2012 Social Security Changes – Cost-of-Living Adjustment (COLA) – 2012 Wage Base
Cost-of-Living Adjustment (COLA) Surce: SSA.gov
Based on the increase in the Consumer Price Index (CPI-W) from the third quarter of 2008 through the third quarter of 2011, Social Security and Supplemental Security Income (SSI) beneficiaries will receive a 3.6 percent COLA for 2012. Other important 2012 Social Security information is as follows:
|
Tax Rate:
|
2011 | 2012 |
|---|---|---|
| Employee | 7.65%* | 7.65% |
| Self-Employed | 15.30%* | 15.30% |
| NOTE: The 7.65% tax rate is the combined rate for Social Security and Medicare. The Social Security portion (OASDI) is 6.20% on earnings up to the applicable taxable maximum amount (see below). The Medicare portion (HI) is 1.45% on all earnings.
* Section 601 of the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 reduced, for wages and salaries paid in calendar year 2011 and self-employment income in calendar year 2011, the OASDI payroll tax by 2 percentage points, applied to the portion of the tax paid by the worker and the self-employed individual. |
Section 101 of the Temporary Payroll Tax Cut Continuation Act of 2011 extends the reduction of the tax rate (see * under NOTE in previous column) through the end of February 2012. (The reduced tax rate for earnings in 2012 applies only to the first $18,350 of a worker’s total wages and self-employment income. The limit of $18,350 is two-twelfths of the $110,100 taxable earnings limit for 2012.) Unless additional legislation is approved, the tax rate will then revert to the unreduced rate. | |
|
Maximum Taxable Earnings:
|
2011 | 2012 |
| Social Security (OASDI only) | $106,800 | $110,100 |
| Medicare (HI only) | N o L i m i t | |
|
Quarter of Coverage:
|
2011 | 2012 |
| Earnings needed to earn one Social Security Credit | $1,120 | $1,130 |
|
Retirement Earnings Test Exempt Amounts:
|
2011 | 2012 |
| Under full retirement age
NOTE: One dollar in benefits will be withheld for every $2 in earnings above the limit. |
$14,160/yr. ($1,180/mo.) |
$14,640/yr. ($1,220/mo.) |
| The year an individual reaches full retirement age
NOTE: Applies only to earnings for months prior to attaining full retirement age. One dollar in benefits will be withheld for every $3 in earnings above the limit. There is no limit on earnings beginning the month an individual attains full retirement age. |
$37,680/yr. ($3,140/mo.) |
$38,880/yr. ($3,240/mo.) |
|
Social Security Disability Thresholds:
|
2011 | 2012 |
| Substantial Gainful Activity (SGA) Non-Blind Blind |
$1,000/mo. $1,640/mo. |
$1,010/mo. $1,690/mo. |
| Trial Work Period (TWP) | $720/mo. | $720/mo. |
|
Maximum Social Security Benefit: Worker Retiring at Full Retirement Age:
|
2011 | 2012 |
| $2,366/mo. | $2,513/mo. | |
|
SSI Federal Payment Standard:
|
2011 | 2012 |
| Individual | $674/mo. | $698/mo. |
| Couple | $1,011/mo. | $1,048/mo. |
|
SSI Resources Limits:
|
2011 | 2012 |
| Individual | $2,000 | $2,000 |
| Couple | $3,000 | $3,000 |
|
SSI Student Exclusion:
|
2011 | 2012 |
| Monthly limit | $1,640 | $1,700 |
| Annual limit | $6,600 | $6,840 |
|
Estimated Average Monthly Social Security Benefits Payable in January 2012:
|
Before 3.6% COLA |
After 3.6% COLA |
| All Retired Workers | $1,186 | $1,229 |
| Aged Couple, Both Receiving Benefits | $1,925 | $1,994 |
| Widowed Mother and Two Children | $2,455 | $2,543 |
| Aged Widow(er) Alone | $1,143 | $1,184 |
| Disabled Worker, Spouse and One or More Children | $1,826 | $1,892 |
| All Disabled Workers | $1,072 | $1,111 |
