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| Actuarial Publications |
Summary of Provisions That Would Change the Social Security Program |
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Description of Proposed Provisions:
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Estimates based on the intermediate assumptions of the 2009 Trustees Report
| Change from present law | Results with this provision | |||||
|---|---|---|---|---|---|---|
| Long-range actuarial balance |
Annual balance in 75th year |
Long-range actuarial balance |
Annual balance in 75th year |
|||
| Present Law, Alternative II. |
-2.00 | -4.34 | ||||
| E1.1 | Raise payroll tax rates
(for employees and employers combined) by 2.2 percentage points
in 2010 and later. graph | table | pdf-graph | pdf-table | memo |
2.09 | 2.19 | 0.09 | -2.15 | |
| E1.2 | Raise payroll tax rates (for employees
and employers combined) by 2.0 percentage points in 2022 (to 14.4%
combined) and by an additional 2.0 percentage points in 2052
(to 16.4% combined). graph | table | pdf-graph | pdf-table | memo |
2.06 | 3.92 | 0.06 | -0.42 | |
| E1.3 | Beginning in 2010, reduce the combined
OASDI payroll tax rate from 12.4 percent to 11.4 percent.
graph | table | pdf-graph | pdf-table | memo |
-0.96 | -1.01 | -2.96 | -5.35 | |
| E1.4 |
Raise the payroll tax rates gradually (for employees and employers
combined) by 0.1 percentage points in 2015; continue this increase
each year for 20 years. By 2034, the combined employee and employer
payroll tax rate would be 14.4 percent.
graph | table | pdf-graph | pdf-table | memo |
1.39 | 1.98 | -0.62 | -2.36 | |
| E1.5 |
Increase the payroll tax rate (currently 12.4 percent) to 12.6 percent
in 2012, 12.9 percent in 2020, 13.1 in percent in 2030, 13.9 percent in
2040, 13.5 percent in 2050, and 13.3 percent in 2060.
graph | table | pdf-graph | pdf-table | memo |
0.73 | 0.91 | -1.28 | -3.43 | |
| E1.6 |
Increase the payroll tax rate (currently 12.4 percent) to 12.6 percent
in 2012, 12.9 percent in 2020, 13.3 in percent in 2030, 13.8 percent in
2040, 14.4 percent in 2060, and 14.5 percent in 2075.
graph | table | pdf-graph | pdf-table | memo |
1.02 | 2.07 | -0.98 | -2.27 | |
| E1.7 |
Increase the payroll tax rate (currently 12.4 percent) to 12.7 percent in 2012,
13.0 percent in 2025, 13.3 in percent in 2040, 14.0 percent in 2060, 14.5 percent
in 2070, and 14.7 percent in 2080.
graph | table | pdf-graph | pdf-table | memo |
0.83 | 2.25 | -1.17 | -2.09 | |
| E2.1 | Beginning in 2010, make
all earnings subject to the payroll tax (but retain the current-law
taxable maximum for benefit calculations). graph | table | pdf-graph | pdf-table | memo |
2.32 | 2.49 | 0.31 | -1.86 | |
| E2.2 | Beginning in 2010, make all earnings
subject to the payroll tax and credit them for benefit purposes. graph | table | pdf-graph | pdf-table | memo |
1.89 | 1.65 | -0.11 | -2.69 | |
| E2.3 |
Determine the level of the contribution and benefit base such that
90 percent of the earnings would be subject to the payroll tax
(phased in 2010-2019). All earnings subject to the payroll tax
would be used in determining benefits. graph | table | pdf-graph | pdf-table | memo |
0.75 | 0.62 | -1.25 | -3.72 | |
| E2.4 |
Make 90% of the earnings subject to the payroll tax (phased in
2010-2019), but retain the current-law taxable maximum for
benefit purposes. This estimate considers all self-employed
earnings in computing the percentage of earnings subject to
the payroll tax. graph | table | pdf-graph | pdf-table | memo |
0.94 | 1.07 | -1.06 | -3.27 | |
| E2.5 |
Raise the taxable maximum amount (the contribution and benefit base)
to include 90 percent of total OASDI covered earnings. Phase in
this increase gradually between 2011 and 2016. Benefit
computations would reflect all earnings up to the new taxable
maximum.
graph | table | pdf-graph | pdf-table | memo |
0.74 | 0.61 | -1.26 | -3.73 | |
| E2.6 |
Impose a 3 percent payroll tax on OASDI covered earnings above
the current taxable maximum starting in 2010. Benefit
computations would not reflect any earnings above the taxable
maximum amount.
graph | table | pdf-graph | pdf-table | memo |
0.57 | 0.61 | -1.44 | -3.73 | |
| E2.7 |
In 2010 through 2012, raise the OASDI contribution and benefit
base from $106,800 to $115,200 (in 2009 AWI indexed dollars). For
years after 2012, the contribution and benefit base would be increased
based on changes in SSA's average wage index. Additional earnings
subject to the OASDI payroll tax would be credited for benefit
calculation purposes.
