Social Security Guarantee Bill
At a Glance
- Extends Social Security solvency by lifting the payroll tax cap above $250,000
- Prohibits any benefit cuts for current or future retirees
- Locks trust fund money so it cannot be diverted to other spending
- Phases in full payroll tax coverage of all earnings over seven years
- 85% of Americans support preserving benefits through higher taxes on top earners
Social Security is the most successful anti-poverty program in American history and the foundation of retirement security for tens of millions of Americans. More than 68 million people receive monthly benefits[1], including retirees, disabled workers, and survivors of deceased workers. For most elderly Americans, Social Security represents their largest source of income, and for many it is the difference between dignity and destitution. Without Social Security, approximately 4 in 10 elderly Americans would have incomes below the poverty line[2].
The program is now approaching a crisis that has been decades in the making. The Social Security Trustees project that the Old-Age and Survivors Insurance trust fund will be depleted by 2033[3]—just seven years away. If Congress fails to act, all beneficiaries will face an automatic benefit cut of approximately 23 percent[3], regardless of age, income, or need. Current retirees who have paid into the system their entire working lives would see their monthly checks reduced. Workers nearing retirement who have planned their finances around promised benefits would have the rug pulled out from under them.
The program's financial challenges stem primarily from demographic shifts that were foreseeable but never adequately addressed. In 1960, there were more than five workers paying into the system for every beneficiary[4]. Today, that ratio has fallen to fewer than three-to-one[4] and is projected to decline further. Americans are living longer—a 65-year-old today can expect to live significantly longer than when Social Security was created[5]—and the Baby Boom generation has been reaching retirement age at a rate of roughly 10,000 people per day[6]. These trends are not temporary; they reflect permanent changes in American society that require permanent policy adjustments.
The system's revenue base has also eroded since Congress last addressed solvency in 1983. At that time, 90 percent of covered earnings were subject to the payroll tax[7]. Today, only about 83 percent of earnings are taxed[7] because wages at the top have grown faster than the taxable maximum. The current payroll tax cap—$176,100 in 2025[8]—means that a worker earning that amount pays the same Social Security tax as a billionaire. Someone earning $2 million per year finishes paying their Social Security taxes for the entire year before the end of February, while middle-income workers contribute on every paycheck throughout the year.
Americans overwhelmingly support preserving Social Security through increased revenue rather than benefit cuts. Polling consistently shows that 85 percent of Americans believe benefit levels should be maintained or increased even if it means higher taxes, with support crossing party lines[9]. Specifically, a large majority supports raising or eliminating the payroll tax cap on high earners as the fairest way to address the funding gap.
This legislation ensures long-term solvency of Social Security by gradually lifting the payroll tax cap on high earners while protecting benefits for current and future retirees. By asking those who have benefited most from the American economy to pay their fair share, we can preserve the program that has kept generations of Americans out of poverty without burdening middle-class workers or cutting benefits that retirees have earned through a lifetime of work.
Problems the Bill Aims to Solve
Social Security Faces Insolvency Within a Decade. The Old-Age and Survivors Insurance trust fund is projected to be depleted by 2033[3]. At that point, the program will only be able to pay approximately 77 percent of scheduled benefits[3], resulting in an automatic cut of 23 percent for all beneficiaries. This is not a distant hypothetical—it will affect people who are already retired and those planning to retire in the coming years. Every year Congress fails to act, the solutions become more painful and the options more limited.
Automatic Benefit Cuts Would Devastate Retirees. If the trust fund is depleted without congressional action, benefits will be cut indiscriminately across the board. A retiree currently receiving $2,000 per month would see their benefit reduced by approximately $460[3]. For millions of seniors who depend on Social Security as their primary income source, such cuts would force impossible choices between food, medicine, housing, and other necessities. Workers who have paid into the system for decades would be denied the benefits they were promised and have earned.
The Worker-to-Beneficiary Ratio Has Fundamentally Changed. When Social Security was designed, there were many workers supporting each retiree. That ratio has fallen from five-to-one in 1960 to fewer than three-to-one today[4], and will decline further as the population ages. This demographic shift is permanent and requires adjustments to the program's revenue base. The system cannot sustain itself using parameters designed for a fundamentally different demographic reality.
