Nine out of 10 working people in the United States are covered by ביטוח לאומי. This includes those in Federal civilian employment, some State and local government employees, and self-employed workers.
A reformed system needs to combine a guaranteed social minimum with insurance that does not depend on formal wage employment. This would provide subsidized coverage against impoverishing losses. It would complement social assistance with consumption smoothing instruments and reduce stigma and incentive to work by disentangling redistribution from savings.
Social Security is a set of public policies that protect the incomes of people with limited work capacity. It aims to reduce vulnerability, promote human dignity, and foster social stability by providing income support for those who cannot or can only very sparingly participate in labor markets. It also provides insurance against certain risks, such as disability, and supports family reunification in the event of death or illness of the breadwinner.
The IMF’s engagement in social protection and welfare issues is growing. The Fund sees three main components of a well-functioning safety net: a guaranteed social minimum (with social assistance at its core), social insurance, and labor market regulation.
These programs include a range of income or consumption transfers, such as cash transfer schemes, child grants and pensions for the elderly. They help vulnerable groups and those at risk of social exclusion, including women, older persons, poor children, displaced people, and others. They can be idiosyncratic, affecting individuals or households, or they can be covariate, affecting large communities and regions.
This box compares old age social protection expenditure among selected countries in 2014. Purchasing power standards are used to measure the relative value of expenditures between countries. The comparison should be made with caution, as people receiving one type of social protection are likely to benefit from other types, such as sickness or housing, which have different patterns of spending by country.
All payment for work you do counts as Social Security wages, except when the pay is for a political office or for services performed in the military. Wages also include the cash value of most other forms of compensation that are not cash, such as property.
Depending on the age when you retire, you may be eligible for the following benefits. The amount of your retirement benefit depends on your earnings history, the number of years you’ve worked and whether you’re currently working.
Disability benefits help people with long-term disabilities that make it difficult to work or to live independently. Social Security disability benefits can help with medical expenses, living expenses and other costs.
In 2020, almost three tenths (28.1 %) of the total expenditure on social protection benefits was spent on sickness/health care benefits. This share varied between EU Member States, from a high of 38.9 % in Ireland and 35.1 % in the Netherlands down to relatively low ratios in Greece and Denmark.
Widows, widowers and children can get monthly payments to help meet their basic needs. The payments are based on your husband or wife’s earning record, and you can receive them as soon as you reach age 60 (or 50 if disabled).
Many State and local government employees have Social Security coverage because their employers have entered into special agreements with us called Section 218 agreements. However, some workers aren’t covered by these agreements or they’re not members of their agency’s public pension plan.
If you have enough work credits, you can qualify for Social Security benefits when you retire or become disabled. Generally, you earn Social Security credits by working in covered employment. You also can get credit for some self-employed activities, such as selling your home-based business. Wages include any payment for services performed, including the cash value of stock options and other non-cash compensation. However, you cannot receive Social Security benefits based on self-employment income unless you meet special requirements.
In addition to your work credits, you must be a citizen or lawfully present noncitizen to qualify for Social Security benefits. Your family members can also receive benefits based on your earnings record if they are your spouse, child, or parent and have enough work credits.
To be eligible for Supplemental Security Income (SSI), you must have limited income and resources. SSI disregards one-half of your monthly earnings, up to $1,780 per month. Earnings from self-employment are not disregarded, but if you have education grants under Title IV of the Higher Education Act or under Bureau of Indian Affairs student assistance programs, these are excluded from your income and resources, regardless of whether they are used.
Your payment day is the Wednesday of each month that is not a Federal holiday. You can volunteer to change your payment day as long as the other beneficiaries on your record agree.
You pay taxes into the Social Security system while you’re working, and you receive benefits based on those contributions. However, there are many different tax situations that could impact your benefit payments. We recommend that you consult a professional advisor for help with questions related to your specific situation.
Your retirement benefits are taxable, but the amount of federal and California state income tax withheld from each payment depends on the number of allowances you claim. You can make allowance changes at any time by logging in to your myASRS account, or you can declare an allowance amount as part of your online retirement application. Without an election, new retirees will have federal and California state tax withheld at the default rate for a married individual filing jointly.
If you receive a lump sum distribution that includes employee after-tax contributions (such as a purchase service credit payment), the portion of the payment that reflects investment earnings is taxable. The remainder of the payment is tax-exempt because your after-tax contributions were paid with money that had already been taxed and can’t be taxed again.
If you received IHSS or WPCS payments, you may choose to include them in your earned income for purposes of the Earned Income Credit and the Additional Child Tax Credit. However, you must follow the rules established by the Franchise Tax Board to avoid over- or underclaiming these credits.