The beginning of 2012 brings a lot of good news for the elderly Americans who have been impaired by the economic downturn. Starting with this year, for the first time since 2009, the elderly will receive bigger Social Security benefits statements.
This year, there will be several changes in the Social Security program that people interested in the matter should really take the time to learn about. The changes involve a boost in monthly payments, higher Social Security tax cap and earnings limits, as well as an extension of the tax holiday.
The Associated Press writes that the Social Security Commissioner Michael Astrue said that annual statements will be resent starting next month to people 60 and older who are not yet receiving benefits. The revised mailing guidelines include getting people to get their statements online. Through this web-based system, the number of statements that will be sent out will reduce costs to about $3.7 million, from a staggering $70 million annual bill.
Also, for the first time since 2009, Social Security benefiters can expect to receive bigger monthly payments. About 60 million Americans will receive increased Social Security payments by 3.6 percent this year.
Another change this year includes an increase of the Social Security cap. Basically, the maximum amount of earnings that become subject to Social Security taxes had increased to $110,100 this year, from $106,800 in 2011. As a result, according to official estimates, about 10 million high earners are going to have to pay higher taxes.
The Temporary Payroll Tax Cut Continuation Act of 2011 has extended the 2 percent payroll tax cut that workers received last year. The extension covers the first two months of 2012. But high income earners will have to pay a 2 percent Social Security tax for the two months.
Furthermore, this year the maximum possible Social Security income you can get per month is $2,513 if you work every year after age 21 on the maximum taxable wage, which is $110,100. At the same time, if you are a Social Security receiver below the full retirement age, you can earn up to $14,640 in 2012.