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1 1 (March 4, 2020)

handle is hein.crs/govcamx0001 and id is 1 raw text is: Social Security Dual Entitlement p\w -- , gnom go mppm qq\ , q I as 11LULANJILiN, Updated March 4, 2020 Social Security is a social insurance program that partially replaces income lost due to retirement, disability, or death. Workers who have been in Social Security covered employment (jobs subject to Social Security payroll taxes) for a sufficient number of years become insured for Social Security and can receive cash benefits when they retire or become disabled. Dependents of insured workers are also eligible for benefits when the worker retires, becomes disabled, or dies: spouses, former spouses, children, parents, and widow(er)s can receive dependent benefits or survivors benefits. Dependent and survivors benefits are sometimes referred to as auxiliary benefits. Auxiliary benefits are equal to a percentage of the insured worker's basic benefit amount, the primary insurance amount (PIA). Beneficiaries entitled to multiple benefits (such as being entitled to both retired-worker and spousal benefits) cannot receive all benefits in full. This can lead to inequities between single-earner and two-earner households. With the increase in two-earner households, some are concerned about the growing prevalence of this inequity. Auxiliary benefits are paid to the eligible spouse, former spouse, and children of retired or disabled workers, and to survivors (including dependent parents) of deceased workers. Auxiliary benefits are determined as a percentage of the insured worker's PIA. Spouses and former spouses receive up to 50% of the worker's PIA, and widow(er)s of deceased workers receive 100% of the worker's PIA. A person may be entitled to multiple benefits at the same time; the typical example of this is someone who is entitled to the retired-worker benefit based on his or her own work record and entitled to an auxiliary benefit based on the (deceased) spouse's work record. Beneficiaries cannot receive a benefit amount that exceeds the highest single benefit that they are entitled to. Instead, beneficiaries essentially receive the higher of the worker benefit and the auxiliary benefit. Someone with a retired-worker benefit that is higher than his or her auxiliary benefit receives only the retired-worker benefit. Someone with an auxiliary benefit higher than his or her retired-worker benefit is referred to as dually entitled and receives his or her retired- worker benefit plus a reduced auxiliary benefit amount equal to the full auxiliary benefit minus the retired-worker benefit, in essence receiving the higher auxiliary benefit amount. Table 1 shows the number of dually entitled beneficiaries and their average monthly benefits in December 2018. The current-law auxiliary benefit structure can lead to inequities among households with different earning profiles, providing proportionally more benefits relative to payroll taxes to single-earner couples than to couples with two-earners, on average. The benefits received by a two- earner household can be as little as half of the benefits received by a single-earner household, despite identical household earnings. This is because the second earner's retired-worker benefit offsets the spousal benefit-even though the second earner contributes to household earnings, he or she might not contribute to the household's payable Social Security benefits. A similar inequity can occur for widow(er) benefits when the primary earner dies. Table I. Retired Workers with Dual Entitlement: Number and Average Benefit Levels, December 2018 Average Monthly Benefit Retired-Worker Reduced- Type of Secondary Benefit Number Combined Benefit Benefit Secondary Benefit Spouses Wives Husbands Widow(er)s Widows Widowers 7,221,015 3,143,436 3,053,796 89,640 4,077,197 3,916,576 160,621 Parents $1,312 $900 $902 $830 $1,630 $1,633 $1,572 $1,487 $745 $567 $289 $290 $227 $781 $796 $425 $814 $849 $1,147 $673 Source: SSA, Annual Statistical Supplement, 2019, Table 5.G3, https://www.ssa.gov/policy/docs/statcomps/supplement/20 I 9/5g.html#table5.g3. Note: Retired-worker benefit and reduced-secondary benefit might not sum to the combined benefit due to rounding. .O 'T

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