2014 Social Security cost-of-living adjustment will be 1.5%

The Social Security Administration (SSA) has announced a 1.5 percent cost-of-living-adjustment (COLA) for Social Security benefits received by beneficiaries starting in January 2014. This COLA will produce an estimated average monthly benefit of $1,294 for all retired workers in 2014, $19 a month more than in 2013. The COLA increase will be applied to this coming year’s benefits, beginning with benefits for December 2013, which are payable in January 2014. The increase will begin for more than 57 million Social Security beneficiaries with benefits that are received in January 2014. Increased payments for more than 8 million SSI beneficiaries will begin on December 31, 2013.

The maximum amount of earnings subject to the Social Security tax (taxable maximum) will increase to $117,000 for 2014, up from $113,700 for 2013. Of the estimated 165 million workers who will pay Social Security taxes in 2014, about 10 million will pay higher taxes as a result of the increase in the taxable maximum.

Source: Social Security News Release and Fact Sheet, October 30, 2013.

For more information on this and related topics, consult the CCH Pension Plan Guide, CCH Employee Benefits Management, and Spencer’s Benefits Reports.

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