General Discussion
In reply to the discussion: Why won't the GOP just come right out and say they want to cut SS, Medicare Medicaid? [View all]reteachinwi
(579 posts)introduced taxation on benefits that amounts to means testing. So higher income retires are "means tested" through the tax code.
Modified for a taxpayer with combined income exceeding a secondary threshold amount ($34,000 for an individual, $44,000 for a married couple filing a joint return, and zero for a married person filing separately), so that the amount of benefits subject to income tax is increased to the sum of (1) the smaller of (a) $4,500 for an individual, $6,000 for a married couple filing a joint return, or zero for a married person filing separately, or (b) 50% of the benefit, plus (2) 85% of the excess of the taxpayer's combined income over the secondary threshold. However, no more than 85% of the benefit amount is subject to income tax. The additional income tax revenues resulting from the increase in the taxable percentage from 50% to 85% are transferred to the HI Trust Fund. Effective for taxable years beginning after 1993.
http://www.ssa.gov/history/taxationofbenefits.html