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It’s time to fix Social Security’s tax burden

December 26, 2018 By Liz Weston

People on Social Security need a tax break. The rest of us need to make sure they get it — for everyone’s sake.

When Congress made Social Security benefits taxable in 1983, lawmakers didn’t index the tax thresholds to inflation. They “forgot” inflation again when adding a second layer of taxation in 1993.

That means the proportion of recipients who have to pay federal income taxes on their benefits keeps increasing. Initially, only 1 in 10 Social Security recipients had to pay any federal tax. Now, it’s over half.

In my latest for the Associated Press, why this sneaky way of boosting taxes is unfair to those who have already paid their dues.

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Filed Under: Liz's Blog Tagged With: Retirement, Social Security, Taxes

Reader Interactions

Comments

  1. John says

    December 28, 2018 at 11:44 am

    I collect USA social security based on my Australian income alone, never paid a cent toward the system nor a cent in taxes. I have national health care and a aged pension provided by the Australian government. I have real bad dreams of waking up in America.

  2. Joe Writer says

    December 28, 2018 at 12:00 pm

    Liz,
    I hat went to the Social Security office to start my benefits. They total $2500.00 per month. My wife accompanied me to claim her spousal support. I’m 68 years old and my wife is 67 years old. She currently has collected since 62 her benefits at $425 per month. I thought she would be entitled to half of my benefits ($1250). But I was in formed that she wouldn’t be receiving half but around $1000 per month since she was collecting benefits. I’m confused I thought she had the choose to collect spousal benefits at half my rate if it was higher then her current amount.
    Please clarify for me as I’m ready to go in to social security to have her benefits reaccessed.
    Thanks

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