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Social Security increase: Bill would change COLA, put more money in hands of seniors 9/27/2022 Leada Gore,

A new proposal would change the way Social Security benefits are calculated, potentially putting more money into the pockets of beneficiaries.

U.S. Rep. John Larson, D-Conn., will introduce “Social Security 2011: A Sacred Trust,” that would, among other things, discontinue the use of the Consumer Price Index for Urban Wage Earners and Clerical Workers in determining yearly adjustments. Critics say the CPI undercounts some common senior expenses such as healthcare and housing.

READ MORE: Social Security increase 2023: Here’s latest forecast as inflation eases

Instead, the bill would change to calculations based on the Consumer Price Index for the Elderly, which places greater emphasis on costs for food, housing, apparel, medical care and goods and services.

The bill would also provide a benefit bump for current and new Social Security beneficiaries, including those who are receiving retirement, disability, or dependent benefits, equal to the average of 2% of benefits to make up for what Larson described as a “inadequate” COLAs since 1983.

It would also set a new minimum benefit of 25% above the poverty line which would be tied to wage levels as benchmark, eliminate the 5-month waiting period to receive payments and provide caregiver credits for those who take time off the workforce to care for children or other dependents.

READ MORE: Social Security COLA increase: There’s a change in projected cost-of-living raise

In return, the bill would change the formula for how payroll taxes are collected. Currently, payroll taxes are not collected on an individual’s wages over $142,800. That would change to apply payroll taxes to all wages above $400,000.

Larson is set to introduce the bills in the coming days.

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