The Social Security Administration reviews key numbers each year and usually makes adjustments, and this year, the changes are significant. In a recent release, the SSA announced what is and is not changing for 2022.
Here are the key changes:
- The maximum taxable earnings for the Social Security portion rises from $142,800 to $147,000. (There is no limit on the Medicare portion.)
- Exempt amounts under the earnings test rise from $18,960/year to $19,560/year. For those under normal retirement age, $1 in benefits will be withheld for every $2 in earnings above the limit.
- The maximum benefit rises from $3,148/month to $3,345/month.
- Social Security and Supplemental Security Income beneficiaries will receive a 5.9% COLA for 2022.
Not changing are:
- The tax rates, which remain at 7.65 percent for employees and 15.30 percent for the self-employed
- The additional 0.9 percent in Medicare taxes for those earning at least $200,000 ($250,000 for married couples filing jointly)
This is just a summary. Further details, including disability threshold changes, are available on the SSA site.
About this Author
Laura specializes in income tax return preparation, compliance, and research for individuals and businesses. She also is experienced in preparing compiled and reviewed financial statements, individual and S-Corporation taxation, multi-state taxation, and income tax credits including the R&D credit.