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Honored Social Butterfly

Social Security Announces 2022 COLA Increase

SSA.gov News Release 10/13/2021 - Cost-of-Living Adjustment (COLA) Information for 2022

from the link:

Social Security and Supplemental Security Income (SSI) benefits for approximately 70 million Americans will increase 5.9 percent in 2022.

The 5.9 percent cost-of-living adjustment (COLA) will begin with benefits payable to more than 64 million Social Security beneficiaries in January 2022. Increased payments to approximately 8 million SSI beneficiaries will begin on December 30, 2021. (Note: some people receive both Social Security and SSI benefits)

Read more about the Social Security Cost-of-Living adjustment for 2022.

The maximum amount of earnings subject to the Social Security tax (taxable maximum) will increase to $147,000.

The earnings limit for workers who are younger than "full" retirement age (see Full Retirement Age Chart) will increase to $19,560. (We deduct $1 from benefits for each $2 earned over $19,560.)

The earnings limit for people reaching their “full” retirement age in 2022 will increase to $51,960. (We deduct $1 from benefits for each $3 earned over $51,960 until the month the worker turns “full” retirement age.)

There is no limit on earnings for workers who are "full" retirement age or older for the entire year.

 

AARP.org - Social Security Resource Center - Social Security COLA Set at 5.9 Percent for 2022

Lots more info at the AARP.org link above.

 

Medicare Part B premiums have not yet been announced.

It's Always Something . . . . Roseanna Roseannadanna
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Newbie

Yes sounds good BUT it's not because Bidens horrible decisions (XL Pipeline, Tax increases yet to come, Supply shortages) have increased the price of everything we buy way past 5.9%. Gas alone will eat that up in no time. Then groceries and clothing will take it quickly. AARP should be telling people the Biden Administration is hurting all seniors in their pocket book. Stop covering for this Presidents bad choices.

Newbie

Puhleeze... it was ever thus. Its no different with him than with any other president. And it isnt meant to give you extra. The COLA is BECAUSE prices went up. Otherwise you wouldn't get an increase. 

Newbie

I turned  65 this  July.  In June I  had Medicaid for  health insurance due to  being laid off and health reasons so  I had to  take my So. Security benefits early taking a $400/ cut.  Then in July,  my birthday month I all of  a sudden was told I made to  much to be  on Medicaid and I now fall into a new catagory called SLMB where they will pay your $148.50 premium and lower your  drug costs but I will now have a regular  managed care  plan with $295 per day hospital stay, $35 each time I  see a specialist and / or Physical  Therapist, which  I need to have for a hip surgery.  Plus I  have  to buy all my home health products that you need after a hip surgery.  How in the hell do they think  I can do it.  I was  blind  sided  with being told I was  loosing my Medicaid (with no co-pay, no out-of-pocket) to all these  co-pays and out-of-pocket  costs.  And  get this,  to  be eligible for  food stamps the amount of  money you can make goes  up every year so you can still be  eligible due to  the cost of  living goingn up.  But for those of  us that turn 65 that were on Medicaid due to loosing our  jobs of no fault  of our  own, and just having a  birthday, they instantly take  away your medicaid and tell you you make  to much and you now  are  SLMB.  Which they do  pay my monthly premium and you get  lower  drug  costs, you  are  slammed with co-pays and out-of-pocket.  I  need a hip surgery and the hospital co-pays and  the  physical therapy co-pays are insane.  I will be  dead  before I  can  pay  it off.  All because I turned  65.  When  you need  it the most as  you get  older  they take away and make it  harder for you to take care of  your  health.  When we  get this COLA So. Security increase that  will take even the $148.50 premium payment  help they give  me  now  away.  Every year as  we  get the COLA's they LOWER the amount you can make so it is harder for  any  one over  65 to get Medicare/Medicaid help (called  dual eligible or  QMB) or  even what  they tossed me into where  you  pick  a  managed  care  plan but you  are  (SLMB) where you have  co-pays and deductibles that are  impossible  for you to pay.   Yet  the amount of money you can make  for food stamp  money goes  up every year.  Go figure.  Our country is  going to  kill off  us  baby boomers by not allowing us to  get the help we need  to take care of  ourselves.  I still work one  day a week,  I volunteer and I  want  to  be healthy. Without  this surgery I will end up crippled  for life  and will only  get  worse.  

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Honored Social Butterfly

@SHarts53 

Sorry this happen to you and it sounds like the consequences of your actions weren't fully understood at the time.  All you can do now is to understand how it all works.  You are right - Medicare is definitely not a free health program.

 

Only you can answer the personal income/resource amounts for getting some type of Medicare savings.    There are (4) different types of Medicare Savings Programs and each has an income/resource eligibility limit.  Each pays for different (Medicare) things based on financial need as defined by the income/resource limits.

