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Social Security benefits to increase in 2021


Nearly 70 million Americans will see a 1.3 percent increase in their Social Security benefits and SSI payments in 2021. Federal benefit rates increase when the cost-of-living rises, as measured by the Department of Labor’s Consumer Price Index (CPI-W).

The CPI-W rises when inflation increases, leading to a higher cost-of-living. This change means prices for goods and services, on average, are a little more expensive, so the COLA helps to offset these costs.

January 2021 marks other changes that will happen based on the increase in the national average wage index. For example, the maximum amount of earnings subject to Social Security payroll tax in 2021 will be higher. The retirement earnings test exempt amount will also change in 2021.

Social Security will mail COLA notices throughout the month of December to retirees, survivors, disability beneficiaries, SSI recipients and representative payees. View and save the Social Security COLA notice online via the Message Center inside my Social Security in early December without waiting for the mailed notice.

Sign up for or log in to your personal account at www.ssa.gov/myaccount. Choose email or text under “Message Center Preferences” to receive courtesy notifications. More information about the 2021 COLA is available at www.ssa.gov/cola.

According to the U.S. Small Business Administration, about 30 million small businesses in the United States employ tens of millions of people. Running a small business can be a 24-7 endeavor. Managing employees, inventory, scheduling, services and marketing can be challenging.

Social Security’s business services allow online filing of W-2/W-2Cs with an option to verify employees’ names and Social Security numbers against agency records.

Small business owners also can take advantage of Business Services Online at www.ssa.gov/bso/bsowelcome.htm. Registration is requited to use the free service, which also offers fast and secure online W-2 filing options to certified public accountants, enrolled agents and individuals who process W-2s and W-2Cs.

For more information about electronic wage reporting, visit www.ssa.gov/pubs/EN-05-10034.pdf.

Social Security