CEPR

The calculator below (also available here) which shows the last day when salaries, if spread evenly throughout the year, are subject to Social Security taxes.[1] It also displays how much taxes are levied based on current law, and how much would be levied if the payroll tax cap were scrapped. Salaries which might be interesting to enter into the calculator are:

$31,099: This is an estimate of the median annual earnings of an individual in the US in 2016. (The vast majority of earnings at the level is wage income.)

$200,000: This is the upper limit of income of what former President Obama defined as “middle class,” and assumes that this income is entirely wage income.

$8,900,000: This is the estimated wage income of Larry Fink, CEO of BlackRock Inc., the largest asset management company in the world. It includes $900,000 in salary and $8,000,000 as a bonus, which is a fraction of his total pay package of $25.5 million. (Many high-earners receive a significant part of their compensation outside of wages.) Fink was recently in the news calling for businesses to serve a social purpose. In the past, however, Fink used his power to advocate for privatizing Social Security and mocked the idea of ordinary people retiring at 65. Part of those efforts included serving on the Campaign to Fix the Debt’s steering committee, which journalist David Dayen called a “stalking horse” for “reforms” to cut or privatize Social Security.


[1] It’s important to note that Social Security taxes only apply to wage income and not to other types of income, like investment income. As incomes rise, wage income often becomes eclipsed by investment income — which under current law, is not subject to Social Security taxes