Bernie Sanders and Peter DeFazio have introduced the Social Security Expansion Act, which would restore full solvency to the Social Security system by increasing revenues and raising benefits. Under the proposal, payroll taxes would be imposed on earnings over $250,000. A 12.4% tax would be assessed on investment and business income over $250,000 (couples) or $200,000 (individuals), and a 16.2% net investment income tax would be imposed on active S-corporation holders and active limited partners.
All benefits would be raised starting in 2023 by increasing the first bend point multiplier to .95 from .90.
The COLA would be based on the CPI-E, an index that is thought to better reflect spending by retirees and is estimated to result in a 0.2 percentage point higher cost-of-living adjustment than under the current CPI-W index.
Dependent benefits, which now end at age 18, would be extended to age 22 if the child is in high school, college, or vocational school.
The bill, H.R. 8005, was introduced June 9, 2022 and has 21 co-sponsors, all Democrats.
Read more about the proposal and SSA’s actuarial analysis here.