The following excerpts are from a May 29, 2007 Daily Herald article and the opinions of the author, Scott Burns, may or may not reflect those of the SIP Committee.

In 1983 a presidential commission recommended that Social Security benefits be taxed. The recommendation became law in 1984. At the time, few retirees were affected because benefits were only to be taxed when other sources of income were quite high. With the initial income level set at $25,000 for a single return and $32,000 for a joint return, it was expected that only 1 percent of beneficiaries would pay any taxes on their benefits. But there was a catch. The income levels weren't indexed to inflation. As inflation and economic growth increased the level of benefits for future retirees, more and more retirees would pay the tax.

For a couple, the taxation of benefits begins when your other sources of income plus one-half of your Social Security benefits exceed $32,000. Today the average Social Security check is $1,048 a month or $12,576 a year. So an average two-earner couple may have benefits of $25,152. Subtract one-half of this amount from $32,000 and you have the amount of income they can have from other sources before benefits become taxable - $19,424. Once their other income exceeds $19,424, every additional dollar causes either 50 cents or 85 cents of benefits to be added to their taxable income.

Now let's fast forward about 17 years. According to the recently released Social Security trustees report, the average worker retiring in 2008 will receive benefits of $16,260 a year. By 2024 the average worker will receive benefits of $19,972, measured in today's dollars. Assuming a 3 percent inflation rate, this will mean cash benefits of $32,954.