Scrap the Social Security Cap Day
About this event
"Scrap the Cap Day" us a recurring advocacy day.
Earnings above a cap aren’t subject to the payroll taxes that fund Social Security. As a result, millionaires and billionaires pay the same tax as someone earning $184,500 in 2026. This tax cap has been part of Social Security since the 1930s and is indexed to the average wage, so it changes every year.
This means anything a person makes after this year's cap amount is NOT taxable under FICA.
Comparing incomes between the 1930s and the 2020s, we see a tax cap that has not kept up with an ever-increasing disparity between the wealthy and the middle class.
Around the time Social Security was put into law, there were only about 20,000 millionaires in the country. These days, there are over 20 million Americans who can call themselves millionaires (and over 700 of them are billionaires—the first ever confirmed billionaire in the United States was Henry Ford in 1925).
With a huge increase in the number of Americans making income far exceeding our current tax cap and a huge gap between the $50,000 income of the average American and over 20 million people making million-dollar incomes, the income tax is said by many to be regressive.
Scrapping the Social Security income cap would remove the income limit on earnings subject to Social Security taxes to fund the program better and make it fairer.
Requiring all Americans to pay FICA taxes on 100% of their income—something most Americans already do—would provide a significant boost to Social Security’s coffers.
The Social Security Actuaries estimate this measure alone would introduce $3.5 TRILLION to the Trust Fund over just 10 years.
Read more about "Scrap the Cap Day" on the Seniors Center
website
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