Description of Proposed Provision:
C1.5: Starting in 2019, allow workers to choose whether to have their payroll tax rate reduced by 2 percentage points. For each calendar year that a worker chooses to have their payroll tax reduced, their normal retirement age (NRA) increases 1 month. We assume 2/3 of workers each year will choose this payroll reduction. The General Fund of the Treasury reimburses the OASI and DI Trust Funds for the reduction in payroll tax revenue.
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 |
|||
| 2018 | 13.81 | 12.64 | -1.17 | 288 | 0.00 | 0.00 | 0.00 | ||
| 2019 | 13.95 | 12.87 | -1.08 | 272 | -0.00 | 0.00 | 0.00 | ||
| 2020 | 14.12 | 12.89 | -1.23 | 256 | -0.01 | 0.00 | 0.01 | ||
| 2021 | 14.26 | 12.92 | -1.34 | 240 | -0.02 | 0.00 | 0.02 | ||
| 2022 | 14.41 | 12.95 | -1.46 | 223 | -0.03 | 0.00 | 0.03 | ||
| 2023 | 14.58 | 12.97 | -1.62 | 206 | -0.04 | 0.00 | 0.04 | ||
| 2024 | 14.75 | 12.99 | -1.76 | 189 | -0.05 | -0.00 | 0.05 | ||
| 2025 | 14.92 | 13.01 | -1.92 | 173 | -0.06 | -0.00 | 0.06 | ||
| 2026 | 15.09 | 13.13 | -1.95 | 156 | -0.07 | -0.00 | 0.07 | ||
| 2027 | 15.28 | 13.15 | -2.13 | 140 | -0.09 | -0.00 | 0.08 | ||
| 2028 | 15.48 | 13.17 | -2.31 | 123 | -0.10 | -0.00 | 0.10 | ||
| 2029 | 15.68 | 13.19 | -2.49 | 107 | -0.11 | -0.00 | 0.11 | ||
| 2030 | 15.86 | 13.20 | -2.66 | 90 | -0.13 | -0.00 | 0.12 | ||
| 2031 | 16.02 | 13.21 | -2.81 | 74 | -0.14 | -0.00 | 0.14 | ||
| 2032 | 16.16 | 13.22 | -2.93 | 57 | -0.16 | -0.00 | 0.16 | ||
| 2033 | 16.27 | 13.23 | -3.04 | 39 | -0.18 | -0.01 | 0.18 | ||
| 2034 | 16.35 | 13.24 | -3.12 | 21 | -0.21 | -0.01 | 0.20 | ||
| 2035 | 16.42 | 13.25 | -3.17 | 3 | -0.24 | -0.01 | 0.23 | ||
| 2036 | 16.46 | 13.25 | -3.21 | ---- | -0.26 | -0.01 | 0.25 | ||
| 2037 | 16.50 | 13.25 | -3.24 | ---- | -0.29 | -0.01 | 0.28 | ||
| 2038 | 16.51 | 13.26 | -3.25 | ---- | -0.32 | -0.01 | 0.30 | ||
| 2039 | 16.49 | 13.26 | -3.23 | ---- | -0.35 | -0.01 | 0.33 | ||
| 2040 | 16.46 | 13.26 | -3.20 | ---- | -0.37 | -0.02 | 0.36 | ||
| 2041 | 16.41 | 13.26 | -3.15 | ---- | -0.40 | -0.02 | 0.38 | ||
| 2042 | 16.35 | 13.25 | -3.10 | ---- | -0.43 | -0.02 | 0.41 | ||
| 2043 | 16.28 | 13.25 | -3.03 | ---- | -0.45 | -0.02 | 0.43 | ||
| 2044 | 16.21 | 13.25 | -2.96 | ---- | -0.48 | -0.02 | 0.46 | ||
| 2045 | 16.14 | 13.25 | -2.90 | ---- | -0.52 | -0.02 | 0.50 | ||
| 2046 | 16.08 | 13.24 | -2.83 | ---- | -0.55 | -0.02 | 0.53 | ||
| 2047 | 16.01 | 13.24 | -2.77 | ---- | -0.59 | -0.03 | 0.56 | ||
| 2048 | 15.95 | 13.24 | -2.71 | ---- | -0.63 | -0.03 | 0.60 | ||
| 2049 | 15.89 | 13.24 | -2.65 | ---- | -0.66 | -0.03 | 0.64 | ||
| 2050 | 15.84 | 13.24 | -2.60 | ---- | -0.70 | -0.03 | 0.67 | ||
| 2051 | 15.79 | 13.24 | -2.55 | ---- | -0.74 | -0.03 | 0.71 | ||
| 2052 | 15.75 | 13.23 | -2.52 | ---- | -0.78 | -0.03 | 0.75 | ||
| 2053 | 15.72 | 13.23 | -2.49 | ---- | -0.82 | -0.04 | 0.78 | ||
| 2054 | 15.70 | 13.23 | -2.47 | ---- | -0.86 | -0.04 | 0.82 | ||
| 2055 | 15.69 | 13.24 | -2.45 | ---- | -0.90 | -0.04 | 0.86 | ||
