September 9, 2026

Social Security Trust Fund Nears 2032 Deadline As Some Republicans Consider Tax Hikes

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Some Republican lawmakers are becoming more open to raising Social Security taxes as the program faces a worsening financing shortfall, with the retirement trust fund projected to be depleted in 2032 and payable benefits potentially falling below scheduled levels.

Sen. Bernie Moreno (R-Ohio) has joined Sen. Elizabeth Warren (D-Mass.) in proposing to raise the payroll tax cap, while Rep. Tom Cole (R-Okla.), chairman of the House Appropriations Committee, has also said he is willing to consider higher taxes, according to a report published by the Washington Post on Monday.

Cole said he is willing to consider both raising the tax rate and increasing the amount of income subject to the tax.

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“I’m willing to look at the tax rate. I am willing to raise the amount of income through tax.”

The shift comes as Social Security’s funding gap becomes more urgent. The Social Security retirement trust fund is projected to run dry in 2032, and millions of recipients could face a 22% reduction in benefits unless lawmakers act, according to the 2026 Social Security Trustees report.

Tax Cap Debate

Social Security payroll taxes apply to wages up to $184,500 in 2026. Moreno and Warren have proposed eliminating the cap so higher earners would pay the tax on more of their income.

A separate proposal from Sen. Bernie Sanders (I-Vt.) would also lift the payroll-tax cap. Sanders has said the change could make Social Security solvent for 75 years while increasing benefits by $2,400.

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The debate comes alongside a bipartisan Senate effort to create a formal process for Congress to consider long-term Social Security reforms. The proposal would establish a bipartisan advisory board to develop recommendations aimed at keeping the program solvent for at least 50 years.

The financing debate also comes as research shows Social Security benefits can exceed the payroll taxes paid by workers and employers. For people born in the 1960s, scheduled benefits are projected to equal about 133% of combined payroll taxes paid by them and their employers.

GOP Debate

Not all Republicans support higher taxes. Grover Norquist, founder of Americans for Tax Reform, argued that Republicans should continue pushing for spending cuts instead, according to the report.

Cole said the political consequences of Social Security becoming insolvent could be worse than the backlash from a broader solution that includes higher taxes.

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“You’ve got to deal with Social Security,” Cole said. “And believe me, you’ll have a lot bigger problem if it goes bankrupt than you’ll have keeping it whole, because people will feel cheated.”

Rep. Lloyd K. Smucker (R-Pa.) has also said more payroll-tax revenue should be considered and suggested reducing benefits for wealthier retirees, according to the report.

The White House has said there will be “zero reductions” to Social Security payments under President Donald Trump, while no detailed plan has been provided for addressing the program’s deteriorating finances.

Photo courtesy: Shutterstock

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