The Social Security Tax Cap
Currently, taxation for Social Security is capped on income at $118,500. This means that any amount over that number that you make is not liable to being taxed for Social Security purposes, there is only so much that you can pay in to Social Security before they stop taking your money. Amounts up to that level of income are subjected to a 6.2% tax rate and income based on investment is not taxed for Social Security at all. Some candidates propose removing the cap or changing the cap in order to help stave off the insolvency problem looming on the horizon for the Social Security program. In Sanders’s plan solvency would be extended from 2033 to 2065 by instating a soft cap between the incomes of $118,500 and $250,000 where earnings below the low end and above the high end would be subject to the tax. For more information on this subject, visit this article by Daniel Marans with MSN.
This posting is presented for informational purposes only and does not represent legal or financial guidance. Any opinions or interpretations presented are either those of the original author or, in the case of articles authored by the AMAC Foundation, are the opinions of AMAC Foundation staff, originally trained and accredited by the National Social Security Association (NSSA) and certified via the AMAC Foundation. Any links included in the article are valid on the posted date; socialsecurityreport.org cannot guarantee the duration of the links’ validity. NSSA and the AMAC Foundation and its staff are not affiliated with or endorsed by the Social Security Administration or any other governmental entity. To submit a question, visit our website (https://amacfoundation.org/services/) or email us at ssadvisor@amacfoundation.org. Because we are a non-profit organization, there is no charge for these services.