Description of Proposed Provision:
E3.12: Beginning in 2025, apply 2 percent payroll tax rate on earnings over the wage-indexed equivalent of $400,000 in 2017 (about $548,700 in 2025), with the threshold wage-indexed after 2025. Provide proportional benefit credit for additional earnings taxed, based on the payroll tax rate applied to the additional earnings divided by the full 12.4 percent payroll tax rate.

Financial Estimates for the OASDI Trust Fund Program

  Proposal   Change from Current Law
  Expressed as a percentage of
current-law taxable payroll

Trust fund
ratio as of
January 1
Expressed as a percentage of
current-law taxable payroll
Calendar
year
Cost
rate
Income
rate
Annual
balance

Cost
rate
Income
rate
Annual
balance
201713.4113.03-0.38
298
0.000.000.00
201813.4912.93-0.56
287
0.000.000.00
201913.7012.95-0.75
273
0.000.000.00
202013.8512.96-0.89
259
0.000.000.00
202114.0212.99-1.03
245
0.000.000.00
202214.2613.02-1.23
230
0.000.000.00
202314.5413.05-1.50
215
0.000.000.00
202414.8313.08-1.74
199
0.000.000.00
202515.1013.26-1.84
182
0.000.160.16
202615.3713.30-2.07
166
-0.000.170.17
202715.6213.32-2.30
150
-0.000.170.17
202815.8513.33-2.52
133
0.000.170.17
202916.0713.35-2.72
116
0.000.170.17
203016.2713.36-2.90
99
0.000.170.17
203116.4513.38-3.07
81
0.000.170.17
203216.6113.39-3.22
63
0.000.170.17
203316.7413.40-3.35
45
0.000.170.16
203416.8513.40-3.45
25
0.000.170.16
203516.9313.41-3.52
6
0.010.170.16
203617.0013.41-3.58
----
0.010.170.16
203717.0313.42-3.61
----
0.010.170.16
203817.0313.42-3.61
----
0.010.170.16
203917.0113.42-3.59
----
0.010.170.16
204016.9713.42-3.56
----
0.010.170.16
204116.9313.42-3.51
----
0.010.170.16
204216.8813.41-3.46
----
0.020.170.16
204316.8213.41-3.41
----
0.020.170.15
204416.7813.41-3.37
----
0.020.170.15
204516.7413.41-3.33
----
0.020.170.15
204616.7013.41-3.29
----
0.020.170.15
204716.6713.41-3.26
----
0.020.170.15
204816.6413.41-3.24
----
0.030.170.15
204916.6213.40-3.21
----
0.030.170.14
205016.6013.40-3.19
----
0.030.170.14
205116.5913.40-3.18
----
0.030.170.14
205216.5913.41-3.18
----
0.030.170.14
205316.6013.41-3.20
----
0.040.170.14
205416.6313.41-3.22
----
0.040.170.14
205516.6613.41-3.25
----
0.040.170.13
205616.7013.41-3.28
----
0.040.170.13
205716.7413.42-3.32
----
0.040.180.13
205816.7913.42-3.37
----
0.050.180.13
205916.8313.43-3.41
----
0.050.180.13
206016.8813.43-3.45
----
0.050.180.12
206116.9313.43-3.50
----
0.050.180.12
206216.9813.44-3.54
----
0.060.180.12
206317.0313.44-3.59
----
0.060.180.12
206417.0813.44-3.63
----
0.060.180.12
206517.1313.45-3.68
----
0.060.180.12
206617.1813.45-3.73
----
0.060.180.11
206717.2413.45-3.78
----
0.070.180.11
206817.2913.46-3.83
----
0.070.180.11
206917.3513.46-3.88
----
0.070.180.11
207017.4013.46-3.93
----
0.070.180.11
207117.4513.47-3.98
----
0.070.180.11
207217.4913.47-4.02
----
0.080.180.10
207317.5313.47-4.05
----
0.080.180.10
207417.5613.48-4.08
----
0.080.180.10
207517.5813.48-4.11
----
0.080.180.10
207617.6013.48-4.12
----
0.080.180.10
207717.6113.48-4.13
----
0.080.180.10
207817.6113.48-4.13
----
0.080.180.10
207917.6013.48-4.12
----
0.080.180.10
208017.6013.48-4.11
----
0.080.180.10
208117.5913.48-4.11
----
0.090.180.10
208217.5913.48-4.11
----
0.090.180.10
208317.6013.48-4.12
----
0.090.180.10
208417.6113.48-4.13
----
0.090.180.10
208517.6413.48-4.15
----
0.090.180.10
208617.6713.48-4.18
----
0.090.180.10
208717.7013.49-4.22
----
0.090.180.10
208817.7513.49-4.26
----
0.090.180.10
208917.7913.49-4.30
----
0.090.180.10
209017.8413.50-4.34
----
0.090.180.09
209117.8913.50-4.39
----
0.090.180.09
209217.9313.50-4.43
----
0.090.180.09


Summarized Estimates

  Proposal   Change from Current Law
Years Cost
rate
Income
rate
Actuarial
balance

Year of reserve
depletion
1

Cost
rate
Income
rate
Actuarial
balance
2017-2091 16.70% 13.99% -2.71%
2035
0.04% 0.15% 0.12%

1 Under current law, the year of Trust Fund reserve depletion is 2034.
Based on Intermediate Assumptions of the 2017 Trustees Report.