The 3 Biggest Changes Made to Social Security in 2024 and How They Affect Your Paycheck
Written by
Nicholas Morine
Edited by
Angela Corry
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Various news stories about Social Security have made headlines throughout the year, ranging from questions concerning its solvency to arguments over how the program should be funded. Particulars of how Social Security should be administered in the future have been the stuff of presidential debates and analyst panel discussions. Americans can expect that trend to continue as more and more citizens rely on the program yearly for retirement.
In 2024, several changes were made to Social Security, many of which could directly affect your paycheck and bank account.
Social Security Tax Threshold Increased in 2024
As AARP explained, Social Security benefits are largely funded via payroll taxes — and that tax rate is 12.4% of earnings. While in 2023 earnings up to $160,200 were subject to this tax, in 2024 that threshold increased to earnings of up to $168,600.
In 2025, per CNBC, that figure will increase once more, to 176,100. This represents a hike of about 4.4%.
Social Security Earnings Test Threshold Also Raised This Year
According to AARP, most Social Security recipients who elect to work while also claiming Social Security benefits are subject to an earnings threshold.
For those who have not yet reached the full retirement age (FRA) of between ages 66 and 67 — your FRA is linked to the year you were born, as the Social Security Administration (SSA) outlined — you will see $1 of your Social Security payment withheld for every $2 in work income above $22,320.
However, for individuals who will reach their FRA in what remains of 2024, you will have $1 of your Social Security payment withheld for every $3 in earnings above $59,520. When the calendar flips over to the month you hit the milestone, the earnings test expires. That only leaves December of this year as an example, for those who will reach their FRA during that month.
There is no Social Security earnings test for those who have reached FRA, and those receiving Social Security Disability Insurance (SSDI) fall under entirely different guidelines.
Substantial Gainful Activity Threshold Bumped Up in 2024
Americans with disabilities as defined by the SSA saw an increase in the amount of earnings they were allowed to take home before being deemed to have engaged in substantial gainful activity (SGA). Engaging in SGA automatically excludes you from the possibility of claiming Social Security Disability Insurance (SSDI) benefits.
Per the SSA, the SGA earnings amount for individuals with a disability other than blindness is $1,550 per month in 2024, up from $1,470 per month in 2023. Next year, that amount will be bumped up to $1,620.
If you are an SSDI recipient who is blind, the SGA amount is instead $2,590 per month — a figure which increased from $2,460 in 2023. In 2025, that threshold will increase to $2,700.
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