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Center for Economic and Policy Research
A breakdown of worker wages.
One of the proposals for keeping Social Security afloat is to simply ask for more money.
It turns out, not that many taxpayers would have to pay up.
A new analysis from the Center for Economic and Policy Research finds that less than 6 percent of workers would be affected if the government lifted the cap on Social Security taxes and applied it to earnings above $106,800.
Currently, taxpayers pay their share of Social Security taxes only on earnings up to $106,800. Any earnings above that are exempt from the tax.
Another plan that’s been tossed around would be to just charge Social Security tax on earnings of more than $250,000, but not to charge the tax on earnings between $106,800 and $250,000.
That plan would affect a little more than 1 percent of workers, the liberal-leaning think tank found in its analysis of the most recent American Community Survey data.
The move could potentially add trillions of dollars to Social Security coffers over the next 75 years, according to CEPR.
Social Security is at risk of becoming underfunded because the big Baby Boom generation is aging and people are generally living longer.
Other proposals for fixing Social Security include raising the age of eligibility and slowing cost of living increases.
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Leave a Comment:
Absolutely--it's almost a ridiculous question..why if you make more money than poor the poor Joe you pay less? Either equal contributions for everyone, or use a sliding scale....
If he income threshold is raised, the payments to those paying in more should be raised.... which is a net gain of ZERO.
The smartest thing is to raise the SS tax from 3% to 6% and keep the cap the same. That way the 94% of Americans who need SS the most are the ones to pay for it, and it stops SS from being a totally socialist tool. This is still a capitilistic economy.
Stop payments to anyone who has gotten back more than they put in based on an interest rate of 3%.
Stop payments to anyone who did not pay in.
sAyItLiKeItIs makes an important point. If the limit is lifted then the $200K earner will pay twice as much as the $100k earner. Will the $200k guy receive twice as much in benefits?
If not, how can you justify having him pay more?
Those that make $100k a year already pay in twice that of someone making $50k, but they are still paid the same amount once they retire. I highly doubt this policy will change, but, you never know. Take those extra earnings and invest in stocks, or a money market account, or heck, even a jar that you bury under your house, choose your risk level. If you're making 6 figures and counting on Social Security to pay for your expenses when you retire, you have another thing coming.
I would like to see an "opt out" box when filing my tax forms. Can I choose to not to pay into a system I may never see a return from and allow independent thinking for my own financial stability?
Why would you say that?
Right from SSA.gov
The top of the food chain is getting away with murder, make them pay for being so greedy, this includes corporations and banking institutions
If there is no cap for 'pay-in' then there shouldn't be a cap for 'pay-out'.
You just can't have it both ways...Just keep it fair. The people who make more than $106k already pay more in than they will ever get back out WITH the current system.
It's a tax and all taxes should be paid by every one. The cap is just another loophole that benefits the rich.
Honestly, I do not understand the people who are insisting more paid in should be more back. Social Security is designed as a safety net for people of retirement age. I understand that everybody receives it when eligible. That is also silly!
Social Security is not an alternative to playing the market...it is not a standard investment plan.
I pay my taxes and would happily pay more if required... By no means would I automatically think the government should give me more in return. Our company bookkeeper gave us the option to continue to pay the full amount a several of us do.
Then it should be a welfare program paid through federal taxes. I would rather donate the difference to charity.