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Social Security benefits gets a bump for 2021

Good news! The Social Security Administration just announced a 1.3% cost-of-living adjustment (COLA) increase for Social Security and Supplemental Security Income (SSI) benefits for 2021.

More than 64 million people collecting Social Security payments will see the increase in January 2021, with increased SSI payments to more than 8 million beginning December 31, 2020. For those of you who collect both Social Security and SSI benefits, you’ll see COLA adjustments in both 2020 and 2021.

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January is a busy time for financial adjustments. COLA adjustments are made at the same time the Department of Labor’s Bureau of Labor Statistics determines the Consumer Price Index for the year. Other adjustments based on the increase in average wages occurs at the same time.

You should receive notification of the change to your benefit amount sometime in early December. You can view Social Security payment changes online under your personal My Social Security account. Simply use your social security number to create or access your account at www.socialsecurity.gov/myaccount.

Medicare changes for 2021 have not yet been announced. You can find announcements on the Medicare program at www.medicare.gov. If you receive Social Security and Medicare benefits your exact COLA adjustment won’t be available until after the 2021 changes in Medicare premiums are released. You should receive a notification of all final decisions by early December.

To learn more, please visit www.socialsecurity.gov/cola.  Contact a Henry + Horne tax professional with any questions.

Beth Hawley