Social Security is supposed to support us in our old age after we retire. But the government has been dipping into the Social Security funds for years, so much so that it is only projected to last until 2035. That’s only about 15 years from now. But a new bill sets out to extend the fund for at least another 40 years.
“A significant expansion of Social Security currently under consideration by House Democrats would extend the program’s solvency and expand benefits by raising payroll taxes on high-income earners.
If passed, the bill — the Social Security 2100 Act — introduced by Rep. John Larson, D-Conn., would make the program solvent for at least 75 years by beginning to gradually raise payroll taxes in 2020, according to the chief actuary of the Social Security Administration. Under current law, Social Security is expected to expire by 2035.
Currently, all employees and employers pay a 6.2 percent payroll tax on wages capped out at $132,900 — but Larson’s bill would immediately impose a tax on wages above $400,000. He then goes a step further, proposing eventually raising that tax rate to 7.4 percent by 2043. Right now, an employee earning $50,000 per year would pay $3,100 in a payroll tax. That would climb to $3,125 in 2020 and peak at 3,700 in 2047 under Larson’s proposal.
But Larson said it essentially equates, on average, to an additional 50 cents per week every year.”
Social Security was originally setup as “an act to provide for the general welfare by establishing a system of Federal old-age benefits, and by enabling the several States to make more adequate provision for aged persons, blind persons, dependent and crippled children, maternal and child welfare, public health, and the administration of their unemployment compensation laws; to establish a Social Security Board; to raise revenue; and for other purposes.”
If this bill passes it could help the millions that have been paying into Social Security receive the benefits they rightly deserve. Now if only the fund could go untouched until then.