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Summary of Provisions That Would Change the Social Security Program |
Description of Proposed Provisions:
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Estimates based on the intermediate assumptions of the 2015 Trustees Report
Printer-friendly Version (PDF) |
Change from present law [percent of payroll] |
Shortfall eliminated | |||||
---|---|---|---|---|---|---|
Long-range actuarial balance |
Annual balance in 75th year |
Long-range actuarial balance |
Annual balance in 75th year |
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Present law shortfall in long-range actuarial balance is 2.68 percent of payroll and in annual balance for the 75th year is 4.65 percent of payroll. | ||||||
H1 |
Starting in 2016, tax Social Security benefits in a manner similar to private
pension income. Phase out the lower-income thresholds during 2016-2025.
graph | table | pdf-graph | pdf-table | memo (Social Security Advisory Board) |
0.21 | 0.15 | 8% | 3% | |
H2 |
Starting in 2016, tax Social Security benefits in a manner similar to private
pension income. Phase out the lower-income thresholds during 2016-2035.
graph | table | pdf-graph | pdf-table | memo (Warshawsky) |
0.19 | 0.15 | 7% | 3% | |
H3 |
Tax Reform for Individuals: Starting in 2017, modify personal income
tax by: (a) establishing two-brackets with marginal rates of 15 and 27 percent
separated at $51,000 (CPI indexed); (b) creating a non-refundable credit for
low-income tax filers age 65 and older; and (c) treating capital gains as
regular income. Tax all Social Security benefits at the applicable marginal
rate (15 or 27 percent) less 7.5 percent, with 60 percent of this revenue
going to OASDI and 40 percent going to HI.
graph | table | pdf-graph | pdf-table | memo (Bipartisan Policy Center) |
0.01 | -0.03 | 0% | -1% | |
H4 |
Increase the threshold for taxation of OASDI benefits to $50,000 for single
filers and $100,000 for joint filers starting in 2017. Taxation of benefits
revenues transferred to the Hospital Insurance (HI) Trust Fund would be the
same as if the current-law computation applied.
graph | table | pdf-graph | pdf-table | memo (Larson 2015) | memo (Larson 2014) |
-0.12 | -0.01 | -4% | 0% |
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