’s $12,000 for a married couple filing jointly

? Total: $46,700 in deductions for qualifying couples over 65.
? That’s nearly $35,000 of tax-free income—before factoring in any other credits or deductions.

But this bonus phases out if your income is too high:

  • Starts to phase out at $75,000 (single) or $150,000 (joint)

  • Disappears completely after 2028

Why This Is the Biggest Tax Planning Window of Your Lifetime

You have a temporary tax-free zone that’s bigger than it’s ever been—and ever will be again.

Let that sink in.

This isn't just about saving a little on next year’s return. It’s about reshaping your entire retirement tax picture for the next 20–30 years.

Here’s what this window allows you to do:

  • Convert Traditional IRA dollars to Roth while staying in lower brackets

  • Harvest gains from appreciated investments while paying little or no capital gains tax

  • Coordinate IRA withdrawals to avoid RMD (Required Minimum Distribution) tax spikes later

  • Lock in low rates before potential future increases

  • Smooth your income so it doesn’t push up your Medicare premiums or trigger Social Security taxation

And here’s what it looks like in action.

Real-Life Example: The $80,000 Roth Conversion Strategy

Let’s say you’re a married couple, both over 65, with $100,000 in annual income.

  • With the enhanced deductions, only $53,300 of your income is taxable

  • That keeps you squarely in the 12% bracket

  • That gives you enough room to convert $20,000 from your IRA to a Roth IRA each year

  • Over four years, that’s $80,000 moved from taxable to tax-free—potentially for life

And because of your deductions?
 That entire conversion could happen at minimal tax cost—or even none at all.

But this only works if you plan ahead and spread it out across the four years. Wait too long, and you run out of room—or worse, miss the window altogether.

What Most Retirees Will Do (And Why That’s a Problem)

Most people will hear about these changes and do… nothing.

They’ll assume their current plan is “good enough” or put off acting until it’s too late. They’ll miss the strategic opportunity and find themselves paying thousands more in taxes later because they didn’t move money when they had the chance.

In 2029, they’ll wonder what happened. You don’t want to be in that boat.

Key Moves to Consider in This Four-Year Window

You don’t need to overhaul your entire retirement plan—but you do need to make intentional moves in this critical four-year period. Here’s where to start:

1. Roth Conversions While Brackets Are Low

Move money out of traditional IRAs into Roth accounts while staying in lower brackets.

  • Use your $46,700+ deduction to shelter more income

  • Avoid higher RMDs and Social Security taxation later

2. Harvest Gains in Taxable Accounts

Sell appreciated stocks or funds now to lock in gains with minimal taxes.

  • Reset your cost basis

  • Reduce future capital gains exposure

3. Coordinate Withdrawals Across Accounts

Balance income from Social Security, pensions, IRAs, and brokerage accounts.

  • Avoid income spikes

  • Keep Medicare premiums in check

  • Stay under phaseout thresholds

4. Map a Multi-Year Strategy

Don’t front-load all your moves into 2025. The smart play is to strategically distribute actions across 2025–2028 to optimize each year’s brackets and deductions.

Why This Matters for Your Future

The goal isn’t just to save money in the next four years. It’s to protect your income for the next three decades.

  • Every dollar you move from taxable to tax-free is a dollar that’s never taxed again

  • Every capital gain you realize in this window is money that stays in your pocket

  • Every RMD you reduce protects you from higher taxes in your 70s and 80s

Think of it this way: You’ve been saving and investing for decades. Now is the moment to optimize what you keep—not just what you earned.

⚠️ This Is Not a Drill: 2025 to 2028 Is a One-Time Opportunity

The Senior Bonus Deduction vanishes after 2028. The enhanced deductions may not last either.

You’ve got a clear timeline. You know the rules. The only question is: Will you act on them?

Your Next Step

Don’t wait until 2027. Start designing your tax strategy now.

✅ Review your current income, tax bracket, and account balances
✅ Project where you’ll be in 10, 20, and 30 years
✅ Work with a professional who understands how to model Roth conversions, gain harvesting, and deduction optimization across multiple years

Because what you do between 2025 and 2028 could determine how much of your retirement you get to enjoy—and how much goes to Uncle Sam.

*This blog post is based on the insights shared by Gudorf Financial Group. For personalized advice tailored to your unique circumstances, always consult a financial, legal, or tax professional.*

Transcript: Prefer to Read — Click to Open


Danny (00:00.13)

The new tax law just got signed and if you’re retired or getting close to retirement, this changes everything about how you should think about your money for the next four years. I’m talking about a window of opportunity that could save you tens of thousands of dollars in taxes, but only if you act before it closes in 2028. Most people are going to miss this completely because they don’t understand what just changed and why the clock is ticking.

Here’s what everyone needs to know right now. The new tax all creates a four year planning window from 2025 through 2028, where certain tax benefits are available that won’t be there forever. We’re talking about the senior bonus deduction and expanded standard deduction limits that are temporary and not permanent. After 2028, these opportunities disappear.

That means you have exactly four years to take advantage of what could be the biggest tax planning opportunity of your lifetime. Let me break down what actually changed and why this matters so much for your retirement plan. The biggest change is that the lower tax brackets and larger standard deduction are now permanent. Before this law was passed, most retirement planning experts assumed the 2017 Tax Cuts and Jobs Act

would expire at the end of 2025. That would have meant the 12 % bracket jumping all the way up to 15 and the 22 % bracket back to the 25 % and the 24 % bracket back to 28%. At the same time, the standard deduction would have shrunk and personal exemptions would have returned. All of that combined would have resulted in a tax increases

for about 62 % of Americans. The new law removes that uncertainty completely. But here’s where it gets really interesting for retirees. The standard deduction isn’t just staying at current levels. It’s actually being enhanced starting this year in 2025. The standard deduction increases by $1,500 for joint filers and $750 for single filers.

