Retirement Social Security

Bernie Sanders Pushes to Expand Social Security - Here’s Who Would Pay for It

A closer look at the plan, the tax changes, and who pays more.

By David Maina

Edited by Laura Hohenstein

Updated March 5, 2026

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Senator Bernie Sanders has reintroduced a plan to expand Social Security and increase senior benefits for current and future retirees. The proposal would raise monthly payments for millions of Americans, but it would also change how the program is funded.

The approach focuses on shifting more of the cost to higher-income households, while leaving most workers' taxes unchanged. Here's what the proposal would do and who would be expected to pay for the expansion.

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What the bill would change

Sanders' Social Security Expansion Act combines a benefit increase with a set of tax changes designed to pay for it.

For one, it would raise benefits for current and future retirees. Supporters describe the increase as roughly $200 more per month on average (about $2,400 per year), achieved by adjusting the benefit formula so checks rise across the board.

To fund those increases, the bill targets income that currently falls outside the system. Today, Social Security payroll taxes apply only up to an annual earnings cap. Under the proposal, wages above $250,000 would also be subject to the 12.4% payroll tax, meaning high earners would contribute on a larger share of their income.

The plan would also extend Social Security taxes to certain investment and business income for upper-income households.

Because many high earners receive significant income from dividends, capital gains, or business profits, this change is meant to bring more of that income into the program's funding stream.

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Who would pay more

The added costs would fall on a relatively small group of high-income households.

Workers earning more than $250,000 would begin paying Social Security taxes on income above that level. Today, earnings above the annual cap aren't taxed for Social Security. Under the proposal, those higher earnings would be subject to the same 12.4% payroll tax that applies to lower wages.

For example, someone earning $300,000 would pay Social Security taxes on an additional $50,000 of income. At much higher income levels, the added tax grows quickly, since every dollar above $250,000 would be included.

Higher-income households would also pay more if a significant share of their income comes from investments or business profits. By applying Social Security taxes to certain non-wage income, the plan targets individuals whose earnings currently fall outside the payroll tax system.

For most Americans, though, nothing would change. Households earning $250,000 or less would see no increase in their Social Security payroll taxes, and their paychecks would be taxed the same way they are today.

What it could mean for Social Security's finances

The tax changes are designed to bring more revenue into the system by expanding who contributes and what types of income are covered. Because a large share of earnings above today's cap comes from higher-income households, the proposal would significantly increase payroll tax collections over time.

According to estimates from the Social Security Administration's (SSA) chief actuary, the added revenue could allow the program to pay full scheduled benefits for at least the next 75 years.

Under current projections, the combined trust funds are expected to face a shortfall in the mid-2030s, which would eventually lead to across-the-board benefit reductions if no changes are made.

In practical terms, that means the additional taxes would not only fund the proposed benefit increase but also reduce the risk of future across-the-board cuts.

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Why the proposal is controversial, and what happens next

The plan has drawn strong reactions on both sides, largely along partisan lines.

Supporters argue the approach asks the highest earners to pay more into a system that most Americans rely on. They frame the proposal as a way to strengthen Social Security, increase benefits, and avoid future cuts without raising taxes on the middle class.

Opponents see it differently. They describe the changes as a significant tax increase on high-income households and warn that higher payroll and investment taxes could affect business investment, hiring, or economic growth.

For now, the political reality is a major obstacle. The bill has support from Democratic lawmakers but little to no Republican backing, and Social Security changes of this size typically require bipartisan agreement to move forward.

Without that support, the proposal faces long odds, meaning it remains a policy idea rather than a change retirees should expect anytime soon.

Bottom line

The proposal would increase Social Security benefits by about $200 per month on average, with most of the added cost falling on households earning above $250,000 and those with substantial investment or business income.

For retirees and those planning for retirement, the more practical focus is the current rules. Policy changes like this face a long legislative path and may evolve before anything takes effect. Building your retirement plan around today's system, and adjusting only if the law actually changes, can help keep expectations realistic and decisions grounded.

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