Provisions Affecting OASDI Contribution and Benefit Base

Information on the contribution and benefit base (taxable maximum)

These provisions modify the OASDI contribution and benefit base (taxable maximum). The OASDI contribution and benefit base serves the following two purposes:

As a contribution base, it establishes the maximum annual amount of covered earnings subject to OASDI payroll taxes.
As a benefit base, it establishes the maximum amount of earnings creditable for the purpose of benefit computation.

We provide a summary list of all options in this category. For each provision listed below, we provide an estimate of the financial effect on the OASDI program over the long-range period (the next 75 years) and for the 75th year. In addition, we provide graphs and detailed single year tables.

All estimates are based on the intermediate assumptions described in the 2008 Trustees Report. Choose the type of estimates (summary or detailed) from the list of provisions.

Number	Table and graph selection
E1	Beginning in 2009, make all earnings subject to the payroll tax (but retain the current-law taxable maximum for benefit calculations). Summary measures and graphs (PDF version) Detailed single year tables (PDF version)
E2	Beginning in 2009, make all earnings subject to the payroll tax and credit them for benefit purposes. Summary measures and graphs (PDF version) Detailed single year tables (PDF version)
E3	Determine the level of the contribution and benefit base such that 90 percent of the earnings would be subject to the payroll tax (phased in 2009-2018). All earnings subject to the payroll tax would be used in determining benefits. Summary measures and graphs (PDF version) Detailed single year tables (PDF version)
E4	Make 90% of the earnings subject to the payroll tax (phased in 2009-2018), but retain the current-law taxable maximum for benefit purposes. This estimate considers all self-employed earnings in computing the percentage of earnings subject to the payroll tax. Summary measures and graphs (PDF version) Detailed single year tables (PDF version) Memorandum containing the provision (effective dates may be different)
E5	Raise the taxable maximum amount (the contribution and benefit base) to include 90 percent of total OASDI covered earnings. Phase in this increase gradually between 2010 and 2015. Benefit computations would reflect all earnings up to the new taxable maximum. Summary measures and graphs (PDF version) Detailed single year tables (PDF version)
E6	Impose a 3 percent payroll tax on OASDI covered earnings above the current taxable maximum starting in 2009. Benefit computations would not reflect any earnings above the taxable maximum amount. Summary measures and graphs (PDF version) Detailed single year tables (PDF version)
E7	In 2009 through 2011, raise the OASDI contribution and benefit base from $102,000 to $110,000 (in 2008 AWI indexed dollars). For years after 2011, the contribution and benefit base would be increased based on changes in SSA's average wage index. Additional earnings subject to the OASDI payroll tax would be credited for benefit calculation purposes. Summary measures and graphs (PDF version) Detailed single year tables (PDF version) Memorandum containing the provision (effective dates may be different)
	Above provisions Summary measures


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