Here's a look at the Social Security changes workers and retirees will experience in 2017:
Bigger monthly payments. Social Security payments will increase by 0.3% in 2017. That's considerably less than the 3.6% cost-of-living adjustment retirees received in 2012. Social Security payments are adjusted each year to reflect inflation as measured by the Consumer Price Index for Urban Wage Earners and Clerical Workers. Previous inflation adjustments have ranged from zero in 2010 and 2011 to 14.3% in 1980.
The average Social Security check is expected to increase by $5.00 as a result of the change, from $1,360 to $1,3655 in 2017. Couples will see their benefit payments grow from an average of $2,014 to $2,024.
Higher Social Security tax cap. The maximum amount of earnings subject to Social Security taxes will be $127,200 in 2017, up from $118,500 in 2016. About 20 million people will pay higher taxes as a result of the increase in the taxable maximum.
Increased earnings limit. Retirees who work and collect Social Security benefits at the same time will be able to earn $360 more next year before any portion of their Social Security payment will be withheld. Social Security recipients who are younger than their full retirement age (66 for those born between 1943 and 1954) can earn up to $15,720 in 2015, after which $1 of every $2 earned will be temporarily withheld from their Social Security payments.
For retirees who turn 66 in 2015, the limit will be $41,880 after which $1 of every $3 earned will be withheld.
Once you reach your full retirement age, you can earn any amount without penalty and collect Social Security benefits at the same time. At your full retirement age your monthly payments will also be adjusted to reflect any benefits that were withheld and your continued earnings.
Maximum possible benefit grows. The maximum possible Social Security benefit for a worker who begins collecting benefits at their full retirement age will be $2,642 in 2014, up from $2,533 per month in 2013.
Paper checks will end. The U.S. Treasury will stop mailing paper checks to Social Security beneficiaries. All federal benefit recipients must then receive their payments via direct deposit to a bank or credit union account or loaded into a Direct Express Debit MasterCard.
Retirees who do not choose an electronic payment option will receive their payments loaded onto a prepaid debit card. Most people already receive their benefit payments electronically, and new Social Security recipients have been required to choose an electronic payment option since 2011.
Social Security Statements:
Social Security Administration resumes mailing statements in 2015. If you turn 25, 30, 35, 40, 45, 50, 55, and 60 years old in 2015, All taxpayers over 60 years old will receive a mailed statement 3 months before their birthday.