Social Security Primer
May 13, 2024

Social Security Primer

Updated July 22, 2025 (R42035) Jump to Main Text of Report

Contents

• Introduction
• Origins and Brief History of Social Security
• Social Security Financing
• Taxation of Social Security Benefits
• Status of the Social Security Trust Funds
• Social Security Cash-Flow Surpluses and Deficits
• Social Security Reform Debate
• Social Security Benefit Rules
• Full Retirement Age
• Computation of a Social Security Retired-Worker Benefit
• Adjustments to Benefits Claimed Before or After the FRA
• Other Adjustments to Benefits
• Disabled-Worker Benefit
• Benefits for the Worker's Family Members
• Maximum Family Benefit
• Social Security Beneficiaries

Tables

• Table 1. Increase in the Full Retirement Age Scheduled Under Current Law
• Table 2. Computation of a Worker's Primary Insurance Amount (PIA) in 2025 Based on an Illustrative AIME of $7,500
• Table 3. Social Security Benefits for the Worker's Family Members
• Table 4. Social Security Beneficiaries, by Type, May 2025

Summary

Social Security provides monthly cash benefits to retired or disabled workers and their family Social Security provides monthly cash benefits to retired or disabled workers and their family
members, and to the family members of deceased workers. Among the beneficiary population, members, and to the family members of deceased workers. Among the beneficiary population,
Emma K. Tatem
85.986.1% are retired or disabled workers; family members of retired, disabled, or deceased workers % are retired or disabled workers; family members of retired, disabled, or deceased workers
Analyst in Social Policy
make up the remainder. In make up the remainder. In March 2024May 2025, approximately , approximately 67.569.6 million beneficiaries received a total million beneficiaries received a total

of $119.8of $129.4 billion in benefit payments for the month; the average monthly benefit was $1, billion in benefit payments for the month; the average monthly benefit was $1,775.

858. Workers become eligible for Social Security benefits for themselves and their family members by Workers become eligible for Social Security benefits for themselves and their family members by
working in Social Securityworking in Social Security-–covered employment. In covered employment. In 20242025, an estimated 94% of workers will work in paid employment or , an estimated 94% of workers will work in paid employment or
self-employment covered by Social Security, and their earnings will be subject to the Social Security payroll tax. Employers self-employment covered by Social Security, and their earnings will be subject to the Social Security payroll tax. Employers
and employees each pay 6.2% of covered earnings, up to an annual limit on taxable earnings ($and employees each pay 6.2% of covered earnings, up to an annual limit on taxable earnings ($168,600 in 2024).
176,100 in 2025). Among other requirements, a worker generally needs 40 earnings credits (10 years of covered employment) to be eligible for Among other requirements, a worker generally needs 40 earnings credits (10 years of covered employment) to be eligible for
a Social Security retired-worker benefit. Fewer earnings credits are needed to qualify for a disabled-worker benefit; the a Social Security retired-worker benefit. Fewer earnings credits are needed to qualify for a disabled-worker benefit; the
number needed varies depending on the age of the worker when he or she became disabled. A workernumber needed varies depending on the age of the worker when he or she became disabled. A worker’'s initial monthly s initial monthly
benefit is based on his or her career-average earnings in covered employment. Social Security retired-worker benefits are first benefit is based on his or her career-average earnings in covered employment. Social Security retired-worker benefits are first
payable at the age of 62, subject to a permanent reduction for early retirement. Full (unreduced) retirement benefits are first payable at the age of 62, subject to a permanent reduction for early retirement. Full (unreduced) retirement benefits are first
payable at the full retirement age (FRA), which increased gradually from 65 to 67 under a law enacted by Congress in 1983. payable at the full retirement age (FRA), which increased gradually from 65 to 67 under a law enacted by Congress in 1983.
The FRA is 67 for persons born in 1960 or later (i.e., persons who become eligible for retirement benefits at the age of 62 in The FRA is 67 for persons born in 1960 or later (i.e., persons who become eligible for retirement benefits at the age of 62 in
2022 or later).2022 or later).
In addition to payroll taxes, Social Security is financed by federal income taxes that some beneficiaries pay on a portion of In addition to payroll taxes, Social Security is financed by federal income taxes that some beneficiaries pay on a portion of
their benefits and by interest income that is earned on the Treasury securities held by the Social Security trust funds. In their benefits and by interest income that is earned on the Treasury securities held by the Social Security trust funds. In 2023,
2024, the Social Security trust funds had receipts totaling $1.the Social Security trust funds had receipts totaling $1.3542 trillion, expenditures totaling $1. trillion, expenditures totaling $1.3948 trillion, and accumulated assets trillion, and accumulated assets
(U.S. Treasury securities) totaling $2.(U.S. Treasury securities) totaling $2.7972 trillion. Over the program trillion. Over the program’s 89's 90-year history, it has collected roughly $-year history, it has collected roughly $27.7529.17 trillion trillion
and paid out $and paid out $24.9626.45 trillion, leaving asset reserves of $2. trillion, leaving asset reserves of $2.7972 trillion at the end of trillion at the end of 20232024 in its two combined trust funds. in its two combined trust funds.
Projections by the trustees show that, based on the programProjections by the trustees show that, based on the program’'s current financing and benefit structure, benefits scheduled s current financing and benefit structure, benefits scheduled
under current law can be paid in full and on time until under current law can be paid in full and on time until 20352034 (under the intermediate set of assumptions). Projections also (under the intermediate set of assumptions). Projections also
show that Social Security expenditures are estimated to exceed income by show that Social Security expenditures are estimated to exceed income by at least 20%24% on average over the next 75 years. Restoring over the next 75 years. Restoring
long-range trust fund solvency and other policy objectives (such as increasing benefits for certain beneficiaries) have made long-range trust fund solvency and other policy objectives (such as increasing benefits for certain beneficiaries) have made
Social Security reform an issue of ongoing congressional interest.Social Security reform an issue of ongoing congressional interest.
This report provides an overview of Social Security financing and benefits under current law. Specifically, the report covers This report provides an overview of Social Security financing and benefits under current law. Specifically, the report covers
the origins and a brief history of the program; Social Security financing and the status of the trust funds; how Social Security the origins and a brief history of the program; Social Security financing and the status of the trust funds; how Social Security
benefits are computed; the types of Social Security benefits available to workers and their family members; the basic benefits are computed; the types of Social Security benefits available to workers and their family members; the basic
eligibility requirements for each type of benefit; the scheduled increase in the Social Security retirement age; and the federal eligibility requirements for each type of benefit; the scheduled increase in the Social Security retirement age; and the federal
income taxation of Social Security benefits.

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Contents
Introduction ..................................................................................................................................... 1
Origins and Brief History of Social Security................................................................................... 1
Social Security Financing ................................................................................................................ 3
Taxation of Social Security Benefits ......................................................................................... 4
Status of the Social Security Trust Funds ........................................................................................ 4
Social Security Cash-Flow Surpluses and Deficits ................................................................... 6
Social Security Reform Debate ....................................................................................................... 6
Social Security Benefit Rules .......................................................................................................... 7
Full Retirement Age .................................................................................................................. 7
Computation of a Social Security Retired-Worker Benefit ....................................................... 8
Adjustments to Benefits Claimed Before or After the FRA ............................................... 9
Other Adjustments to Benefits (Including Government Pension Offset and
Windfall Elimination Provision) ...................................................................................... 9
Disabled-Worker Benefit ......................................................................................................... 10
Benefits for the Worker’s Family Members ............................................................................ 10
Maximum Family Benefit .................................................................................................. 11
Social Security Beneficiaries ......................................................................................................... 13

Tables
Table 1. Increase in the Full Retirement Age Scheduled Under Current Law................................. 7
Table 2. Computation of a Worker’s Primary Insurance Amount (PIA) in 2024
Based on an Illustrative AIME of $7,500 ..................................................................................... 8
Table 3. Social Security Benefits for the Worker’s Family Members ............................................ 11
Table 4. Social Security Beneficiaries, by Type, March 2024 ....................................................... 14

Contacts
Author Information ........................................................................................................................ 14

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Social Security Primer

Introduction
income taxation of Social Security benefits.

Introduction

Social Security is a self-financing program that provides monthly cash benefits to retired or Social Security is a self-financing program that provides monthly cash benefits to retired or
disabled workers and their family members and to the family members of deceased workers.disabled workers and their family members and to the family members of deceased workers.11 As As
of March 2024of May 2025, there were approximately , there were approximately 67.569.6 million Social Security beneficiaries. Of those, million Social Security beneficiaries. Of those,
53.355.6 million ( million (78.979.8%) were retired workers and family members, 8.%) were retired workers and family members, 8.42 million ( million (12.511.8%) were %) were
disabled workers and family members, and 5.disabled workers and family members, and 5.89 million (8. million (8.64%) were survivors of deceased %) were survivors of deceased
workers.workers.² 2
Social Security is financed primarily by payroll taxes paid by covered workers and their Social Security is financed primarily by payroll taxes paid by covered workers and their
employers. An estimated employers. An estimated 182185 million workers are covered by Social Security. million workers are covered by Social Security.33 Employers and Employers and
employees each pay 6.2% of covered earnings, up to an annual limit; self-employed individuals employees each pay 6.2% of covered earnings, up to an annual limit; self-employed individuals
pay 12.4% of net self-employment income, up to an annual limit. The annual limit on taxable pay 12.4% of net self-employment income, up to an annual limit. The annual limit on taxable
earnings is $earnings is $168,600 in 2024.4176,100 in 2025.⁴ Social Security is also credited with tax revenues from the federal Social Security is also credited with tax revenues from the federal
income taxes paid by some beneficiaries on a portion of their benefits. In addition, Social income taxes paid by some beneficiaries on a portion of their benefits. In addition, Social
Security receives interest income from Social Security trust fund investments. Social Security Security receives interest income from Social Security trust fund investments. Social Security
income and outgo are accounted for in two separate trust funds authorized under Title II of the income and outgo are accounted for in two separate trust funds authorized under Title II of the
Social Security Act: the Federal Old-Age and Survivors Insurance (OASI) Trust Fund and the Social Security Act: the Federal Old-Age and Survivors Insurance (OASI) Trust Fund and the
Federal Disability Insurance (DI) Trust Fund.Federal Disability Insurance (DI) Trust Fund.55 This report refers to the separate OASI and DI This report refers to the separate OASI and DI
trust funds on a combined basis as the Social Security trust funds.trust funds on a combined basis as the Social Security trust funds.6 In 20236 In 2024, the combined Social , the combined Social
Security trust funds (OASDI) had total receipts of $1.Security trust funds (OASDI) had total receipts of $1.3542 trillion, total expenditures of $1. trillion, total expenditures of $1.39
48 trillion, and accumulated holdings (assets) of $2.trillion, and accumulated holdings (assets) of $2.7972 trillion. trillion.⁷7
Origins and Brief History of Social Security
Title II of the original Social Security Act of Title II of the original Social Security Act of 193581935⁸ established a national plan designed to established a national plan designed to
provide economic security for the nationprovide economic security for the nation’'s workers. The system of Old-Age Insurance it created s workers. The system of Old-Age Insurance it created
provided benefits to individuals who were aged 65 or older and who had provided benefits to individuals who were aged 65 or older and who had “earned”"earned" retirement retirement
benefits through work in jobs covered by the system. Benefits were to be financed by a payroll benefits through work in jobs covered by the system. Benefits were to be financed by a payroll
tax paid by employees and their employers on wages up to a base amount ($3,000 per year at the

