Social Security Idea Could Cost Doctors

$25,732—Annual Social Security benefit for a high-wage earner who starts collecting at age 66.(MarketWatch.com, 2008)

Social Security reform hasn’t figured heavily in the news since the early years of the Bush Administration (not a pretty event then), but the issue recently resurfaced among Democrat presidential hopefuls. Senator Barack Obama (D-IL) called for an end to the income level threshold at which Social Security tax stops being deducted, while remarking that most workers wouldn’t notice the change in their taxes if it was removed. Senator Hilary Clinton (D-NY) called the idea a “trillion-dollar tax increase” and said it was unnecessary and unacceptable.

While questioning both candidates’ arithmetic, Time magazine recently published a chart showing how eliminating the income threshold would affect taxpayers with incomes higher than $102,000, the cap for this year. According to the Time chart, those with incomes between $150,000 and $200,000, which is about the average for most physicians, would pay between $2,976 and $6,076 more in Social Security taxes under Senator Obama’s proposal if it became reality. Those amounts would double for those who are self-employed, as many doctors are, since they pay both the employer and employee parts of the Social Security tax.

“I care about our young people, and I wish them great success, because they're our Hope for the Future, and some day, when my generation retires, they'll have to pay us trillions of dollars in Social Security”—Dave Barry