In 2023 Social Security Is Set to Undergo Six Major Changes

In 2023 Social Security Is Set to Undergo Six Major Changes

In 2023 Social Security Is Set to Undergo Six Major Changes.This year, Social Security is undergoing significant changes, with many of them linked to the largest cost-of-living adjustment (COLA) witnessed in over four decades.

In 2023 Social Security Is Set to Undergo Six Major Changes

While the new COLA will influence Social Security payouts, it’s just one of several modifications set for 2023. Here’s a breakdown of these changes based on the latest information from the Social Security Administration. Check out this article Social Security COLA for 2024 Increased : How Much Will Benefits Increase Next Year?

See also  Comprehensive Guide to SSI Eligibility and Benefits from Social Security

1. Implementation of the New COLA

2023 sees a notable 8.7% rise in the Social Security COLA, marking the most substantial increase since the 11.2% hike in 1981. This significant increase is attributed to the highest inflation rate in 41 years. Consequently:

  • The average monthly Social Security payment for retirees has surged by $146, moving from $1,681 to an estimated $1,827.
  • Beneficiaries of Social Security started receiving the updated payment from January 2023, while those on Supplemental Security Income (SSI) saw the change from December 30, 2022.

However, it’s essential to note that not all recipients will experience the exact 8.7% COLA. The increase might be higher or lower for some, depending on factors like the primary insurance amount (PIA) and Medicare enrollment timing. Beneficiaries should have received mailed notices from the SSA detailing the new payment figures.

See also  Dispelling Disability Benefit Myths | Understanding Social Security

2. Adjusted Social Security Disability Income Limits

The SSA offers monthly benefits to individuals incapacitated from work due to disabilities. While these benefits typically continue until the recipient can resume regular work, there are cases where one might qualify for disability even while working. However, eligibility is capped at a specific income level. The thresholds for 2023 have been adjusted based on average monthly earnings.

3. Enhancement in SSI Federal Payment Standard

Beneficiaries eligible for both Social Security and Supplemental Security Income (SSI) will notice an increase in the maximum Federal SSI payment amounts this year. This is in line with the 8.7% COLA:

  • For single individuals, the standard has increased from $841 in 2022 to $914 in 2023.
  • For couples, the amount has gone up from $1,261 in 2022 to $1,371 in 2023.
See also  Are You Breaking One of the 2,728 Rules Set by Social Security?

4. Increase in Maximum Benefits for Full Retirement Age Retirees

For Americans retiring at the full retirement age (either 66 or 67, based on birth year), the maximum benefits have been adjusted:

  • The cap has risen from $3,345 per month in 2022 to $3,627 per month in 2023.
See also  Do I Need to Apply for Social Security Income in Advance?

5. Revised Maximum Taxable Earnings for Active Workers

All salaried individuals are familiar with the portion of their paycheck reserved for Social Security taxes. The annual earnings subject to these taxes have a ceiling, known as the maximum taxable earnings. For 2023:

  • This limit has been increased from $147,000 in 2022 to $160,200.
See also  Applying for Social Security at Age 65 Could Reduce Your Check

6. Modifications to Earnings Test Exempt Amounts

For those earning beyond a specified level and yet to reach the full retirement age, Social Security may withhold benefits. This is termed the retirement earnings test exempt amount. The SSA has made adjustments for 2023:

  • For those below the full retirement age, the exempt amount has been raised from $1,630 per month in 2022 to $1,770 in 2023.
  • For those attaining the full retirement age, the amount has increased from $4,330 per month in 2022 to $4,710 in 2023.

Similar Posts