Braille Monitor                  December 2021

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2021 Social Security Updates

by Jesa Medders

Jesa MeddersFrom the Editor: Each year we update vital numbers about Social Security for recipients and those contributing to Social Security so that our readers can get what they deserve from this crucial program. We cannot make you an expert on all of the provisions that might apply to you, but this is a very good general update and can point you to areas in which you should do further self education.

It's that time of year again when we provide you with information regarding annual adjustments to the Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI) programs. In 2022, approximately seventy million Americans will see a 5.9 percent cost-of-living adjustment (COLA) increase in their benefit amounts. Thus, come January, monthly checks will be higher.

The 2022 amounts are below along with some general concepts pertaining to the Social Security and Medicare programs, in case you want to better understand or refresh yourself about your rights. The COLA (if any) is based on the consumer price index (CPI-W), which measures the rate of inflation against the wages earned by the approximately 173 million workers across the nation over the previous four quarters starting with the third quarter of the previous year.

Tax Rates

FICA and Self-Employment Tax Rates: If you are employed, you know that you do not bring home everything you earn. 7.65 percent of your pay, for example, is deducted to cover your contribution to the Old Age, Survivors, and Disability Insurance (OASDI) Trust Fund and the Medicare Hospital Insurance (HI) Trust Fund. 6.20 percent covers OASDI, and 1.45 percent is contributed to the HI Trust Fund. Additionally, your employer is required to match this 7.65 percent for a total of 15.30 percent.

For those who are self-employed, there is no "employer" to match the 7.65 percent, which means a self-employed individual pays the entire 15.30 percent of their income. These numbers will not change in 2022 regardless of whether an individual is employed or self-employed. As of January 2013, individuals with earned income of more than $200,000 ($250,000 for married couples filing jointly) pay an additional 0.9 percent in Medicare taxes; this does not include the above amounts.

Maximum Taxable Earnings

There is a ceiling on taxable earnings for the OASDI Trust Fund, which was $142,800 in 2021 and will jump to $147,000 in 2022. Thus, for earnings above $147,000, there is no 6.20 percent deducted for OASDI. As for Medicare, there is no limit on taxable earnings for the HI Trust Fund.

Social Security Disability Insurance (SSDI) Quarters of Coverage

The OASDI Trust Fund is kind of like an insurance policy. You have to pay a premium to participate. Therefore, to qualify for Retirement, Survivors, or Disability Insurance benefits, an individual must pay a minimum amount of FICA taxes into the OASDI Trust Fund by earning a sufficient number of calendar quarters to become fully insured for Social Security benefits.

In 2021 credit for one quarter of coverage was awarded for any individual who earned at least $1,470 during the year, which means that an individual would need to earn at least $5,880 to be credited with four quarters of coverage. In 2022 the amount increases to $1,510 for one calendar quarter or $6,040 to earn four quarters of coverage for the year.

A maximum of four quarters can be awarded for any calendar year, and it makes no difference when the income is earned during that year. Basically, the taxes you pay into the OASDI and HI Trust Funds are your premiums to take part in the Social Security and Medicare programs. The total number of quarters required to be eligible for benefits depends on the individual's age. The older the individual, the more quarters are required. Furthermore, a higher average income during an individual's lifetime means a higher Social Security or SSDI check when benefits start. Remember the above quoted numbers for quarters of coverage to become fully insured are only minimum amounts.

Trial Work Period (TWP)

This concept is often misunderstood. The amount of earnings required to use a trial work month is not based on the earnings limit for blind beneficiaries but instead on the national average wage index. In 2021 the amount required to use a TWP month was only $940, and this amount will increase to $970 in 2022. If you are self-employed, you can also use a trial work month if you work more than eighty hours in your business, and this limitation will not change unless expressly adjusted.

Substantial Gainful Activity (SGA)

The earnings limit for a blind beneficiary in 2021 was $2,190 per month and will increase to $2,260 in 2022. Again, it's important to remember this is not the amount of money an individual makes to use a trial month. This is to say that the TWP can be exhausted even if your income is well below $2,260 per month. See the above information about the TWP.

In 2022 a blind SSDI beneficiary who earns $2,260 or more in a month (before taxes but after subtracting unincurred business expenses for the self-employed, subsidized income for the employed, and impairment-related work expenses) will be deemed to have exceeded SGA (Substantial Gainful Employment) and will likely no longer be eligible for SSDI benefits.

Supplemental Security Income (SSI)

The federal payment amount for individuals receiving SSI was $794 in 2021 and will increase to $841 in 2022. For married couples, the federal monthly payment amount of SSI will rise from $1,191 to $1,261.

Student Earned Income Exclusion

In 2021, the monthly amount was $1,930 and will increase to $2,040 in 2022. The annual amount was $7,770 in 2021 and will be $8,230 in 2022. The asset limits under the SSI program will remain unchanged at $2,000 per individual and $3,000 per married couple.


Signed on December 19, 2014, the ABLE Act has a significant impact on resource limits associated with the SSI and Medicaid programs for those who were blind or disabled by the age of twenty-six. Traditionally, SSI beneficiaries have been required to adhere to strict resource limits: such as a maximum of $2,000 in the bank for an individual receiving SSI benefits. Under the ABLE Act, however, the amount deposited in an ABLE Account can be much higher. ABLE Account contributions must be designated specifically for purposes such as education, housing (with a cautionary warning to follow), employment training and support, assistive technology, health, prevention and wellness, financial management, legal fees, and funeral and burial expenses. The required implementing regulations are being enacted in most states. Check with your financial institution of choice for a status of ABLE Act regulations in a specific state and to see if an ABLE account is right for you.

As to the warning about ABLE Account contributions for housing, it is important to note that SSI beneficiaries may still face the traditional $2,000 resource limit for ABLE Account funds designated for housing. Thus, SSI beneficiaries should consider the many other purposes not subject to the traditional resource limits when making ABLE Account contributions, since there are also tax advantages associated with ABLE accounts.

For more information write to [email protected].

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