Social Security Announces 2.1 Percent Benefit
Increase for 2004
(See Fact Sheet Below)
Oct. 16, 2003 - Monthly Social Security and Supplemental Security Income benefits for
more than 51 million Americans will increase 2.1 percent in 2004, the
Social Security Administration announced today.
 Social Security and Supplemental Security Income benefits increase
automatically each year based on the rise in the Bureau of Labor Statistics’
Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W),
from the third quarter of the prior year to the corresponding period
of the current year. This year's increase in the CPI-W was 2.1 percent.
The 2.1 percent Cost-of-Living Adjustment (COLA) will begin with benefits
that 47 million Social Security beneficiaries receive in January 2004.
Increased payments to 7 million Supplemental Security Income beneficiaries
will begin on December 31.
Some other changes that take effect in January of each year are based
on the increase in average wages. Based on that increase, the maximum
amount of earnings subject to the Social Security tax (taxable maximum)
will increase to $87,900 from $87,000 in 2003. Of the estimated 156
million workers who will pay Social Security taxes in 2004, about 9.2
million will pay higher taxes as a result of the increase in the taxable
maximum in 2004.
Information about Medicare changes for 2004 can be found at www.hhs.gov
– The Internet site for the Department of Health and Human Services.
Fact Sheet by
Social Security
2004 SOCIAL SECURITY CHANGES
Cost-of-Living Adjustment (COLA):
| Based on the increase in the Consumer Price Index (CPI-W)
from the third quarter of 2002 through the third quarter of 2003,
Social Security and Supplemental Security Income (SSI) beneficiaries
will receive a 2.1 percent COLA for 2004. Other important 2004 Social
Security information is as follows: |
| Tax Rate |
2003 |
2004 |
| Employee |
7.65% |
7.65% |
| Self-Employed |
15.30% |
15.30% |
NOTE: The
7.65% tax rate is the combined rate for Social Security and Medicare.
The Social Security portion (OASDI) is 6.20% on earnings up to the
applicable taxable maximum amount (see below). The Medicare portion
(HI) is 1.45% on all earnings. |
| Maximum Earnings Taxable: |
2003 |
2004 |
| Social Security (OASDI only) |
$87,000 |
$87,900 |
| Medicare (HI only) |
No
Limit |
| Quarter of Coverage: |
2003 |
2004 |
| Earnings required |
$890 |
$900 |
| Retirement Earnings Test
Exempt Amounts: |
2003 |
2004 |
| Under full retirement age
NOTE: One dollar in benefits will be
withheld for every $2 in earnings above the limit. |
$11,520/yr.
($960/mo.) |
|
The year an individual reaches
full retirement age
NOTE: Applies only to earnings for months
prior to attaining full retirement age. One dollar in benefits will
be withheld for every $3 in earnings above the limit. |
$30,720/yr.
($2,560/mo.) |
$31,080/yr.
($2,590/mo.) |
| There is no limit
on earnings beginning the month an individual attains full retirement
age (65 and 2 months for retirees born in 1938; 65 and 4 months for
those born in 1939). |
| Social Security Disability Thresholds: |
2003 |
2004 |
|
Substantial Gainful Activity (SGA) |
Non-Blind |
$ 800/mo. |
$ 810/mo. |
| Blind |
$1,330/mo. |
$1,350/mo. |
| Trial Work Period
(TWP) |
$ 570/mo. |
$ 580/mo. |
Maximum Social Security Benefit:
Worker Retiring at
Full Retirement Age in |
2003
|
2004
|
| NOTE: For retirees born in
1938, full retirement age is 65 and 2 months; for those born in
1939, it is 65 and 4 months. Full retirement age will gradually
increase to age 67 for those born in 1960 or later. |
$1,741/mo.
(Age 65 and 2 months) |
$1,825/mo.
(Age 65 and 4 months) |
| SSI Federal Payment Standard: |
2003 |
2004 |
| Individual |
$ 552/mo. |
$ 564/mo. |
| Couple |
$ 829/mo |
$ 846/mo. |
| SSI Resources Limits: |
2003 |
2004 |
| Individual |
$2,000 |
$2,000 |
| Couple |
$3,000 |
$3,000 |
| SSI Student Exclusion Limits: |
2003 |
2004 |
| Monthly Limit |
$1,340 |
$1,370 |
| Annual Limit |
$5,410 |
$5,520 |
Estimated Average Monthly Social Security Benefits
Payable in January 2004: |
Before
2.1% COLA |
After
2.1% COLA |
| All Retired Workers |
$ 903 |
$ 922 |
| Aged Couple, Both Receiving
Benefits |
$1,492 |
$1,523 |
| Widowed Mother and Two Children |
$1,865 |
$1,904 |
| Aged Widow(er) Alone |
$ 870 |
$ 888 |
| Disabled Worker, Spouse and
One or More Children |
$1,412 |
$1,442 |
| All Disabled Workers |
$ 844 |
$ 862 |
|
