Tax the Well-to-Do More for Social Security, Many Older Americans Say

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Among Americans age 50 or older, 61 percent support raising the cap on income subject to Social Security tax, an Associated Press survey finds.

“Among Democrats, support was at 73 percent; among Republicans, it was 45 percent,” the AP says. The survey included more than 1,000 people.

The cap is currently $113,700, and will be $117,000 for 2014, the Social Security Administration says. Individuals who make more than that don’t pay Social Security taxes on the excess. If the cap were raised, higher earners would contribute more to the program — but it wouldn’t change what we five-figure earners contribute because it’s not changing the tax rate.

The survey documented other opinions about Social Security, including:

  • 62 percent of respondents oppose changes to the way benefits are calculated if the change would result in lower increases, as a proposal to switch to using a “chained” consumer price index would do. Just 21 percent support it.
  • “58 percent oppose gradually raising the age when retirees qualify for full benefits, while 29 percent support it.”
  • About one-third believe the age for full retirement benefits should be lower than 65, while 10 percent say it should be higher than 67.
  • 41 percent support reducing benefits for high-income seniors, while 44 percent oppose the idea.

It seems likely that some kind of change is coming. AP says:

Changes to Social Security are on the horizon because the trust funds that support the massive retirement and disability program are projected to run dry in 2033. At that point, Social Security would only collect enough taxes to pay about three-fourths of benefits. If Congress doesn’t act, benefits automatically would be cut by about 25 percent.

What do you think is the fairest solution to increase funding for Social Security? Comment below or on our Facebook page.

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Comments & discussion

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  • wesleypaul11

    Raise the caps for this time. When the picture changes, we can rethink it all.

  • HailHailXoltar

    .

  • HailHailXoltar

    I fall into this category and get a bigger paycheck towards the end of the year every year because I have reached the SS tax limit. I am a Republican generally and don’t favor the “soak the rich” approach for fixing our problems. HOWEVER, I have long wondered why there should be ANY salary cap on social security paid by individuals. This definitely falls under the category of “pay your fair share” by paying SS tax on everything you earn. Don’t quote me on this, but I seem to remember reading an article about fixing SS a while back and I believe they said that removing this cap would close the SS shortfall (coming in vs. going out after 2033) by about 1/2! Seems like an obvious solution to me.
    This may be less popular, but I’ve always thought that SS payments should be a safety net for those that either couldn’t or were too dumb to save for retirement. I think that was its original purpose. It should be subsistence level only (which I think it is) for those who need it. Here’s the unpopular part :-): If you have a pension or have saved enough before retirement, I don’t think you should get SS payments after retirement. It should be a true safety net so we don’t have lots of elderly people homeless and hungry. Yes, that would mean that many would pay in to the system and not get anything out of it, but the same is true of food stamps, government subsidized housing, and other social programs. You could definitely make the point that you may remove the motivation for people to save if they don’t think they can save more than SS would pay them, however, it would be better than the current situation where everybody gets it no matter what.
    Please discuss …

  • ron

    . It is stupid why not get the government out of ss and make it private. It should be like an insurance policy what I put in should be what I can take out. Sorry I am not rich but all we will be doing is driving the rich out of the country.

  • Karen

    I don’t believe that “soaking the rich” is an answer. However, there shouldn’t be a salary cap for income taxes either. Pay your fair share is as affordable for the rich as it is for the poor, or “not so rich”. Loopholes that are only available for the rich makes for an unlevel and unfair advantage so that the rich get richer and the poor (who can’t afford to find out about the loopholes – can’t afford fancy lawyers who will negotiate on their behalf) get poorer. Don’t we have a shrinking middle class? More people are considered at or below poverty level than ever before? Democracy is supposed to give everyone a fair chance for success. Social Security was put into place to assure Americans that they would have a “safety net” when they reach their golden years. If we are all paying into the same “pool”, just like insurance, we are wagering that we will live longer than our money invested. But we also have to realize that we may not live longer than our money invested. Of course, if some people did not invest in their fair share, we will definately be short – Economics 101.

