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SOCIAL SECURITY UPDATE

  • Writer: Treavor Dodsworth CFP®, CPA, CKA®
    Treavor Dodsworth CFP®, CPA, CKA®
  • Oct 25, 2024
  • 1 min read

Social Security recently released a few updates for 2025. I am going to mention a couple of them below.

Social Security Updats

The first update is the cost-of-living adjustment. This will be 2.5%. It is a fairly modest increase. The prior year it was 3.2%.


Another update is related to the amount of earnings subject to Social Security tax. This has increased $7,500 (from $168,600 in 2024 to $176,100). Therefore if you are a W2 employee making $176,100 or more you will pay about $465 more for the year in Social Security tax. Note generally speaking the earnings subject to Social Security tax is per person not tax return. Therefore if both husband and wife are making over $176,100 with W2 earnings you will both pay $465 more in Social Security tax.


Understanding how Social Security works, from how you are initially taxed, the various claiming strategies, and even how the actual benefits are taxed can present several opportunities to improve the net benefit to you.




 
 

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