Social Security Expansion: Benefit Adjustments and Fund Stability
This act aims to enhance Social Security benefits by adjusting the calculation formula and ensuring the program's long-term solvency. It introduces a new inflation index for seniors, extends eligibility for full-time students up to age 22, and modifies tax rules for earnings above $250,000 and investment gains. Additionally, it merges the two existing trust funds into a single Social Security Trust Fund.
Key points
Benefit Formula Adjustment: The bill increases the first bend point factor in the primary insurance amount formula from 90% to 95% and increases a specific calculation component by 22% for individuals becoming eligible after 2022.
New Cost-of-Living Index: The Consumer Price Index for Elderly Consumers (CPI-E) will be used to calculate annual cost-of-living adjustments (COLA).
Higher Minimum Benefits: Low-income earners with at least 11 years of work will receive increased minimum benefits based on a new percentage table.
Student Support Extension: Children of entitled or deceased individuals may receive benefits until age 22 if they are full-time students at an educational institution.
Tax Changes: A payroll and self-employment tax applies to remuneration above $250,000, and the tax on investment gain is increased from 3.8% to 16.2%.
Unified Social Security Trust Fund: The Federal Old-Age and Survivors Insurance Trust Fund and the Federal Disability Insurance Trust Fund will be merged into a single Social Security Trust Fund.
Status:
Expired
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