1 A person may receive retired-worker benefits and continue to have earnings. However, under certain circumstances,
earnings may affect the amount of a person’s monthly benefit.
2 Social Security Administration (SSA), Monthly Statistical Snapshot, March 2024, Table 2. See the latest edition of
the Monthly Statistical Snapshot at http://www.socialsecurity.gov/policy/docs/quickfacts/stat_snapshot/index.html.
3 Currently, 94% of workers in paid employment or self-employment are covered by Social Security. SSA, Social
Security Fact Sheet, at https://www.ssa.gov/OACT/FACTS/.
4 The annual limit on covered wages and net self-employment income that is subject to the Social Security payroll tax
(the taxable wage base) is adjusted annually based on average wage growth, if a Social Security cost-of-living
adjustment (COLA) is payable.
5 42 U.S.C. §401.
6 Under current law, the Federal Old-Age and Survivors Insurance (OASI) and Federal Disability Insurance (DI) trust
funds cannot borrow from each other when faced with a funding shortfall. The shifting of funds between OASI and DI
can only be done with authorization from Congress. In the past, Congress has authorized temporary interfund
borrowing among the OASI, DI, and Medicare Hospital Insurance trust funds, as well as temporary payroll tax
reallocations between OASI and DI, to deal with funding shortfalls. Most recently, under the Bipartisan Budget Act of
2015 (P.L. 114-74), Congress authorized a temporary reallocation of payroll taxes from the OASI fund to the DI fund
for calendar years 2016 through 2018. Because of such actions, the OASI and DI trust funds are discussed on a
combined basis. For more information, see CRS Report R43318, The Social Security Disability Insurance (DI) Trust
Fund: Background and Current Status.
7 SSA, Trust Fund Data, at https://www.ssa.gov/cgi-bin/ops_period.cgi.
8 P.L. 74-271.
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tax paid by employees and their employers on wages up to a base amount ($3,000 per year at the time). Monthly benefits were to be based on cumulative wages in covered jobs. The law related time). Monthly benefits were to be based on cumulative wages in covered jobs. The law related
the amount of the benefit to the amount of a workerthe amount of the benefit to the amount of a worker’'s wages covered by the program, but the s wages covered by the program, but the
formula was progressive. That is, the formula was weighted to replace a larger share of the formula was progressive. That is, the formula was weighted to replace a larger share of the
earnings of low-wage workers compared with those of higher-wage workers. Before the Old-Age earnings of low-wage workers compared with those of higher-wage workers. Before the Old-Age
Insurance program was in full operation, the Social Security Amendments of 1939 shifted the Insurance program was in full operation, the Social Security Amendments of 1939 shifted the
emphasis of Social Security from protection of the individual worker to protection of the family emphasis of Social Security from protection of the individual worker to protection of the family
by extending monthly cash benefits to the dependents and survivors of workers.by extending monthly cash benefits to the dependents and survivors of workers.99 The program The program
now provided OASI.now provided OASI.
During the decades that followed, changes to the Social Security program were mainly ones of During the decades that followed, changes to the Social Security program were mainly ones of
expansion. Coverage of workers became nearly universal (the largest groups remaining outside expansion. Coverage of workers became nearly universal (the largest groups remaining outside
the system are state and local government employees who have not chosen to join the system and the system are state and local government employees who have not chosen to join the system and
federal employees who were hired before 1984). In 1956, Congress established the Disability federal employees who were hired before 1984). In 1956, Congress established the Disability
Insurance (DI) program.Insurance (DI) program.1010 Over the years, there were increases in the payroll tax rate, which Over the years, there were increases in the payroll tax rate, which
increased from 2.0% of pay (1.0% each for employees and employers) in the 1937-1949 period to increased from 2.0% of pay (1.0% each for employees and employers) in the 1937-1949 period to
its current level of 12.4%.its current level of 12.4%.1111 In addition, there were increases in the amount of wages subject to In addition, there were increases in the amount of wages subject to
the payroll tax (the taxable wage base), which increased from $3,000 in the 1937-1950 period to the payroll tax (the taxable wage base), which increased from $3,000 in the 1937-1950 period to
$168,600 in 2024.12$176,100 in 2025.¹² The types of individuals eligible for benefits were expanded over the years, The types of individuals eligible for benefits were expanded over the years,13
13 and benefit levels were increased periodically. In 1972, legislation provided for automatic cost-of-and benefit levels were increased periodically. In 1972, legislation provided for automatic cost-of-
living adjustments, starting in 1975, indexed to the change in consumer prices as measured by the living adjustments, starting in 1975, indexed to the change in consumer prices as measured by the
Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) published by the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) published by the
Department of LaborDepartment of Labor’'s Bureau of Labor Statistics.s Bureau of Labor Statistics.¹⁴ 14
Beginning in the late 1970s, legislative action regarding Social Security became more Beginning in the late 1970s, legislative action regarding Social Security became more
concentrated on solving persistent financing problems. Legislation enacted in 1977 raised taxes concentrated on solving persistent financing problems. Legislation enacted in 1977 raised taxes
and curtailed future benefit growth in an effort to shore up the systemand curtailed future benefit growth in an effort to shore up the system’'s finances.s finances.1515 Still, in 1982, Still, in 1982,
the OASI trust fund needed to borrow assets from the DI trust fund and the Medicare Hospital the OASI trust fund needed to borrow assets from the DI trust fund and the Medicare Hospital
Insurance (HI) trust fund (borrowed amounts were fully repaid by 1986). In 1983, Congress Insurance (HI) trust fund (borrowed amounts were fully repaid by 1986). In 1983, Congress
passed additional major legislation that was projected to restore solvency to the Social Security passed additional major legislation that was projected to restore solvency to the Social Security
system on average over the 75-year projection period at that time.16

9 P.L. 76-379.
10 The DI program was established by the Social Security Amendments of 1956 (P.L. 84-880). The program became
known as the Old-Age, Survivors, and Disability Insurance (OASDI) program, the formal name for Social Security.
11 Congress has increased the Social Security payroll tax rate many times over the program’s history. The payroll tax
rate under current law (12.4%) was established by the Social Security Amendments of 1983 (P.L. 98-21). P.L. 98-21
increased the payroll tax rate gradually from 11.4% in 1984 to 12.4% in 1990.
12 The taxable wage base amounts are in nominal dollars. The most recent legislative change to the Social Security
taxable wage base was in 1977. The Social Security Amendments of 1977 (P.L. 95-216) established ad-hoc increases in
the taxable wage base for 1979, 1980, and 1981, followed by a return to automatic wage indexation for 1982 and
subsequent years.
13 For example, the Social Security Amendments of 1965 (P.L. 89-97) established benefits for divorced wives aged 62
or older.
14 See the Social Security Amendments of 1972 (P.L. 92-603). For more information, see CRS Report 94-803, Social
Security: Cost-of-Living Adjustments.
15 See the Social Security Amendments of 1977 (P.L. 95-216).
16 Following the Social Security Amendments of 1983 (P.L. 98-21), projections showed the re-emergence of long-range
deficits as a result of changes in actuarial methods and assumptions and because program changes had been evaluated
with respect to their effect on the average 75-year deficit. That is, while program changes were projected to restore
trust fund solvency on average over the 75-year projection period, a period of surplus years was followed by a period
of deficit years. As time passed, the inclusion of additional deficit years in the 75-year valuation period resulted in a
return to projected long-range deficits.
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system on average over the 75-year projection period at that time.¹⁶ Current projections by the Social Security Board of Trustees show that the Social Security system Current projections by the Social Security Board of Trustees show that the Social Security system
has a long-range funding shortfall, and that the system will operate with annual cash-flow deficits has a long-range funding shortfall, and that the system will operate with annual cash-flow deficits
each year through the end of the 75-year projection period (2098). These projections, and other each year through the end of the 75-year projection period (2098). These projections, and other
factors, have focused attention on potential Social Security program changes.factors, have focused attention on potential Social Security program changes.
Social Security Financing
The Social Security program is financed primarily by revenues from Federal Insurance The Social Security program is financed primarily by revenues from Federal Insurance
Contributions Act (FICA) taxes and Self-Employment Contributions Act (SECA) taxes. FICA Contributions Act (FICA) taxes and Self-Employment Contributions Act (SECA) taxes. FICA
taxes are paid by both employers and employees; however, it is employers who remit the taxes to taxes are paid by both employers and employees; however, it is employers who remit the taxes to
the U.S. Treasury. Employers remit FICA taxes on a regular basis throughout the year (e.g., the U.S. Treasury. Employers remit FICA taxes on a regular basis throughout the year (e.g.,
weekly, monthly, quarterly, or annually), depending on the employerweekly, monthly, quarterly, or annually), depending on the employer’'s level of total employment s level of total employment
taxes (Social Security, Medicare, and federal individual income tax withholding).taxes (Social Security, Medicare, and federal individual income tax withholding).
The FICA tax rate of 7.65% each for employers and employees has two components: 6.20% for The FICA tax rate of 7.65% each for employers and employees has two components: 6.20% for
Social Security and 1.45% for Medicare HI.Social Security and 1.45% for Medicare HI.1717 Under current law, employers and employees each Under current law, employers and employees each
pay 6.2% of covered wages, up to the taxable wage base, in Social Security payroll taxes. The pay 6.2% of covered wages, up to the taxable wage base, in Social Security payroll taxes. The
SECA tax rate is 15.3% for self-employed individuals, with 12.4% for Social Security and 2.9% SECA tax rate is 15.3% for self-employed individuals, with 12.4% for Social Security and 2.9%
for Medicare HI. Self-employed individuals pay 12.4% of net self-employment income, up to the for Medicare HI. Self-employed individuals pay 12.4% of net self-employment income, up to the
taxable wage base, in Social Security payroll taxes.taxable wage base, in Social Security payroll taxes.1818 One-half of the SECA taxes are allowed as a One-half of the SECA taxes are allowed as a
deduction for federal income tax purposes. SECA taxes are normally paid once a year as part of deduction for federal income tax purposes. SECA taxes are normally paid once a year as part of
filing an annual individual income tax return.filing an annual individual income tax return.¹⁹ 19
In addition to Social Security payroll taxes, the Social Security program has two other sources of In addition to Social Security payroll taxes, the Social Security program has two other sources of
income. First, certain Social Security beneficiaries must include a portion of Social Security income. First, certain Social Security beneficiaries must include a portion of Social Security
benefits in taxable income for the federal income tax, and the Social Security program receives benefits in taxable income for the federal income tax, and the Social Security program receives
part of those federal tax revenues.part of those federal tax revenues.2020 Second, the Social Security program receives interest from Second, the Social Security program receives interest from
the U.S. Treasury on its investments in special U.S. government obligations.the U.S. Treasury on its investments in special U.S. government obligations.
As the Managing Trustee of the Social Security trust funds, the Secretary of the Treasury is As the Managing Trustee of the Social Security trust funds, the Secretary of the Treasury is
required by law to invest Social Security revenues in interest-bearing federal government required by law to invest Social Security revenues in interest-bearing federal government
securities held by the trust funds.securities held by the trust funds.2121 The revenues exchanged for the federal government securities The revenues exchanged for the federal government securities
are deposited into the general fund of the U.S. Treasury and are indistinguishable from revenues are deposited into the general fund of the U.S. Treasury and are indistinguishable from revenues
in the general fund that come from other sources. Because the assets held by the trust funds are in the general fund that come from other sources. Because the assets held by the trust funds are
federal government securities, the trust fund balance represents the amount of money owed to the federal government securities, the trust fund balance represents the amount of money owed to the
Social Security trust funds by the general fund of the U.S. Treasury. Funds needed to pay Social

