Social Security During The United States

1518 WordsOct 31, 20157 Pages
Social Security in the United States I. Introduction Social security in the United States is a federal system run by the Social Security Administration to provide monetary benefits, or welfare, to citizens who are retired, unemployed, or disabled. In 1935, President Franklin D. Roosevelt enacted the Social Security Act which limited the dangers of old age, unemployment, disability, and families with dependent children within the United States during the great depression. In order to obtain the funds paid out to current social security recipients payroll taxes called Federal Insurance Contributions Act (FICA) and the Self-Employment Contributions Act (SECA) taxes are collected from the earnings of current workers.1 FICA and SECA…show more content…
Taxes and Trust Funds To pay for current social security programs, payroll taxes called the Federal Insurance Contributions Act (FICA) and the Self-Employment Contributions Act (SECA) are collected from current employed workers. In contributing to the system, workers will in turn receive retirement benefits from the workforce during their time of retirement. FICA taxes are regressive and only affect a certain limit of income, for example any earnings over $118,500 in 2015 are exempt from FICA taxes.8 These income taxes are then pooled into Social Security Trust Funds which hold, or invest, the money collected before various programs disperse the money to the populous. How the funds are used by the various programs vary, but all programs that are funded via the Social Security Trust Funds are administered by the Social Security Administration. III. Benefits and Roles of Various Social Security Programs The Old-Age, Survivors, and Disability Insurance (OASDI) program is designed to provide Retirement Insurance Benefits (RIB) and Social Security Disability Insurance (SSD or SSDI) to eligible Americans. Americans must be 62 or older in order to
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