Will the Next Stimulus Package Hurt Social Security?
As lawmakers in Washington debate if and how to implement another economic stimulus package, one possible feature being considered is to temporarily suspend Social Security and Medicare payroll taxes. While this would mean a bigger take-home paycheck for employees and expense relief for employers, it would also hurt the Social Security and Medicare programs, which are already facing financial difficulties. Social Security and Medicare hospitalization benefits predominantly rely on payroll taxes to fund operations, and cutting off that funding, even temporarily, would exacerbate problems with the already threatened Trust Fund reserves. Lacking any offsetting measures by Congress, a payroll tax cut would mean depleting the Trust Funds earlier than now projected, resulting in benefit cuts sooner than currently forecast. All of this is discussed in this Mooresville (NC) Tribune article by Maurie Backman. Click here to read more.