Another Archival Summary of the BEST Social Security Mod Plan

Another Archival Summary of the BEST Social Security Mod Plan

For more details on the plan, please read my earlier posts!

Historical Background

Since Social Security’s inception in 1935, many changes have been made to the program. Some examples are adding disability benefits, the Supplemental Security Income program, Medicare, and mandating coverage for the self-employed and employees of non-profit organizations.

What It Does

·          Improves long range solvency of the Social Security Trust Funds.

·          Adds progressivity to Social Security taxation.

·          Welcomes new groups of workers into the Social Security program.

·          Serves to stabilize the economy.

·          Slows the inflation of real estate values.

·          Inspires new confidence in the Social Security program.

What It Does Not Do

·          It does not remove the Social Security wage/coverage cap.

·          It does not increase the retirement age.

·          It does not reduce the amount of retirement benefits.

How Does It Do It?

·          Lowers the payroll tax rate for workers/self-employed who earn at or below minimum wage levels from 7.65%-15.3% respectively to 4.65%-9.3%.

·          Increases the payroll tax for that portion of earnings which exceed the curent maximum covered base from 7.65%-15.3% to 9.65%-17.3%, using current methodology for cap increases, over a 10 year rolling period.

·          Adds three new categories of work which will be subject to Social Security coverage: Short term capital gains, all rentals from real estate, and working for state & local employers currently not covered by Social Security for the first five years of employment.

Who Does It Affect?

·          Having an equitable, progressive, solvent Social Security program affects everyone.

·          Those who work in real estate rentals and in the businesses of short term investing, and currently non-covered state and local employers and employees.

·          Higher wage earners who earn in excess of the current Social Security maximum.

·          Minimum wage earners, young workers starting to work, and retired part-time workers.

·          Start-up businesses whose profits are at minimum wage levels.