Monthly Social Security and Supplemental Security Income (SSI) benefits for more than 65 million Americans will increase 0.3 percent in 2017.
The 0.3 percent cost-of-living adjustment (COLA) will begin with benefits payable to more than 60 million Social Security beneficiaries in January 2017. Increased payments to more than 8 million SSI beneficiaries will begin on December 30, 2016. The Social Security Act ties the annual COLA to the increase in the Consumer Price Index as determined by the Department of Labor’s Bureau of Labor Statistics.
Some other adjustments that take effect in January of each year are based on the increase in average wages. Based on that increase, the maximum amount of earnings subject to the Social Security tax (taxable maximum) will increase to $127,200 from $118,500. Of the estimated 173 million workers who will pay Social Security taxes in 2017, about 12 million will pay more because of the increase in the taxable maximum.
The earnings limit for workers who are younger than “full” retirement age (age 66 for people born in 1943 through 1954) will increase to $16,920. (Social Security deducts $1 from benefits for each $2 earned over $16,920.)
The earnings limit for people turning 66 in 2017 will increase to $44,880. (Social Security deducts $1 from benefits for each $3 earned over $44,880 until the month the worker turns age 66.)
There is no limit on earnings for workers who are “full” retirement age or older for the entire year.
For some beneficiaries, their Social Security increase may be partially or completely offset by increases in Medicare premiums.
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