17 The Patient Protection and Affordable Care Act (ACA; P.L. 111-148) imposed an additional Medicare HI tax of 0.9
percentage point on high-income workers with wages over $200,000 for single filers and $250,000 for joint filers,
effective for taxable years beginning in 2013.
18 Self-employed individuals must pay Social Security payroll taxes if they have net earnings from self-employment of
$400 or more in a year; 92.35% of net earnings (up to the annual limit) are taxable.
19 If a self-employed individual does not pay himself or herself wages, SECA taxes are paid annually on the Internal
Revenue Service Form 1040 (U.S. Individual Income Tax Return). If a self-employed individual does pay himself or
herself wages, FICA taxes are paid during the year along with any FICA tax payments for his or her employees.
20 The tax revenues associated with including Social Security benefits in federal taxable income go to the Social
Security trust funds and the Medicare HI trust fund. For more information, see CRS Report RL32552, Social Security:
Taxation of Benefits.
21 Social Security Act, Title II, §201(d). For more information, see SSA, Office of the Chief Actuary, Actuarial Note
Number 142, Social Security Trust Fund Investment Policies and Practices, by Jeffrey L. Kunkel, January 1999, at
http://www.ssa.gov/OACT/NOTES/n1990s.html.
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Social Security trust funds by the general fund of the U.S. Treasury. Funds needed to pay Social Security benefits and administrative expenses come from the redemption of federal government Security benefits and administrative expenses come from the redemption of federal government
securities held by the trust funds.securities held by the trust funds.²²22
Taxation of Social Security Benefits
Since 1984, Social Security benefits have been subject to the federal income tax. As part of the Since 1984, Social Security benefits have been subject to the federal income tax. As part of the
Social Security Amendments of 1983 (P.L. 98-21), Congress made up to 50% of a personSocial Security Amendments of 1983 (P.L. 98-21), Congress made up to 50% of a person’'s Social s Social
Security benefits subject to the federal income tax if he or she has provisional income above a Security benefits subject to the federal income tax if he or she has provisional income above a
specified threshold ($25,000 for an individual tax filer; $32,000 for a married couple filing specified threshold ($25,000 for an individual tax filer; $32,000 for a married couple filing
jointly). Provisional income is defined as total income from all sources recognized for tax jointly). Provisional income is defined as total income from all sources recognized for tax
purposes plus certain otherwise tax-exempt income, including half of Social Security benefits. purposes plus certain otherwise tax-exempt income, including half of Social Security benefits.
Revenues from this Revenues from this “"first tierfirst tier”" of taxation are credited to the Social Security trust funds. In of taxation are credited to the Social Security trust funds. In 2023,
2024, the trust funds received $the trust funds received $50.755.1 billion (3. billion (3.89% of total trust fund income) from this provision.% of total trust fund income) from this provision.²³ 23
Next, as part of the Omnibus Budget Reconciliation Act of 1993 (P.L. 103-66), Congress made up Next, as part of the Omnibus Budget Reconciliation Act of 1993 (P.L. 103-66), Congress made up
to 85% of a personto 85% of a person’'s Social Security benefits subject to the federal income tax if he or she has s Social Security benefits subject to the federal income tax if he or she has
provisional income above a second higher threshold ($34,000 for an individual tax filer; $44,000 provisional income above a second higher threshold ($34,000 for an individual tax filer; $44,000
for a married couple filing jointly). Revenues from this for a married couple filing jointly). Revenues from this “"second tiersecond tier”" of taxation are credited to of taxation are credited to
the Medicare HI trust fund. In the Medicare HI trust fund. In 20222024, the HI trust fund received $, the HI trust fund received $35.039.8 billion (8. billion (8.48% of total trust % of total trust
fund income) from this provision.fund income) from this provision.²⁴ 24
Under current law, the income thresholds are fixed (i.e., they are not adjusted for inflation or Under current law, the income thresholds are fixed (i.e., they are not adjusted for inflation or
wage growth). Over time an increasing number of beneficiaries will be subject to the federal wage growth). Over time an increasing number of beneficiaries will be subject to the federal
income tax on benefits.income tax on benefits.²⁵25
Status of the Social Security Trust Funds
Projections by the Social Security Board of Trustees (the trustees) show that Social Security Projections by the Social Security Board of Trustees (the trustees) show that Social Security
expenditures will exceed expenditures will exceed tax revenues each year through the end of the 75-year valuation period each year through the end of the 75-year valuation period
(2098).26(2099).²⁶ That is, Social Security will operate with annual That is, Social Security will operate with annual cash-flow deficits as it has since 2010. as it has since 2010.
With interest income taken into account, Social Security maintained a With interest income taken into account, Social Security maintained a total surplus (tax revenues (tax revenues
plus interest income exceeded expenditures) from 2010 through 2020. From 2021 to plus interest income exceeded expenditures) from 2010 through 2020. From 2021 to 20232024, total , total
cost exceeded total revenues. The trustees project that total costs will exceed total revenues for all cost exceeded total revenues. The trustees project that total costs will exceed total revenues for all
remaining years in the projection period; the last instance of costs exceeding revenues was in remaining years in the projection period; the last instance of costs exceeding revenues was in
1982. The trustees project that the trust funds will have a positive balance (asset reserves) until 1982. The trustees project that the trust funds will have a positive balance (asset reserves) until
20352034, allowing Social Security benefits scheduled under current law to be paid in full and on time , allowing Social Security benefits scheduled under current law to be paid in full and on time
until then.27

22 SSA, Trust Fund FAQs, at http://www.socialsecurity.gov/OACT/ProgData/fundFAQ.html.
23 The 2024 Annual Report of the Board of Trustees of the Federal Old-Age and Survivors Insurance and Federal
Disability Insurance Trust Funds, May 6, 2024, https://www.ssa.gov/oact/TR/2024/tr2024.pdf (hereinafter cited as
2024 Annual Report of the Social Security Board of Trustees). See Table III.A3, p. 37.
24 Social Security and Medicare Boards of Trustees, Status of the Social Security and Medicare Programs: A Summary
of the 2024 Annual Reports, May 6, 2024, p. 12, at https://www.ssa.gov/oact/TRSUM/tr24summary.pdf.
25 For more information, see CRS Report RL32552, Social Security: Taxation of Benefits, by Paul S. Davies.
26 Projections cited in this CRS report are based on the intermediate (or “best estimate”) set of assumptions in the 2024
Annual Report of the Social Security Board of Trustees and refer to the OASI and DI trust funds on a combined basis.
For more information on the trust fund projections, see CRS Report RL33028, Social Security: The Trust Funds.
27 Separately, the OASI fund is projected to have asset reserves until 2033, at which point continuing income to the
fund would be sufficient to pay 79% of OASI scheduled benefits. The DI fund is projected to have asset reserves
throughout the 75-year projection period. See 2024 Annual Report of the Social Security Board of Trustees, p. 6.
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until then.²⁷ Over the long run, the trustees project that the 75-year actuarial deficit for the trust funds is equal Over the long run, the trustees project that the 75-year actuarial deficit for the trust funds is equal
to 3.to 3.5082% of taxable payroll.% of taxable payroll.2828 Stated a different way, the trustees project that Social Security Stated a different way, the trustees project that Social Security
expenditures will exceed income by expenditures will exceed income by at least 20%about 24% on average over the next 75 years. For illustration purposes, over the next 75 years. For illustration purposes,
the trustees point out that the following changes would be needed for the trust funds to remain the trustees point out that the following changes would be needed for the trust funds to remain
solvent throughout the 75-year projection period: (1) an immediate and permanent 3.solvent throughout the 75-year projection period: (1) an immediate and permanent 3.33-
65-percentage-point increase in the payroll tax rate (from 12.40% to percentage-point increase in the payroll tax rate (from 12.40% to 15.73%);2916.05% beginning in January 2025);²⁹ or (2) an immediate or (2) an immediate
20.822.4% reduction in benefits for all current and future beneficiaries% reduction in benefits for all current and future beneficiaries beginning in January 2025; or (3) some combination of ; or (3) some combination of
these approaches. Social Securitythese approaches. Social Security’'s projected long-range funding shortfall is attributed primarily s projected long-range funding shortfall is attributed primarily
to demographic factors (such as lower fertility rates and increasing life expectancy) as well as to demographic factors (such as lower fertility rates and increasing life expectancy) as well as
program design features (such as a wage-indexed benefit formula and annual COLAs).program design features (such as a wage-indexed benefit formula and annual COLAs).³⁰ 30
At the end of At the end of 20232024, the trust funds were credited with asset reserves of $2., the trust funds were credited with asset reserves of $2.7972 trillion. With the trillion. With the
projection that the programprojection that the program’'s total costs will continue to exceed total revenue throughout the s total costs will continue to exceed total revenue throughout the
projection period, the trustees estimated that the value of asset reserves held in the trust funds projection period, the trustees estimated that the value of asset reserves held in the trust funds
peaked at the end of 2020. Thus, the trust fund balance began to decline in 2021 and is projected peaked at the end of 2020. Thus, the trust fund balance began to decline in 2021 and is projected
to continue declining until to continue declining until exhaustion in 2035trust fund reserve depletion in 2034. The . The trust fund ratio can be used to put the size of can be used to put the size of
the trust fund balance into perspective. This ratio represents trust fund assets at the beginning of a the trust fund balance into perspective. This ratio represents trust fund assets at the beginning of a
year as a percentage of cost for the year. In year as a percentage of cost for the year. In 20242025, for example, the projected trust fund ratio is , for example, the projected trust fund ratio is
188169%. (Assets held by the trust funds at the beginning of %. (Assets held by the trust funds at the beginning of 20242025 are projected to be 1. are projected to be 1.8869 times times
greater than the cost of the program in greater than the cost of the program in 20242025.) The trustees project that the trust fund ratio will .) The trustees project that the trust fund ratio will
decline to decline to 8495% in % in 20302029 and reach zero at the point of trust fund reserve depletion and reach zero at the point of trust fund reserve depletion in 2035.31
during 2034.³¹ After depletion of trust fund reserves, the program would continue to operate with incoming After depletion of trust fund reserves, the program would continue to operate with incoming
Social Security receipts; those receipts are projected to be sufficient to pay Social Security receipts; those receipts are projected to be sufficient to pay 8381% of benefits % of benefits
scheduled under current law in scheduled under current law in 20352034, declining to , declining to 7371% of scheduled benefits in % of scheduled benefits in 2098.322099.³² Under Under
current law, Social Security does not have authority to borrow from the general fund of the current law, Social Security does not have authority to borrow from the general fund of the
Treasury. Therefore, the program cannot draw upon general revenues to make up the difference Treasury. Therefore, the program cannot draw upon general revenues to make up the difference
between incoming receipts and benefit payments when the program no longer has asset reserves between incoming receipts and benefit payments when the program no longer has asset reserves
to draw upon. The Social Security Act does not specify what would happen to the payment of to draw upon. The Social Security Act does not specify what would happen to the payment of
benefits scheduled under current law in the event of Social Security trust fund depletion. Two benefits scheduled under current law in the event of Social Security trust fund depletion. Two
possible scenarios are (1) the payment of full monthly benefits on a delayed basis or (2) the possible scenarios are (1) the payment of full monthly benefits on a delayed basis or (2) the
payment of partial (reduced) monthly benefits on time.

