GM National Retiree Association | Over The Hill Car People. Com

[Admin]

Social Security to hand out first raises since '09

Social Security recipients to get first raise since 2009; inflation report will determine size

FILE - In this Feb. 11, 2005 file photo, trays of printed social security checks wait to be mailed from the U.S. Treasury's Financial Management services facility in Philadelphia. Social Security recipients will get a raise in January _ their first increase in benefits since 2009. Experts expect the increase will be about 3.5 percent. Some 55 million beneficiaries find out for sure Wednesday when an inflation measure that determines the annual cost-of-living adjustment is released. (AP Photo/Bradley C. Bower, File)

Stephen Ohlemacher, Associated Press, On Tuesday October 18, 2011, 1:42 pm EDT

WASHINGTON (AP) -- Social Security recipients will get a raise in January -- their first increase in benefits since 2009. It's expected to be about 3.5 percent.

Some 55 million beneficiaries will find out for sure Wednesday when a government inflation measure that determines the annual cost-of-living adjustment is released.

Congress adopted the measure in the 1970s, and since then it has resulted in annual benefit increases averaging 4.2 percent. But there was no COLA in 2010 or 2011 because inflation was too low. That was small comfort to the millions of retirees and disabled people who have seen retirement accounts dwindle and home values drop during the period of economic weakness, said David Certner, legislative policy director for the AARP.

"People certainly feel like they are falling behind, and these are modest income folks to begin with, so every dollar counts," Certner said. "I think sometimes people forget what seniors' incomes are."

Some of the increase in January will be lost to higher Medicare premiums, which are deducted from Social Security payments. Medicare Part B premiums for 2012 are expected to be announced next week, and the trustees who oversee the program are projecting an increase.

Monthly Social Security payments average $1,082, or about $13,000 a year. A 3.5 percent increase would amount to an additional $38 a month, or about $455 a year.

Most retirees rely on Social Security for a majority of their income, according to the Social Security Administration. Many rely on it for more than 90 percent of their income.

Federal law requires the program to base annual payment increases on the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). Officials compare inflation in the third quarter of each year -- the months of July, August and September -- with the same months in the previous year.

If consumer prices increases from year to year, Social Security recipients automatically get higher payments, starting the next January. If price changes are negative, the payments stay unchanged.

Only twice since 1975 -- the past two years -- has there been no COLA.

Wednesday's COLA announcement will come as a special joint committee of Congress weighs options to reduce the federal government's $1.3 trillion budget deficit. In talks this summer, President Barack Obama floated the idea of adopting a new measure of inflation to calculate the COLA, one that would reduce the annual increases.

Advocates for seniors mounted an aggressive campaign against the proposal, and it was scrapped. But it could resurface in the ongoing talks.

"We're very concerned about that," said Web Phillips of the National Committee to Preserve Social Security and Medicare. "I think that what this illustrates is the dangers of trying to make Social Security policy in the context of deficit reduction."

Social Security payments increased by 5.8 percent in 2009, the largest increase in 27 years, after energy prices spiked in 2008. But energy prices quickly dropped and home prices became soft in markets across the country, contributing to lower inflation the past two years.

For example, average gasoline prices topped $4 a gallon in the summer of 2008. But by January 2009, they had fallen below $2. Today, the national average is about $3.46 a gallon.

"A lot of that increase had to do with energy," Polina Vlasenko, an economist at the American Institute for Economic Research, based in Great Barrington, Mass., said of the 2009 change.

As a result, Social Security recipients got an increase that was far larger than actual overall inflation. However, they weren't to get another increase until consumer prices exceeded the levels measured in 2008.

So far this year, prices have been higher than that, Vlasenko said. Based on consumer prices in July and August, the COLA for 2012 would be about 3.5 percent. Vlasenko estimates the COLA will be from 3.5 percent to 3.7 percent.

Advocates for seniors say it's about time.

