Social
Security announces 2.3 percent benefit
increase for 2008
Monthly Social Security
and Supplemental Security Income benefits
for more than 54 million Americans will
increase 2.3 percent in 2008, the Social
Security Administration announced today.
Social Security and
Supplemental Security Income benefits
increase automatically each year based on
the rise in the Bureau of Labor Statistics'
Consumer
Price Index for Urban Wage Earners and
Clerical Workers (CPI-W), from
the third quarter of the prior year to the
corresponding period of the current year.
This year's increase in the CPI-W was 2.3
percent.
The 2.3 percent
Cost-of-Living Adjustment (COLA) will begin
with benefits that nearly 50 million Social
Security beneficiaries receive in January
2008. Increased payments to more than 7
million Supplemental Security Income
beneficiaries will begin on December 31.
Some other changes that
take effect in January of each year are
based on the increase in average wages.
Based on that increase, the maximum amount
of earnings subject to the Social Security
tax (taxable maximum) will increase to
$102,000 from $97,500. Of the estimated 164
million workers who will pay Social Security
taxes in 2008, nearly 12 million will pay
higher taxes as a result of the increase in
the taxable maximum.
2008 Cost-of-Living Adjustment
(COLA):
Based on the increase in the
Consumer Price Index (CPI-W) from
the third quarter of 2006 through
the third quarter of 2007, Social
Security and Supplemental Security
Income (SSI) beneficiaries will
receive a 2.3 percent COLA for
2008. Other important 2008 Social
Security information is as follows:
NOTE: The
7.65% tax rate is the combined
rate for Social Security and
Medicare. The Social Security
portion (OASDI) is 6.20% on
earnings up to the applicable
taxable maximum amount (see
below). The Medicare portion
(HI) is 1.45% on all earnings.
Under full
retirement age
NOTE: One dollar
in benefits will be withheld for
every $2 in earnings above the
limit.
$12,960/yr.
($1,080/mo.)
$13,560/yr.
($1,130/mo.)
The year an
individual reaches full retirement
age
NOTE: Applies only to
earnings for months prior to
attaining full retirement age. One
dollar in benefits will be withheld
for every $3 in earnings above the
limit.
$34,440/yr.
($2,870/mo.)
$36,120/yr.
($3,010/mo.)
There is no limit
on earnings beginning the month an
individual attains full retirement
age.
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