2014 OASDI Trustees Report

 

B. TRUST FUND FINANCIAL OPERATIONS IN 2013

Table II.B1 shows the income, expenditures, and asset reserves for the OASI, the DI, and the theoretical combined OASI and DI Trust Funds in calendar year 2013.

Table II.B1.—Summary of 2013 Trust Fund Financial Operations

[In billions]

		OASI	DI	OASDI
Asset reserves at the end of 2012		$2,609.7	$122.7	$2,732.3
Total income in 2013		743.8	111.2	855.0
	Net payroll tax contributions	620.8	105.4	726.2
	Reimbursement from General Fund of the Treasury	4.2	.7	4.9
	Taxation of benefits	20.7	.4	21.1
	Interest	98.1	4.7	102.8
Total expenditures in 2013		679.5	143.4	822.9
	Benefit payments	672.1	140.1	812.3
	Railroad Retirement financial interchange	3.9	.6	4.5
	Administrative expenses	3.4	2.8	6.2
Net increase in asset reserves in 2013		64.3	-32.2	32.1
Asset reserves at the end of 2013		2,674.0	90.4	2,764.4

Note: Totals do not necessarily equal the sums of rounded components.

In 2013, net payroll tax contributions accounted for 85 percent of total trust fund income. Net payroll tax contributions consist of taxes paid by employees, employers, and the self-employed on earnings covered by Social Security. These taxes are paid on covered earnings up to a specified maximum annual amount, which was $113,700 in 2013. Table II.B2 shows the tax rates for 2013.

In 2013, less than one percent of OASI and DI combined Trust Fund income came from reimbursements from the General Fund of the Treasury. Public Laws 111-312, 112-78, and 112-96 account for most of the reimbursement for the year. These acts specified general fund reimbursement for temporary reductions in revenue due to reduced payroll tax rates for employees and for self-employed workers.

Two percent of OASI and DI combined Trust Fund income in 2013 came from subjecting up to 50 percent of Social Security benefits to Federal personal income taxation for beneficiaries with income (including half of benefits and all non-taxable interest) exceeding specified levels. Interest earned on investment of trust fund asset reserves accounted for 12 percent of OASDI income. The Department of the Treasury invests trust fund reserves in interest-bearing securities issued by the U.S. Government. In 2013, the combined trust fund reserves earned interest at an effective annual rate of 3.8 percent.

Almost 99 percent of expenditures from the combined OASI and DI Trust Funds in 2013 were retirement, survivor, and disability benefits totaling $812.3 billion. The financial interchange with the Railroad Retirement program was the source of a net payment of $4.5 billion from the combined OASI and DI Trust Funds, which was about 0.5 percent of total expenditures. The administrative expenses of the Social Security program were $6.2 billion, which was about 0.7 percent of total expenditures.

The trust fund investments provide a reserve to pay benefits whenever total program cost exceeds income. Trust fund reserves increased by $32.1 billion in 2013 because total income to the combined funds, including interest earned on trust fund reserves, exceeded total expenditures. At the end of 2013, the combined reserves of the OASI and the DI Trust Funds were 320 percent of estimated expenditures¹ for 2014. In comparison, the combined reserves at the end of 2012 were 332 percent of expenditures for 2013.

Table II.B2.—Payroll Tax Contribution Rates for 2013

[In percent]

	OASI	DI	OASDI
Payroll tax contribution rate for employees	5.30	0.90	6.20
Payroll tax contribution rate for employers	5.30	.90	6.20
Payroll tax contribution rate for self-employed persons	10.60	1.80	12.40

 

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1

Estimated expenditures are based on the intermediate set of assumptions.