28 2024 Annual Report of the Social Security Board of Trustees, p. 5. The Congressional Budget Office (CBO) also
publishes long-range projections for the Social Security trust funds. CBO projects that the trust funds will have a
positive balance (asset reserves) until 2033 and a 75-year actuarial deficit equal to 5.1% of taxable payroll. See CBO,
CBO’s 2023 Long-Term Projections for Social Security, June 29, 2023 https://www.cbo.gov/system/files/2023-06/
59184-SocialSecurity.pdf. Taxable payroll refers to total earnings in the economy that are subject to Social Security
payroll taxes (with some adjustments). Program costs and income are evaluated as a percentage of taxable payroll
because Social Security payroll taxes are the primary source of funding for the program.
29 The estimated payroll tax increase needed to maintain solvency differs from the actuarial deficit for two reasons.
First, the estimated tax increase projects zero trust funds reserves at the end of the projection period whereas the
actuarial deficit assumes trust fund reserves equal to one year’s cost. Second, the estimated payroll tax increase needed
to maintain solvency does not reflect behavioral response changes to tax rate changes.
30 A wage-indexed benefit formula allows initial monthly benefits for successive groups of new beneficiaries to keep
pace with increases in the standard of living. An annual COLA for benefits already in payment allows benefits for
current beneficiaries to keep pace with increases in prices.
31 2024 Annual Report of the Social Security Board of Trustees, Table IV.A3, p. 51.
32 Social Security and Medicare Boards of Trustees, Status of the Social Security and Medicare Programs: A Summary
of the 2024 Annual Reports, May 6, 2024, p. 7.
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payment of partial (reduced) monthly benefits on time.
Social Security Cash-Flow Surpluses and Deficits
From 1984 to 2009, Social Security generated surplus tax revenues (i.e., the program operated From 1984 to 2009, Social Security generated surplus tax revenues (i.e., the program operated
with annual cash-flow surpluses). Surplus tax revenues and interest income credited to the trust with annual cash-flow surpluses). Surplus tax revenues and interest income credited to the trust
funds in the form of federal government securities contributed to a growing trust fund balance. funds in the form of federal government securities contributed to a growing trust fund balance.
Beginning in 2010, however, the program began operating with annual cash-flow deficits, and the Beginning in 2010, however, the program began operating with annual cash-flow deficits, and the
trustees project that Social Security tax revenues will remain below program expenditures each trustees project that Social Security tax revenues will remain below program expenditures each
year throughout the 75-year projection period (year throughout the 75-year projection period (2024-2098).
2025-2099). When Social Security operates with a cash-flow deficit, the trust funds redeem more federal When Social Security operates with a cash-flow deficit, the trust funds redeem more federal
securities than the amount of current Social Security tax revenues, relying in part on trust fund securities than the amount of current Social Security tax revenues, relying in part on trust fund
asset reserves to pay benefits and administrative expenses. Because the federal securities held by asset reserves to pay benefits and administrative expenses. Because the federal securities held by
the trust funds are redeemed with general revenues, this results in increased spending for Social the trust funds are redeemed with general revenues, this results in increased spending for Social
Security from the general fund. When there are no surplus governmental receipts, the federal Security from the general fund. When there are no surplus governmental receipts, the federal
government must raise the necessary funds by increasing taxes or other income; reducing other government must raise the necessary funds by increasing taxes or other income; reducing other
spending; borrowing from the public; or some combination of these measures.spending; borrowing from the public; or some combination of these measures.
With respect to the programWith respect to the program’'s reliance on general revenues, it is important to note that Social s reliance on general revenues, it is important to note that Social
Security does not have authority to borrow from the general fund of the Treasury under current Security does not have authority to borrow from the general fund of the Treasury under current
law. Rather, the program relies on revenues collected for Social Security purposes in previous law. Rather, the program relies on revenues collected for Social Security purposes in previous
years that were used by the federal government at the time for other (non-Social Security) years that were used by the federal government at the time for other (non-Social Security)
spending needs and interest income earned on trust fund investments. The program draws on spending needs and interest income earned on trust fund investments. The program draws on
those previously collected Social Security tax revenues and interest income (trust fund asset those previously collected Social Security tax revenues and interest income (trust fund asset
reserves) when current Social Security tax revenues fall below current program expenditures.reserves) when current Social Security tax revenues fall below current program expenditures.
Social Security Reform Debate
Social Security reform is an issue of ongoing interest to lawmakers. For some advocates of Social Security reform is an issue of ongoing interest to lawmakers. For some advocates of
reform, the focus is on restoring long-range solvency to the trust funds. For others, the focus is on reform, the focus is on restoring long-range solvency to the trust funds. For others, the focus is on
constraining the projected growth in spending for entitlement programs—including Social constraining the projected growth in spending for entitlement programs—including Social
Security, Medicare, and Medicaid—in the context of broader efforts to reduce growing federal Security, Medicare, and Medicaid—in the context of broader efforts to reduce growing federal
budget deficits. The Social Security reform debate reflects other policy objectives as well, such as budget deficits. The Social Security reform debate reflects other policy objectives as well, such as
improving the adequacy and equity of benefits,improving the adequacy and equity of benefits,3333 and different philosophical views about the role and different philosophical views about the role
of the Social Security program and the federal government in providing retirement income. Over of the Social Security program and the federal government in providing retirement income. Over
the years, the debate has reflected two fundamentally different approaches to reform. The the years, the debate has reflected two fundamentally different approaches to reform. The
traditional approach would maintain the current structure of the program (i.e., a defined benefit would maintain the current structure of the program (i.e., a defined benefit
system funded on a pay-as-you-go basis) by making relatively modest changes, such as an system funded on a pay-as-you-go basis) by making relatively modest changes, such as an
increase in the retirement age or an increase in the taxable wage base. In general, the goal of this increase in the retirement age or an increase in the taxable wage base. In general, the goal of this
approach is to preserve the social insurance nature of the program. In contrast, the approach is to preserve the social insurance nature of the program. In contrast, the personal
savings and investment approach would redesign the 1930s-era program to create a prefunded would redesign the 1930s-era program to create a prefunded
system in which benefits would be based partially or entirely on personal savings and system in which benefits would be based partially or entirely on personal savings and
investments. More recently, the Social Security debate has reflected a shift in focus among some investments. More recently, the Social Security debate has reflected a shift in focus among some
lawmakers away from efforts to scale back the program toward proposals that would expand lawmakers away from efforts to scale back the program toward proposals that would expand
Social Security benefits to address concerns about the adequacy of benefits and, more broadly, Social Security benefits to address concerns about the adequacy of benefits and, more broadly,
retirement income security.

33 Traditionally, one of the principles governing the Social Security program has been balancing the competing goals of
social adequacy and individual equity. The social adequacy goal takes into account factors beyond a person’s payroll
tax contributions in determining the appropriate level of benefits (factors such as providing a minimum standard of
living). The individual equity goal takes into account the degree to which a person’s benefit level reflects his or her
payroll tax contributions to the system.
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Social Security Benefit Rules
retirement income security. Social Security Benefit Rules Social Security provides monthly cash benefits to retired or disabled workers and to the family Social Security provides monthly cash benefits to retired or disabled workers and to the family
members of retired, disabled, or deceased workers. Benefits are designed to replace part of a members of retired, disabled, or deceased workers. Benefits are designed to replace part of a
worker’worker's earnings. As such, a workers earnings. As such, a worker’'s benefit is based on his or her career-average earnings in s benefit is based on his or her career-average earnings in
covered employment (i.e., earnings up to the annual taxable limit) and a progressive benefit covered employment (i.e., earnings up to the annual taxable limit) and a progressive benefit
formula that is intended to provide adequate benefit levels for workers with low career-average formula that is intended to provide adequate benefit levels for workers with low career-average
earnings. This section explains how the workerearnings. This section explains how the worker’'s primary insurance amount (PIA) is computed. s primary insurance amount (PIA) is computed.
The workerThe worker’'s PIA is his or her monthly benefit amount payable at the full retirement age (FRA); s PIA is his or her monthly benefit amount payable at the full retirement age (FRA);
it also determines the amount of monthly benefits payable to family members based on the it also determines the amount of monthly benefits payable to family members based on the
worker’worker's record. This section also covers the basic eligibility requirements for different types of s record. This section also covers the basic eligibility requirements for different types of
Social Security benefits.Social Security benefits.
Full Retirement Age
Social Security retirement benefits are first payable to retired workers at the age of 62, subject to Social Security retirement benefits are first payable to retired workers at the age of 62, subject to
a permanent reduction for a permanent reduction for “"early retirement.early retirement.”" The age at which full (unreduced) retirement The age at which full (unreduced) retirement
benefits are first payable is the FRA.benefits are first payable is the FRA.3434 For most of the program For most of the program’'s history, the FRA was 65. As part s history, the FRA was 65. As part
of the Social Security Amendments of 1983 (P.L. 98-21), Congress raised the FRA from 65 to 67. of the Social Security Amendments of 1983 (P.L. 98-21), Congress raised the FRA from 65 to 67.
The 1983 law established a gradual phase-in from 65 to 67 over a 22-year period (2000 to 2022).The 1983 law established a gradual phase-in from 65 to 67 over a 22-year period (2000 to 2022).
Specifically, workers born in 1938 or later are affected by the increase in the FRA (i.e., workers Specifically, workers born in 1938 or later are affected by the increase in the FRA (i.e., workers
who become eligible for retirement benefits at age 62 in 2000 or later). The increase in the FRA who become eligible for retirement benefits at age 62 in 2000 or later). The increase in the FRA
has been fully phased in for workers born in 1960 or later (i.e., workers who become eligible for has been fully phased in for workers born in 1960 or later (i.e., workers who become eligible for
retirement benefits at age 62 in 2022 or later)retirement benefits at age 62 in 2022 or later). Table 1 shows the scheduled increase in the FRA shows the scheduled increase in the FRA
being phased in under current law.being phased in under current law.35
35 Table 1. Increase in the Full Retirement Age Scheduled Under Current Law
Year of Birth
Full Retirement Age
1938

1938

65 and 2 months65 and 2 months
1939

1939

65 and 4 months65 and 4 months
1940

1940

65 and 6 months

1941

65 and 8 months

1942

65 and 10 months

1943 to 1954

66

1955

66 and 2 months

1956

66 and 4 months

1957

66 and 6 months

1958

66 and 8 months

1959

66 and 10 months

1960 or later

67

65 and 6 months
1941
65 and 8 months
1942
65 and 10 months
1943 to 1954
66
1955
66 and 2 months
1956
66 and 4 months
1957
66 and 6 months
1958
66 and 8 months
1959
66 and 10 months
1960 or later
67

