Description of Proposed Provision:
E2.14: Apply OASDI 12.4 percent payroll tax rate on earnings above $250,000 starting in 2021, and tax all earnings once the current-law taxable maximum exceeds $250,000. Provide benefit credit for earnings above the current-law taxable maximum that are subject to the payroll tax, using a secondary PIA formula. This secondary PIA formula involves: (1) an "AIME+" derived from annual earnings from each year after 2020 that were in excess of that year's current-law taxable maximum; and (2) a formula factor of 2 percent on this newly computed "AIME+".

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
201913.9112.85-1.06
273
0.000.000.00
202013.9412.87-1.07
260
0.000.000.00
202114.0914.300.21
245
0.001.401.40
202214.2314.430.20
239
-0.001.511.51
202314.3914.490.10
233
-0.001.551.55
202414.5814.57-0.02
226
-0.001.601.60
202514.7814.64-0.15
219
-0.001.651.65
202614.9914.81-0.17
212
-0.001.701.70
202715.1914.89-0.30
205
-0.001.761.76
202815.4314.99-0.44
198
-0.001.821.82
202915.6315.07-0.55
192
0.001.881.88
203015.8115.15-0.65
185
0.001.951.95
203115.9715.23-0.73
180
0.002.022.02
203216.1115.32-0.80
174
0.002.092.09
203316.2315.40-0.84
170
0.002.162.16
203416.3315.48-0.85
165
0.002.242.23
203516.4015.56-0.84
161
0.012.312.31
203616.4715.57-0.89
157
0.012.322.31
203716.5215.58-0.95
153
0.012.322.31
203816.5715.59-0.99
149
0.012.322.31
203916.6115.59-1.02
144
0.012.322.31
204016.6315.59-1.03
139
0.012.322.31
204116.6215.59-1.03
135
0.012.322.31
204216.6015.60-1.01
130
0.012.322.31
204316.5715.60-0.98
125
0.022.322.31
204416.5415.60-0.94
121
0.022.322.31
204516.5115.60-0.91
117
0.022.322.31
204616.4715.60-0.88
113
0.022.332.31
204716.4515.60-0.85
109
0.022.332.31
204816.4315.60-0.83
105
0.022.332.31
204916.4115.60-0.81
101
0.022.332.31
205016.3915.60-0.79
97
0.022.332.31
205116.3915.60-0.79
93
0.032.332.30
205216.3915.60-0.79
89
0.032.332.30
205316.4015.60-0.79
85
0.032.332.30
205416.4115.61-0.81
81
0.032.332.30
205516.4415.61-0.83
77
0.032.332.30
205616.4715.61-0.86
72
0.032.332.30
205716.5115.62-0.89
68
0.032.332.30
205816.5615.62-0.94
63
0.032.342.30
205916.6115.63-0.98
58
0.032.342.30
206016.6615.63-1.03
53
0.032.342.30
206116.7215.64-1.08
47
0.042.342.30
206216.7715.64-1.13
41
0.042.342.30
206316.8315.65-1.18
35
0.042.342.30
206416.8815.65-1.23
28
0.042.342.30
206516.9415.66-1.28
21
0.042.342.30
206616.9915.66-1.33
14
0.042.342.30
206717.0515.67-1.39
7
0.042.342.30
206817.1215.67-1.44
----
0.042.352.30
206917.1815.68-1.50
----
0.042.352.30
207017.2415.69-1.55
----
0.042.352.30
207117.2915.69-1.60
----
0.042.352.30
207217.3515.70-1.65
----
0.042.352.31
207317.3915.70-1.69
----
0.042.352.31
207417.4415.70-1.73
----
0.052.352.31
207517.4815.71-1.77
----
0.052.352.31
207617.5115.71-1.79
----
0.052.352.31
207717.5215.71-1.81
----
0.052.352.31
207817.5315.72-1.81
----
0.052.362.31
207917.5215.72-1.81
----
0.052.362.31
208017.5115.72-1.79
----
0.052.362.31
208117.4915.72-1.77
----
0.052.362.31
208217.4715.72-1.75
----
0.052.362.31
208317.4515.72-1.73
----
0.052.362.31
208417.4315.72-1.71
----
0.052.362.31
208517.4015.72-1.69
----
0.052.362.32
208617.3915.72-1.67
----
0.052.372.32
208717.3815.72-1.66
----
0.052.372.32
208817.3815.72-1.66
----
0.052.372.32
208917.3915.72-1.66
----
0.052.372.32
209017.4115.72-1.68
----
0.052.372.32
209117.4415.73-1.71
----
0.052.372.32
209217.4815.73-1.75
----
0.052.372.32
209317.5315.74-1.79
----
0.052.372.32
209417.5815.74-1.84
----
0.052.372.32


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
2019-2093 16.62% 15.97% -0.65%
2067
0.02% 2.16% 2.13%

1 Under current law, the year of Trust Fund reserve depletion is 2035.
Based on Intermediate Assumptions of the 2019 Trustees Report.