Cost-of-Living Adjustment (COLA) Information for 2017
Monthly Social Security and Supplemental Security Income (SSI) benefits for more than 65 million Americans will increase 0.3 percent in 2017.
The 0.3 percent cost-of-living adjustment (COLA) will begin with benefits payable to more than 60 million Social Security beneficiaries in January 2017. Increased payments to more than 8 million SSI beneficiaries will begin on December 30, 2016.
Read more about the Social Security Cost-of-Living adjustment for 2017.
The maximum amount of earnings subject to the Social Security tax (taxable maximum) will increase to $127,200.
The earnings limit for workers who are younger than "full" retirement age (age 66 for people born in 1943 through 1954) will increase to $16,920. (We deduct $1 from benefits for each $2 earned over $16,920.)
The earnings limit for people turning 66 in 2017 will increase to $44,880. (We deduct $1 from benefits for each $3 earned over $44,880 until the month the worker turns age 66.)
There is no limit on earnings for workers who are "full" retirement age or older for the entire year.
Read more about the COLA, tax, benefit and earning amounts for 2017.
Information about Medicare changes for 2017, when announced, will be available at www.Medicare.gov. For some beneficiaries, their Social Security increase may be partially or completely offset by increases in Medicare premiums.
History of Automatic Cost-Of-Living Adjustments (COLA)
The purpose of the COLA is to ensure that the purchasing power of Social Security and Supplemental Security Income (SSI) benefits is not eroded by inflation. It is based on the percentage increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) from the third quarter of the last year a COLA was determined to the third quarter of the current year. If there is no increase, there can be no COLA.
The CPI-W is determined by the Bureau of Labor Statistics in the Department of Labor. By law, it is the official measure used by the Social Security Administration to calculate COLAs.
Congress enacted the COLA provision as part of the 1972 Social Security Amendments, and automatic annual COLAs began in 1975. Before that, benefits were increased only when Congress enacted special legislation.
Beginning in 1975, Social Security started automatic annual cost-of-living allowances. The change was enacted by legislation that ties COLAs to the annual increase in the Consumer Price Index (CPI-W).
The change means that inflation no longer drains value from Social Security benefits.
The 1975-82 COLAs were effective with Social Security benefits payable for June (received by beneficiaries in July) in each of those years. After 1982, COLAs have been effective with benefits payable for December (received by beneficiaries in January).
July 1975 -- 8.0%
January 1997 -- 2.9%
|(1) The COLA for December 1999 was originally determined as 2.4 percent based on
CPIs published by the Bureau of Labor Statistics. Pursuant to Public Law