34 The full retirement age is also called the normal retirement age (NRA).
35 For more information, see CRS Report R44670, The Social Security Retirement Age.
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Source: Social Security Administration, Office of the Chief Actuary, Social Security Administration, Office of the Chief Actuary, Normal Retirement Age, atAge,
https://www.ssa.gov/OACT/ProgData/nra.htmlhttps://www.ssa.gov/OACT/ProgData/nra.html.
. Computation of a Social Security Retired-Worker Benefit
Among other requirements, a worker generally needs 40 earnings credits (10 years of Social Among other requirements, a worker generally needs 40 earnings credits (10 years of Social
Security-Security–covered employment) to be eligible for a Social Security retired-worker benefit.covered employment) to be eligible for a Social Security retired-worker benefit.36 A
worker’36 A worker's initial monthly benefit is based on his or her highest 35 years of earnings in covered s initial monthly benefit is based on his or her highest 35 years of earnings in covered
employment, which are indexed to historical wage growth.employment, which are indexed to historical wage growth.3737 The highest 35 years of indexed The highest 35 years of indexed
earnings are summed, and the total is divided by 420 months (35 years x 12 months). The earnings are summed, and the total is divided by 420 months (35 years x 12 months). The
resulting amount is the workerresulting amount is the worker’'s s average indexed monthly earnings (AIME). If a worker has (AIME). If a worker has
fewer than 35 years of earnings in covered employment, years with no earnings are entered as fewer than 35 years of earnings in covered employment, years with no earnings are entered as
zeroes in the computation, resulting in a lower AIME and therefore a lower monthly benefit.zeroes in the computation, resulting in a lower AIME and therefore a lower monthly benefit.
The workerThe worker’'s PIA is determined by applying a formula to the AIME as shown s PIA is determined by applying a formula to the AIME as shown inin Table 2. First,
First, the AIME is sectioned into three brackets (or segments) of earnings, which are divided by dollar the AIME is sectioned into three brackets (or segments) of earnings, which are divided by dollar
amounts known as bend points. In amounts known as bend points. In 20242025, the bend points are $1,, the bend points are $1,174226 and $7, and $7,078.38391.³⁸ Three different Three different
replacement factors—90%, 32%, and 15%—are applied to the three brackets of AIME.replacement factors—90%, 32%, and 15%—are applied to the three brackets of AIME.3939 The The
three products derived from multiplying each replacement factor and bracket of AIME are added three products derived from multiplying each replacement factor and bracket of AIME are added
together. For workers who become eligible for retirement benefits (i.e., those who attain age 62), together. For workers who become eligible for retirement benefits (i.e., those who attain age 62),
become disabled, or die in become disabled, or die in 20242025, the PIA is determined as shown in the example , the PIA is determined as shown in the example inin Table 2.
Table 2. Computation of a Worker’'s Primary Insurance Amount (PIA) in 2024
2025 Based on an Illustrative AIME of $7,500
Replacement
PIA for Worker with an Illustrative
Factors

Replacement Factors

Three Brackets of AIME
AIME of $7,000
90%
first $1,174 of AIME, plus
90% x $1,174 = $1,056.60
32%
AIME over $1,174 and through $7,078,
32% x $5,904 = $1,889.28
plus
15%
AIME over $7,078
15% x $422 = $63.30
Total: Worker’s PIA (rounded down to lower dime)
$3,009.10
Source: Congressional Research Service.
Generally, a worker’

PIA for Worker with an Illustrative AIME of $7,500

90%

first $1,226 of AIME, plus

90% x $1,226 = $1,103.40

32%

AIME over $1,226 and through $7,391, plus

32% x $6,165 = $1,972.80

15%

AIME over $7,391

15% x $109 = $16.35

Total: Worker's PIA (rounded down to lower dime)

$3,092.50

Source: Congressional Research Service.

Note: Under current law, PIA is rounded down to the nearest dime (42 U.S.C. §415(a)(1)(A)).

Generally, a worker's PIA increases each year from the year of eligibility (at age 62) to the year s PIA increases each year from the year of eligibility (at age 62) to the year
of benefit receipt based on the Social Security COLA.of benefit receipt based on the Social Security COLA.4040 In addition, Social Security benefits In addition, Social Security benefits
already in payment generally increase each year based on the COLA.

36 A worker may earn up to four earnings credits per calendar year. In 2024, a worker earns one credit for each $1,730
of covered earnings, up to a maximum of four credits for covered earnings of $6,920 or more. Earnings credits are also
called quarters of coverage.
37 Earnings through the age of 60 are indexed; earnings thereafter are counted at nominal value. Indexing past earnings
brings them up to near-current wage levels.
38 The bend points in the benefit formula are indexed to average wage growth under current law.
39 The replacement factors in the benefit formula are fixed under current law.
40 Automatic COLAs went into effect in 1975. Since that time, there have been three years when no COLA was payable
(2010, 2011, and 2016). For more information, see CRS Report 94-803, Social Security: Cost-of-Living Adjustments.
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already in payment generally increase each year based on the COLA. Adjustments to Benefits Claimed Before or After the FRA
A workerA worker’'s initial monthly benefit is equal to his or her PIA if he or she begins receiving benefits s initial monthly benefit is equal to his or her PIA if he or she begins receiving benefits
at the FRA. A workerat the FRA. A worker’'s initial monthly benefit will be s initial monthly benefit will be less than his or her PIA if he or she begins than his or her PIA if he or she begins
receiving benefits receiving benefits before the FRA, and it will be the FRA, and it will be greater than his or her PIA if he or she begins than his or her PIA if he or she begins
receiving benefits receiving benefits after the FRA. the FRA.
A retired-worker benefit is payable as early as the age of 62, however, the benefit will be A retired-worker benefit is payable as early as the age of 62, however, the benefit will be
permanently reduced to reflect the longer expected period of benefit receipt. Retired-worker permanently reduced to reflect the longer expected period of benefit receipt. Retired-worker
benefits are reduced by five-ninths of 1% (or 0.0056) of the workerbenefits are reduced by five-ninths of 1% (or 0.0056) of the worker’'s PIA for each month of s PIA for each month of
entitlement before the FRA up to 36 months, for a reduction of about 6.7% per year. For each entitlement before the FRA up to 36 months, for a reduction of about 6.7% per year. For each
month of benefit entitlement before the FRA in excess of 36 months, retirement benefits are month of benefit entitlement before the FRA in excess of 36 months, retirement benefits are
reduced by five-twelfths of 1% (or 0.0042), for a reduction of 5% per year.reduced by five-twelfths of 1% (or 0.0042), for a reduction of 5% per year.41
41 Workers who delay filing for benefits until after the FRA receive a delayed retirement credit Workers who delay filing for benefits until after the FRA receive a delayed retirement credit
(DRC). The DRC applies to the period that begins with the month the worker attains the FRA and (DRC). The DRC applies to the period that begins with the month the worker attains the FRA and
ends with the month before he or she attains the age of 70. The DRC is 8% per year for ends with the month before he or she attains the age of 70. The DRC is 8% per year for
workers born in 1943 or later (i.e., workers who attain the age of 62 in 2005 or later).workers born in 1943 or later (i.e., workers who attain the age of 62 in 2005 or later).
The actuarial adjustment to benefits based on claiming age is intended to provide the worker with The actuarial adjustment to benefits based on claiming age is intended to provide the worker with
roughly the same total lifetime benefits, regardless of the age at which he or she begins receiving roughly the same total lifetime benefits, regardless of the age at which he or she begins receiving
benefits (based on average life expectancy). Therefore, if a worker claims benefits before the benefits (based on average life expectancy). Therefore, if a worker claims benefits before the
FRA, his or her monthly benefit is reduced to take into account the longer expected period of FRA, his or her monthly benefit is reduced to take into account the longer expected period of
benefit receipt. For a worker whose FRA is 66, the decision to claim benefits at the age of 62 benefit receipt. For a worker whose FRA is 66, the decision to claim benefits at the age of 62
results in a 25% reduction in his or her PIA. For a worker whose FRA is 67, the decision to claim results in a 25% reduction in his or her PIA. For a worker whose FRA is 67, the decision to claim
benefits at the age of 62 results in a 30% reduction in his or her PIA. Similarly, if a worker claims benefits at the age of 62 results in a 30% reduction in his or her PIA. Similarly, if a worker claims
benefits after the FRA, his or her monthly benefit is increased to take into account the shorter benefits after the FRA, his or her monthly benefit is increased to take into account the shorter
expected period of benefit receipt.expected period of benefit receipt.⁴²42
Other Adjustments to Benefits (Including Government Pension Offset and
Windfall Elimination Provision)
Other benefit adjustments may apply, such as those related to simultaneous entitlement to more Other benefit adjustments may apply, such as those related to simultaneous entitlement to more
than one type of Social Security benefit. Under the dual entitlement rule, for example, a Social than one type of Social Security benefit. Under the dual entitlement rule, for example, a Social
Security spousal benefit is reduced if the person also receives a Social Security benefit based on Security spousal benefit is reduced if the person also receives a Social Security benefit based on
his or her own work in covered employment (i.e., a retired-worker or disabled-worker benefit).43
Similarly, under the government pension offset (GPO), a Social Security spousal benefit is
reduced if the person also receives a pension based on his or her own work in noncovered
employment.

