"Ninety-four percent of Americans contribute to Social Securityall year long, but the wealthy stop paying after their first $168,600 in wage income."
Most Americans contribute to Social Security year-round, but U.S. millionaires will stop paying into the critical program onMarch 2—just over two months into 2024.
That's because Social Security's payroll tax doesn't apply to earned income above a certain level. For 2024, the cut-off is $168,600, and capital gains—such as stock appreciation—arenot subjectto the payroll levy at all. Elon Musk, the CEO of Tesla and the world's richest man, pays nothing into Social Securitybecause he doesn't take a salary.
Emma Curchin, domestic outreach and research assistant at the Center for Economic and Policy Research (CEPR),notedThursday that with the $168,600 payroll tax cap in place, a millionaire's effective Social Security tax rate "is less than 1%."
"This is compared to the 6.2% that any worker making less than $168,600 pays," Curchin wrote. "The burden of paying for Social Security rests on working class people in this country."
CEPR on Thursday released acalculatorthat allows users to see when people with certain annual incomes stop contributing to Social Security, whichkeeps more people out of povertyin the U.S. than any other program.
The calculator shows that a CEO with a $20 million annual salary stopped paying into Social Security just three days into 2024—and contributed just as much to the program for the year as someone who makes $168,600.
The tool was released as anew surveyby Data for Progress showed that 71% of likely U.S. voters want Congress to guarantee Social Security's solvency "by increasing taxes on wealthy Americans" rather than by cutting benefits.
Progressive lawmakers havelong supportedlifting the Social Security payroll tax cap to force rich Americans to contribute more to the program.
Rep. John Larson's (D-Conn.)Social Security 2100 Act, for example, would expand the program's benefits by applying the payroll tax to annual earnings above $400,000.
"Ninety-four percent of Americans contribute to Social Securityall year long, but the wealthy stop paying after their first $168,600 in wage income, and they don't pay in at all on their unearned investment income," Larson andSocial Security Workspresident Nancy Altman wrote in anop-edfor Data for Progress on Thursday.
"The best part about the Social Security 2100 Act? There's no need for a closed-door commission to pass it into law, because it's what the American people want to do," they added.
