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Summary Measures and Graphs

Description of Proposed Provision:
Beginning in 2015, apply 4 percent payroll tax rate on earnings above $400,000 in 2015, with the threshold wage-indexed after 2015. Provide benefit credit for additional earnings taxed, using a secondary PIA formula. This secondary PIA formula involves: (1) an AIME+ derived from annual earnings taxed only between $400,000 and $500,000 (with thresholds wage-indexed after 2015); and (2) a formula factor of 2 percent on this newly computed AIME+.

Estimates based on the intermediate assumptions of the 2013 Trustees Report

Summary Measures
[As a percentage of taxable payroll]
Present Law 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
Long-range
actuarial
balance
Annual
balance in
75th year
-2.72 -4.77 0.32 0.34 -2.40 -4.42


graph of OASDI cost rates and income rates by year, under
                 present law and provision. click on graph to view underlying
                 data. graph of OASDI trust fund ratio by year, under present law
                 and provision. click on graph to view underlying data.
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Last reviewed or modified July 11, 2014