Social Security Taxes for 2023: Biden to Increase Revenue by Taxing the Rich

The Social Security Administration acquires most of its revenue by taxing the salaries and wages of workers. Accordingly, U.S. President Joe Biden introduced a proposal of taxing the rich to increase the Social Security taxes for 2023.

The Social Security Administration acquires most of the Social Security taxes for 2023 by taxing the salaries and wages of workers in the U.S. The liability to pay the 12.4% payroll tax is divided between the employers and the employees. On the other hand, the self-employed bear the burden of paying the 12.4% payroll tax in full.

Nonetheless, according to Williams, not all earned income is subject to the 12.4% payroll tax. In 2023, the salaries and wages that are worth up to $160,200 are subject to taxes. Unfortunately, this suggests that 94% of the working Americans who earn less than $160,200 per year bear the burden of paying into the Social Security taxes for 2023.

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Increasing the Social Security Taxes for 2023

On the other hand, an article in Business Insider states that an earned income above $160,200 is exempted from the 12.4% payroll tax. In 2021, the payroll taxes were applicable to only 81% of earned income in comparison to the 91% of earnings in 1984. This suggests that the earning power of the rich is increasing rapidly, while in the end, more earnings are exempted from the Social Security taxes for 2023.

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