High Earners Stop Paying Into the System Early in the Year. The payroll tax cap means that workers earning above $176,100[8] stop contributing to Social Security once they reach that threshold. A worker earning $2 million finishes paying Social Security taxes before the end of February, while middle-class workers contribute on every paycheck all year long. This cap exempts the highest earners from contributing proportionally to the system that provides a safety net for all Americans, making the payroll tax effectively regressive.
The Taxable Share of Earnings Has Declined. In 1983, when Congress last reformed Social Security, 90 percent of covered earnings were subject to the payroll tax[7]. Today, only about 83 percent of earnings are taxed[7] because wages at the top have grown faster than the cap. This erosion of the tax base costs the system billions annually and reflects a growing concentration of income among those who escape the payroll tax entirely on their highest earnings.
Congressional Inaction Breaks Faith with the American People. Workers have paid into Social Security throughout their careers with the understanding that benefits would be there when they retired. Allowing the trust fund to deplete through inaction represents a fundamental betrayal of that promise. Americans have done their part by contributing to the system; Congress must do its part by ensuring the system can deliver on its commitments. Preserving Social Security is not a partisan issue—it is a matter of honoring the social contract that binds generations of Americans together.
Social Security Guarantee Act
120th Congress, 2nd Session
Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,
Sec. 1. SHORT TITLE.
This Act may be cited as the "Social Security Guarantee Act."
Sec. 2. FINDINGS.
Congress finds the following:
- (1) The Old-Age and Survivors Insurance trust fund is projected to be depleted by 2033, at which point benefits would be automatically reduced by approximately 23 percent.
- (2) More than 68 million Americans receive Social Security benefits, and for the majority of elderly Americans it constitutes their largest source of income.
- (3) The current contribution and benefit base of $176,100 means only approximately 83 percent of covered earnings are subject to the payroll tax, compared with 90 percent in 1983.
- (4) Americans overwhelmingly support preserving benefits through increased contributions by high earners rather than benefit reductions.
Sec. 3. APPLICATION OF PAYROLL TAX TO EARNINGS ABOVE $250,000.
- (1) Effective for remuneration paid after December 31, 2025, OASDI taxes shall apply to wages and self-employment income in excess of $250,000, in addition to taxes on earnings up to the contribution and benefit base.
- (2) PHASE-IN.—The gap between the contribution and benefit base and $250,000 shall be closed over 7 years:
- (a) For 2026, taxes apply up to the base and above $250,000.
- (b) For 2027 through 2032, the threshold above which additional taxes apply shall be reduced by equal annual increments so that by 2032 the threshold equals the contribution and benefit base.
- (c) The Commissioner shall publish the applicable threshold for each year by November 1 of the preceding year.
Sec. 4. BENEFIT FORMULA PROTECTION.
- (1) Earnings above the contribution and benefit base that become subject to OASDI taxes under Section 3 shall not be included in the computation of the primary insurance amount.
- (2) This ensures additional taxes contribute to solvency without creating disproportionate benefit entitlements.
Sec. 5. PROHIBITION ON BENEFIT REDUCTIONS.
- (1) No provision of this Act shall authorize a reduction in benefits for any current beneficiary.
- (2) No provision shall reduce benefits for any future beneficiary below amounts payable under the formula in effect on the date of enactment.
- (3) Cost-of-living adjustments shall continue without modification.
Sec. 6. SOCIAL SECURITY TRUST FUND LOCK BOX.
- (1) Amounts in the OASI and DI Trust Funds shall be used exclusively for benefit payments and administrative expenses under title II of the Social Security Act.
- (2) No amounts may be transferred, loaned, or made available for any other purpose including general revenue expenditures or deficit reduction.
- (3) Any provision or action that would divert trust fund resources shall be subject to a point of order in both chambers, waivable only by a three-fifths vote.
Sec. 7. ANNUAL SOLVENCY REPORTING.
- (1) The Board of Trustees shall submit an annual report on trust fund solvency, the effect of this Act's revenue changes, and recommendations for additional action if the 75-year actuarial balance remains in deficit.
- (2) The first report shall be submitted within 12 months of enactment and made publicly available.
Sec. 8. EFFECTIVE DATE.
- (1) This Act shall take effect on the date of enactment.
- (2) The payroll tax provisions shall apply to remuneration paid after December 31, 2025.