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What a new plan in Congress would mean for benefits

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 A Social Security reform bill popular with House Democrats is getting reintroduced in Congress.

The document has some updates this time to increase support from Republicans all across the aisle.

Rep. John Larson of Connecticut, the chairman of House Ways and Means Social Security Subcommittee is introducing the bill.

Representative Alexandria Ocasio Cortez, D.N.Y. and Richard Neal, D.Mass. were among those who announced the reintroduction.

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This new bill is based on recent estimates by the Social Security Administration that trust funds supporting the program will run out in 13 years. The year 2034 will be the date at which point. 78% of promised benefitsAll fees will be charged.

This bill would allow Congress to prolong the date until 2038 in order to provide more time for Congress to resolve long-term problems with the program’s solvency.

It would include President Joe Biden’s proposals during his presidential campaign and fixes that were discussed at Capitol Hill Hearings.

Nancy Altman, President of Social Security Works (an advocacy group which promotes increasing benefits), said, “It has got a lot it’s attractive.

The Social Security 2100 Act, which is similar to Biden’s plan would provide a greater minimum benefit for workers with low incomes. The benefit levels would not be below the poverty line, but they would be linked to wages currently being earned.

Additionally, existing and new beneficiaries receive a benefit increase of about 2% on top of their average benefits.

The Consumer Price Index for Elderly (or CPI-E) would tie annual cost-of living adjustments to CPI. This experimental index is thought to better reflect seniors’ costs. Biden included this modification in his Social Security proposal.

The plan incorporates several elements which might draw support. Notably the Social Security 2100 Act, which was proposed last year, had more than 200 cosponsors. All of these were Democrats.

Seeking bipartisan support

After the last votes on February 28, 2019, the Senate voted to remove Rep. John Larson (D-Conn.).

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New rules would eliminate Social Security benefit reductions for public employees and spouses. They are also known as Windfall Elimination Provision or Government Pension Offset.

The issue was published at recent House hearingSocial Security and is supported by both parties.

One proposal that was eliminated — a higher payroll tax rate — may also help draw more support. Social Security 2100 Act originally called for gradual increases in contributions from employers and workers to the program, to 7.4%. That’s an increase of roughly 20% from 6.2% over the past 20 years.

However, legislation requires that higher-wage earners pay more Social Security taxes. These taxes will be capped at $142,800 per week in 2021 and rise to $147,000 in 2022. This proposal would reapply taxes on wages up to $400,000 which aligns with Biden’s proposal.

Additional changes include the extension of benefits for students up to the age 22 and elimination of a waiting period of five months to receive disability benefits. Additionally, caregiver credits were created to make sure that retirees who have taken time off from the workforce do not lose their retirement benefits.

The bill’s attention and acceptance by Republican legislators will remain to be seen. Social Security Works advocates are positive, however.

Altman explained that everyone hopes that, once reconciliation is complete and they have reached the debt limit, Social Security will be up for grabs.

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