Many Newark, New Jersey, recipients of Social Security Disability benefits are aware that since 1975, the Social Security Administration has revised payments annually to address the rising cost of living expenses caused by inflation. In 2009 and 2010, the SSA did not announce a Cost-of-Living Adjustment, or COLA, because the there was no recorded inflation.
However, next year, recipients will receive an increase of almost two percent in SSD benefits, marking the fourth consecutive year of benefit increases. According to the SSA, the next opportunity for an increase will be reviewed in October 2015.
As news reports state, the increase will help the almost 60 million retirees, dependents and survivors receiving benefits. Additionally, more than eight million recipients of Supplemental Security Income will also be part of the revision. Moreover, the American Federation of Government Employees also announced that more than 2.5 million federal government retirees will also benefit from the increase.
According to the SSA, an average retired worker will have about $264 more in a year in SSD benefits. However, for recipients younger than retirement age with income from an existing job, the maximum exemption is extended to $15,720, which calculates to an increase of $240 for the year. For every $2 earned above the exemption limit, the SSA will withhold $1 from a paycheck. Immediately after a beneficiary retires, the exemption limit will end.
The SSA also announced that beginning in January, the maximum annual income subject to the Social Security levy will go up $1,500, making the maximum taxable income $118,500. This increase is based on rising worker wages during the last year. The agency estimates that the change will affect about 10 million of the 168 million workers who now pay Social Security taxes.
Source: BloombergBNA.com, “Social Security Benefit Payments to Increase by 1.7 Percent in 2015,” Larry Swisher, Oct. 27, 2014