What the bill proposes

In 2023, a group of Democratic senators introduced the Social Security 2100: A Sacred Trust, a bill that would change how Social Security taxes work, how benefits are calculated, and who pays into the system. The bill does not pass money to you when ready — it is a proposal for how Congress might alter the program's rules if it becomes law. Understanding what it would do helps you see how policy debates affect the retirement income you may receive.

The bill has three main parts: it would raise the cap on earnings subject to Social Security tax, increase the minimum benefit for long-term workers, and change the formula that determines how much you receive based on your work history. It would also adjust the cost-of-living adjustment (COLA) — the annual raise Social Security gives to account for inflation — to use a different measurement method.

As of now, the bill remains in committee and has not passed either chamber of Congress. Bills at this stage often do not become law, so the changes described here are proposals, not current rules.

Key Takeaways

  • The Social Security 2100 bill would raise the earnings cap — the maximum income subject to Social Security tax — from its current level to cover higher earners.
  • The bill proposes a higher minimum benefit for workers with 30 or more years of contributions, which would increase payments for lower-income retirees.
  • It would change the benefit calculation formula to give workers with lower lifetime earnings a larger share of their benefits relative to higher earners.
  • The bill would adjust how annual cost-of-living raises are calculated, using a different inflation measure than Social Security currently uses.
  • The bill remains a proposal and has not been enacted into law, so current Social Security rules remain unchanged.

How the earnings cap change would work

Social Security taxes are currently paid only on earnings up to a certain amount — in 2024, that cap is $168,600. Income above that level is not taxed for Social Security purposes. The Democratic bill would gradually raise this cap so that more of high earners' income becomes subject to the tax.

Under the proposal, the cap would rise over time until 90 percent of all earnings in the economy are covered by Social Security tax, rather than the current roughly 83 percent. This means workers earning above the current cap would pay Social Security tax on a larger portion of their income, while workers below the cap would see no change to their tax burden.

The bill does not eliminate the cap entirely — it keeps a cap in place but moves it higher. This is different from some other proposals that would remove the cap altogether.

Changes to the minimum benefit and benefit formula

The bill proposes a new minimum benefit for workers who have paid into Social Security for at least 30 years. This minimum would be set at 125 percent of the federal poverty line, meaning long-term workers would receive at least that amount even if their work history would normally result in a lower payment.

The bill would also adjust the Primary Insurance Amount (PIA) — the formula Social Security uses to turn your work history into a monthly payment. Currently, Social Security replaces a higher percentage of earnings for lower-income workers and a lower percentage for higher-income workers. The bill would make this replacement rate more generous for lower earners and less generous for higher earners, widening the gap between what low-income and high-income retirees receive.

These changes would primarily affect workers with lower lifetime earnings, as they would see larger increases to their benefits under the new formula.

How the cost-of-living adjustment would change

Every year, Social Security increases benefits to account for inflation. Currently, this increase is based on the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), which measures price changes for a specific group of workers. The Democratic bill would switch to the Chained Consumer Price Index for All Urban Consumers (Chained CPI-U), a different inflation measure.

The Chained CPI-U typically grows more slowly than the CPI-W, which means annual raises would be smaller under the new method. Over decades, this difference compounds — a retiree receiving benefits for 20 years would see a noticeably smaller total than under the current system. The bill does not eliminate annual raises; it changes how they are calculated.

The bill also includes a provision that would prevent the Chained CPI-U from ever producing a benefit cut, meaning your payment would not go down from year to year even if inflation were negative.

Who would pay more in taxes under this proposal

The earnings cap increase would affect only workers whose income exceeds the current cap. In 2024, that means workers earning more than $168,600 per year would pay Social Security tax on a larger share of their income. Self-employed workers would also pay more, since they pay both the employer and employee portions of the tax.

Workers earning below the cap would see no change to their tax burden. The bill does not propose raising the tax rate itself — only the amount of income subject to the tax.

Employers would also pay more in taxes on high-earning employees, since they match the employee contribution. The bill does not specify whether employers would pass this cost to workers through lower wage growth or absorb it themselves.

How this bill compares to other Social Security proposals

Social Security faces a long-term funding challenge: the trust fund that pays benefits is projected to be depleted around 2033 if no changes are made. After that point, incoming tax revenue would cover only about 80 percent of scheduled benefits. Different proposals address this problem in different ways.

The Democratic bill focuses on raising revenue by taxing higher earners more, while also increasing benefits for lower-income workers. Other proposals focus on reducing benefits, raising the retirement age, or some combination of revenue increases and benefit changes. Some proposals would raise the tax rate itself rather than just the cap.

The bill does not address the long-term solvency question directly — it does not specify whether the changes would fully fund Social Security for the next 75 years or only partially address the shortfall. Analysts disagree on whether the revenue increases alone would solve the funding problem.

What happens if the bill becomes law

If Congress passed this bill and the president signed it, the changes would take effect on a schedule set by the law. The earnings cap would likely rise gradually over several years rather than all at once. The benefit formula and minimum benefit changes would probably explore to new retirees first, with existing retirees either grandfathered under old rules or transitioned gradually.

The bill would not affect your current Social Security statement or your benefits if you are already receiving them, unless the law specifically included a transition provision. Workers still in the workforce would see changes to their tax burden and, eventually, to the benefits they receive when they retire.

Any change to Social Security requires an act of Congress, so the current rules remain in effect until and unless a bill is signed into law.

Frequently Asked Questions

Would this bill fix Social Security's funding problem?

The bill raises revenue and increases some benefits, but experts disagree on whether it fully solves the long-term funding challenge. Some analyses suggest it would extend the trust fund's life but not eliminate the shortfall entirely. The bill itself does not include a specific solvency target or timeline.

Would my benefits go down if this bill passed?

For most workers, no. The bill increases the minimum benefit and makes the formula more generous for lower earners. Higher earners might see smaller benefit increases than they would under current law, but not actual cuts. Existing retirees would likely be unaffected unless the law included a specific transition rule.

When would these changes take effect?

The bill has not passed Congress, so no changes are scheduled. If it did become law, the changes would take effect on a timeline set by Congress — typically phased in over several years for tax changes and applied to new retirees first for benefit changes.

Would I pay more in Social Security taxes if I earn under $168,600?

No. The bill raises the earnings cap, not the tax rate. Workers below the current cap would see no change to their tax burden. Only workers earning above the cap would pay tax on additional income.

How does the Chained CPI-U differ from the current inflation measure?

The Chained CPI-U typically grows more slowly than the current measure, meaning annual benefit raises would be smaller. Over a long retirement, this compounds into a noticeably lower total benefit. The bill includes a floor preventing benefit cuts even if inflation were negative.