Bernie Sanders Social Security plan would boost benefits and extend program solvency for 75 years
Sen. Bernie Sanders has reintroduced legislation that would expand Social Security Administration benefits for current and future retirees while reshaping how the program is funded. The proposal aims to increase monthly checks for millions of Americans while shifting more of the financial burden onto higher-income households.
The plan combines a benefit increase with new tax rules designed to generate additional revenue for the program. Supporters say the approach would strengthen Social Security’s finances while avoiding tax increases for most workers.
What the Social Security Expansion Act would change
Sanders’ Social Security Expansion Act pairs higher benefits with tax changes aimed at paying for the expansion.
The bill would raise payments for both current and future retirees. Supporters describe the increase as roughly $200 more per month on average, or about $2,400 per year. The boost would come from adjustments to the benefit formula so that checks rise across the board.
The proposal is designed to expand support for retirees while addressing long-term funding concerns.
How benefits could increase for retirees
Under the legislation, the formula used to calculate Social Security benefits would be adjusted to increase payments across the system.
Supporters say the change would translate to an average benefit increase of about $200 per month for millions of beneficiaries. That increase would apply to both people currently receiving Social Security and future retirees entering the program.
Advocates argue the adjustment reflects rising living costs and the growing reliance many Americans have on Social Security income in retirement.
Closing the payroll tax gap on high earners
A major funding change in the proposal targets income that currently falls outside the Social Security payroll tax system.
Today, payroll taxes only apply up to an annual earnings cap. Once workers reach that threshold, additional wages are not subject to the Social Security tax.
Under Sanders’ proposal, wages above $250,000 would once again become subject to the 12.4% payroll tax, significantly expanding the portion of high earners’ income that contributes to the program.
Applying Social Security taxes to more types of income
The legislation would also extend Social Security taxes beyond traditional wages.
Certain investment and business income for higher-income households would become subject to the tax. This change targets income streams that currently sit outside the payroll tax system.
Because many high earners receive significant income from dividends, capital gains, or business profits, the proposal aims to bring more of those earnings into the Social Security funding stream.
What do the Bill sponsors say
“Protecting Social Security is our commitment to seniors who’ve worked their whole lives to earn it,” said Rep. Hoyle. “While Congressional Republicans continue to threaten cuts to Social Security, I am proud to join Senator Sanders, Senator Warren and Representative Schakowsky in introducing a concrete proposal that extends the program for another 75 years by having millionaires and billionaires pay their fair share like every other working American. The Social Security Expansion Act was my first bill in Congress, and I will not stop fighting until I see it passed into law.”
“At a time when nearly half of older Americans have no retirement savings and over 26% of seniors are trying to survive on an income of less than $17,500 a year, our job is not to cut Social Security as many of our Republican colleagues want to do,” said Sen. Sanders. “Our job is to expand Social Security so that every senior in America can retire with the dignity that they deserve and every person with a disability can live with the security they need. The legislation we are introducing today will expand Social Security benefits by $2,400 a year, lift millions of seniors out of poverty and extend the solvency of Social Security for generations to come by making sure that the wealthiest people in our society pay their fair share into the system. Right now, a billionaire pays the same amount into Social Security as someone who makes $176,100 a year. Our bill puts an end to that absurdity. And by doing that, we can expand Social Security benefits and make sure that Social Security can pay out every single benefit owed to every eligible American for the next 75 years.”
“Social Security serves as a lifeline for millions of seniors, and hardworking Americans deserve to receive the benefits they paid into,” said Sen. Warren. “It’s a mistake for Donald Trump and his allies in Congress to focus on securing tax cuts for billionaires and large corporations when we should be focusing on expanding and increasing Social Security benefits so that everyone can retire with dignity.”
“Social Security is your hard-earned money; it is not an entitlement. President Donald Trump and his unelected billionaire sidekick Elon Musk think they alone can decide if you get your Social Security check. They had better think again. That is stealing. Americans pay into the program with each paycheck. We must expand Social Security benefits, not cut them, and I have a bill to do just that,” said Rep. Schakowsky. “The Social Security Expansion Act will protect the national treasure that is Social Security by extending the trust fund’s solvency for 75 years and expanding benefits by $2,400 a year so that everyone in America can retire with the security and dignity they deserve after a lifetime of hard work.”
Who would pay higher Social Security taxes
The tax increases would apply to a relatively small group of high-income households.
Workers earning more than $250,000 would begin paying Social Security taxes on income above that level. Today, earnings above the annual cap are not taxed for Social Security purposes.
By extending the 12.4% payroll tax to additional earnings, the bill would increase contributions from top earners while leaving most workers’ taxes unchanged.
The mechanics of the proposal are straightforward when applied to individual incomes.
For example, someone earning $300,000 annually would pay Social Security taxes on an additional $50,000 of income under the proposal. At much higher income levels, the additional tax liability grows quickly because every dollar above $250,000 would be taxed.
This structure concentrates the new costs among the highest earners.
Why most Americans would see no tax increase
Despite the tax adjustments, most households would not see any increase in their payroll taxes.
Workers earning $250,000 or less would continue paying Social Security taxes under the current rules. Their paychecks would be taxed the same way they are today.
Supporters highlight this feature as a key part of the plan’s design, arguing it protects middle-income workers while expanding benefits.
How the proposal could affect Social Security’s finances
The plan’s tax changes are intended to significantly increase revenue flowing into the Social Security system.
By expanding the range of income subject to payroll taxes, the proposal would capture more revenue from high earners whose income currently exceeds the taxable cap or comes from non-wage sources.
According to estimates from the chief actuary at the Social Security Administration, the added revenue could allow the program to pay full scheduled benefits for at least the next 75 years.
The current funding challenge facing Social Security
Without policy changes, Social Security faces long-term financial pressure.
Current projections indicate the program’s combined trust funds could face a shortfall in the mid-2030s. If that occurs and no legislative action is taken, the system would eventually need to reduce benefits across the board.
Supporters of the expansion proposal argue the new tax revenue would both fund higher benefits and help prevent those potential cuts.
Why the proposal is politically controversial
The legislation has drawn sharply divided reactions in Washington.
Supporters argue the plan asks the highest earners to contribute more to a program relied upon by most Americans. They frame the proposal as a way to strengthen Social Security and increase benefits without raising taxes on the middle class.
Critics, however, describe the plan as a significant tax increase on high-income households. Some also warn that higher payroll and investment taxes could affect hiring, business investment, or broader economic growth as the proposal targets additional income streams.
Despite support from some Democratic lawmakers, the bill faces steep political hurdles in Congress.
Major changes to Social Security have historically required bipartisan cooperation, and the proposal currently lacks meaningful Republican backing. Without that support, the legislation faces long odds of advancing in its current form.
Bernie Sanders had introduced the S.393 – Social Security Expansion Act in the 118th Congress on 02/13/2023. The bill was read twice and referred to the Committee on Finance with no progress.
For now, the reintroduced plan in the 119th Congress remains a policy proposal rather than a change retirees should expect in the near term.
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John Dealbreuin came from a third world country to the US with only $1,000 not knowing anyone; guided by an immigrant dream. In 12 years, he achieved his retirement number.
He started Financial Freedom Countdown to help everyone think differently about their financial challenges and live their best lives. John resides in the San Francisco Bay Area enjoying nature trails and weight training.
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