Cost-of-Living Adjustment (COLA)
- Social Security and Supplemental Security Income (SSI) beneficiaries will receive a 1.3% COLA for 2021.
- This increase is based on the rise in the Consumer Price Index (CPI-W) from the third quarter of 2019 to the third quarter of 2020.
Tax Rates
- The Social Security tax rate remains unchanged at 6.20% for employees and 12.40% for self-employed individuals.
- The Medicare tax rate also remains unchanged at 1.45% for both employees and self-employed individuals.
- High-income earners (over $200,000 for individuals and $250,000 for married couples) will continue to pay an additional 0.9% Medicare tax.
Maximum Taxable Earnings
- The maximum taxable earnings for Social Security (OASDI) increase from $137,700 in 2020 to $142,800 in 2021.
- There is no maximum taxable earnings limit for Medicare (HI).
Quarter of Coverage
- The amount of earnings required to earn a quarter of Social Security coverage increases from $1,410 in 2020 to $1,470 in 2021.
Retirement Earnings Test Exempt Amounts
- The exempt amount for individuals under full retirement age increases from $18,240 per year ($1,520 per month) in 2020 to $18,960 per year ($1,580 per month) in 2021.
- The exempt amount for the year an individual reaches full retirement age increases from $48,600 per year ($4,050 per month) in 2020 to $50,520 per year ($4,210 per month) in 2021.
- There is no earnings test for individuals who reach full retirement age during the year.
Social Security Disability Thresholds
- The Substantial Gainful Activity (SGA) threshold for non-blind individuals increases from $1,310 per month in 2020 to $1,360 per month in 2021.
- The SGA threshold for blind individuals increases from $2,190 per month in 2020 to $2,260 per month in 2021.
- The Trial Work Period (TWP) earnings limit increases from $940 per month in 2020 to $970 per month in 2021.
Maximum Social Security Benefit
- The maximum Social Security benefit for a worker retiring at full retirement age increases from $3,011 per month in 2020 to $3,148 per month in 2021.
SSI Federal Payment Standard
- The SSI federal payment standard for individuals increases from $783 per month in 2020 to $794 per month in 2021.
- The SSI federal payment standard for couples increases from $1,175 per month in 2020 to $1,191 per month in 2021.
SSI Resource Limits
- The SSI resource limit for individuals remains unchanged at $2,000.
- The SSI resource limit for couples remains unchanged at $3,000.
SSI Student Exclusion
- The monthly SSI student exclusion limit increases from $1,900 in 2020 to $1,930 in 2021.
- The annual SSI student exclusion limit increases from $7,670 in 2020 to $7,770 in 2021.
Estimated Average Monthly Social Security Benefits Payable in January 2021
| Category | Before 1.3% COLA | After 1.3% COLA |
|---|---|---|
| All Retired Workers | $1,523 | $1,543 |
| Aged Couple, Both Receiving Benefits | $2,563 | $2,596 |
| Widowed Mother and Two Children | $2,962 | $3,001 |
| Aged Widow(er) Alone | $1,434 | $1,453 |
| Disabled Worker, Spouse and One or More Children | $2,195 | $2,224 |
| All Disabled Workers | $1,261 | $1,277 |
The Big Changes to Social Security in 2024
FAQ
What is the $16728 Social Security bonus?
At what age is Social Security no longer taxable?
Will Social Security be taxed in 2024?
What income reduces Social Security benefits?
Will Social Security benefits increase in 2021?
Approximately 70 million Americans will see a 1.3 percent increase in their Social Security benefits and Supplemental Security Income (SSI) payments in 2021. Federal benefit rates increase when the cost-of-living rises, as measured by the Department of Labor’s Consumer Price Index (CPI-W).
Will Social Security benefits increase in 2024?
Social Security and Supplemental Security Income (SSI) benefits for more than 71 million Americans will increase 3.2 percent in 2024. The 3.2 percent cost-of-living adjustment (COLA) will begin with benefits payable to more than 66 million Social Security beneficiaries in January 2024.
Will Social Security benefits increase in 2022?
Social Security and Supplemental Security Income (SSI) benefits for approximately 70 million Americans will increase 5.9 percent in 2022, the Social Security Administration announced today. 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.
When will SSI increases start?
Increased payments to approximately 8 million SSI beneficiaries will begin on December 30, 2021. (Note: some people receive both Social Security and SSI benefits). The Social Security Act ties the annual COLA to the increase in the Consumer Price Index as determined by the Department of Labor’s Bureau of Labor Statistics.