The Social Security Administration announced yesterday that Social Security and Supplemental Security Income (SSI) benefits will increase 1.7% in 2013. The 1.7% cost-of-living adjustment (COLA) will begin in January 2013 for Social Security beneficiaries and will begin December 31, 2012 for SSI recipients. For some Medicare beneficiaries, the Social Security increase may be partially or completely offset by increases in Medicare premiums.
In addition, based on the increase in average wages, the maximum amount of earnings subject to the Social Security tax (taxable maximum) will increase to $113,700 in 2013 from $110,100 in 2012. As a result of the increase in the taxable maximum, it is expected that 10 million of the 163 million workers who pay Social Security taxes in 2013 will pay higher taxes as a result of the increase of the taxable maximum.
Please visit www.socialsecurity.gov/cola if you have questions about how Social Security COLAs are calculated.
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