AMAC seeks end to “the tax on aging
Published 12:00 am Wednesday, October 7, 2020
WASHINGTON, DC — “No one likes to pay taxes. But, it can be downright painful if you are elderly and your income from Social Security is not enough to support retirement. So you try to make ends meet by taking on a job. And then you learn that not only do you have to pay taxes on your earnings from that job but also on your Social Security income, which you funded in the first place with taxes you paid when you were working full time,” says senior activist Bob Carlstrom.
Carlstrom says it is time to put an end to what he calls: “the tax on aging.”
He notes that it is getting tougher and tougher each year for seniors to make ends meet as the cost of living continues to rise. According to the National Institute on Retirement Security, “The burden of preparing for retirement is increasing as workers face more risk and rising costs. Escalating housing, healthcare and long-term care costs in retirement are creating retirement obstacles for Americans.”
Carlstrom, president of AMAC Action, the advocacy affiliate of the Association of Mature American Citizens, says that he and AMAC are determined to see the law changed. They are promoting a bill in Congress that would amend the Internal Revenue Code of 1986 to remove the inclusion of Social Security and tier I railroad retirement benefits in an individual’s taxable gross income.
Social Security benefits were initially exempt from federal income tax, but in 1983, Congress approved recommendations from the National Commission on Social Security Reform to tax the benefits of some higher-income Social Security beneficiaries.
Carlstrom notes that the definition of “higher income” has changed dramatically in the ensuing 37 years. As he put it in a letter to Members of Congress.
“Every year, millions of seniors become eligible for either Social Security or tier I railroad retirement benefits. After working for decades, paying taxes on their hard-earned income to fund these federal programs, some seniors are forced to pay income tax on the benefits they receive from the federal government. Taxing benefits which were created from already taxed funds is nonsensical and curtails retirement benefits seniors have been promised. Seniors deserve to reap the full benefits of their hard work from career-long contributions to Social Security and the Railroad Retirement Plan.”
The Senior Citizens Tax Elimination Act would amend the Internal Revenue Code of 1986 to remove the inclusion of tier I railroad retirement benefits and Social Security benefits in an individual’s gross income. As this legislation takes effect, seniors will notice their tax liability is significantly reduced. Seniors will no longer be burdened with the “double tax” on their federally earned benefits.
– This article was submitted by the Association of Mature Americans (AMAC).