For quite a while now we’ve been reading the reports from the Social Security Administration’s reviews of the status of the trust fund – where the prediction is that we’ll end up in the year 2033 with only enough money to pay 77¢ on the dollar of the promised benefits from Social Security. So far this revelation has not resulted in policymakers’ taking any actual steps to fix things, but sometime someone has to act. What can be done about fixing Social Security?
social security tax
2013 Social Security Wage Base Projected
jb update 10/16/2012: The wage base for 2013 was confirmed at $113,700. The Social Security Administration trustees recently projected the wage base for 2013. This is the maximum amount of wage income that an individual earns for the year that is subject to Social Security withholding tax. For 2013, this amount is projected at $113,700. The new amount is $3,600 more than the 2012 wage base, which is set at $110,100, for an increase of 3.27%. Keep in mind that this is only the increase in the taxed wage base, and there is little correlation between this and any potential increase in benefits for the year. Future years’ estimated wage bases are projected as follows: 2014: $117,900 2015: $123,000 2016: $128,400 These are only projections, each year in October the SSA trustees will set the amount for the coming year.
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Don’t Forget – Social Security Tax is Going Up Next Year!
Image via Wikipedia This year you may have been blissfully enjoying an increase in your paycheck without realizing it. Remember the Tax Act of 2010? One of the provisions in that little gem of legislation was to reduce the Social Security withholding amount for the calendar year 2011 by 2%. This means that you’re only having to pay out 4.2% for Social Security tax during the 2011 tax year – and next year you’ll back back in the 6.2% world. But that’s not where it stops. There is another increase in the offing for 2012: the tax wage ceiling is scheduled to increase as well, from the $106,800 level that it’s been at for the past two years, to an estimated $110,100. This means that if you’re at the top of the wage base, your withholding and employer portion of Social Security tax will increase from $11,107 in 2011 to […]
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Proposed Social Security Wage Base Increases
October 19, 2011 update: the expected wage base increase has been confirmed as $110,100 for 2012. For more information, see this article. The Social Security Administration has released the proposed figures for the increase in the wage base for taxation for 2012 and projected some figures for the years up to 2015. This is the limited amount of income against which Social Security withholding tax is applied. For 2009 through 2011, the wage base has been static – at $106,800 for each year. The amount did not increase for these years since the average wage index (AWI) actually decreased from 2008 to 2009, and the modest increase in the index from 2009 to 2010 did not make up for the decrease in the prior year. For 2011, the AWI is expected to increase once again, by 3.08%. This sets the projected wage base for 2012 at $110,100, up a total of […]
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