Is a Social Security Perpetuity Tax Coming? - AMAC & Fox Business

Ted Jenkin, CEO and co-founder of oXYGen Financial, writes for Fox Business that a Social Security tax on all of your income is a real possibility under a second Biden term. He notes Biden has called for putting the combined 12.4% FICA tax on incomes over $400k. Currently, the tax stops at $168,600 in wages, though that amount increases yearly, and thus the two would meet a some point. That’s the perpetuity tax. The author also notes spending and revenue as per below.

  1. Personal Income Tax (47% of U.S. revenue)
  2. Payroll Tax (Social Security and Medicare) (37% of U.S. revenue)
  3. Corporate Income Tax (9.5% of U.S. revenue)

Top four expenses:

  1. Medicare/Medicaid (24% of spending)
  2. Social Security (22% of spending)
  3. Defense (13% of spending)
  4. Net Interest on the Debt (11% of spending)

Full article here.

As an example of the leading thoughts on reforming Social Security, the Association of Mature American Citizens (AMAC, Inc.) believes Social Security must be preserved and modernized.  This can be achieved without tax increases by slight modifications to cost-of-living adjustments and payments to high-income beneficiaries plus gradually increasing the full (but not early) retirement age.  AMAC Action, AMAC’s advocacy arm, supports an increase in the threshold where benefits are taxed and then indexing for inflation, and calls for eliminating the reduction in people’s benefits for those choosing to work before full retirement age.  AMAC is resolute in its mission that Social Security be preserved for current and successive generations and has gotten the attention of lawmakers in D.C., meeting with many congressional offices and staff over the past decade. 

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