Trump Plan to End Social Security Taxes Means, Without A Replacement Tax, Ending SS Disability Payments In 2021, All Retirement Payments in 2023, Say Social Security Auditors
Contributor: Buddy Robinson
President Trump has already ordered a temporary pause in the collection of Social Security taxes, for September through December, for people earning up to $4,000 per week ($104,000/year).
This is just a temporary deferral and people would have to pay up those taxes afterward.
Much more striking though, Trump also said that he may want to halt collection of all Social Security taxes, if he is re-elected. He did not propose replacing that money with some other source.
Social Security's payroll tax currently pays 75% of current benefits, and come 2035 it will be paying 100% of the cost of benefits.
Several US Senators made a formal request to Social Security's Actuaries -- who are the official numbers crunchers -- asking what would be the result of Trump's idea. On August 24, they got a reply back from Stephen Goss, who is the Chief Actuary of the Social Security Trust Funds. He wrote:
“If this hypothetical legislation were enacted, with no alternative source of revenue to replace the elimination of payroll taxes on earned income paid on January 1, 2021 and thereafter, we estimate that DI (Social Security Disability Benefits) Trust Fund asset reserves would become permanently depleted in about the middle of calendar year 2021, with no ability to pay DI (Disability) benefits thereafter.”
“We estimate that OASI (Social Security Retirement Benefits) Trust Fund reserves would become permanently depleted by the middle of calendar year 2023, with no ability to pay OASI benefits thereafter.”
In other words, if Trump gets his way, and there is no other money to replace that huge loss of tax revenue, people who get Social Security Disability would stop getting benefits in the middle of 2021, and those who get regular Social Security retirement would stop getting benefits in the middle of 2023.
The idea that the President is even toying with this idea demonstrates two crucial things: His infinite ignorance of the Social Security system and its importance, and his total lack of any concern or empathy for elderly and disabled Americans.
*Threats to the safety net