By: Virginia P. Reno and Johanna Gray
Published: April, 2007
Social Security Brief No. 24 ~ April 2007
Summary: In January 2007, 49.2 million people, or about one in every six U.S. residents, received Social Security benefits. The benefits are financed by dedicated taxes on earnings paid by workers and employers and by income taxes that upper income beneficiaries pay on part of their Social Security benefits. According to the 2007 Trustees report, the Social Security trust funds will have an annual surplus of $189 billion in 2007. Annual surpluses are projected to continue for the next 10 years and reserves are projected to grow to $4,459 billion by the end of 2016. Beginning in 2017, tax revenues flowing into the trust funds will be less than total expenditures. In 2041, the reserves are projected to be depleted. At that time, tax income coming into the trust funds will cover about 75 percent of benefits due, according to the 2007 report of the Social Security Trustees.