Craig announces legislations eliminating federal taxes on Social Security benefits

(ABC 6 News) – Representative Angie Craig announced a new piece of legislation that would eliminate federal taxes on Social Security benefits.

If passed, the You Earned It, You Keep It Act would pull all federal taxes on social security benefits in 2025.

According to Craig, “the bill would be paid for by raising the cap on the Social Security payroll tax,” increasing what high-earning taxpayer contribute into Social Security.

According to a study of the law, higher income taxes would increase from 1.7% under current-law taxable payroll in 2025 to 2.5% of current-law taxable payroll by 2035.

The same study found the bill would guarantee Social Security payments are made on time and in full through 2054, whereas previous projections estimated 2034.

“This bill is a win-win—it’s a tax cut for seniors and a way to ensure more Americans can depend on the Social Security benefits they’ve earned. And on top of that, it’s fiscally responsible,” said Craig.

The was originally co-sponsored by Representatives Ro Khanna (D-Calif.), Yadira Caraveo (D-Colo.), Mary Peltola (D-Alaska), Andrea Salinas (D-Ore.), Don Davis (D-N.C.), and Hillary Scholten (D-Mich.).