Social Security Disability Trust Fund Extended By Five Years; 2018 COLA Projected
The Disability Insurance (DI) Trust Fund will become depleted in 2028, which is five years later than last year’s estimate of 2023, with 93 percent of benefits still payable, according to the Social Security Board of Trustees report issued today.
The Trustees state the improvement is a reflection of both declining disability applications and lower rates of disability incidence projected for the short term.
This is an increase of six years later than projected when the Bipartisan Budget Act of 2015 was passed, which reallocated a portion of the payroll contribution rate from the Old-Age and Survivors Insurance (OASI) Trust Fund to the DI Trust Fund. This reallocation of taxes in 2016, 2017 and 2018 provided funds to extend reserves beyond 2016.
Today’s report is the focus of tomorrow’s hearing by the House Ways and Means Social Security Subcommittee on the topic, “Social Security’s Solvency Challenge: Status of the Social Security Trust Funds.” The combined trust fund reserves will continue to grow until 2022, when the annual cost is expected to surpass income.
The Trustees reported no change in the depletion dates for the retirement, or OASI Trust Fund, and combined OASDI Trust Funds, which remain 2035 and 2034, respectively. At that time, 77 percent of scheduled benefits would be payable.
The 261-page report outlines the overall health of the trust funds. In addition, the Trustees estimate a cost-of-living adjustment (COLA) for 2018 ranging from 1.5 percent to 2.9 percent, which would be an increase over the 0.3 percent COLA for 2017.
About 8.8 million disabled workers and 1.7 million dependents receive benefits through the Social Security Disability Insurance (SSDI) program, which is a federal insurance program funded by workers and employer payroll taxes.
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