•Press Release Health and Social Programs United States
Washington DC — Starting today, wage earners making over $1,000,000 will notice their Social Security payroll tax is zero. Because the outdated wage cap has not budged since 1989, even as income inequality has risen, the burden of supporting Social Security falls more heavily on those who make less.
“The current payroll tax is not even one percent of a millionaire’s wage income,” said CEPR Program Associate Sarah Rawlins. She illustrates that point with this handy online calculator that allows you to see for yourself when people with various wage incomes stop paying into Social Security.
With the Social Security Trust fund projected to have a shortfall in the future, scrapping the payroll tax cap to make every earner pay the same tax rate, along with modest changes to the program, could eliminate the shortfall and allow for crucial expansions to benefits.