Danny (02:22.671)

That brings the standard deduction up to $31,500 for married couples who are filing jointly and $15,750 for single filers. And if you’re over the age of 65, you get additional deduction on top of that. It’s going to be $1,600 per qualifying spouse if you’re married and filing jointly and $2,000 if you’re single and over the age of 65.

So in total, a married couple filing jointly with both spouses over 65 will have a standard deduction of $34,700 in 2025. And a single filer over the age of 65 gets a standard deduction of $17,750. In real terms, that means nearly $35,000 of income for a retired couple would be completely shielded from federal tax before any other

deductions or credits even come into the picture. If that couple had income of a hundred thousand dollars, only 65,000 of it would be considered taxable income. Now here is the game changer. There’s a brand new senior bonus deduction that was passed in the new tax bill. That’s completely separate from everything else that I just mentioned. Starting in 2025, the new deduction is $6,000 per qualifying individual

over the age of 65. For a married couple where both spouses qualify, that’s up to $12,000 in additional deductions. What makes this especially valuable is that it applies whether you itemize or not. If you itemize, you add this deduction on top of your itemized deductions. But for most people who take this standard deduction, the bonus stacks right on top of the standard deduction.

For 2025, the effective standard deduction for married couples over age 65 will be around $46,700. That’s $31,500 for the standard deduction, $3,200 for the regular over 65 increase in standard deduction, and the $12,000 from the senior bonus deduction. But there are two more critical things that you need to know about how this senior bonus deduction works. First,

Danny (04:47.627)

it starts to phase out once your income gets over certain levels. That phase out starts at about $75,000 for single filers and $150,000 for people who are married filing jointly. Second, this is only available for tax years from 2025 through 2028. We’re looking at a four-year planning window and this window isn’t

just something to note, it’s something that you really need to plan around. For many retirees, this creates a rare opportunity to lower your lifetime tax bill by making smart moves while these deductions are available. If you’re considering Roth conversions, the next four years could be your sweet spot. With the enhanced standard deduction and the senior bonus deduction, you can convert more to Roth

while keeping your taxable income in a lower bracket. In some cases, you might not trigger any federal taxes at all. So maybe you’ve been holding appreciated investments in a taxable brokerage account. This window also gives you a chance to harvest some of those gains and reset your cost basis, possibly while paying little or no tax because your standard deduction is much higher.

If you’re coordinating withdrawals from accounts like IRAs, this could be ideal time to smooth out your income and avoid future tax spikes and make your required minimum distributions more manageable down the road. Think about it this way. Right now you have a tax free zone that’s bigger than it’s ever been and bigger than it will be after 2028. That’s your opportunity to move money around, convert

accounts and position yourself for lower taxes throughout the rest of your retirement. But you can’t wait until 2027 or 2028 to start thinking about this. The best strategies require planning and execution over multiple years. Let me give you a real example of how this could work. Say you’re a married couple over 65 with $100,000 in annual income under the new law with your enhanced standard deduction.

Danny (07:07.44)

of $46,700, only $53,300 of that income would be taxable. That puts you squarely in the 12 % tax bracket with plenty of room to do additional planning. You could potentially do a $20,000 Roth conversion and still stay in that same 12 % bracket. Over four years, that’s $80,000 you can move forward and move from the taxable

to the tax free account while rates are low and your deductions are high. But here’s what most people will do instead. They’ll hear about these changes, think it sounds good, and then do nothing. They’ll assume their current plan is fine or that they’ll deal with it later. By the time they realize what they’ve missed, it will be 2029 and the window will be closed. Don’t let that be you. The key is understanding.

that this isn’t about one year of tax savings. This is about position yourself for the next 20 or 30 years of retirement. Every dollar you can move from a taxable account to a tax free account during this window is a dollar that will never be taxed again. Every gain you can harvest at low or 0 % tax rates is money that stays in your pocket instead of going to the government. You also

need to think about required minimum distributions. If you have large 401k balances, traditional IRAs or 401ks, those are going to create mandatory withdrawals starting at age 73 or 75. Those withdrawals are taxed as ordinary income and they can push you into higher tax brackets, making more of your social security taxable and even increasing your Medicare premiums. But,

If you use this four year window to strategically convert some of those funds to Roth accounts, you can potentially reduce those further required minimum distributions and keep more control of your tax situation. The math on this is compelling, but it requires action. You can’t just hope for the best or assume everything will work out. You need to have a plan that takes advantage of this window while it’s open. That means

Danny (09:25.328)

looking at your current tax situation, projecting your future income needs and figuring out the optimal way to use these enhanced deductions to lower your tax rates. This is also about timing within these four years. You don’t want to do everything in 2025 and then have nothing left to optimize in 2026, 2027 or in 2028. The best approach is usually to spread the planning out.

across all four years, taking advantage of the deductions each year while managing your overall tax bracket. Remember, once 2028 ends, this window closes. The senior bonus deduction goes away. The enhanced standard deduction levels might not continue as well. You’ll be back to whatever the standard tax rules are at the time. That’s why I say retirees can’t afford

to miss the next four years. This is your chance to optimize decades of future tax savings, but only if you act while the opportunity exists. Whether you’re already retired or getting close to it, now is the time to take a fresh look at your tax strategy. Put this window to work. Don’t wait until it’s too late. The next four years could determine how much of your retirement income you get to keep versus

how much you send to the government. Make sure you’re on the right side of this equation. Now that you understand this four year window, you’ll want to know exactly how to coordinate your different account withdrawals to maximize the tax benefits throughout retirement. I’ll show you specific strategies that can help you take full advantage of these opportunities. In this next video right here, how to legally pay 0 % capital gains on $100,000 of retirement income.

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