Safeguarding American Families and Expanding Social Security Act of 2026

Key Points

• The bill gradually eliminates the Social Security payroll tax cap on high earners. Starting in 2026, 80% of wages above the current cap would be taxable, dropping by 20 percentage points each year until 2030, when all earnings above the cap would be fully taxed.
• Monthly Social Security benefits would increase by changing the formula used to calculate payments. The percentage applied to the lowest bracket of lifetime earnings would rise from 90% to 95%, and a new 5% credit would apply to earnings above the contribution and benefit base.
• Yearly cost-of-living adjustments (COLAs) for Social Security would be calculated using a new Consumer Price Index for Elderly Consumers, which tracks spending patterns of older Americans more closely, especially healthcare and housing costs.
• Current retirees would also see their benefits recalculated starting in January 2026, ensuring that existing beneficiaries share in the benefit increase. If the recalculation produces a lower amount, the original higher benefit is preserved.
• High earners who pay additional taxes on income above the cap would eventually receive somewhat higher benefits through a new "surplus average indexed monthly earnings" calculation, crediting 5% of those excess earnings toward their benefit amount.