 

Take a look at them to make sure that you are in the correct category based on your income/resources.  These are 2021 figures not 2022.  Redo your comparison when the 2022 numbers come out, hopefully soon - your state may know them now or soon.

Medicare.gov - Medicare Savings Programs

In addition, on the left side of this same Medicare.gov page, you will see the (Medicare related) Medicaid category, also for your review with your state to see the income/resource limits for this program for low income; it is state specific.

 

You are getting a pretty good additional benefit under the SLMB program now - just based on 2021 figures.  Taxpayers are paying and you are saving $ 148.50 per month ( 2021 Part B premiums) + as you said, savings on your Medicare covered medications.    

 

Usually, these income/resource limits change every year, so you may need to review the 2022 figures to make sure that you still qualify and for which program - your state should be able to help with this - they may automatically send you a renewal application. 

 

With a COLA as large as 5.9% for 2022, and new eligibility limits set for these Medicare Saving programs in 2022, some Medicare beneficiaries may find that they will lose their Medicare Savings program classification - it is all in the numbers and the program.  That's why it has to be reviewed every year so as not to be blind-sided.

 

What happened to you is not unusual - you went from the expanded Medicaid program, expanded under the ACA and your state,  when you were 64 and lost your job TO Medicare when you turned 65 -  There are different eligibility criteria (income, family size, etc.) associated with Medicaid programs of different types.  You were on this (expanded Medicaid) at 64 years of age :  Healthcare.gov - Medicaid expansion & what it means for you.  

This expanded Medicaid program under the ACA is completely different in eligibility criteria with the Medicare/Medicaid program.

 

 

 

 

It's Always Something . . . . Roseanna Roseannadanna
Honored Social Butterfly

The XL Pipeline was never needed as even Canada rejected it. Fact is it was built in stages a number of years ago. Price of gas is set by OPEC and their is a world shortage due to the virus. If Trump had done his job we would not have this happening. The Biden Admin is saving all the people of this Country from living under a Dictatorship Trump tried to establish when he tried to take over the govt. last Jan. AARP is now trying to make sure we stay a democracy  and asking all Seniors to take part in that by learning what is really going on.

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Social Butterfly

.

@DM0810 

The truth is trump inflation is starting to ramp up after he ignored the pandemic for over a year.

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Social Butterfly

.

@GailL1 

When do you think they’ll raise or eliminate the caps on incomes subject to Social Security FICA, no matter how it is earned? Include capital gains, CEO stock bonuses, hedge fund managers carried interest rule exempted income and any other tax dodge exempted income.

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Honored Social Butterfly

Another reply to you that I just thought about -

Another change that NEEDS to happen is for employers and employees to start paying social security payroll taxes on ALL their compensation - especially the benefits which they get in lieu of actual wages, like employer provided health insurance.

It's Always Something . . . . Roseanna Roseannadanna
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Social Butterfly

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So, you would be in favor of taxing fringe benefits?  I don’t know you might restricting an employer to be able to bring top talent on board to their company.

 

You know that sometimes fringe benefits is what can seal the deal between an employer bringing a skilled /talented employee onto their payroll. Fringe benefits too are sometimes offered in lieu of a higher salary

 

Yes, I think the problem is the tax code but not for the average working U.S. citizen.

 

According to Forbes nearly 500 people became Billionaires during the pandemic year. Add that to the 300 we already had in this country for a total of 800 billionaires.

 

https://www.forbes.com/sites/chasewithorn/2021/04/06/nearly-500-people-have-become-billionaires-duri...

 

Taxation is too soft on those 800 billionaires with deep pockets,

 

If those tax cuts and loopholes for the billionaires were actually helping to create meaningful jobs with a living wage and good benefits in our country, not China, you know I’d be the first to say “Ok @GailL1  enough with picking on the billionaires and hedge fund managers those tax cuts and loopholes for the rich are working and should be retained.”

