Fact check: Biden voted to tax Social Security, wants to reform retirement benefits – USA TODAY
The claim: Biden voted in favor of taxing Social Security
Democratic presidential candidate Joe Biden’s tax plan remains a sticking point for some voters. A meme posted to Facebook on Sept. 15 says Biden is no friend of working folks because of his voting history on taxes, such as his vote for a 1983 bill authorizing a 50% tax on Social Security.
The former senator from Delaware was also the deciding vote in raising the Social Security tax rate to up to 85% in 1993, according to the meme.
“His voting record on Social Security records over the years is one slap in the face to retirees after another,” says the claim. “Now he wants to tax our 401k’s and IRA’s … and he also wants to introduce a 3% annual tax on our homes.”
Biden has said he would raise the income tax bracket for families that earn over $400,000 a year as well as corporate taxes, according to reporting from USA TODAY.
The Social Security Amendments of 1983, which led to its taxation, is such a contentious topic on the internet that the Social Security Administration added it to its list of myths and misinformation.
Social Security benefits were “explicitly excluded” from federal income taxation before Republican President Ronald Reagan signed the amendments into law, according to the SSA. Up to 50% of benefits could be added to taxable income based on certain income thresholds from 1984, onward.
A provision of the 1993 Omnibus Budget Reconciliation Act raised the Social Security tax rate from 50% to 85% for households in a higher income bracket. The act was Democratic President Bill Clinton’s first budget and marked the highest peace-time tax increases on high-income earners in U.S. history up to that time, according to the University of California, Berkeley.
Biden voted to pass the 1983 amendments, according to records maintained by the SSA. GovTrack, a government transparency website, recorded Biden’s yea vote on the 1993 Act.
Individuals who report a combined income between $25,000 and $34,000 may be liable for income taxes for up to 50% of Social Security benefits. For joint filers, the bracket is $32,000 to $44,000. Those whose earnings match or exceed the upper tier of each bracket could pay tax on up to 85% of benefits, according to the SSA.
Did Biden propose taxing 401(k)s and IRA’s?
The claim alleges the Biden campaign proposes taxing retirees’ 401(k)s and IRAs in addition to a 3% federal tax on property.
“It’s on page 78 of the Dems’ platform,” says the meme.
But there’s no indication of proposed taxes on 401(k) or IRA retirement accounts on Biden’s official campaign website. The Democratic presidential nominee said he wants to equalize retirement plan tax benefits across the income scale, according to the Biden campaign.
Biden would accomplish this by eliminating the current deduction for contributions while providing a 26% refundable tax credit for each dollar contributed to a traditional retirement account, according to The Tax Foundation. The tax credit would be deposited into the retirement account as a matching contribution.
Aside from raising taxes on families in the top tax bracket, other proposed tax policies include raising the corporate tax rate from 21% to 28%, a 15% minimum tax on book income “so that no corporation gets away with paying no taxes,” asking families earning over $1 million to pay wage and investment income taxes at the same rate and instituting a true minimum tax on U.S. companies’ foreign earnings while penalizing corporations that outsource jobs overseas.
The part of the claim stating Biden would propose a 3% federal property tax has already been debunked by USA TODAY. Property taxes are collected at the state and local level, according to the article.
Our rating: Partly false
We rate this claim PARTLY FALSE, based on our research. As a senator, Biden voted in favor of two laws that authorized taxation of Social Security benefits. But Democratic presidential nominee Biden has not proposed taxing retirement accounts or a federal property tax.