41 The early retirement reduction for spousal benefits is different. Spousal benefits claimed before the FRA are reduced
by 25/36 of 1% (or 0.0069) for each month of entitlement before the FRA, up to 36 months, and by five-twelfths of 1%
(or 0.0042) for each month of entitlement before the FRA in excess of 36 months. The reduction is applied to the base
spousal benefit, which is 50% of the worker’s PIA. The spousal benefit is not reduced for entitlement before the FRA if
the spouse is caring for a qualifying child. The early retirement reduction also differs for widow(er)’s benefits. The
maximum reduction for widow(er)’s benefits claimed before the FRA is equal to 28.5% of the deceased worker’s PIA.
Alternatively, if a widow(er) claims benefits at the FRA, his or her benefits are reduced if the deceased worker claimed
benefits before the FRA and therefore was receiving a reduced benefit. Under the widow(er)’s limit provision, the
widow(er)’s benefit is limited to the higher of (1) the benefit the deceased worker would be receiving if he or she were
still alive or (2) 82.5% of the deceased worker’s PIA. In this case, the maximum reduction applied to the widow(er)’s
benefit is equal to 17.5% of the deceased worker’s PIA.
42 For more information, see CRS Report R43542, How Social Security Benefits Are Computed: In Brief.
43 For more information, see CRS In Focus IF10738, Social Security Dual Entitlement.
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Under the windfall elimination provision (WEP), a modified benefit formula is used to compute a
worker’s Social Security benefit when he or she also receives a pension from noncovered
employment. The modified formula results in a lower initial monthly benefit compared to the
regular benefit formula.44 his or her own work in covered employment (i.e., a retired-worker or disabled-worker benefit).⁴³ Under the retirement earnings test (RET), a personUnder the retirement earnings test (RET), a person’'s Social Security s Social Security
benefit is subject to withholding when he or she is below the FRA and has wage or salary income benefit is subject to withholding when he or she is below the FRA and has wage or salary income
above an annual dollar threshold (i.e., above an annual exempt amount).above an annual dollar threshold (i.e., above an annual exempt amount).4544 Under the Social Under the Social
Security maximum family benefit rules, benefits payable to each family member (with the Security maximum family benefit rules, benefits payable to each family member (with the
exception of the worker) are subject to reduction when total benefits payable to the family based exception of the worker) are subject to reduction when total benefits payable to the family based
on the workeron the worker’'s record exceed a specified limit.s record exceed a specified limit.
Disabled-Worker Benefit
For Social Security disability benefits, For Social Security disability benefits, “disability”"disability" is defined as the inability to engage in is defined as the inability to engage in
substantial gainful activity (SGA) by reason of a medically determinable physical or mental substantial gainful activity (SGA) by reason of a medically determinable physical or mental
impairment that is expected to last for at least 12 months or result in death. Generally, the worker impairment that is expected to last for at least 12 months or result in death. Generally, the worker
must be unable to do any kind of substantial work that exists in the national economy, taking into must be unable to do any kind of substantial work that exists in the national economy, taking into
account age, education, and work experience. As noted previously, a worker generally needs 40 account age, education, and work experience. As noted previously, a worker generally needs 40
earnings credits to qualify for a Social Security retired-worker benefit. A worker under the age of earnings credits to qualify for a Social Security retired-worker benefit. A worker under the age of
62 can qualify for a Social Security disabled-worker benefit with fewer earnings credits. The 62 can qualify for a Social Security disabled-worker benefit with fewer earnings credits. The
number of earnings credits needed varies, depending on the age of the worker when he or she number of earnings credits needed varies, depending on the age of the worker when he or she
became disabled; however, a minimum of six earnings credits is needed. Similarly, while the became disabled; however, a minimum of six earnings credits is needed. Similarly, while the
worker’worker's highest 35 years of earnings are used to compute a retired-worker benefit, fewer years of s highest 35 years of earnings are used to compute a retired-worker benefit, fewer years of
earnings may be used to compute a disabled-worker benefit.earnings may be used to compute a disabled-worker benefit.4645 Because a disabled worker Because a disabled worker’s
's benefit is not reduced for entitlement before the FRA, a disabled workerbenefit is not reduced for entitlement before the FRA, a disabled worker’'s benefit is equal to his s benefit is equal to his
or her PIA.or her PIA.47
46 Benefits for the Worker’'s Family Members
Although the majority of Social Security beneficiaries are retired or disabled workers, 9.Although the majority of Social Security beneficiaries are retired or disabled workers, 9.67 million million
beneficiaries (beneficiaries (14.113.9% of the total) are the dependents and survivors of retired, disabled, or % of the total) are the dependents and survivors of retired, disabled, or
deceased workers.deceased workers.48
47 Social Security benefits are payable to the spouse, divorced spouse, or child of a retired or Social Security benefits are payable to the spouse, divorced spouse, or child of a retired or
disabled worker. Benefits are also payable to the widow(er), divorced widow(er), child, or parent disabled worker. Benefits are also payable to the widow(er), divorced widow(er), child, or parent
of a deceased worker. In addition, motherof a deceased worker. In addition, mother’'s or fathers or father’'s benefits are payable to a young widow(er) s benefits are payable to a young widow(er)
who is caring for a deceased workerwho is caring for a deceased worker’'s child; the child must be under the age of 16 or disabled, s child; the child must be under the age of 16 or disabled,
and the child must be entitled to benefits.and the child must be entitled to benefits.4948 Benefits payable to family members are equal to a Benefits payable to family members are equal to a
specified percentage of the workerspecified percentage of the worker’'s PIA, subject to a maximum family benefit. For example, the spouse of a retired worker may receive up to 50% of the retired worker's PIA, subject to a maximum family benefit. For example, the

44 The WEP differs from other types of benefit adjustments in that it involves an alternative PIA formula. For more
information, see CRS In Focus IF10203, Social Security: The Windfall Elimination Provision (WEP) and the
Government Pension Offset (GPO).
45 For more information, see CRS Report R41242, Social Security Retirement Earnings Test: How Earnings Affect
Benefits, by Zhe Li and SSA, Exempt Amounts Under the Earnings Test, at https://www.ssa.gov/OACT/COLA/
rtea.html.
46 For more information, see CRS Report R43370, Social Security Disability Insurance (SSDI): Becoming Insured,
Calculating Benefit Payments, and the Effect of Dropout Year Provisions.
47 For more information, see CRS Report R44948, Social Security Disability Insurance (SSDI) and Supplemental
Security Income (SSI): Eligibility, Benefits, and Financing.
48 SSA, Monthly Statistical Snapshot, March 2024, Table 2. See the latest edition of the Monthly Statistical Snapshot at
http://www.socialsecurity.gov/policy/docs/quickfacts/stat_snapshot/index.html.
49 To receive mother’s/father’s benefits, the person must be unmarried and must not be entitled to widow(er)’s benefits.
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spouse of a retired worker may receive up to 50% of the retired worker’s PIA, and the widow(er) s PIA, and the widow(er)
of a deceased worker may receive up to 100% of the deceased workerof a deceased worker may receive up to 100% of the deceased worker’'s PIA. Benefits payable to s PIA. Benefits payable to
family members may be subject to adjustments based on the personfamily members may be subject to adjustments based on the person’'s age at entitlement, receipt s age at entitlement, receipt
of a Social Security benefit based on his or her own work record, and other factors.of a Social Security benefit based on his or her own work record, and other factors.
Table 3 provides a summary of Social Security benefits payable to the family members of a provides a summary of Social Security benefits payable to the family members of a
retired, disabled, or deceased worker. It includes the basic eligibility requirements and basic retired, disabled, or deceased worker. It includes the basic eligibility requirements and basic
benefit amounts before any applicable adjustments (such as for the maximum family benefit).benefit amounts before any applicable adjustments (such as for the maximum family benefit).
Maximum Family Benefit
The total amount of Social Security benefits payable to a family based on a retired, disabled, or The total amount of Social Security benefits payable to a family based on a retired, disabled, or
deceased workerdeceased worker’'s record is capped by the maximum family benefit. The family maximum cannot s record is capped by the maximum family benefit. The family maximum cannot
be exceeded, regardless of the number of beneficiaries entitled to benefits on the workerbe exceeded, regardless of the number of beneficiaries entitled to benefits on the worker’s
's record.record.5049 If the sum of all benefits payable on the worker If the sum of all benefits payable on the worker’'s record exceeds the family maximum, s record exceeds the family maximum,
the benefit payable to each dependent or survivor is reduced in equal proportion to bring the total the benefit payable to each dependent or survivor is reduced in equal proportion to bring the total
amount of benefits payable to the family within the limit. In the case of a amount of benefits payable to the family within the limit. In the case of a retired or deceased
worker, the maximum family benefit is determined by a formula and varies from 150% to 188% , the maximum family benefit is determined by a formula and varies from 150% to 188%
of the workerof the worker’'s PIA. For the family of a worker who attains the age of 62 in s PIA. For the family of a worker who attains the age of 62 in 20242025, or dies in , or dies in 2024
2025 before attaining the age of 62, the total amount of benefits payable to the family is limited tobefore attaining the age of 62, the total amount of benefits payable to the family is limited to
• 150% of the first $1,150% of the first $1,500567 of the worker of the worker’'s PIA, pluss PIA, plus
• 272% of the worker272% of the worker’'s PIA over $1,s PIA over $1,500567 and through $2, and through $2,166262, plus, plus
• 134% of the worker134% of the worker’'s PIA over $2,s PIA over $2,166262 and through $2, and through $2,825950, plus, plus
• 175% of the worker175% of the worker’'s PIA over $2,s PIA over $2,825.51
950.⁵⁰The dollar amounts in the maximum family benefit formula ($1,The dollar amounts in the maximum family benefit formula ($1,500567 / $2, / $2,166262 / $2, / $2,825 in 2024)
950 in 2025) are indexed to average wage growth, as in the regular benefit formula. In the case of a are indexed to average wage growth, as in the regular benefit formula. In the case of a disabled
worker, the maximum family benefit is equal to 85% of the worker, the maximum family benefit is equal to 85% of the worker’'s AIME; however, the family s AIME; however, the family
maximum cannot be maximum cannot be less than 100% or or more than 150% of the worker of the worker’'s PIA.s PIA.52
51 Table 3. Social Security Benefits for the Worker’'s Family Members
Basic Benefit Amount
Before Any Applicable
Basis for Entitlement
Basic Eligibility Requirements
Adjustments
Spouse
At least age 62, or
50% of worker’s PIA

Basic Benefit Amount Before Any Applicable Adjustments

Spouse

At least age 62, or

Any age if caring for the child of a Any age if caring for the child of a
retired or disabled worker. The child retired or disabled worker. The child
must be under the age of 16 or must be under the age of 16 or
disabled, and the child must be entitled disabled, and the child must be entitled
to benefits.

50 Social Security Act, Title II, §203.
51 SSA, Formula for Family Maximum Benefit, at https://www.socialsecurity.gov/OACT/COLA/familymax.html.
52 Benefits for a divorced beneficiary are not taken into account for purposes of the family maximum. See SSA,
Program Operations Manual System (POMS), Section RS 00615.682, “Family Benefits Where a Divorced Spouse or a
Surviving Divorced Spouse is Entitled,” at https://secure.ssa.gov/apps10/poms.nsf/lnx/0300615682.
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Basic Benefit Amount
Before Any Applicable
Basis for Entitlement
Basic Eligibility Requirements
Adjustments
Divorced Spouse
At least age 62
50% of worker’s PIA
(The divorced individual must have
Must be unmarried
been married to the worker for at
Note: A divorced spouse who is under
least 10 years before the divorce
to benefits.

50% of worker's PIA

Divorced Spouse

(The divorced individual must have been married to the worker for at least 10 years before the divorce became final.)

At least age 62

Must be unmarried

Note: A divorced spouse who is under the age of 62 is not eligible for spousal the age of 62 is not eligible for spousal
became final.)
benefits even if he/she is caring for the benefits even if he/she is caring for the
child of a retired or disabled worker.child of a retired or disabled worker.
Aged Widow(er) &
At least age 60
100 50% of worker% of worker’s PIAa
Divorced 's PIA

Aged Widow(er) &

Divorced Aged Widow(er)

Aged Widow(er)
Must be unmarried (unless the
(The divorced individual must have (The divorced individual must have
marriage occurred after attainment of
been married to the worker for at been married to the worker for at
age 60)
least 10 years before the divorce least 10 years before the divorce
became final.)became final.)
Disabled Widow(er) &
At least age At least age 50 (ages 50-59)
71.5% of worker’s PIAa
Divorced 60

Must be unmarried (unless the marriage occurred after attainment of age 60)

100% of worker's PIA^a

Disabled Widow(er) &

Divorced Disabled Widow(er)

Disabled Widow(er)
Must be unmarried (unless the
Disabled widow(er)s and
(The divorced individual must have
marriage occurred after attainment of
divorced disabled widow(er)s
been married to the worker for at
age 50)
ages 50-59 receive the same
least 10 years before the divorce
The qualifying disability must have
rate of reduction set for
became final.)
occurred
widow(er)s at age 60 (28.5% of
the worker’s PIA), regardless of
(1) before or within seven years of the their age at the time of
worker’s death;
entitlement.
(The divorced individual must have been married to the worker for at least 10 years before the divorce became final.)

