Monthly Social Security and Supplemental Security Income benefits for more
than 52 million Americans will increase 4.1 percent in 2006, the Social Security
Administration announced today.
The benefits increase automatically each year based on the rise in the Bureau
of Labor Statistics' Consumer Price Index for Urban Wage Earners and Clerical
Workers (CPI-W), from the third quarter of the prior year to the corresponding
period of the current year. This year's increase in the CPI-W was 4.1 percent.
The 4.1 percent Cost-of-Living Adjustment (COLA) will begin with benefits that
more than 48 million Social Security beneficiaries receive in January 2006.
Increased payments to 7 million Supplemental Security Income beneficiaries will
begin on December 30.
Some other changes that take effect in January of each year are based on the
increase in average wages. Based on that increase, the maximum amount of earnings
subject to the Social Security tax (taxable maximum) will increase to $94,200
from $90,000. Of the estimated 159 million workers who will pay Social Security
taxes in 2006, about 11.3 million will pay higher taxes as a result of the increase
in the taxable maximum in 2006.