Social Security works by distributing public funds to provide a basic level of economic stability for the public and to support them in specific situations.
Social Security is funded by the money raised from social security taxes collected as part of FICA.
From a pensions perspective, the theory is that the money you put into Social Security today, pays for your pension when you retire. This has however become distorted over the years as funds have been moved around, the net effect is that the money you pay today is actually paying for the pensioners of today. With an increasing population this means that our children and grandchildren will need to pay more and more social security if we are to have a retirement like that enjoyed by our own parents and grandparents.
Social Security programs provide:
Social Security is managed by the Social Security Administration (SCA) via a nationwide network of over 1,400 offices that include:
Did you know that the SCA also have a presence in U.S. embassies around the globe.
You can access the SCA frequently asked questions here, its a good resource.
You can calculate how much Social Security you are due to pay using the Tax Calculator
You can calculate how Social Security affects your tax payments here, simply select the advanced tax calculator and enter your Social Security details
Contact us if you would like to expand on the Social Security information shown or share your personal experiences of how Social Security has affected your tax return. If you are a website owner, Independent Financial Advisor etc, we will provide a link back to your website in recognition of your support.