In addition to the 4.1% increase that has been announced in the Cost-of-Living Adjustment (COLA) to Social Security and Supplemental Security Income benefits from January 2006, there are also equivalent increases to the thresholds that apply to Social Security tax.

From January 2006, the maximum amount of earnings subject to the Social Security tax will increase from $90,000 to $94,200. The amount of earnings needed to earn one quarter of coverage will also increase from $920 to $970. There is no change to the combined tax rate for Social Security and Medicare, which will remain at 7.65%.

...back to 10 November 2005

Sources:
Social Security Announces 4.1 Percent Benefit Increase for 2006
2006 Social Security Changes

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