The big news for 2023 is an 8.7% jump in the Social Security COLA, which is the highest since an 11.2% increase in 1981. The COLA’s steep hike this year is due to the soaring inflation rate, which is also the biggest in 41 years.
The SSA pays monthly benefits to people who are unable to work for a year or more because of a disability, and the benefits usually continue until recipients can work again on a regular basis.
Social Security recipients who also qualify for Supplemental Security Income (SSI) benefits have seen an increase in the maximum Federal SSI payment amounts in 2023, based on the 8.7% COLA. For individuals, the standard rose to $914 a month from $841 in 2022. For couples, the payment rose to $1,371 a month in 2023 from $1,261 in 2022.
Americans who retire at full retirement age — either 66 or 67, depending on when you were born — saw a bump in their maximum benefits this year. The maximum rose to $3,627 a month in 2023 from $3,345 a month in 2022.
Anyone who has ever received a paycheck knows that part of that check is withheld to pay Social Security taxes. There is a limit on the amount of your annual earnings that can be taxed by Social Security, called the maximum taxable earnings.
Social Security withholds benefits if your earnings exceed a certain level and if you are under the full retirement age (FRA). This is called the retirement earnings test exempt amount.