"If you've been at the grocery store lately and remember what you used to pay for things, see what you're paying for things today," Phillips said. "The cost-of-living adjustment makes sure that the Social Security benefit that you qualify for when you retire or you become disabled continues to stay current with prices so that the buying power of your benefit does not decline over time."

http://finance.yahoo.com/news/Social-Security-to-hand-out-apf-1746150979.html?x=0
_________________
Click Here To Return To The Home Page Of www.overthehillcarpeople.com

[Admin]

Make Sure Your Check Reflects This Increase!
_________________
Click Here To Return To The Home Page Of www.overthehillcarpeople.com

[Admin]

5 Social Security Changes Coming in 2012

By Emily Brandon | U.S.News & World Report LP – Mon, Jan 23, 2012 11:17 AM EST

Social Security recipients will see bigger payments this year for the first time since 2009. But the future of Social Security taxes for workers remains uncertain. The 2011 payroll tax holiday has been extended only through the end of February and is scheduled to increase in March under current law. Here's a look at the Social Security changes workers and retirees will experience this year.

A boost in monthly payments. Social Security payments for more than 60 million Americans will increase 3.6 percent in 2012, the first increase since 2009. The typical retiree will see an increase of about $43 per month, although a portion of the increase may be deducted to pay for higher Medicare Part B premiums. Since 1975, Social Security payments have been automatically adjusted each year for inflation as measured by the Consumer Price Index for Urban Wage Earners and Clerical Workers. Cost-of-living adjustments have ranged from 14.3 percent in 1980 to zero in 2010 and 2011.

Higher Social Security tax cap. The maximum amount of earnings subject to Social Security taxes has increased from $106,800 in 2011 to $110,100 in 2012. The Social Security Administration estimates that about 10 million high earners will pay higher taxes as a result of the increase in the taxable maximum.

[See 10 Things You Didn't Know About Social Security.]

Social Security tax holiday temporarily extended. The 2 percent payroll tax cut that workers received in 2011 was recently extended through the first two months of 2012 by the Temporary Payroll Tax Cut Continuation Act of 2011. Nearly 160 million workers will continue to have 4.2 percent of their pay deposited into the Social Security trust fund instead of the usual 6.2 percent until Feb. 29, 2012.

However, higher-income employees who earn more than $18,350 in January and February 2012 must pay a 2 percent Social Security tax on the amount they earn between $18,350 and $110,100. "This additional recapture tax is an add-on to income tax liability that the employee would otherwise pay for 2012 and is not subject to reduction by credits or deductions," according to a statement from the IRS. "The recapture tax would be payable in 2013 when the employee files his or her income tax return for the 2012 tax year." Under current law, Social Security taxes are scheduled to return to 6.2 percent of pay in March 2012.

Higher earnings limits. Early retirees who work and collect Social Security benefits at the same time can earn $480 more next year before a portion of their Social Security benefit will be temporally withheld. Social Security recipients below their full retirement age (66 for those born between 1943 and 1954) can earn up to $14,640 in 2012, above which 50 cents of each dollar earned will be withheld from their Social Security payments. For retirees who will turn 66 in 2012, the limit climbs to $38,880, after which 33 cents of each dollar earned will be deducted from monthly payments. Starting the month you turn your retirement age, there is no penalty for working and collecting Social Security benefits at the same time. At that time, your benefit will also be adjusted to reflect your continued work record and any benefits that were withheld.

Maximum possible benefit grows. The maximum possible Social Security check will grow to $2,513 per month in 2012, up from $2,366 in 2011. To get this amount, a worker would need to earn the maximum taxable amount ($110,100 in 2012) every year after age 21.

Twitter: @aiming2retire

http://finance.yahoo.com/news/5-social-security-changes-coming-153637037.html
_________________
Click Here To Return To The Home Page Of www.overthehillcarpeople.com

[Admin]

5 Social Security Changes Coming in 2012

#SS #GOV.

http://forums.overthehillcarpeople.com/viewtopic.php?p=9878#9878
_________________
Click Here To Return To The Home Page Of www.overthehillcarpeople.com