Research Report Adding Employer Contributions to Health Insurance to Social Security's Earnings and Tax Base
Karen E. Smith, Eric Toder
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Including employer-sponsored health insurance (ESI) in taxable compensation would increase income and payroll tax receipts, but would also increase Old Age, Survivors, and Disability Insurance (OASDI) benefits by adding ESI to the OASDI earnings base. The increased present value of OASDI benefits from including ESI in the wage base in 2014 would offset about 22 percent of increased income and payroll taxes, 57 percent of increased payroll taxes, and 72 percent of increased OASDI taxes. Both taxes and benefits as a share of income would increase between the bottom and middle quintiles and then decline for higher income taxpayers.
Research Areas Aging and retirement Taxes and budgets
Tags Social Security Pensions Medicare and private health insurance Health insurance Individual taxes Retirement policy
Policy Centers Income and Benefits Policy Center Urban-Brookings Tax Policy Center