At least age 50 (ages 50-59)

Must be unmarried (unless the marriage occurred after attainment of age 50)

The qualifying disability must have occurred

(1) before or within seven years of the worker's death;

(2) within seven years of having been (2) within seven years of having been
previously entitled to benefits on the previously entitled to benefits on the
worker’worker's record as a widow(er) with a s record as a widow(er) with a
child in his or her care; orchild in his or her care; or
(3) within seven years of having been (3) within seven years of having been
previously entitled to benefits as a previously entitled to benefits as a
disabled widow(er) that ended disabled widow(er) that ended
because the qualifying disability ended because the qualifying disability ended
(whichever is later).(whichever is later).
Widowed Mother or Father
Surviving spouse of any age who is
75% of deceased worker’s PIA
(Young Widow(er) with Child)
caring for the deceased worker’ 71.5% of worker's PIA^a

Disabled widow(er)s and divorced disabled widow(er)s ages 50-59 receive the same rate of reduction set for widow(er)s at age 60 (28.5% of the worker's PIA), regardless of their age at the time of entitlement.

Widowed Mother or Father

(Young Widow(er) with Child)

Surviving spouse of any age who is caring for the deceased worker's child. s child.
The child must be under the age of 16 The child must be under the age of 16
or disabled, and the child must be or disabled, and the child must be
entitled to benefits.entitled to benefits.
Must be unmarriedMust be unmarried
Must not be entitled to widow(er)Must not be entitled to widow(er)’s
benefits
's benefits Note: In the case of a surviving Note: In the case of a surviving
divorced parent, the child must be his divorced parent, the child must be his
or her natural or legally adopted child. or her natural or legally adopted child.
The 10-year marriage requirement The 10-year marriage requirement
that applies to divorced spouses under that applies to divorced spouses under
other circumstances does not apply.other circumstances does not apply.
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Basic Benefit Amount
Before Any Applicable
Basis for Entitlement
Basic Eligibility Requirements
Adjustments
Child

75% of deceased worker's PIA

Child

A dependent, unmarried child of a A dependent, unmarried child of a
50% of worker’s PIA for child of
retired, disabled, or deceased worker.retired, disabled, or deceased worker. a retired or disabled worker
The child must beThe child must be
75% of deceased worker’s PIA
(1) under the age of 18;(1) under the age of 18;
for child of a deceased worker
(2) a (2) a ful full-time elementary or -time elementary or
secondary student under the age of secondary student under the age of
19; or19; or
(3) a disabled person aged 18 or older (3) a disabled person aged 18 or older
whose disability began before age 22.whose disability began before age 22.
The term child refers to a biological The term child refers to a biological
child, adopted child, stepchild, or in child, adopted child, stepchild, or in
some cases grandchild, of the worker.some cases grandchild, of the worker.
Dependent Parent of a
At least age 62
82.5

50% of worker's PIA for child of a retired or disabled worker

75% of deceased worker% of deceased worker’'s PIA for child of a deceased worker

Dependent Parent of a Deceased Worker

At least age 62

s PIA
Deceased Worker
Must not have married since the Must not have married since the
if one parent is entitled to
worker’worker's deaths death
benefits
Must have been receiving at least Must have been receiving at least
75% of deceased worker’s PIA
one-half of his or her support from
(for each parent) if two parents
the worker at the time of the
are entitled to benefits
worker’one-half of his or her support from the worker at the time of the worker's death (or, if the worker had s death (or, if the worker had
a period of disability that continued a period of disability that continued
until death, at the beginning of the until death, at the beginning of the
period of disability).period of disability).

82.5% of deceased worker's PIA if one parent is entitled to benefits

75% of deceased worker's PIA (for each parent) if two parents are entitled to benefits

Source: Congressional Research Service.Congressional Research Service.
Notes: The family relationship requirement for entitlement to benefits based on the workerThe family relationship requirement for entitlement to benefits based on the worker’'s record may be s record may be
met in alternative ways. For example, the relationship requirement can be met if, under state law as interpreted met in alternative ways. For example, the relationship requirement can be met if, under state law as interpreted
by the courts of the state, the applicant would be able to inherit a share of the workerby the courts of the state, the applicant would be able to inherit a share of the worker’'s personal property if the s personal property if the
worker were to die without leaving a worker were to die without leaving a wil will.. The table shows the minimum eligibility age for each type of benefit The table shows the minimum eligibility age for each type of benefit
(i.e., the age at which benefits are first payable on a reduced basis). The maximum family benefit may apply, (i.e., the age at which benefits are first payable on a reduced basis). The maximum family benefit may apply,
reducing the benefit payable to each family member (excluding the worker) on a proportional basis. In the case reducing the benefit payable to each family member (excluding the worker) on a proportional basis. In the case
of a retired or deceased worker, the maximum family benefit varies from 150% to 188% of the workerof a retired or deceased worker, the maximum family benefit varies from 150% to 188% of the worker’'s PIA. In s PIA. In
the case of a disabled worker, the maximum family benefit is equal to the lesser of 85% of the workerthe case of a disabled worker, the maximum family benefit is equal to the lesser of 85% of the worker’'s AIME or s AIME or
150% of the worker150% of the worker’'s PIA, but no less than 100% of the workers PIA, but no less than 100% of the worker’'s PIA. Other benefit adjustments may apply.s PIA. Other benefit adjustments may apply.
a. a. A workerA worker’'s claiming age affects the widow(er) benefit. If a worker was receiving a reduced benefit due to s claiming age affects the widow(er) benefit. If a worker was receiving a reduced benefit due to
claiming benefits claiming benefits before the the ful full retirement age, the widow(er) benefit cannot exceed the workerretirement age, the widow(er) benefit cannot exceed the worker’'s reduced s reduced
benefit amount. Alternatively, if a worker was entitled (or would have been entitled) to a higher benefit due benefit amount. Alternatively, if a worker was entitled (or would have been entitled) to a higher benefit due
to claiming benefits to claiming benefits after the the ful full retirement age, the workerretirement age, the worker’'s PIA—adjusted to take into account the s PIA—adjusted to take into account the
delayed retirement credit—is used to compute the widow(er) benefit, thereby increasing the benefit.delayed retirement credit—is used to compute the widow(er) benefit, thereby increasing the benefit.
Social Security Beneficiaries
In March 2024 In May 2025, there were approximately , there were approximately 67.569.6 million Social Security beneficiaries. As shown in million Social Security beneficiaries. As shown in
Table 4, retired-worker and disabled-worker beneficiaries accounted for , retired-worker and disabled-worker beneficiaries accounted for 85.986.1% of the beneficiary % of the beneficiary
population. The largest single category of beneficiaries was retired workers (75.population. The largest single category of beneficiaries was retired workers (75.19%), with an %), with an
average monthly benefit of $average monthly benefit of $1,9132,002. The second-largest category was disabled workers (10.. The second-largest category was disabled workers (10.83%), %),
with an average monthly benefit of $1,with an average monthly benefit of $1,537582. Family members of retired, disabled, or deceased . Family members of retired, disabled, or deceased
workers accounted for the remainder of the beneficiary population (workers accounted for the remainder of the beneficiary population (14.1%).5313.9%).⁵² Table 4 provides a provides a
breakdown of the Social Security beneficiary population in breakdown of the Social Security beneficiary population in March 2024.

53 Percentages do not sum to 100% due to rounding.
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Table 4. Social Security Beneficiaries, by Type, March 2024
Total Monthly
Number
Benefits
Average Monthly
May 2025. Table 4. Social Security Beneficiaries, by Type, May 2025 Type of Beneficiary
Number (in thousands)
Percentage
(in millions)
Benefit
All beneficiaries
67,521
100.0%
$119,837
$1,774.83
Old-Age and Survivors
Insurance
59,103
87.5
108,093
1,828.91
Retirement benefits
53,272
78.9
99,326
1,864.52
Retired workers
50,690
75.1
96,985
1,913.31
Spouses of retired
workers
1,882
2.8
1,716
911.68
Children of retired
workers
700
1.0
625
892.95
Survivor benefits
5,831
8.6
8,767
1,503.52
Total Monthly Benefits (in millions)

Average Monthly Benefit

All beneficiaries

69,628

100.0%

$129,351

$1,857.75

Old-Age and Survivors Insurance

61,405

88.2

117,511

1,913.70

Retirement benefits

55,551

79.8

108,339

1,950.27

Retired workers

52,817

75.9

105,760

2,002.39

Spouses of retired workers

1,995

2.9

1,895

950.20

Children of retired workers

739

1.1

684

925.14

Survivor benefits

5,854

8.4

9,172

1,566.66

Children of Children of
deceased workersdeceased workers
2,065
3.1
2,284
1,106.13
Widowed
mothers/fathers
102
0.2
129
1,266.33
Nondisabled
widow(er)s
3,465
5.1
6,169
1,780.42
Disabled widow(er)s
199
0.3
184
926.73
Parents of deceased
1
1
1,603.30
a
workers

Disability Insurance
8,418
12.5
11,744
1,395.15
Disabled workers
7,277
10.8
11,187
1,537.33
Spouses of disabled
workers
86
0.1
36
418.89
Children of disabled
workers
1,055
1.6
521
494.08

2,081

3.0

2,371

1,139.18

Widowed mothers/fathers

99

0.1

130

1,314.10

Nondisabled widow(er)s

3,479

5.0

6,485

1,863.71

Disabled widow(er)s

194

0.3

185

953.73

Parents of deceased workers

1

^a

1

1,697.90

Disability Insurance

8,223

11.8

11,841

1,439.97

Disabled workers

7,137

10.3

11,291

1,581.97

Spouses of disabled workers

87

0.1

38

440.46

Children of disabled workers

999

1.4

512

512.13

Source: Table reproduced from Social Security Administration, Table reproduced from Social Security Administration, Monthly Statistical Snapshot, March 2024May 2025, Table 2. , Table 2.
See the latest edition of the See the latest edition of the Monthly Statistical Snapshot atat http://www.socialsecurity.gov/policy/docs/quickfacts/http://www.socialsecurity.gov/policy/docs/quickfacts/
stat_snapshot/index.htmlstat_snapshot/index.html.
a. . a. Indicates a value less than 0.05%.

Footnotes

1.

A person may receive retired-worker benefits and continue to have earnings. However, under certain circumstances, earnings may affect the amount of a person's monthly benefit.

2.

Social Security Administration (SSA), Monthly Statistical Snapshot, May 2025, Table 2. See the latest edition of the Monthly Statistical Snapshot at http://www.socialsecurity.gov/policy/docs/quickfacts/stat_snapshot/index.html.

3. Currently, 94% of workers in paid employment or self-employment are covered by Social Security. SSA, Social Security Fact Sheet, at https://www.ssa.gov/OACT/FACTS/. 4.

The annual limit on covered wages and net self-employment income that is subject to the Social Security payroll tax (the taxable wage base) is adjusted annually based on average wage growth, if a Social Security cost-of-living adjustment (COLA) is payable.

