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Workers who would have up to $391 more withheld for Social Security in 2025

Because of the cap on taxable income, Social Security recipients could pay up to $391 more in taxes next year.

Estados Unidos
En agosto, noviembre y diciembre, algunos beneficiarios del Seguro Social recibirán dos pagos, uno al inicio y otro al final de cada mes.

Every month, the Social Security Administration (SSA) issues millions of checks to beneficiaries that, who for the most part are retired workers. In order to receive the maximum monthly Social Security payment, contributors to the program must meet certain criteria, including paying payroll taxes on the maximum taxable income in the 35 years of the worker’s highest income.

As with the Cost of Living Adjustment (COLA), the SSA modifies taxable income limits annually. In such a way that the amount is in line with the national average salary index. For 2024, the maximum taxable income limit is $168,000. This means that any income above that amount is not subject to taxes, at least by Social Security.

Since this is a limit that changes from year to year, it is expected that in 2025 some workers will have more withheld from their paychecks for Social Security. While the official income limit will be announced in October, along with the COLA increase, the Social Security Board of Trustees has already released its first projections.

Workers who would have up to $391 more withheld for Social Security in 2025

According to projections from the Social Security Board of Trustees, in 2025 maximum taxable income is expected to rise from $168,600 to $174,900, meaning that a greater portion of workers will be subject to taxes on their income.

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Under this scenario, workers with income above the current threshold would have to pay up to around $391 more in taxes next year. That is, a larger amount will be withheld from them than is currently in effect, that would be subject to the tax rate of 6.2%.

To better understand the increase in the taxable income limit, experts from The Motley Fool explain that those who earn $174,900 by 2025 will see $10,844 withheld from their paycheck. The same withholding under the current threshold is equivalent to $10,453 from paychecks this year, giving a difference of $391 dollars.