Taxes

We’re Working Together to Secure Today and Tomorrow

February 27, 2017 • By

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Last Updated: February 27, 2017

man and woman at tableYour first job is a landmark occasion. You’re meeting new people, making professional connections, and probably cashing that first paycheck. You might be a little surprised when you see a portion of your earnings go to a tax called “FICA” for the Federal Insurance Contributions Act. This deduction goes to Social Security and is your way of helping us secure your today and tomorrow. It’s our job to keep the safety net of Social Security strong through your incremental contributions.

Understanding how important your contribution is takes some of the sting away because your taxes are helping millions of Americans. By law, employers must withhold Social Security taxes from workers’ paychecks. While referred to as “Social Security taxes” on an employee’s pay statement, sometimes the deduction is labeled as “FICA.” This stands for Federal Insurance Contributions Act, a reference to the original Social Security Act. Sometimes, you will see “OASDI,” which stands for Old Age, Survivors, and Disability Insurance, the official name for the Social Security Insurance program.

The taxes you pay now mean a lifetime of protection — for retirement in old age or in the event of disability. And when you die, your family (or future family) may be able to receive survivors benefits based on your work.

You probably have family members — grandparents, for example — who already enjoy benefits that your Social Security taxes help provide. Social Security is completely solvent through 2033. At that point, retirement benefits will be reduced to 75 percent, unless changes are made to the law. In the past, Social Security has evolved to meet the needs of a changing population — and you can count on Social security in the future.

Because you’re a long way from retirement, you may have a tough time seeing the value of benefit payments that could be many decades in the future. But keep in mind the Social Security taxes you’re paying can provide valuable disability or survivors benefits, if the unexpected happens. Studies show that of today’s 20-year-olds, about one in four will become disabled, and about one in eight will die before reaching retirement.

To learn more about Social Security and exactly what you’re earning for yourself by paying Social Security taxes, take a look at our online booklet, How You Earn Credits, at www.socialsecurity.gov/pubs/10072.html.

We’re doing this job together. The small amount you contribute with every paycheck allows us to help millions of retired workers, disabled people, and veterans. You can learn more about how we’re with you through life’s journey at www.socialsecurity.gov.

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About the Author

Jim Borland, Acting Deputy Commissioner for Communications

Jim Borland, Acting Deputy Commissioner for Communications

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Comments

  1. Shirley T.

    Ok thank you.

  2. Shirley T.

    I can not get into my SS account , I have called and had even gone into the office and still can not get into my account. Please help.

    • John O.

      This site can not help you. Return the the SS Office and talk to a supervisor.

  3. John M.

    The 800 phone number, this web site, and my local SSA office has been very helpful to me when I needed to transition from my spouse’s health plan when she retired to Medicare……each transaction was very pleasant and a credit to the SSA employees…..and, I thank you………..

    • Ray F.

      Thank you Mr. Stack! We’re pleased we can help. We will continue our efforts to meet your requirements and expectations in the years to come.

  4. Jill S.

    The SSA provides more services and assistance in many areas than are listed here. Go to their new web site on how to make complicated issues simple. It is a need to know.

  5. Me

    I have a question how is it that people come from other countries and they are already retired how are they able to received SS benefits when they have not paid a dime into the system?

    • db

      this is a Ponzi Scheme…stop asking questions and pay up !!

    • John O.

      We have tantalization agreements with other countries and can provide payouts by combining what is paid into each country’s system. Also, dependents can receive benefits having never paid anything into the system. Just coming over on the boat and never paying anything is what’s called fake news, that does not happen unless you are a dependent drawing from another’s work activity..

    • Cesar

      Easy answer …USA and other countries have a bilateral and/or reciprocal agreements about pension payments for example if you are Australian and go to live in USA you will receive your pension from USA and maybe nothing from Australia because you had other income (USA Pension) the same if you go to live in Australia you will get your pension in Australian dollars paid by Australian SS.
      In some cases people work in USA for years. pay taxes then return to their own countries and if a bilateral and/or reciprocal arrangements exist between the countries you will get your pension from your country and a proportional payment based on the number of credits you accumulate over your working life in USA.

      About your credits have a look here ….. https://blog.ssa.gov/were-working-together-to-secure-today-and-tomorrow/

      Hope this clear your question ……

  6. Margaret C.

    Thank you, I appreciate this explanation. We all chip in to pay for all of our benefits. It makes sense!

    • Ray F.

      Thank you for your feedback Margaret!

  7. Altagracia c.

    Excellent Service

    • Ray F.

      Thank you for your comment. We appreciate your support!

      • ELENA S.

        BUT WHAT ABOUT THE BOATLOADS OF REFUGEES WHO COME IN AS VISITING AND NEVER LEAVE AND IMMEDIATELY GET OUR SOCIAL SECURITY MONEY¿ ? AND WHAT ABPUT MY UNCLE WHO PAID INTO SS BIG AND DIED BEFORE HE COULD COLLECT.
        .WHY SHOULD HIS MONEY GO TO STRANGERS¿?

  8. Sharon C.

    Please keep me informed on this sight

    • AKA

      Uh? what does this mean??

  9. Marlene

    Will the 75 percent apply to those individuals already collecting full social security benefits?

    • John

      Yes, and only to those being paid at the time. I expect adjustments to be made before that ever becomes a reality.

      • Doug

        How about those receiving Disability Social Security? Will Disability Social Security be reduced to 75%?

        • Ray F.

          Hi Doug. The 2016-Annual Trustees Report shows that, as a whole, Social Security is fully funded until 2034, and after that it is about three-quarters financed. Considered alone, the Disability Insurance (DI) Trust Fund is projected to pay full benefits until 2023. It is important that Congress acts well before 2023 in order to strengthen the finances of the program as a whole. Social Security’s independent actuaries have analyzed over 100 policy proposals from lawmakers on both sides of the aisle, and those results are available on the Actuary’s website. Thanks!

  10. IRENE K.

    seems he gov. spend more than taking in. no mater
    how much we give – seems never enough for the
    gov. also the return on ss is based on payroll.
    then reaching age to receive ss they don’t pay the
    amount that should be received – if one continues
    to work past 80.
    NEVER ENOUGH

    • maggie

      well if obama didn’t cut the number of people working ie the obamacare requirement of less than 50 ppl and less than 40 hrs of work there would not be less taxes collected.

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