Protecting and Preserving Social Security Act makes two major changes to the program. First, it switches the annual cost-of-living adjustment (COLA) formula from the standard consumer price index to a new index specifically measuring spending patterns of Americans 62 and older (CPI-E), which typically rises faster because seniors spend more on healthcare. Second, it phases in Social Security payroll taxes on wages above the current taxable wage cap — currently about $176,100 — with high earners' wages above that threshold becoming fully subject to the tax by 2032, while also expanding the benefit formula so some of those additional contributions translate into slightly higher benefits. Both the COLA change and the tax expansion are expected to improve Social Security's long-term finances.
Average Household Impact
- Social Security COLA formula — switches to CPI-E index that more closely tracks senior spending, likely producing higher annual benefit increases
- Social Security benefit eligibility for CPI-E increase — explicitly excludes resulting benefit increases from reducing SSI or Medicaid eligibility
Corporate Benefits
- Payroll tax on high-wage earners — phases in Social Security tax on wages above the annual cap (~$176K), reaching full inclusion by 2032
Congressional Summary
Protecting and Preserving Social Security ActThis bill eliminates the cap on income subject to Social Security taxes and revises methods for calculating various aspects of Social Security benefits.Under current law, Social Security has a taxable maximum, which refers to the maximum amount of a worker's earnings that are subject to Social Security payroll taxes (set at $176,100 in 2025). The taxable maximum also serves as the maximum amount of earnings used to calculate a worker's Social Security benefits.This bill phases out the taxable maximum so as to apply payroll taxes to all earnings after 2031, and revises the method used to calculate a worker’s Social Security benefits to account for earnings in excess of the taxable maximum.The bill also revises the method of calculating cost-of-living adjustments to Social Security benefits to reflect the spending habits of individuals over the age of 62. An increase in Social Security benefits resulting from this change may not be treated as income for purposes of determining eligibility for, or the amount of assistance provided under, the Medicaid or Supplemental Security Income programs.
Details
- Congress
- 119th
- Chamber
- House
- Status
- summarized
- Action
- Introduced in House
- Action Date
- 2025-08-12
- Date Added
- 2026-06-04
- Source
- Congress.gov →
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