The Social Security Administration announced this week a 2 percent boost to monthly Social Security and Supplemental Security Income (SSI) benefits for 2018. The increase is the largest since 2012, and is based on the rise in the Consumer Price Index over the past 12 months ending in September 2017.
For those still contributing to Social Security through wages, the potential maximum income subject to Social Security tax increases 1.2 percent this year, to $128,700. A recap of the key amounts is outlined here:
The Social Security and Medicare tax rates do not change from 2017 to 2018.
Note: The above tax rates are a combination of 6.20 percent Social Security and 1.45 percent for Medicare. There is also 0.9 percent Medicare wages surtax for those with wages above $200,000 single ($250,000 joint filers) that is not reflected in these figures. Please note that your employer also pays Social Security and Medicare taxes on your behalf. These figures are reflected in the self-employed tax rates, as self-employed individuals pay both halves of the tax.
As always, feel free to pass this Tip along to friends, and reach out if you need help with your personal tax and finance situation.
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