On October 18, 2016, the Social Security Administration (SSA) announced that there will be a 0.3% COLA for social security benefits and SSI payments in the year 2017. This is the smallest increase since automatic COLAs were enacted by Congress in 1972, except for the three "no change" years earlier in this decade (2010, 2011, 2016). Previously, the smallest increase was 1.3% ... in 1987 and also in 1999.
The maximum amount of earnings subject to the Social Security tax will increase to $127,200. Interestingly, this represents a 7.3% increase over the $118,500 wage limit in effect for the year 2016.
Medicare has not yet announced the 2017 increase in the Medicare Part B premium. With social security benefits increasing only slightly, however, the increase for social security recipients whose AGI is below the "base" level ($85k single or $170k MFJ) will be no greater than the amount of their social security increase, resulting in no change in their net benefit amount. Individuals who are covered by Medicare Part B but did not receive social security benefits during 2016, and those who are subject to higher premiums due to their income level may see a significant increase in their Medicare premiums in 2017.
The maximum amount of earnings subject to the Social Security tax will increase to $127,200. Interestingly, this represents a 7.3% increase over the $118,500 wage limit in effect for the year 2016.
Medicare has not yet announced the 2017 increase in the Medicare Part B premium. With social security benefits increasing only slightly, however, the increase for social security recipients whose AGI is below the "base" level ($85k single or $170k MFJ) will be no greater than the amount of their social security increase, resulting in no change in their net benefit amount. Individuals who are covered by Medicare Part B but did not receive social security benefits during 2016, and those who are subject to higher premiums due to their income level may see a significant increase in their Medicare premiums in 2017.
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