graph | table | pdf-graph | pdf-table | memo |
0.11 | 0.08 | -1.89 | -4.26 | |
| E2.8 |
Impose a 6 percent payroll tax on OASDI covered earnings above
the current taxable maximum starting in 2010. Benefit
computations would not reflect any earnings above the taxable
maximum amount.
graph | table | pdf-graph | pdf-table | memo |
1.12 | 1.20 | -0.88 | -3.14 | |
| E2.9 |
Beginning in 2010, make all earnings subject to the OASDI payroll
tax and give benefit credit using an PIA formula that is extended to
provide less credit for those with AIMEs higher than the current-law
maximum AIME level. The high end of the benefit formula, applied to
2009, would be: 15 percent of AIME between $4,482 and $8,900
($106,800 divided by 12), plus 3 percent of AIME over $8,900.
graph | table | pdf-graph | pdf-table | memo |
2.17 | 2.19 | 0.16 | -2.15 | |
| E2.10 |
Beginning in 2010, raise the taxable maximum each year by an
additional 2 percent over the current-law, wage-indexed amount until
total earnings subject to payroll taxes equals 90 percent of all
covered earnings. Credit the earnings for benefit purposes.
graph | table | pdf-graph | pdf-table | memo |
0.60 | 0.65 | -1.41 | -3.69 | |
| E2.11 |
Make all earnings subject to the employer OASDI payroll tax
beginning in 2010. For the employee OASDI payroll tax and for
benefit calculation purposes, the taxable maximum would equal the
present-law taxable maximum for years 2009 and earlier. Beginning in
2010, the taxable maximum would be raised each year by an additional
2 percent over the current-law, wage-indexed amount until earnings
subject to payroll taxes equals 90 percent of all covered earnings.
graph | table | pdf-graph | pdf-table | memo |
1.41 | 1.39 | -0.60 | -2.95 | |
| E2.12 |
Apply the following payroll tax rate above the current-law
taxable maximum, with no credit toward benefits: 2.0 percent in 2012
and 3.0 percent in 2060.
graph | table | pdf-graph | pdf-table | memo |
0.41 | 0.60 | -1.59 | -3.74 | |
| E2.13 |
Increase the taxable maximum (contribution and benefit base) increases
by an additional 2 percent over normal indexing starting in 2012, until
90 percent of OASDI covered earnings is taxable (achieved in 2048).
The present-law taxable maximum is retained for benefit purposes; no
benefit credit is given for earnings above the present-law taxable maximum.
graph | table | pdf-graph | pdf-table | memo |
0.69 | 1.06 | -1.31 | -3.28 | |
| E2.14 |
Apply the following payroll tax rates above the current-law taxable
maximum, with no credit toward benefits: 2.0 percent in 2012, 3.0
percent in 2025, 3.5 percent in 2040, 4.5 percent in 2050, and 5.5
percent in 2060.
graph | table | pdf-graph | pdf-table | memo |
0.65 | 1.10 | -1.35 | -3.24 | |
| E2.15 |
Apply 2 percent payroll tax rate on earnings over $200,000 in 2017,
with the $200,000 threshold wage-indexed after 2017. Give proportional
benefit credit for additional earnings in AIME for benefit computation.
graph | table | pdf-graph | pdf-table | memo |
0.19 | 0.16 | -1.81 | -4.18 | |
| E2.16 |
Apply 2 percent payroll tax rate on earnings over $200,000 in 2017,
with the $200,000 threshold wage-indexed after 2017. Give no
benefit credit for additional earnings in AIME for benefit computation.
graph | table | pdf-graph | pdf-table | memo |
0.24 | 0.30 | -1.76 | -4.04 | |
| E2.17 |
Apply 3 percent payroll tax rate on earnings over $200,000 in 2017,
with the $200,000 threshold wage-indexed after 2017. Give proportional
benefit credit for additional earnings in AIME for benefit computation.
graph | table | pdf-graph | pdf-table | memo |
0.29 | 0.25 | -1.71 | -4.09 | |
| E2.18 |
Apply 3 percent payroll tax rate on earnings over $200,000 in
2017, with the $200,000 threshold wage-indexed after 2017. Give
no benefit credit for additional earnings in AIME for benefit computation.
graph | table | pdf-graph | pdf-table | memo |
0.37 | 0.45 | -1.63 | -3.89 | |
| E2.19 |
Apply 4 percent payroll tax rate on earnings over $200,000 in 2017,
with the $200,000 threshold wage-indexed after 2017. Give proportional
benefit credit for additional earnings in AIME for benefit computation.
