The amount of monthly benefits you
receive is based on three fundamental
factors:
[
Average earnings upon which you
have paid Social Security taxes,
which are adjusted over the years
for changes in average earnings of
the American work force;
[
Family composition (for example,
whether you have a spouse or
dependent child who may be eligi
-
ble for benefits); and
[
Consumer Price Index (CPI) changes
that occur after you become entitled
to benefits.
Benefits are subject to individual and
family maximums.
Once benefits begin, their continuation
may depend upon your meeting a vari-
ety of conditions. For example, if you
have earnings that exceed specified
amounts while you are under age 70,
your Social Security benefits will be
reduced or stopped. There are special
Social Security rules that may affect
the benefits of Federal employees,
including the Federal Employees Retire
-
ment System (FERS) participants. If
you previously had some service that
was covered by the Civil Service Retire
-
ment System (CSRS) (or another similar
retirement system for Federal employ
-
ees), your Social Security benefits may
be affected by the Windfall Elimination
Provision. If you transferred to FERS
and do not complete 5 years of service
under FERS, any spousal benefit you
are entitled to under Social Security
may be reduced because of the Govern
-
ment Pension Offset. If you think either
of these provisions may affect your
benefits, ask your servicing personnel
office or local Social Security office for
copies of the factsheet, A Pension From
Work Not Covered by Social Security
(Publication No. 05-10045) and the
factsheet, Government Pension Offset
(Publication No. 05-10007). You may
also request these publications by call
-
ing the Social Security Administration
on (800) 772-1213 or by downloading
from the Web at:
http://www.ssa.gov/pubs
Social Security Taxes
Most of the cost of Social Security is
paid for through payroll taxes. Each
year you pay a percentage of your sal-
ary up to a specified earnings amount
called the maximum taxable wage
base. The Federal Government, as your
employer, pays an equal amount. The
percentage you each pay for old age,
survivor, and disability insurance cov-
erage is 6.20% of your earnings up to
the maximum taxable wage base.
The maximum taxable wage base is
$68,400 in 1998. It increases automati
-
cally each year based on the yearly rise
in average earnings of the American
work force.
The Social Security tax covers both the
Old Age, Survivors, and Disability
Insurance (OASDI) and Medicare Hospi
-
tal Insurance programs. The Medicare
portion you and your agency each pay
is 1.45% of your total pay. All wages
are subject to the deduction for Medi
-
care.
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