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Eliminating taxes on Social Security benefits could accelerate this depletion. Currently, taxing these benefits contributes approximately $100 billion annually to the trust fund. Without these funds, the already precarious situation facing Social Security could worsen.
Potential Solutions on the Horizon
To address the impending Social Security crisis, several potential solutions are being discussed:
Adjusting the Taxable Wage Base: Currently capped at $176,100, discussions are ongoing about either raising or eliminating this wage base for contributions.
Increasing Social Security Tax Rates: Currently at 7.65% for employees—half for the employer—the possibility of increasing this rate is on the table.