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Means Testing Social Security: Income Versus Wealth

Alan L. Gustman, Thomas L. Steinmeier, and Nahid Tabatabai

Abstract:

A Social Security means test targeting benefit recipients in the top quarter of the income distribution will have substantially different distributional effects from a means test targeting the top quarter of wealth holders. Only 14.5 percent of individuals fall in the top quarters of both the income and wealth distributions. A means test based on income will reduce benefits for 10.5 percent of individuals who fall outside the top quarter of wealth holders, while a means test based on wealth will have similar consequences for those who fall outside the top quarter of the income distribution.

Citation

Alan L. Gustman, Thomas L. Steinmeier, and Nahid Tabatabai (2017), Means Testing Social Security: Income Versus Wealth , National Tax Journal, 70:1, pp. 111-132

DOI: dx.doi.org/10.17310/ntj.2017.1.04