Who’s Above the Social Security Payroll Tax Cap?

[sinkingfeeling]

http://www.cepr.net/documents/publications/ss-cap-2011-09.pdf

Raising the Social Security cap – which would make some or all earnings above $106,800 subject to the Social Security tax – has gotten some attention as a way to help alleviate Social Security’s long-term budget shortfall. U.S. Senator Bernie Sanders plans to introduce legislation to keep the current cap at $106,800, but to also apply the Social Security payroll tax to earnings over $250,000. It is similar to previous bills and echoes a proposal by then-Senator Obama on the campaign trail in 2008. While this would leave those making between the current cap of $106,800 and the proposed cap of $250,000 paying the lowest rates, it would help secure the solvency of the program and avoid an increase in taxes on the middle class.

To help inform this policy debate, we examined Census Bureau data from the most recently available American Community Survey and found that less than 6 percent of workers would be affected if the Social Security cap were eliminated entirely and only slightly more than 1 percent would be affected if the current tax were applied to earnings over $250,000 (but not between the current cap and the $250,000 level). However, the share of workers that would pay more varies widely by gender, race or ethnicity, age, and state of residence.

[liberal N proud]

1. Not even close

If I were above $106K, I would be happy to pay more, but that will never happen.

[exelwood]

2. When I began working...

...the cap was 9,000 dollars (yes, many years ago) and when people would hit it was cause for mild celebration at getting the "raise". Then it went to 11000 and by the time I retired I got to pay it 12 month a years. :)

Increasing the PRT is the single most important thing American workers can fight for. If they eliminate that tax SS is nothing but a welfare program and we know what happens to welfare programs, they get cut.