American seniors who receive Social Security payments will receive a cost of living adjustment (COLA) of 3.6 percent in 2012, according to the U.S. Social Security Administration.
It will be the first increase in monthly payments since 2009. Payments did not rise the last two years because inflation, as measured by the government, remained low.
The 3.6 percent COLA will begin with benefits that nearly 55 million Social Security beneficiaries receive in January 2012. Increased payments to more than 8 million SSI beneficiaries will begin on December 30, 2011.
Some other changes that take effect in January of each year are based on the increase in average wages. Based on that increase, the maximum amount of earnings subject to the Social Security tax (taxable maximum) will increase to $110,100 from $106,800.
Of the estimated 161 million workers who will pay Social Security taxes in 2012, about 10 million will pay higher taxes as a result of the increase in the taxable maximum.
Information about Medicare changes for 2012, when announced, will be available at www.Medicare.gov. For some beneficiaries, their Social Security increase may be partially or completely offset by increases in Medicare premiums.