
                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: WEDNESDAY, May 5, 1993                   TAG: 9305050180
SECTION: NATIONAL/INTERNATIONAL                    PAGE: A1   EDITION: METRO 
SOURCE: Associated Press
DATELINE: WASHINGTON                                LENGTH: Medium

SOCIAL SECURITY TAX TO HIT SOME SENIORS MORE

Millions of the nation's wealthiest senior citizens would pay an average of $1,000 more a year under President Clinton's plan to cut the deficit by raising taxes on Social Security benefits, federal officials told Congress Tuesday.

In all, about 9 million middle- and upper-income seniors would see their tax bills rise, but for many the increase would be relatively small.

The administration's proposal targets seniors with annual incomes of at least $25,000 for individuals and $32,000 for married couples. Under the plan, the maximum portion of their Social Security benefits subject to income taxes would be increased from 50 percent to 85 percent.

Although the plan would affect about one-fourth of all Social Security recipients, most of the money would come from the best-off, the Treasury Department's Randolf H. Hardock said.

"Most retirees would be unaffected by the administration's proposal," Hardock said. "The administration's proposal would have minimal effects on lower-income taxpayers."

The American Association of Retired Persons said higher taxes would be "particularly onerous" for middle-class taxpayers with incomes of $30,000 to $50,000. Such people could wind up paying $1,000 a year more in taxes, said AARP, the nation's largest senior citizens lobby.

"After state taxes, local property taxes, higher out-of-pocket costs for health care and the normal costs of maintaining a household are accounted for, another several hundred to a thousand dollars in new tax liability represents a significant loss," said Judith Brown, chair of AARP's board of directors.

Brown said that for these seniors the amount of lost income is significant, difficult if not impossible to replace. "Older Americans' income erodes significantly over time, and this tax increase accelerates that trend," she said.

Ron Pollack, executive director of Families USA, another seniors' advocacy group, testified that the tax plan "would throw no one below the poverty line or below 150 percent of the poverty line."

He said the average income of those affected would be more than $61,000 a year.

by CNB