Why Is This Legal?

     From an accounting firm's newsletter:

The federal self-employment (SE) tax just keeps going higher and higher. [No, apart from a cost of living adjustment in the earnings base, it hasn't changed in many years.] If you've reached the breaking point, there may be a way to tame the SE tax beast by converting your existing unincorporated small business into an S corporation. ...

So it may be time to consider an S corporation conversion. Reason: The SE tax doesn't apply to earnings from an S corporation business. 

The FICA tax is only due on an S corporation shareholder-employee's salary. So when the company pays only a portion of its profits to the owner, or owners, in the form of a reasonable salary, with the remaining portion paid out in the form of cash distributions, only the salary portion is hit with Social Security and Medicare taxes (in the form of the FICA tax). The profits paid out as cash distributions are exempt from the FICA tax (and exempt from the SE tax too)....

Thanks, Trump

     The Social Security field office in downtown Cleveland will be closed this week because of the Republican national convention.

People Cut Off Social Security Disabilty Benefits Struggle

     And these are claimants that Social Security has found to be medically improved.

The Cost Of Budget Cuts

This Would Be A Lot Less Difficult To Address Than COBOL Problems

     From the written testimony of Rick Warsinskey, President, National Council of Social Security Management Associations(NCSSMA) an organization of Social Security managers, mostly at field offices, before the House Social Security Subcommittee yesterday:

... Every day, SSA [Social Security Administration] employees wait and watch as their computers crawl from one system’s window to another. Users watch the spinning wheel move as programs and screens attempt to load, losing valuable time that could be used to assist other customers or address workload backlogs. Around noon Eastern Time every day our system reaches peak capacity and the slowness becomes most apparent, as almost all the offices in the country are open to the public and taking claims, talking to the public on the telephone, or handling some aspect of a claimant’s record. We can demonstrate the degradation of SSA computer speed in real numbers. We surveyed our offices and found that data speed tests showed these median Megabits per Second (Mbps) speeds: 

Download: 2.87 Mbps 
Upload: .25 Mbps 

A year ago when we surveyed the same measurements, the median speeds were: Download: 

3.45 Mbps 
Upload: 2.0 Mbps 

This degradation in data speeds supports the nearly universal feedback we are receiving that our system is slowing down significantly. It is important to note the data speeds you can typically expect to receive from cable internet service providers are now over 50 Mbps for download and 10 Mbps for upload speed. ...

Our computers often freeze or applications become inaccessible and require a reboot. It can take 10 minutes to restart a computer and get back online. We are often unable to run live video training or engage in video communications with the public due to lack of bandwidth. Once we open more than five programs on our computers, they often freeze, requiring us to reboot the system. Internet access and our e-mail communications are also excruciatingly slow.

Our online time and attendance system (WebTA), which is the system used to pay employees, periodically freezes and is often down on the day we certify payroll for employees. Additional time is spent on the telephone waiting to talk to our internal help desk to resolve computer issues that we are experiencing. The need to call the help desk will only increase as SSA expands telework and calls to resolve access issues increase.

Disability Benefit Termination Attracts Media Attention

Proposed Rules On Appointed Representatives

     The Social Security Administration is clearing out its regulatory cupboard as we approach the end of the Obama administration and the end of Carolyn Colvin's tenure as Acting Commissioner of Social Security. The agency has sent to the Office of Management and Budget (OMB) a proposal titled Revisions to Rules of Conduct and Standards of Responsibility for Appointed Representatives. The following blurb is all that it is publicly known at the moment.

This regulatory change adds several affirmative duties and prohibited actions for representatives. We will clarify some of our rules regarding processing representative sanction actions at the hearing and Appeals Council levels and change the timeframe for suspended representatives to request reinstatement when the Appeals Council denies an initial request for reinstatement from 1 to 3 years.

     OMB is part of the White House. If OMB approves the proposed rules, which is not automatic, the proposal get published in the Federal Register. The public can then comment on the proposal. The agency must consider the comments. The consideration given is usually nothing more than giving some meaningless reason why the comment will be ignored. This process generally takes at least a year.

Draft Appropriations Bill Calls For Decrease In Social Security Operating Funds

     The House Appropriations Committee has released a draft appropriations bill for fiscal year 2017, which begins on October 1, 2016, covering Social Security's administrative budget. Here's the summary:

The bill provides $11.9 billion to administer SSA activities – a decrease of $250 million from the fiscal year 2016 enacted level – to ensure those served by the program receive efficient and timely assistance and services. One‑time costs for building renovations provided in fiscal year 2016 make up a majority of the decrease.

     I'm all in favor of reducing the appropriation for the building renovation. The appropriation for the current year included an exorbitant amount of money for the renovation of one office building at Social Security's central offices. This had not been requested by the agency or the President. It was added to get the support of Senator Barbara Mikulski of Maryland, where the money would be spent. However, the agency as a whole is in dire straits and needs a significant increase in operating funds.