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Conversationalist

@ReTiReD51 As @Gail1 pointed out, many fringe benefits are already taxed. It is the tax exclusion for employer provided health insurance that is the topic. Tax free employer provided health insurance is the largest tax expenditure that reduces Federal Tax revenue by about $140 to $150 Billion per year. This figure does not include State, Local and FICA taxes. The Tax Foundation estimates that Federal Tax Revenue will be reduced by almost $3 Trillion from 2019 to 2028. It may be the most important factor that contributes to our ever increasing health care costs. Remember, it is also deductible for Employers as an employment cost, it goes untaxed. The Affordable Care Act (ACA) also known as Obamacare initially addressed this topic by the "Cadillac Tax" provision which would cap our tax codes tax exclusion for employer provided health insurance. Employers would pay a 40% excise tax for Plans that exceed that exceed certain monetary benchmarks. As you may not be aware, this provision was tabled (delayed) twice and eliminated in 2019. I am providing a link to an article from the Tax Foundation that addresses the "Cadillac Tax" and employer provided health insurance.https://taxfoundation.org/cadillac-tax-employer-sponsored-health-insurance/. Hopefully, I linked it correctly so you may click and read the info. FYI, if you are enrolled in Medicare Part B and D, you are paying for those benefits with after tax dollars. For example, using $148 for Part B (148 X 12= $1,776), you need $1,989 ($1,776 X 1.12%) of income if you are in the 12% tax bracket to net $1,776. I am assuming that you are paying Federal taxes. If you do not pay Federal Taxes, then this is a moot point. Why are Medicare Eligible people paying with after tax dollars and employer provided people receiving health insurance tax free?    

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Honored Social Butterfly

I don't understand your link between what we are discussing here and the number of billionaires.  

 

So to get back on track -

 

Yep, I would be in favor of taxing fringe benefits for the benefit of Social Security/Medicare  payroll taxes - many (most) types, except for employer provided health insurance, are already taxed for federal income taxes.  I guess you didn't know this.

 

An employee "fringe benefit" is a form of pay other than money for the performance of services by employees. Any fringe benefit provided to an employee is taxable income for that person unless the tax law specifically excludes it from taxation. Taxable fringe benefits must be included as income on the employee's W-2 and are subject to withholding.

 

From IRS:  Employee Benefits

Fringe benefits are generally included in an employee's gross income (there are some exceptions). The benefits are subject to income tax withholding and employment taxes. Fringe benefits include cars and flights on aircraft that the employer provides, free or discounted commercial flights, vacations, discounts on property or services, memberships in country clubs or other social clubs, and tickets to entertainment or sporting events.

 

In general, the amount the employer must include is the amount by which the fair market value of the benefits is more than the sum of what the employee paid for it plus any amount that the law excludes. There are other special rules that employers and employees may use to value certain fringe benefits.

Health Plans  

If an employer pays the cost of an accident or health insurance plan for his/her employees (including an employee's spouse and dependents), then the employer's payments are not wages and are not subject to social security, Medicare, and FUTA taxes, or federal income tax withholding. Generally, this exclusion also applies to qualified long-term care insurance contracts. However, the cost of health insurance benefits must be included in the wages of S corporation employees who own more than two percent of the S corporation (two percent shareholders).

 

Doesn't have anything to do with the average working US Citizen or an employee in the upper echelon - if you get it in lieu of wages - it is compensation and therefore should be taxed - income taxes and social security & medicare payroll taxes.

 

Tax Policy Center - How does the tax exclusion for employer-sponsored health insurance work?

Employer-paid premiums for health insurance are exempt from federal income and payroll taxes. Additionally, the portion of premiums employees pay is typically excluded from taxable income. 

 

It's Always Something . . . . Roseanna Roseannadanna
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Social Butterfly

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The only time a billionaire pays taxes is when they sell stock, which is unearned income, and then they pay at the capital gains rate.

 

The average working U.S. citizen earns an income and pays Federal, state, city, and FICA payroll taxes.

 

Remember Warren Buffet paid a lower tax rate than his secretary.

 

Let’s start taxing Warren and all the unearned income, and any other tax dodge exempted income for FICA taxes purposes.

 

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Honored Social Butterfly


@ReTiReD51 wrote:

.

The only time a billionaire pays taxes is when they sell stock, which is unearned income, and then they pay at the capital gains rate.

 

The average working U.S. citizen earns an income and pays Federal, state, city, and FICA payroll taxes.

 

Remember Warren Buffet paid a lower tax rate than his secretary.

 

Let’s start taxing Warren and all the unearned income, and any other tax dodge exempted income for FICA taxes purposes.

 


We already talked about income classifications being taxed above as well as raising the earning cap - asked by you on 10-14-2021 08:07 AM and answered by me on 10-15-2021 12:23 PM.

 

Here we are talking about compensation - as in wages and those things paid as compensation like employer based health insurance premiums.  THIS is the BIGGEST tax loophole that we have.  

 

You said:  "The average working U.S. citizen earns an income and pays Federal, state, city, and FICA payroll taxes."

 

NOT on their employer based health insurance which is part of their compensation.  A fringe benefit that is not taxed AT ALL - not income tax and not payroll taxes of SS and Medicare.  Neither does the employer pays their share of the payroll taxes on this form of compensation - Employer based health insurance is compensation - remember its origin.

It's Always Something . . . . Roseanna Roseannadanna
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Social Butterfly

.

I have no problem with the averaging working person not paying a tax on their health insurance, dependent care, group term life insurance or other nontaxable qualified benefits.  They deserve these tax breaks.

