Chapter 12. Social Security & Medicare Social Security Benefits In General ........................................................................................... 12–1 Social Security Eligibility.......................................................................................................... 12–2 Applying For Social Security..................................................................................................... 12–3 Estimating Social Security Benefits .......................................................................................... 12–4 Retirement Benefits . ................................................................................................................ 12–5 Disability Benefits .................................................................................................................... 12–6 Survivor Benefits . .................................................................................................................... 12–7 Supplemental Security Income (SSI) . ....................................................................................... 12–8 Medicare.................................................................................................................................. 12–9 Nursing Homes ...................................................................................................................... 12–10
the disability program. All funds are administered by the Social Security Administration with oversight provided by an independent Board of Trustees. Each fund pays its specific benefits and invests excess monies in U.S. Government securities. The last program, Supplemental Security Income (SSI), is not funded through the Social Security tax. Rather, the benefits from this program are paid for by the general revenue of the federal government. Taxes. For 2022, the Social Security tax rate is 6.2% each for the employer and employee (12.4% total) on the first $147,000 of employee wages. The tax rate for Medicare is 1.45% each for the employee and employer (2.9% total). There is no wage base limit for Medicare tax so all covered wages are subject to Medicare tax. For individuals earning over $200,000 a year (or $250,000 if Married, Filing Jointly), there is an additional Medicare tax of 0.9% for a total of 2.35% paid by the employee. There is no employer match on the additional tax.
12–1. SOCIAL SECURITY BENEFITS IN GENERAL. From its inception in 1935 as a retirement insurance initiative, Social Security has evolved into a large, multifaceted program that addresses the health and economic needs of approximately 61 million Americans. Monthly disbursements in excess of $80 billion are made to benefit recipients in five major programs: a. Retirement
b. Disability c. Survivor d. Medicare e. Supplemental Security Income
The first four programs are funded through the Social Security taxes paid by employees and employers. The government deposits these dollars into trust funds — two trust funds for the Medicare program; one trust fund for the retirement and survivor programs; and one trust fund for
CHAPTER 12: SOCIAL SECURITY & MEDICARE
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