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For instance, the maximum taxable earnings limit is $168,600 in 2024. Income above that amount is not subject to Social Security payroll tax, nor is it included in the benefits formula.
The SSA adjusts the maximum taxable earnings each year for inflation. ... Chart by author. Here's the maximum possible 2025 Social Security benefit at 62, 67, and 70.
This cap is the highest annual income subject to Social Security tax, and the closer your wages are to this limit, the higher your benefit will be. In 2024, the cap is $168,600 per year.
Note that although self-employed individuals pay 12.4%, this is mitigated two ways. First, half of the amount of the tax is reduced from salary before figuring the tax (you don't pay Social Security tax on the tax your employer pays for you.) Second, the "employer" half is an adjustment to income on the front page of Form 1040.
The income limit will increase in most years to account for cost-of-living changes. In 2024, it will be $168,600 per year. Starting in 2025, though, it will increase to $176,100 per year.
The maximum taxable earnings amount changes each year and is adjusted for inflation, among other factors. Below are the past few years’ adjustments. Year. Amount. 2015. $118,500. 2016.
Starting in 2025, the maximum taxable earning limit will be $176,100 per year -- up from $168,600 per year in 2024. For context, if you began your career 35 years ago in 1990, the limit that year ...
The table below lays out all the maximum taxable thresholds going back a few decades. Year. Social Security's Taxable Earned Income Ceiling. Year. Social Security's Taxable Earned Income Ceiling ...
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