graph | table | pdf-graph | pdf-table | memo |
0.39 | 0.34 | -1.61 | -4.00 | |
| E2.20 |
Apply 4 percent payroll tax rate on earnings over $200,000 in 2017,
with the $200,000 threshold wage-indexed after 2017. Give no benefit
credit for additional earnings in AIME for benefit computation.
graph | table | pdf-graph | pdf-table | memo |
0.49 | 0.61 | -1.51 | -3.73 | |
| E2.21 |
Apply 2 percent payroll tax rate on earnings over $300,000 in 2017,
with the $300,000 threshold wage-indexed after 2017. Give
proportional benefit credit for additional earnings in AIME for
benefit computation.
graph | table | pdf-graph | pdf-table | memo |
0.14 | 0.12 | -1.86 | -4.22 | |
| E2.22 |
Apply 2 percent payroll tax rate on earnings over $300,000 in 2017,
with the $300,000 threshold wage-indexed after 2017. Give no benefit
credit for additional earnings in AIME for benefit computation.
graph | table | pdf-graph | pdf-table | memo |
0.18 | 0.23 | -1.82 | -4.11 | |
| E2.23 |
Apply 3 percent payroll tax rate on earnings over $300,000 in 2017,
with the $300,000 threshold wage-indexed after 2017. Give proportional
benefit credit for additional earnings in AIME for benefit computation.
graph | table | pdf-graph | pdf-table | memo |
0.21 | 0.19 | -1.79 | -4.16 | |
| E2.24 |
Apply 3 percent payroll tax rate on earnings over $300,000 in 2017,
with the $300,000 threshold wage-indexed after 2017. Give no
benefit credit for additional earnings in AIME for benefit computation.
graph | table | pdf-graph | pdf-table | memo |
0.27 | 0.34 | -1.73 | -4.00 | |
| E2.25 |
Apply 4 percent payroll tax rate on earnings over $300,000 in 2017,
with the $300,000 threshold wage-indexed after 2017. Give proportional
benefit credit for additional earnings in AIME for benefit computation.
graph | table | pdf-graph | pdf-table | memo |
0.29 | 0.25 | -1.72 | -4.09 | |
| E2.26 |
Apply 4 percent payroll tax rate on earnings over $300,000 in 2017,
with the $300,000 threshold wage-indexed after 2017. Give no benefit
credit for additional earnings in AIME for benefit computation.
graph | table | pdf-graph | pdf-table | memo |
0.36 | 0.45 | -1.64 | -3.89 | |
| E2.27 |
Apply 2 percent payroll tax rate on earnings over $400,000 in 2017,
with the $400,000 threshold wage-indexed after 2017. Give proportional
benefit credit for additional earnings in AIME for benefit computation.
graph | table | pdf-graph | pdf-table | memo |
0.12 | 0.10 | -1.89 | -4.24 | |
| E2.28 |
Apply 2 percent payroll tax rate on earnings over $400,000 in 2017,
with the $400,000 threshold wage-indexed after 2017. Give no benefit
credit for additional earnings in AIME for benefit computation.
graph | table | pdf-graph | pdf-table | memo |
0.15 | 0.18 | -1.85 | -4.16 | |
| E2.29 |
Apply 3 percent payroll tax rate on earnings over $400,000 in 2017,
with the $400,000 threshold wage-indexed after 2017. Give proportional
benefit credit for additional earnings in AIME for benefit computation.
graph | table | pdf-graph | pdf-table | memo |
0.17 | 0.15 | -1.83 | -4.19 | |
| E2.30 |
Apply 3 percent payroll tax rate on earnings over $400,000 in 2017,
with the $400,000 threshold wage-indexed after 2017. Give no benefit
credit for additional earnings in AIME for benefit computation.
graph | table | pdf-graph | pdf-table | memo |
0.22 | 0.28 | -1.78 | -4.06 | |
| E2.31 |
Apply 4 percent payroll tax rate on earnings over $400,000 in 2017,
with the $400,000 threshold wage-indexed after 2017. Give proportional
benefit credit for additional earnings in AIME for benefit computation.
graph | table | pdf-graph | pdf-table | memo |
0.23 | 0.20 | -1.77 | -4.14 | |
| E2.32 |
Apply 4 percent payroll tax rate on earnings over $400,000 in 2017,
with the $400,000 threshold wage-indexed after 2017. Give no benefit
credit for earnings in AIME for benefit computation.
graph | table | pdf-graph | pdf-table | memo |
0.30 | 0.37 | -1.71 | -3.97 | |
| E2.33 |
Make 90% of the earnings subject to the payroll tax (phased in 2010-2019).
In addition, apply a tax rate of 6.2 percent for earnings above the
revised taxable maximum, phased in from 2010-2019. This additional tax
rate would be paid by employers on wages of their employees, and by
self-employed workers on their earnings. Benefit computations for
workers would only reflect earnings below the revised taxable maximum.
graph | table | pdf-graph | pdf-table | memo |
1.37 | 1.36 | -0.63 | -2.98 | |
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