| 2056 | 15.69 | 13.24 | -2.45 | ---- | -0.94 | -0.04 | 0.90 | ||
| 2057 | 15.69 | 13.24 | -2.45 | ---- | -0.98 | -0.04 | 0.94 | ||
| 2058 | 15.69 | 13.24 | -2.45 | ---- | -1.02 | -0.05 | 0.97 | ||
| 2059 | 15.71 | 13.24 | -2.46 | ---- | -1.05 | -0.05 | 1.00 | ||
| 2060 | 15.73 | 13.24 | -2.48 | ---- | -1.08 | -0.05 | 1.03 | ||
| 2061 | 15.75 | 13.25 | -2.51 | ---- | -1.10 | -0.05 | 1.05 | ||
| 2062 | 15.78 | 13.25 | -2.53 | ---- | -1.13 | -0.05 | 1.08 | ||
| 2063 | 15.81 | 13.25 | -2.56 | ---- | -1.16 | -0.06 | 1.10 | ||
| 2064 | 15.85 | 13.25 | -2.59 | ---- | -1.17 | -0.06 | 1.11 | ||
| 2065 | 15.89 | 13.26 | -2.63 | ---- | -1.18 | -0.06 | 1.12 | ||
| 2066 | 15.94 | 13.26 | -2.68 | ---- | -1.19 | -0.06 | 1.13 | ||
| 2067 | 15.99 | 13.26 | -2.73 | ---- | -1.20 | -0.06 | 1.14 | ||
| 2068 | 16.04 | 13.27 | -2.77 | ---- | -1.20 | -0.06 | 1.14 | ||
| 2069 | 16.09 | 13.27 | -2.82 | ---- | -1.21 | -0.06 | 1.15 | ||
| 2070 | 16.14 | 13.27 | -2.87 | ---- | -1.22 | -0.06 | 1.16 | ||
| 2071 | 16.18 | 13.28 | -2.90 | ---- | -1.24 | -0.06 | 1.18 | ||
| 2072 | 16.22 | 13.28 | -2.94 | ---- | -1.25 | -0.06 | 1.19 | ||
| 2073 | 16.26 | 13.28 | -2.97 | ---- | -1.26 | -0.06 | 1.19 | ||
| 2074 | 16.29 | 13.28 | -3.01 | ---- | -1.26 | -0.06 | 1.20 | ||
| 2075 | 16.32 | 13.29 | -3.03 | ---- | -1.27 | -0.06 | 1.20 | ||
| 2076 | 16.35 | 13.29 | -3.06 | ---- | -1.27 | -0.07 | 1.20 | ||
| 2077 | 16.36 | 13.29 | -3.07 | ---- | -1.26 | -0.07 | 1.20 | ||
| 2078 | 16.36 | 13.29 | -3.07 | ---- | -1.26 | -0.07 | 1.20 | ||
| 2079 | 16.36 | 13.29 | -3.07 | ---- | -1.26 | -0.07 | 1.19 | ||
| 2080 | 16.35 | 13.29 | -3.06 | ---- | -1.26 | -0.07 | 1.19 | ||
| 2081 | 16.34 | 13.29 | -3.05 | ---- | -1.25 | -0.07 | 1.19 | ||
| 2082 | 16.32 | 13.29 | -3.03 | ---- | -1.25 | -0.07 | 1.19 | ||
| 2083 | 16.30 | 13.29 | -3.02 | ---- | -1.25 | -0.07 | 1.18 | ||
| 2084 | 16.29 | 13.29 | -3.00 | ---- | -1.25 | -0.07 | 1.18 | ||
| 2085 | 16.28 | 13.29 | -2.99 | ---- | -1.25 | -0.07 | 1.19 | ||
| 2086 | 16.27 | 13.28 | -2.99 | ---- | -1.25 | -0.07 | 1.19 | ||
| 2087 | 16.27 | 13.29 | -2.99 | ---- | -1.26 | -0.07 | 1.19 | ||
| 2088 | 16.28 | 13.29 | -3.00 | ---- | -1.26 | -0.07 | 1.20 | ||
| 2089 | 16.30 | 13.29 | -3.01 | ---- | -1.27 | -0.07 | 1.20 | ||
| 2090 | 16.32 | 13.29 | -3.03 | ---- | -1.28 | -0.07 | 1.21 | ||
| 2091 | 16.35 | 13.29 | -3.06 | ---- | -1.29 | -0.07 | 1.22 | ||
| 2092 | 16.38 | 13.29 | -3.09 | ---- | -1.29 | -0.07 | 1.23 | ||
| 2093 | 16.42 | 13.30 | -3.13 | ---- | -1.30 | -0.07 | 1.23 | ||
Summarized Estimates
| Proposal | Change from Current Law | ||||||||
|---|---|---|---|---|---|---|---|---|---|
| Years | Cost rate |
Income rate |
Actuarial balance |
Year of reserve depletion1 |
Cost rate |
Income rate |
Actuarial balance |
||
| 2018-2092 | 16.00% | 13.81% | -2.19% | 2035 | -0.69% | -0.03% | 0.66% | ||
1 Under current law, the year of Trust Fund reserve depletion is 2034. |
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Based on Intermediate Assumptions of the 2018 Trustees Report.