Bill Aims to Fund Social Security for 75 Years by Taxing Wealthy

Comprehensive Legislation Proposes 75-Year Extension for Social Security and Medicare Funding

A significant legislative proposal aims to substantially strengthen the financial foundation of Social Security and Medicare for at least 75 years. This strategic initiative would eliminate the cap on Social Security payroll taxes and increase the net investment income tax for Medicare by 1.2 percentage points for high-income earners above $400,000 annually.

The “Medicare & Social Security Fair Share Act,” introduced by Senator Sheldon Whitehouse (D-Rhode Island) and Representative Brendan Boyle (D-Pennsylvania), represents a fundamental restructuring of how these essential Social Security and Medicare programs are funded.

According to expert analysis from the National Committee to Preserve Social Security and Medicare, the legislation “strengthens Social Security’s financial foundations through increased revenue dedicated to support the program by extending the payroll tax to wages and unearned income of taxpayers exceeding $400,000.”

Social Security Payroll Tax Cap Elimination

The proposal would systematically eliminate the current Social Security tax cap. Under existing law, the 6.2% Social Security payroll tax applies only to earnings up to $176,100, with this threshold increasing annually with inflation. Employers currently match employee contributions at the same 6.2% rate.

Policy experts note that taxing investment income represents a more accurate reflection of contemporary income distribution patterns, as higher-income individuals increasingly derive smaller proportions of their total income from wages alone.

Ensuring Long-term Social Security Program Solvency

The bill’s sponsors assert that the legislation would “ensure wealthy owners of pass-through businesses such as hedge funds and private equity firms with annual incomes exceeding $400,000 cannot circumvent Medicare taxes.”

Independent analyses conducted by both the Centers for Medicare and Medicaid Services Office of the Actuary and the Social Security Administration’s Office of the Chief Actuary confirm the legislation would extend program solvency by a minimum of 75 years.

Max Richtman, president and CEO of the National Committee to Preserve Social Security and Medicare, characterized the proposal as “a bold and forceful step on behalf of seniors and all Americans by strengthening and safeguarding Social Security for future beneficiaries.”

Representative Boyle emphasized the urgency of this legislation, particularly in response to what he describes as attacks on these programs by wealthy individuals. He stated that while “Republicans are pushing a $7 trillion tax giveaway to the ultra-rich,” this legislation aims to “protect the benefits that millions of Americans have earned” through Social Security reform.