Who pays if Social Security cap is lifted? Not many taxpayers

Center for Economic and Policy Research

A breakdown of worker wages.

By Allison Linn

One of the proposals for keeping Social Security afloat is to simply ask for more money.

It turns out, not that many taxpayers would have to pay up.

A new analysis from the Center for Economic and Policy Research finds that less than 6 percent of workers would be affected if the government lifted the cap on Social Security taxes and applied it to earnings above $106,800.

Currently, taxpayers pay their share of Social Security taxes only on earnings up to $106,800. Any earnings above that are exempt from the tax.

Another plan that’s been tossed around would be to just charge Social Security tax on earnings of more than $250,000, but not to charge the tax on earnings between $106,800 and $250,000.

That plan would affect a little more than 1 percent of workers, the liberal-leaning think tank found in its analysis of the most recent American Community Survey data.

The move could potentially add trillions of dollars to Social Security coffers over the next 75 years, according to CEPR.

Social Security is at risk of becoming underfunded because the big Baby Boom generation is aging and people are generally living longer.

Other proposals for fixing Social Security include raising the age of eligibility and slowing cost of living increases.

Related:

Of Social Security and Ponzi schemes

Debt deal or not, Social Security reform is coming

How much you will — or won't — collect from Social Security

Do you think the Social Security cap should be raised?

 

Results with 118 short comments
Total of 12,774 votes - click on the "Display Comments" bar below to sort comments

66.6%
Yes, it should apply to all earnings
8,502 votes
18.7%
Yes, it should also be applied to earnings above $250,000
2,394 votes
14.7%
No
1,878 votes
Display Comments:
Yes, it should apply to all earnings

I paid on 100% of my earnings; it is only fair that everyone should do the same.

  • 17 votes
#1
 - Northern Star
 - 8:08 am EDT on Mon Oct 10, 2011
Yes, it should apply to all earnings

"The move could potentially add trillions of dollars to Social Security coffers over the next 75 years, according to CEPR." 'nough said.

  • 14 votes
#2
 - Texan-1139653
 - 8:13 am EDT on Mon Oct 10, 2011
Yes, it should apply to all earnings

SS is the way our society takes care of the less fortunate. Alternatives tried elsewhere are poorhouses and slavery. I'll stick with SS.

  • 11 votes
#3
 - madison-1272000
 - 8:27 am EDT on Mon Oct 10, 2011
Yes, it should apply to all earnings

Slowing cost of living increases? The current formula doesn't keep up with seniors' COL increases.

  • 14 votes
#4
 - anti-trust proponent
 - 8:27 am EDT on Mon Oct 10, 2011
Yes, it should apply to all earnings

If the 99% have to pay it on all, then so should the 1%.

  • 21 votes
#5
 - digitalnoise
 - 8:27 am EDT on Mon Oct 10, 2011
Yes, it should apply to all earnings

You can bet it will be ME!

  • 1 vote
#6
 - ren-755775
 - 8:39 am EDT on Mon Oct 10, 2011
Yes, it should apply to all earnings

Applying it to all income lowers the rate from 12.4% to 4%. Enables fair contributions from all Americans.

  • 11 votes
#7
 - Skulker7
 - 8:41 am EDT on Mon Oct 10, 2011
Yes, it should apply to all earnings

If we're going to tax everyone equally on SS, shouldn't we do that on the income tax as well? I mean the people that earn less than $30k

  • 12 votes
#8
 - Living in Austin
 - 8:47 am EDT on Mon Oct 10, 2011
Yes, it should apply to all earnings

Of course it should. Why wouldn't we ask people to pay the same percentage of their income as those making far less?

  • 8 votes
#9
 - Titan415-692196
 - 8:57 am EDT on Mon Oct 10, 2011
Yes, it should apply to all earnings

It should apply to all earnings, not just wages. Most people earning over $250,000 are not getting that in a paycheck.

  • 13 votes
#10
 - Anita-2036926
 - 9:00 am EDT on Mon Oct 10, 2011
Yes, it should apply to all earnings

Everyone should have to pay their fair share no matter how much they make. Equal rights means equal % income & SS taxes too!!

  • 10 votes
#11
 - Raina1100
 - 9:07 am EDT on Mon Oct 10, 2011
Yes, it should apply to all earnings

Everyone earning money in our country today should pay. Everyone (no matter their income) can claim it, so everyone should pay it!

  • 11 votes
#12
 - TravisT
 - 9:14 am EDT on Mon Oct 10, 2011
Yes, it should apply to all earnings

We all have to share equally.

  • 7 votes
#13
 - Bongoman
 - 9:15 am EDT on Mon Oct 10, 2011
Yes, it should apply to all earnings

Of course they should pay into Social Security!! They get benefits when they retire, why shouldn't they pay into it!!?

  • 12 votes
#14
 - Aus10
 - 9:16 am EDT on Mon Oct 10, 2011
Yes, it should apply to all earnings

I have been saying this for years, but no one listens. It just makes sense to tax these people. Why should they reap the benefits?

  • 10 votes
#15
 - BarbieD
 - 9:17 am EDT on Mon Oct 10, 2011
Yes, it should apply to all earnings

The Working and Middle Class have to pay in on 100% of their income. So should the rich and corporate plutocrats. TAX THE RICH !!!

  • 15 votes
#16
 - Texas Liberal
 - 9:17 am EDT on Mon Oct 10, 2011
Yes, it should apply to all earnings

We already have that with Medicare, why not with Social Security.