  • Melodie

    How about they put the money back in that they stole plus all the interest that would have accrued them it won’t be out of money for a long time. Why does everyone keep conveniently forgetting that?

  • Scott

    I guess it depends on what you think the original purpose/intent of social security was, and how we best keep that “compact” with government in a way we can still afford it, at a time in history when we live longer and have fewer working people paying in for each retiree.

    The problem with lifting the cap is the more you earn over your life, the lesser percentage a person gets back in social security after retirement, all other things (like life span) being even. So in a way, we are already “soaking” the rich, and lifting caps would just accentuate that.

    I’m not sure i see a good solution. Raising the age would delay retirement and be a burden on people who don’t have the energy or health to continue, but aren’t judged disabled. Removing income caps means the wealthier pay an even more disproportionate share. Raising the tax percentage would hurt all current wage earners. Making a near term change to age or benefit amount would hurt retirees or near-to-retirement people who might not have enough time to offset the unexpected reduction.

    My suggestion is threefold. One is for politicians from both sides start being honest with all of us, discuss the options (and the potential pain) with us, and once they get all the inputs make the tough decision even if it puts their careers at risk. Two, lean towards asking the wealthy to shoulder most of the increase, given how much they’ve benefitted from tax law changes favoring them in recent years, and how much wealth has shifted towards them and away from low and middle income earners. Third, after the fund is on better footing, and if/when demographics change and the boomers generation passes through the system, give tax relief to the wealthy who we would ask to help us through these times.

    Thoughts ?

  • pdxwildchild

    …the powers to be spend waaaay too much time dissecting SS…it ‘was’ being maintained…like a gym membership…oh, thats
    right…the government has “FREE” gym perks , huh?…Well, I say…just give me what I paid in…I’ll buy some rental property…and you’ll never hear from me again…then I might even be able to afford to do some minimal travel..at least a beach trip…lol…What they need to do is dissect the Welfare, SS-Disabilitiy…seek out the frauds…its a joke…I get to stand in a checkout line and watch them eat better than I do…and there’s a neighbor a couple of houses away…getting ss disability…heck, we’ve seen him in action…he just laugh about how he’s ‘screwin’ the pooch’, uncle Sam…we even have pics, and turned him in…the government doest care…they just wanna go after my SS $$$ !!!

  • Chris Davis

    I’ve always saved as if as wasn’t going to be there for me and my wife. To do this means not taking vacations and driving the car for 200k+miles, no restaurants, no movies, etc. I am disgusted with all the freeloaders on govt assistance. It’s time to change this. I’m not sure how but these “folks” as Obama likes to say need to be called out and made to pay their own way. Hard and fast rules need to apy for anyone who wants or appears to need a “safety net”.

  • Draftdog

    Sure, tax ‘em until they bleed. Hell, tax everyone 75%, it won’t make any difference. The 500 plus thieves in Washington will just find a way to spend it all and more and still not have enough to provide the necessary services to those who support and have supported this country. They can fund their bloated retirement fund, pay for their grandiose medical care, but to hell with the working class. They think those poor saps are so stupid, they will keep believing the bull they’ve been feeding them for the last 50 years. And you know what, it looks as though they may be right. I want term limits. I want no law that excludes any government official or applies only to them. That includes repealing all the fluff they have given themselves over the years. Watch how fast Social Security and the medical coverage issues are fixed if their retirement and medical care are included. I don’t care what side of what issue (or the isle) a candidate is on. If he doesn’t support those three things, I will not vote for him. And the first order of business is remove anyone who has been in office more than three terms. Do this at the ballot box and I guarantee we will start to see a big difference in Washington. We need citizens in Washington who care about this country and the people in it, not life long politicians that are there just to line their pockets. I am sick and tired of this petty bickering and the megalomaniac pursuit of a “legacy”. Let’s get to work on fixing the problems that really matter to the people of this country.

  • http://www.morethanbankruptcy.com Goldstein Law Group

    Remove the cap and lower the rate. The program will get more money to remain solvent and most Americans benefit.