The Social Security Administration (SSA) increased the maximum amount of wages subject to Social Security tax to $137,700 for 2020 which is an increase of $4,800 from the 2019 amount of $132,900. Employees with wages of $137,700 or greater would pay in a maximum of $8,537.40 in 2020 and the employer would pay an equal amount. This is an increase of $297.60 from 2019.
The SSA also announced a cost-of-living adjustment of 1.6 percent for recipients of Social Security benefits. In addition, the annual earnings which can be earned before a recipient's benefits are reduced is $18,240 before full retirement age and $48,600 once full retirement age is reached.