Social Security has recently been under attack with misleading claims. The article below aims to set the record straight on Social Security by covering:
How Social Security works from a worker’s perspective
How it’s financed
Why maintaining the system is not as difficult as some claim
Social Security is a crucial government program supported by a dedicated payroll tax (FICA). Workers contribute 12.4% of their earnings (Workers contribute 6.2% of their earnings for Social Security tax and their employer matches it by also contributing 6.2%. If an employee is self-employed, they must contribute both the employer and employee portion to the IRS.), with benefits dependent on lifetime earnings. The program is progressive, offering greater support to lower-income workers. While Social Security doesn’t function like a traditional pension, its structure is designed to ensure sustainability.
In addition, FICA taxes include not only Social Security, but also 1.45% for Medicare tax. The match by employers is also applicable here. The only difference is that there is no league limit on Medicare taxes.
Read more HERE
