Provisions Affecting OASDI Contribution and Benefit Base

Updated May 3, 2006

Introduction

These provisions modify the OASDI contribution and benefit base (taxable maximum). The OASDI contribution and benefit base serves the following two purposes:

As a contribution base, it establishes the maximum annual amount of covered earnings subject to OASDI payroll taxes.
As a benefit base, it establishes the maximal amount of earnings creditable for the purpose of benefit computation.

For the provisions listed below, we provide estimates of the financial effect on the OASDI program over the long-range period (the next 75 years) and for the 75th year. In addition, we provide detailed single year tables.

Tables and graphs are available in two formats: HTML and Portable Document Format (PDF). We recommend the PDF version for printing (requires Adobe Acrobat Reader).

The year of the Trustees Report identifies the assumptions (intermediate) used in the preparation of the estimates. Choose the type of estimates (summary or detailed) from the list of provisions.

Number	Table and graph selection
E1	Beginning in 2006, make all earnings subject to the payroll tax (but retain the current-law taxable maximum for benefit calculations). (2005 Trustees Report) Summary measures and graphs (PDF Version) Detailed Single Year Tables (PDF Version)
E2	Beginning in 2006, make all earnings subject to the payroll tax and credit them for benefit purposes. (2005 Trustees Report) Summary measures and graphs (PDF Version) Detailed Single Year Tables (PDF Version)
E3	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 2006-2015). All earnings subject to the payroll tax would be used in determining benefits. (2005 Trustees Report) Summary measures and graphs (PDF Version) Detailed Single Year Tables (PDF Version)
E4	Make 90% of the earnings subject to the payroll tax (phased in 2008-2017), 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. (2005 Trustees Report) Summary measures and graphs (PDF Version) Detailed Single Year Tables (PDF Version) Related memorandum
	Above provisions Summary measures


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