Social Security, a mandatory supplemental retirement system in the US, was established in 1935 as part of Franklin Delano Roosevelt's New Deal. The Great Depression forcing Americans out of their jobs drove to the need of a security system that could also concern itself with the nation's retired elderly who are often left in the grim poverty. The intent of the program is to ensure a threshold subsistence level below which any worker who had paid into the program cannot fall.
The Social Security program is funded out of payroll taxes; that is, a certain percentage of a worker's paycheck goes directly into a fund to help provide benefits to current recipients.
This would be surprising to know that one out of four families in America is assured with an assured income every year through Social Security. The statistics shows that the number is more than 55 million American workers and their families who have lost income due to retirement, disability or death.
Who Receives Social Security Benefits?
Between 1960 and 2008, Social Security aided the reduction of poverty rate among seniors by more than two-thirds, from 35 percent to just fewer than 10 percent.
On August 14, 1935, President Franklin D. Roosevelt introduced the Social Security Act with a view to establish a support system of old-age benefits for workers, unemployment insurance, benefits for victims of industrial accidents, aid for dependent mothers and children, the blind, and the physically handicapped. Under the Social Security act, the government began collecting the Social Security tax from workers in 1937 and began making payments in 1940. Social security Act provides for the general welfare by establishing a system of Federal old-age benefits, and by enabling the several States to make more adequate provision for aged persons, blind persons, dependent and crippled children, maternal and child welfare, public health, and the administration of their unemployment compensation laws; to establish a Social Security Board; to raise revenue; and for other purposes.
Discover some of the surprising social security facts in the video alongside.
Let us take a look at the few terminologies of the Social security benefits.
What is the Social Security retirement program?
The Social Security retirement program is a federal insurance program for eligible workers 62 years and over. The program assures cash benefits for retired workers who have worked in Social Security covered jobs and have earned enough credits to qualify. At times, family members also qualify for benefits based on the work record of the eligible worker.
Benefits are based on the age at which the worker retires, and his/her average annual earnings. Social Security retirement is not a need-based program.
What are Social Security (FICA) payroll taxes?
The federal government charges taxes on earnings from jobs covered by Social Security to pay for the Social Security retirement program and other Social Security programs. Since the Social Security Act allows the government to collect the Social Security taxes, these taxes are termed Federal Insurance Contribution Act (FICA).
Who is in charge of Social Security fraud prevention?
Social Security Retirement is being run by the Social Security Administration (SSA) and supported by tax dollars. So, in the case of a fraud, the Office of the Inspector General (OIC) of the Social Security Administration (SSA) is in charge of its prevention for Social Security programs. The OIC has a fraud hotline for reporting SSA fraud, waste, or abuse.
Any person who wants to report fraud can do so by:
* Using the SSA online Submit a Report form, or
* Calling the toll-free SSA OIC Fraud Hotline at 1-800-269-0271 (TTY: 1-866-501-2101) between 10 AM and 4 PM
While making the report in case of a Social Security fraud, the victim is supposed to give as many details as possible, including the name, Social Security number, date of birth, address, and phone number of the person committing the fraud, and any victims.
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