26 Feb 2020’s Changes To Social Security
The Social Security Administration implements new changes every year for the Social Security program. They announce the changes that are going to be present at the start of the new year, during the month of October. For the year 2020, there were 6 changes present that were made by the SSA. Firstly, all recipients of Social Security are receiving a 1.6% increase in monthly benefits for cost of living adjustment. The purpose behind this small increase is to combat inflation. Last years cost of living adjustment was at 2.8% but this 1.6% increase has raised the monthly pay by about $24.
Income Cap Increased to $137,000
For 2019, employees were paying a 6.2% tax for Social Security on income up $132,900. For the year 2020, that cap has increased $4,100 and now sits at $137,000. The tax rate will not be changing for the year, only the income cap.
Increase in SSD Benefits
For Social Security Disability Benefits, recipients are now receiving an increase in monthly benefits for 2020. Those who are blind are receiving a maximum of $70 increase and those who are not blind are receiving up to a $40 increase in monthly benefits.
Increase To Earnings Limit
In 2020, before you reach retirement age there is now a $18,240 limit. After that limit is reached, for every $2 exceeded there will be $1 deducted. This was a $600 increase from the year prior. If you are to reach retirement age, there is a $48,600 limit and your social security benefits will be deducted $1 for every $3 exceeding the limit.