The first Social Security change has to do with the taxable maximum. That means the Administration will get more money from those Americans who are high earners. Despite the fact that the payroll tax rate is still the same, the taxable maximum has increased.
As the cost of living goes up, the Administration needs more funds to pay more every year to retirement or disability benefits recipients. Social Security set the taxable maximum at $160,200 in 2023. That means you only pay taxes up to $160,200 of your earnings.
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Of course, this change only affects those who earn more than $160,200. Mainly because those with earnings of more than 160,200 dollars did not pay more taxes after they reached the taxable maximum. Thus, $168,600 will be the new taxable maximum for 2024.
What will the maximum amount a taxpayer pays to Social Security be in 2024?
While a worker can pay up to $9,932.40 in 2023, the amount goes up to $10,453.20 in 2024. As a consequence, high earners may end up paying 520.80 dollars more in 2024. But this is not the only change, thanks to the 2024 COLA boost, beneficiaries will get more cash per month.
In spite of being a lower COLA increase than in the previous year, beneficiaries can still qualify for a payment with a 3.2% boost. Whether it is a fair increase or not is a different story because many seniors claim that it does not even cover the rise in medical costs.
The average retirement benefit will go up to $1,907 in January 2024. Social Security has informed seniors that the average check for retirees is about $1,848, so you may receive about 59 dollars extra per month.
People on disability benefits receive payments of about $1,489 on average. So, if you are on SSDI you may get about $1,537 in 2024 thanks to the 3.2% boost. SSI recipients will get up to $472 (essential person), up to $943 (single), or up to $1,415 (married couples) in 2024.
Social Security work credits will cost more in 2024
Apart from having a higher taxable income and a COLA boost, there will also be a new quarter of coverage amount. In 2023, you need to have $1,640 of earnings to get one work credit. In total, you will need 40 work credits to get retirement benefits.
Social Security has set the new figure for work credits at $1,730. However, you will still need at least ten years of work to get the minimum number of credits to qualify for retirement checks.
The fourth change that will have a positive impact on people with disability’s lives will be the Social Security Disability Thresholds. The Substantial Gainful Activity limits change depending on your situation.
For example, the new threshold is $1,550 per month for those people with a disability who are not blind. Blind people can have earnings that are lower than $2,590. But if you are taking part in the Trial Work Period, the SGA limit is $1,110 per month.