2020 OASDI Trustees Report

 

B. TRUST FUND FINANCIAL OPERATIONS IN 2019

Table II.B1 shows the income, cost, and asset reserves for the OASI, the DI, and the combined OASI and DI Trust Funds in calendar year 2019.

Table II.B1.—Summary of 2019 Trust Fund Financial Operations

[In billions]

		OASI	DI	OASDI
Asset reserves at the end of 2018		$2,797.9	$97.1	$2,894.9
Total income in 2019 a		917.9	143.9	1,061.8
	Net payroll tax contributions	805.1	139.4	944.5
	Interest	77.9	2.9	80.8
	Taxation of benefits	34.9	1.6	36.5
Total cost in 2019		911.4	147.9	1,059.3
	Benefit payments	902.8	145.1	1,047.9
	Administrative expenses	3.7	2.7	6.4
	Railroad Retirement financial interchange	4.9	.1	4.9
Net increase in asset reserves in 2019		6.5	-4.0	2.5
Asset reserves at the end of 2019		2,804.3	93.1	2,897.4

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a

Includes less than $50 million in reimbursements from the General Fund of the Treasury and gifts. See section III.A for details.

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

In 2019, net payroll tax contributions accounted for 89.0 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 $132,900 in 2019. Table II.B2 shows the payroll tax rates for 2019.

Table II.B2.—Payroll Tax Contribution Rates for 2019

[In percent]

	OASI	DI	OASDI
Payroll tax contribution rate for employees	5.3	0.9	6.2
Payroll tax contribution rate for employers	5.3	.9	6.2
Payroll tax contribution rate for self-employed persons	10.6	1.8	12.4

Interest earned on invested trust fund asset reserves accounted for 7.6 percent of OASI and DI combined trust fund income in 2019. Revenue 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 received) exceeding specified levels accounted for 3.4 percent of OASDI income.

The Department of the Treasury invests all trust fund income in interest-bearing securities issued by the U.S. Government. In 2019, the combined trust fund reserves (the excess of all past income over all past expenditures) earned interest at an effective annual rate of 2.8 percent.

Retirement, survivor, and disability benefits accounted for 98.9 percent of OASI and DI combined trust fund cost in 2019. The expenses for administering the Social Security program were 0.6 percent of total cost. The net payment to the Railroad Retirement Social Security Equivalent Benefit Account from the combined OASI and DI Trust Funds accounted for 0.5 percent of total OASDI cost.

Trust fund reserves provide the basis for paying benefits. Combined trust fund reserves increased by $2.5 billion during 2019 because income to the combined funds, including interest earned on trust fund reserves, exceeded total cost. In last year’s report, combined reserves were projected to increase by $1.0 billion in 2019, and then start declining in 2020.¹ At the end of 2019, the combined reserves of the OASI and the DI Trust Funds were $2,897 billion, or 261 percent of estimated cost ¹ for 2020. In comparison, the combined reserves at the end of 2018 were 273 percent of actual cost for 2019.

 

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1

Estimated cost is based on the intermediate set of assumptions.