On October 17, 2007, the Social Security Administration (SSA) announced that monthly Social Security and Supplemental Security Income (SSI) benefits will increase 2.3 percent in 2008, affecting 54 million Americans. The benefits increase automatically each year based on the rise in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W).

Nearly 50 million Social Security beneficiaries will receive the increased benefits beginning in January 2008, and increased payments to more than 7 million SSI beneficiaries will begin on December 31, 2007.

Other changes that take effect in January of each year are based on the increase in average wages, which affect the maximum earnings subject to the Social Security tax (taxable minimum). The new taxable minimum will increase from $97,500 to $102,000. Nearly 12 million of the 164 million workers who will pay Social Security taxes in 2008 will pay higher taxes as a result of the taxable minimum increase.

Social Security Disability Thresholds are also changing.

• For Non-Blind Substantial Gainful Activity (SGA), the threshold increased from $900 per month to $940 per month • For Blind Substantial Gainful Activity (SGA), the threshold increased from $1,500 per month to $1,570 per month • For the Trial Work Period (TWP), the threshold increased from $640 per month to $670 per month

To be eligible for disability benefits, an individual must be not be able to engage in substantial gainful activity (SGA). A person who is earning more than a certain monthly amount is ordinarily considered to be engaging in SGA.

For a worker retiring at full retirement age, the maximum Social Security benefit increased from $2,116 per month to $2,185 per month.

Maximum Federal Supplemental Security Income (SSI) payment amounts for individuals increased from $623 per month to $637 per month, and for couples increased from $934 per month to $956 per month.

A blind or disabled child, who is a student regularly attending school, college, or university, or a course of vocational or technical training, can receive limited earnings that do not count against his or her Supplemental Security Income (SSI) benefits. The monthly limit for SSI Student Exclusion increased from $1,510 to $1,550, and the annual limit increased from $6,100 to $6,240.

Sources: “Social Security Announces 2.3 Percent Benefit Increase for 2008,” Social Security Administration Press Release, October 17, 2007; “2008 Social Security Changes Fact Sheet,” Social Security Administration Press Release, October 17, 2007.