Overview of the Social Security Taxable Earnings Base
The Congressional Research Service is out with a document this past week that provides a broad overview of the Social Security Taxable Earnings Base. Some history of the amounts over time is included. The issue makes news when reform proposals to shore up Social Security are discussed by politicians. Debate tends to center on whether added taxes paid over the cap (currently $160,200) would count toward future benefits. The article covers this topic near the end. “Raising or removing the taxable earnings base could reduce Social Security’s long-term deficit (i.e., improve the long-term solvency of the program). The full impact of the policy change would depend on whether the earnings above the current-law maximum would also be counted toward benefits.” The full two page document is here.