Will my income increase?

The Social Security Administrations said this week that the monthly benefits for nearly 62 million recipients of Social Security will increase in 2013.  

Will I get a pay increase?The 1.7 percent cost-of-living adjustment will begin with benefits that more than 56 million Social Security beneficiaries receive in January 2013. That is only about half of the 3.6 percent COLA increase in 2012, but better than the lack of an increase in 2010 and 2011. Increased COLA payments for more than 8 million SSI beneficiaries will begin on Dec. 31, 2012

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 $113,700 from $110,100.

Of the estimated 163 million workers who will pay Social Security taxes in 2013, nearly 10 million will pay higher taxes as a result of the increase in the taxable maximum.

Information about Medicare changes for 2013, when announced, will be available at www.Medicare.gov.

For some beneficiaries, their Social Security increase may be partially or completely offset by increases in Medicare premiums. 

The Social Security Act provides for how the annual COLA is calculated. For more information, visit www.socialsecurity.gov/cola.

If you have further questions regarding this or any other part of your tax situation please contact your local Liberty Tax office and we will be able to assist you further.

David Rocci 

 

Disclaimer: Every effort has been taken to provide the most accurate and honest analysis of the tax information provided in this blog. Please use your discretion before making any decisions based on the information provided. This blog is not intended to be a substitute for seeking professional tax advice based on your individual needs.

 

Posted To: Tax Rants by David Rocci By: David Rocci On: Saturday, October 27, 2012
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