The Social Security Administration announced 2014 changes on Wednesday.
COST OF LIVING ADJUSTMENT (COLA)
Effective on January 2014 Social Security benefits will increase 1.5%.
MAXIMUM SOCIAL SECURITY BENEFIT
Worker Retiring at Full Retirement Age: 2014 is $2,642/mo.
SOCIAL SECURITY TAX
Maximum taxable Social Security earnings increased to $117,000 from the current $113,700. The tax rate is 7.65%. The portion for Social Security is 6.2%, which is paid on earnings up to the above maximum. The Medicare portion of 1.45%, is on all earnings. Individuals’ earnings over $200,000 (couples filing jointly earnings over $250,000) pay an additional Medicare tax of 0.9%.
EXEMPT EARNINGS
The retirement earnings test exempt amount for those working and still under their full retirement age moved up slightly to $15,480 per year from $15,120 in 2013. One dollar in benefits will be withheld for every $2 in earnings above the limit