Under legislation enacted in 1983, the Social Security Trust Funds receive income based on Federal income taxation of benefits. The funds receive taxes on up to 50 percent of benefits from single taxpayers with incomes over $25,000 and from taxpayers filing jointly with incomes over $32,000.
Legislation enacted in 1993 extended taxation of benefits. The legislation increased the limitation on the amount of benefits subject to taxation from 50 percent to 85 percent for single taxpayers with incomes over $34,000 and for taxpayers filing jointly with incomes over $44,000. All additional tax income resulting from the 1993 legislation is deposited in Medicare’s Hospital Insurance Trust Fund.
The problem with the above is that the thresholds for taxing benefits are not indexed for inflation thus the $25,000 is the equivalent of $57,420.12 today and $32,000 is really $73,497.75.
Talk about fair share! More and more beneficiaries are paying income tax on their Social Security benefits thereby eroding the value of any COLA and accelerating the real decline in net income. Or you could take a more pragmatic point of view and say that lower-income levels should be paying these taxes.
As far as the 1993 changes go; $34,000 is actual the equivalent of $56,150.12 and $44,000 is $72,664.86 in the real world of 2015.
This is just one of many income levels in legislation that are not indexed to inflation.
QUINNSCOMMENTARY 
The problem is a little worse because Americans started saving for retirement with tax deferred accounts. Those accounts make people appear to earn more in retirement. So not only are the thresholds lower in real terms, Americans are recognizing more revenue in retirement.
Comically enough the people who took these accounts as a way to defer taxes are triggering some of the highest taxes in the entire tax code.
http://www.lifehealthpro.com/2015/02/20/what-you-need-to-know-about-how-social-security-is
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Congress in 1983 knew what they were doing. Taxing virtually all of the social security benefits was the plan and since the (fake) social security lock box is going bust, I don’t look for that to change.
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