Social Security COLA is 3.6% for 2012

[Roland Slugg]

On October 19, 2011, the Social Security Administration (SSA) announced that there will be a 3.6% COLA for Social Security benefits and SSI payments in the year 2012. This is the first increase since 2009; there was no COLA in 2010 or in 2011.

SSA also announced that the wage limit for the social security tax will increase to $110,100 in 2012, up $3,300 from the $106,800 taxable limit in effect for 2011. The temporary 2% reduction in the social security tax rate is scheduled to expire at the end of 2011, so unless Congress acts to extend or otherwise adjust that rate, it will increase from 4.2% to 6.2% on wage earners and the self-employed as of January 1, 2012. The President has indicated he would like to see the rate further decreased to 3.1%.

As of this date Medicare has not yet announced the amount of the "standard" Medicare Part B premium for the year 2012. An announcement about this should be made by Medicare next month, but unofficial predictions are that the premium will increase by 10% or more above the current level. In 2011 the "standard" Medicare Part B premium has been $115.40 per month, but many social security recipients have been paying only $110.50 or $96.40 per month, depending on how long they have been receiving social security benefits. As has been the case since 2007, however, Social security recipients with higher incomes will pay sharply higher premiums for their Medicare Part B coverage.

[ChEAr$]

Warning! this is a rant

That was the stupidest, most asinine, dumb and dumbest, "tax reduction" idea any president ever had and congress in it's FINITE wisdom, was even dumber for passing it.

I'm talking about reduction from 6.2 to 4.2 effective just for this year. Sure, I benefited, along with anyone else working legally. But still....... the stage has been set. SSA will go bust a little sooner than later.

I'm done.

[veritas]

It is already

That was the stupidest, most asinine, dumb and dumbest, "tax reduction" idea any president ever had and congress in it's FINITE wisdom, was even dumber for passing it.

I'm talking about reduction from 6.2 to 4.2 effective just for this year. Sure, I benefited, along with anyone else working legally. But still....... the stage has been set. SSA will go bust a little sooner than later.

I'm done.

bust. Paid out more than it took in. There is nothing but IOUs for the 2.6 trillion surplus.

[Burke]

That was the stupidest, most asinine, dumb and dumbest, "tax reduction" idea any president ever had and congress in it's FINITE wisdom, was even dumber for passing it.I'm talking about reduction from 6.2 to 4.2 effective just for this year. Sure, I benefited, along with anyone else working legally. But still....... the stage has been set. SSA will go bust a little sooner than later.I'm done.

I agree. Why didn't they allow the EMPLOYER the reduction? Reducing his costs might have made a difference. I'll bet most people didn't even notice.

[Corduroy Frog]

Why it happened

If you remember the December fiasco of 2010 (actually it is becoming a fiasco EVERY December), the lawmakers decided they needed the revenue that had been sapped away by the "Making Work Pay" credit. However, none in the congress wanted to take the blame for a sudden increase in withholding this past January 2011 which would have resulted.

So they came up with this brilliant plan to ding the employee's share of FICA, so there would be a negligible effect on total withholding. Brilliant because congress would not be blamed for workers taking home a lower paycheck, and their revenue increase because of doing away with the MWP credit.

Stupid because they mortgaged the future. But they have been doing this for years.