Affluent Elderly May Face Tax Hike
AS Congress and the White House work out the government's budget for fiscal 1991, they're walking on eggshells. Politically, no path is more delicate than deficit-reduction actions that affect the income of the nation's elderly. At present it seems increasingly likely that Congress and the White House will seek to raise the income tax levied on the social-security income of America's most affluent elderly Americans, says Horace Deets, executive director of the 32-million-member American Association of Retired Persons.Skip to next paragraph
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Single retirees with an adjusted gross income over $25,000 now pay federal income taxes on half of their social-security benefit. For married retirees who file jointly, the income threshold is $32,000.
At the same time, says Mr. Deets, ``I think there's a movement away'' from temporarily freezing the cost-of-living adjustments that social-security recipients receive annually. This latter approach was suggested some months ago by Rep. Dan Rostenkowski (D) of Illinois, chairman of the House Ways and Means Committee.
Deets says that if the final budget package contains equitable reductions across the board, including some benefits to the elderly, ``certainly we're going to look at it,'' and not reject it out of hand.