Any expansion of social security requires mass taxation on the rich

Important to note, however, is how the legislation would fund this expansion: increasing taxes.

The Social Security program limits the amount of earnings subject to taxation in a given year, currently set at a taxable maximum of $147,000 in 2022. The tax rate for wages is set at 6.2%, or 12.4% split evenly between employers and employees. The Social Security Expansion Act would amend this payroll tax and subject all income over $250,000 to the tax. The bill sponsors estimate that 93% of American households would see no increase, but high-earners could see a substantial impact in their net pay.

Furthermore the new bill would target the self-employed, business owners and investors. The self-employed would see the same tax increase as the salaried, with a new payroll tax on those earning more than $250,000. Net investment income taxes would jump from 3.8% to 16.4% in order to include additional taxes in lieu of Social Security and Medicare payroll taxes. Business owners, too, would be hit with a new 12.4% Social Security tax on business income not already covered by payroll taxes.

A new bill aiming to expand the quickly-depleting Social Security fund could potentially increase taxes for high-earners. Taxable Social Security earnings are currently capped at $147,000 for the year, but this new legislation could tap individuals earning more than $250,000 and subject them to a further 6.2% in payroll taxes. The bill additionally proposes increased taxes on investors and businesses. While these changes could support millions more elderly Americans in their retirement, the impact on high-earners is significant.