 

I do have a problem with people who hide their fortunes off shore in tax havens like the Caymans. Change the tax codes to prevent it and require them to not only pay federal, state, city but FICA taxes as well.

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Honored Social Butterfly

Guess we will have to agree to disagree on these average US citizen workers getting this HUGE tax loop hole - I can remind them of it every time they think their SS benefit should be higher.

 

Like I said on the other topic - change the definition of what is "earned income".   the higher income folks do already pay more - they pay the Medicare surcharge, they pay the IRMAA rates for their Part B and D premiums.  They pay lots and lots of tax on their Social Security benefit which goes back to the Trust Fund.

It's Always Something . . . . Roseanna Roseannadanna
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Honored Social Butterfly


@ReTiReD51 wrote:

.

@GailL1 

When do you think they’ll raise or eliminate the caps on incomes subject to Social Security FICA, no matter how it is earned? Include capital gains, CEO stock bonuses, hedge fund managers carried interest rule exempted income and any other tax dodge exempted income.


Guess that depends on when the Trust Fund(s) hit the critical status of insolvency and beneficiaries have to start budgeting for lower benefits.  Doesn't seem there is too much else that is rushing the legislators to fix it.

 

As to removing the cap - the 1st thing that has to be done is to redefine "earned income" and believe me, that will affect many more than just the so-called "rich".

 

Remember that when one pays into the program, they are entitled to a benefit.  So will either of these changes solve the financial problems of the Trust Fund - NO, not completely.  We can build in more bend points to make the program even more progressive but in the end, the vast amount of contributions that would be paid into the program by lifting (further) or eliminating the earnings cap all together or redefining "earned income",  IMO, would hurt more than it would help the economic wellbeing of our country - at least right now.

 

IF anybody wants some action by our legislators - sooner rather than later - support S.1295 - The Trust Act of 2021 

and let your Congressional Representative know of this support

 

 

It's Always Something . . . . Roseanna Roseannadanna
Social Butterfly

This is reported to be the highest increase in 39 years, so great!

 

But let's await the Medicare Part B Premium announcement; based on the last 20+ years, that will take nearly every penny (75%) of the COLA for Seniors to cover it...

 

#StaySafe


#VegasStrong
Phil Harris, actor and showman, to John Fogerty of CCR: “If I’d known I’d live this long, I’d have taken better care of myself.”
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Periodic Contributor

Thought I heard that the Part B premium will be $157.50

 

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Honored Social Butterfly

There is nothing official yet - so wherever you "heard" it was just guessing.  Will depend on how much Congress want to shield us.

Join the pool -  make your guess here:

AARP Community Medicare & Insurance:  Let's Start A Pool - Best GUESS Wins

 

It's Always Something . . . . Roseanna Roseannadanna
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Honored Social Butterfly


@WebWiseWoman wrote:

This is reported to be the highest increase in 39 years, so great!

 

But let's await the Medicare Part B Premium announcement; based on the last 20+ years, that will take nearly every penny (75%) of the COLA for Seniors to cover it...

 

#StaySafe


Most likely, Part B premiums will go up but that's nothing new and I think your estimate is kind of off since Congress has a hard time of raising the cost to beneficiaries, like they did last year (2020)

AARP 10/15/2020 - Congress Limits Medicare Part B Premium Increase

It isn't suppose to work this way in Medicare Part B - Actions such as this just increases our Country's deficit spending.  SMI Trust Fund (Part B) is suppose to represent 25% of the cost of the program and the government is suppose to pay the rest (75%).  This ratio got blown out of the water last year for 2021 premiums because of this and it maybe the same for this year too.  

Guess we will see.

 

 

It's Always Something . . . . Roseanna Roseannadanna
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Honored Social Butterfly

If we made everyone get VAC, and wear a mask to end Covid 19 there would be more than enough money to pay for all of this.

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Social Butterfly

.

@WebWiseWoman 

Are you aware there is a pool - best guess wins, happening at the at the AARP Medicare&Insurance board? 

 

https://community.aarp.org/t5/Medicare-Insurance/Let-s-Start-A-Pool-Best-GUESS-Wins/m-p/2423465#M725...

 

Why not put your best guess estimate of what you think the standard Medicare Part B Premium will be for 2022 in the mix?

 

I’m not certain what the prize is for the winner but the guessing might help us all deal with the shock of the sticker price for the 2022 premium.

Honored Social Butterfly

Thanks @ReTiReD51 for promoting the contest - yep, should be interesting.

Seems most on this community website don't care - since it doesn't involve a game, a song or a front porch. (OH, OR A benefit - like a credit card - HA, HA)

 

 

It's Always Something . . . . Roseanna Roseannadanna
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