5.

42 U.S.C. §401.

6.

Under current law, the Federal Old-Age and Survivors Insurance (OASI) and Federal Disability Insurance (DI) trust funds cannot borrow from each other when faced with a funding shortfall. The shifting of funds between OASI and DI can only be done with authorization from Congress. In the past, Congress has authorized temporary interfund borrowing among the OASI, DI, and Medicare Hospital Insurance trust funds, as well as temporary payroll tax reallocations between OASI and DI, to deal with funding shortfalls. Most recently, under the Bipartisan Budget Act of 2015 (P.L. 114-74), Congress authorized a temporary reallocation of payroll taxes from the OASI fund to the DI fund for calendar years 2016 through 2018. Because of such actions, the OASI and DI trust funds are discussed on a combined basis. For more information, see CRS Report R43318, The Social Security Disability Insurance (DI) Trust Fund: Background and Current Status.

7.

SSA, Trust Fund Data, at https://www.ssa.gov/cgi-bin/ops_period.cgi.

8.

P.L. 74-271.

9.

P.L. 76-379.

10.

The DI program was established by the Social Security Amendments of 1956 (P.L. 84-880). The program became known as the Old-Age, Survivors, and Disability Insurance (OASDI) program, the formal name for Social Security.

11.

Congress has increased the Social Security payroll tax rate many times over the program's history. The payroll tax rate under current law (12.4%) was established by the Social Security Amendments of 1983 (P.L. 98-21). P.L. 98-21 increased the payroll tax rate gradually from 11.4% in 1984 to 12.4% in 1990.

12.

The taxable wage base amounts are in nominal dollars. The most recent legislative change to the Social Security taxable wage base was in 1977. The Social Security Amendments of 1977 (P.L. 95-216) established ad-hoc increases in the taxable wage base for 1979, 1980, and 1981, followed by a return to automatic wage indexation for 1982 and subsequent years.

13.

For example, the Social Security Amendments of 1965 (P.L. 89-97) established benefits for divorced wives aged 62 or older.

14.

See the Social Security Amendments of 1972 (P.L. 92-603). For more information, see CRS Report 94-803, Social Security: Cost-of-Living Adjustments.

15.

See the Social Security Amendments of 1977 (P.L. 95-216).

16.

Following the Social Security Amendments of 1983 (P.L. 98-21), projections showed the re-emergence of long-range deficits as a result of changes in actuarial methods and assumptions and because program changes had been evaluated with respect to their effect on the average 75-year deficit. That is, while program changes were projected to restore trust fund solvency on average over the 75-year projection period, a period of surplus years was followed by a period of deficit years. As time passed, the inclusion of additional deficit years in the 75-year valuation period resulted in a return to projected long-range deficits.

17.

The Patient Protection and Affordable Care Act (ACA; P.L. 111-148) imposed an additional Medicare HI tax of 0.9 percentage point on high-income workers with wages over $200,000 for single filers and $250,000 for joint filers, effective for taxable years beginning in 2013.

18.

Self-employed individuals must pay Social Security payroll taxes if they have net earnings from self-employment of $400 or more in a year; 92.35% of net earnings (up to the annual limit) are taxable.

19.

If a self-employed individual does not pay himself or herself wages, SECA taxes are paid annually on the Internal Revenue Service Form 1040 (U.S. Individual Income Tax Return). If a self-employed individual does pay himself or herself wages, FICA taxes are paid during the year along with any FICA tax payments for his or her employees.

20.

The tax revenues associated with including Social Security benefits in federal taxable income go to the Social Security trust funds and the Medicare HI trust fund. For more information, see CRS Report RL32552, Social Security: Taxation of Benefits.

21.

Social Security Act, Title II, §201(d). For more information, see SSA, Office of the Chief Actuary, Actuarial Note Number 142, Social Security Trust Fund Investment Policies and Practices, by Jeffrey L. Kunkel, January 1999, at http://www.ssa.gov/OACT/NOTES/n1990s.html.

22.

SSA, Trust Fund FAQs, at http://www.socialsecurity.gov/OACT/ProgData/fundFAQ.html.

23.

The 2025 Annual Report of the Board of Trustees of the Federal Old-Age and Survivors Insurance and Federal Disability Insurance Trust Funds, June 18, 2025, https://www.ssa.gov/oact/tr/2025/tr2025.pdf (hereinafter cited as 2025 Annual Report of the Social Security Board of Trustees). See Table III.A3, p. 38.

24.

Social Security and Medicare Boards of Trustees, Status of the Social Security and Medicare Programs: A Summary of the 2025 Annual Reports, June 18, 2025, p. 12, at https://www.ssa.gov/oact/TRSUM/tr25summary.pdf.

25.

For more information, see CRS Report RL32552, Social Security: Taxation of Benefits, by Paul S. Davies.

26.

Projections cited in this CRS report are based on the intermediate (or "best estimate") set of assumptions in the 2025 Annual Report of the Social Security Board of Trustees and refer to the OASI and DI trust funds on a combined basis. For more information on the trust fund projections, see CRS Report RL33028, Social Security: The Trust Funds.

27.

Separately, the OASI fund is projected to have asset reserves until 2033, at which point continuing income to the fund would be sufficient to pay 77% of OASI scheduled benefits. The DI fund is projected to have asset reserves throughout the 75-year projection period. See 2025 Annual Report of the Social Security Board of Trustees, p. 6.

28.

2025 Annual Report of the Social Security Board of Trustees, p. 5. The Congressional Budget Office (CBO) also publishes long-range projections for the Social Security trust funds. CBO projects that the trust funds will have a positive balance (asset reserves) until 2034 and a 75-year actuarial deficit equal to 4.9% of taxable payroll. See CBO, CBO's 2025 Long-Term Projections for Social Security, June 26, 2025, Table 7, https://www.cbo.gov/publication/61492. Taxable payroll refers to total earnings in the economy that are subject to Social Security payroll taxes (with some adjustments). Program costs and income are evaluated as a percentage of taxable payroll because Social Security payroll taxes are the primary source of funding for the program.

29.

The estimated payroll tax increase needed to maintain solvency differs from the actuarial deficit for two reasons. First, the estimated tax increase projects zero trust funds reserves at the end of the projection period whereas the actuarial deficit assumes trust fund reserves equal to one year's cost. Second, the estimated payroll tax increase needed to maintain solvency does not reflect behavioral response changes to tax rate changes.

30.

A wage-indexed benefit formula allows initial monthly benefits for successive groups of new beneficiaries to keep pace with increases in the standard of living. An annual COLA for benefits already in payment allows benefits for current beneficiaries to keep pace with increases in prices.

31.

2025 Annual Report of the Social Security Board of Trustees, Table IV.A3, p. 51.

32.

Social Security and Medicare Boards of Trustees, Status of the Social Security and Medicare Programs: A Summary of the 2025 Annual Reports, June 18, 2025, p. 7.

33.

Traditionally, one of the principles governing the Social Security program has been balancing the competing goals of social adequacy and individual equity. The social adequacy goal takes into account factors beyond a person's payroll tax contributions in determining the appropriate level of benefits (factors such as providing a minimum standard of living). The individual equity goal takes into account the degree to which a person's benefit level reflects his or her payroll tax contributions to the system.

34.

The full retirement age is also called the normal retirement age (NRA).

35.

For more information, see CRS Report R44670, The Social Security Retirement Age.

36.

A worker may earn up to four earnings credits per calendar year. In 2025, a worker earns one credit for each $1,810 of covered earnings, up to a maximum of four credits for covered earnings of $7,240 or more. Earnings credits are also called quarters of coverage.

37.

Earnings through the age of 60 are indexed; earnings thereafter are counted at nominal value. Indexing past earnings brings them up to near-current wage levels.

38.

The bend points in the benefit formula are indexed to average wage growth under current law.

39.

The replacement factors in the benefit formula are fixed under current law.

40.

Automatic COLAs went into effect in 1975. Since that time, there have been three years when no COLA was payable (2010, 2011, and 2016). For more information, see CRS Report 94-803, Social Security: Cost-of-Living Adjustments.

41.

The early retirement reduction for spousal benefits is different. Spousal benefits claimed before the FRA are reduced by 25/36 of 1% (or 0.0069) for each month of entitlement before the FRA, up to 36 months, and by five-twelfths of 1% (or 0.0042) for each month of entitlement before the FRA in excess of 36 months. The reduction is applied to the base spousal benefit, which is 50% of the worker's PIA. The spousal benefit is not reduced for entitlement before the FRA if the spouse is caring for a qualifying child. The early retirement reduction also differs for widow(er)'s benefits. The maximum reduction for widow(er)'s benefits claimed before the FRA is equal to 28.5% of the deceased worker's PIA. Alternatively, if a widow(er) claims benefits at the FRA, his or her benefits are reduced if the deceased worker claimed benefits before the FRA and therefore was receiving a reduced benefit. Under the widow(er)'s limit provision, the widow(er)'s benefit is limited to the higher of (1) the benefit the deceased worker would be receiving if he or she were still alive or (2) 82.5% of the deceased worker's PIA. In this case, the maximum reduction applied to the widow(er)'s benefit is equal to 17.5% of the deceased worker's PIA.

42.

For more information, see CRS Report R43542, How Social Security Benefits Are Computed: In Brief.

43.

For more information, see CRS In Focus IF10738, Social Security Dual Entitlement.

44.

For more information, see CRS Report R41242, Social Security Retirement Earnings Test: How Earnings Affect Benefits, by Zhe Li and SSA, Exempt Amounts Under the Earnings Test, at https://www.ssa.gov/OACT/COLA/rtea.html.

45.

For more information, see CRS Report R43370, Social Security Disability Insurance (SSDI): Becoming Insured, Calculating Benefit Payments, and the Effect of Dropout Year Provisions.

46.

For more information, see CRS Report R44948, Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI): Eligibility, Benefits, and Financing.

47.

SSA, Monthly Statistical Snapshot, May 2025, Table 2. See the latest edition of the Monthly Statistical Snapshot at http://www.socialsecurity.gov/policy/docs/quickfacts/stat_snapshot/index.html.

48.

To receive mother's/father's benefits, the person must be unmarried and must not be entitled to widow(er)'s benefits.

49.

Social Security Act, Title II, §203.

50.

SSA, Formula for Family Maximum Benefit, at https://www.socialsecurity.gov/OACT/COLA/familymax.html.

51.

Benefits for a divorced beneficiary are not taken into account for purposes of the family maximum. See SSA, Program Operations Manual System (POMS), Section RS 00615.682, "Family Benefits Where a Divorced Spouse or a Surviving Divorced Spouse is Entitled," at https://secure.ssa.gov/apps10/poms.nsf/lnx/0300615682.

52.

Percentages do not sum to 100% due to rounding.

Indicates a value less than 0.05%.



Author Information

Emma K. Tatem

Analyst in Social Policy

Congressional Research Service

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Social Security Primer



Disclaimer
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under the direction of Congress. Information in a CRS Report should not be relied upon for purposes other
than public understanding of information that has been provided by CRS to Members of Congress in
connection with CRS’s institutional role. CRS Reports, as a work of the United States Government, are not
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Congressional Research Service
R42035 · VERSION 45 · UPDATED
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