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The income subject to OASDI tax is capped at $168,600 in 2024, up from $160,200 in 2023. The reason for the cap is that the amount of Social Security and disability benefits you can receive is ...
For self-employed people, the 2013 guidance from SSA indicates the full rate OASDI is 12.4% for 2013. See footnote a. at 2013 SSA.gov link. Returning to the traditional 6.2% OASDI employee share for 2013 effectively reduces take home pay by 2% and increases the maximum OASDI contribution by the same amount, returning it to traditional levels.
Two other suggested provision aims to apply the OASDI 12.4% payroll tax rate on earnings above $250,000 or $300,000 starting in 2023, which would tax all earnings once the taxable maximum exceeds ...
The benefit deductions change in the year a person reaches full retirement age and are still working – SSA deducts only one dollar in benefits for every three a person earns above $40,080 in 2013 for that year and has no deduction thereafter. The income limits change (presumably for inflation) year by year. [59]
Between 1975 and 2008, the OASI was subject to ten actual revisions and three minor legislative revisions. An 11th revision is under discussion in 2009. This is a pay-as-you-go pension system, the law on occupational pensions (2nd pillar) being a funded pension system. The OASI also allows for a (partial) redistribution of wealth. [2]
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[a] [9] The taxation limit in 2020 was $137,700 of gross compensation, resulting in a maximum Social Security tax for 2020 of $8,537.40. [7] This limit, known as the Social Security Wage Base, goes up each year based on average national wages and, in general, at a faster rate than the Consumer Price Index (CPI-U).
This program derives its income from general tax revenue, not Social Security taxes, but it’s applicable to some recipients of disability insurance. Social Security Retirement Statistics