  • 7 votes
#17
 - Candida-3071640
 - 9:25 am EDT on Mon Oct 10, 2011
Yes, it should apply to all earnings

Even though it would affect me, eliminating the cap is the right thing to do.

  • 11 votes
#18
 - S.M.
 - 9:55 am EDT on Mon Oct 10, 2011
No

The cap should be raised, but not to all earnings. There never should have been a 1% reduction in our portion over the last year either.

    #19
     - Travis-1809903
     - 10:04 am EDT on Mon Oct 10, 2011
    Yes, it should apply to all earnings

    U die before you can collect you get 0. Scam! Collect for a month then die, government keeps the balance. Scam!

    • 1 vote
    #20
     - constitutionisburning
     - 10:16 am EDT on Mon Oct 10, 2011
    Yes, it should apply to all earnings

    Pay for earnings UP TO $250,000. Also require PAYBACK of all the Social Security IOU'S held by the Treasury (or consider it stolen money).

    • 4 votes
    #21
     - Shirley Calvert 3572224
     - 10:21 am EDT on Mon Oct 10, 2011
    Yes, it should also be applied to earnings above $250,000

    Been advocating this for years. Now bring on means testing and keep the SS funds out of the general fund and away from congress' greed!!

    • 8 votes
    #22
     - peteMT
     - 10:36 am EDT on Mon Oct 10, 2011
    Yes, it should apply to all earnings

    Tax the recipient of the income, not the business by whom they're employed. We don't need new reasons to layoff more workers.

    • 1 vote
    #23
     - G Henton
     - 10:40 am EDT on Mon Oct 10, 2011
    Yes, it should apply to all earnings

    I didn't even know there was a cap, if I have to pay on based on my whole salary, so should the Fat Cats, we bailed them out anyway.

    • 7 votes
    #24
     - TamaraLH
     - 10:45 am EDT on Mon Oct 10, 2011
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    Comment author avatarChris-1235119

    Absolutely--it's almost a ridiculous question..why if you make more money than poor the poor Joe you pay less? Either equal contributions for everyone, or use a sliding scale....

      Reply#1 - Thu Oct 20, 2011 10:17 AM EDT
      Comment author avatarsAyItLiKeItIs

      If he income threshold is raised, the payments to those paying in more should be raised.... which is a net gain of ZERO.

      The smartest thing is to raise the SS tax from 3% to 6% and keep the cap the same. That way the 94% of Americans who need SS the most are the ones to pay for it, and it stops SS from being a totally socialist tool. This is still a capitilistic economy.

      Stop payments to anyone who has gotten back more than they put in based on an interest rate of 3%.

      Stop payments to anyone who did not pay in.

      • 2 votes
      Reply#2 - Thu Oct 20, 2011 11:50 AM EDT
      Comment author avatarOld Jim-4280569

      sAyItLiKeItIs makes an important point. If the limit is lifted then the $200K earner will pay twice as much as the $100k earner. Will the $200k guy receive twice as much in benefits?

      If not, how can you justify having him pay more?

        Reply#3 - Thu Oct 20, 2011 3:34 PM EDT
        Comment author avatarJenna126

        Those that make $100k a year already pay in twice that of someone making $50k, but they are still paid the same amount once they retire. I highly doubt this policy will change, but, you never know. Take those extra earnings and invest in stocks, or a money market account, or heck, even a jar that you bury under your house, choose your risk level. If you're making 6 figures and counting on Social Security to pay for your expenses when you retire, you have another thing coming.

        I would like to see an "opt out" box when filing my tax forms. Can I choose to not to pay into a system I may never see a return from and allow independent thinking for my own financial stability?

          #3.1 - Wed Nov 30, 2011 5:54 PM EST
          Comment author avatarjanellect

          Why would you say that?

          The amount of a person's retirement benefit depends primarily on his or her lifetime earnings.

          Right from SSA.gov

            #3.2 - Sat Apr 21, 2012 4:37 PM EDT
            Reply
            Comment author avatarJoe-1312625

            The top of the food chain is getting away with murder, make them pay for being so greedy, this includes corporations and banking institutions

            • 1 vote
            Reply#4 - Wed Nov 30, 2011 6:14 PM EST
            LITTLE SISTER-4638673Deleted
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            Comment author avatarMickeyN

            If there is no cap for 'pay-in' then there shouldn't be a cap for 'pay-out'.

            You just can't have it both ways...Just keep it fair. The people who make more than $106k already pay more in than they will ever get back out WITH the current system.

            • 1 vote
            Reply#10 - Wed Nov 30, 2011 7:30 PM EST
            Comment author avatarRummyTub

            It's a tax and all taxes should be paid by every one. The cap is just another loophole that benefits the rich.

              Reply#11 - Wed Nov 30, 2011 8:05 PM EST
              Comment author avatarThaddeus Fouquette

              Honestly, I do not understand the people who are insisting more paid in should be more back. Social Security is designed as a safety net for people of retirement age. I understand that everybody receives it when eligible. That is also silly!

              Social Security is not an alternative to playing the market...it is not a standard investment plan.

              I pay my taxes and would happily pay more if required... By no means would I automatically think the government should give me more in return. Our company bookkeeper gave us the option to continue to pay the full amount a several of us do.

                Reply#12 - Thu Dec 1, 2011 4:21 AM EST
                Comment author avatarjanellect

                Then it should be a welfare program paid through federal taxes. I would rather donate the difference to charity.

                  #12.1 - Sat Apr 21, 2012 4:40 PM EDT
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