2026 Social Security Act Proposal Aims to Stabilize Benefits and Adjust COLA Calculations
Congress has reintroduced the "Social Security 2100 Act," a bill proposing to shore up the system's trust fund until 2054 and alter how cost-of-living adjustments (COLA) are calculated.
A bill aiming to address the long-term solvency of the U.S. Social Security system, titled the "Social Security 2100 Act," has been reintroduced in Congress. The proposal seeks to extend the solvency of the system's trust fund and modify the calculation of cost-of-living adjustments (COLA) for beneficiaries.
The proposed legislation includes a temporary change to how COLAs are calculated from 2027 to 2036. This adjustment would align with the Consumer Price Index for the Elderly (CPI-E), which is intended to better reflect the actual financial burdens faced by seniors, particularly concerning housing and healthcare costs. Additionally, the bill proposes extending the Social Security payroll tax to cover income above $400,000. These measures are projected to extend the trust fund's ability to pay benefits for an additional 32 years.
The Social Security trust fund faces projected insolvency. The Old-Age and Survivors Insurance (OASI) Trust Fund is estimated to be depleted by late 2032. The combined fund, which also covers Social Security Disability Insurance (SSDI), is projected to become insolvent by February 2035. The "Social Security 2100 Act" aims to prevent this depletion and ensure benefits for current and future generations.
However, the bill's passage faces uncertainty due to limited bipartisan support. Analysts suggest that while the full bill may not pass, specific components, such as the adoption of a more senior-focused inflation measure or increased taxation on higher incomes, could potentially be incorporated into future bipartisan Social Security reform packages.