SSA Announces Modest Cost-of-Living Adjustment for 2024
The upcoming increase is below adjustments for the previous two years.
The Social Security Administration (SSA) recently announced that the Social Security and Supplemental Security Income (SSI) benefits for approximately 71million Americans will increase 3.2 percent in 2023. The cost-of-living adjustment (COLA) will begin with benefits payable to more than 66 million Social Security beneficiaries in January 2024. Increased payments to approximately 7.5 million SSI beneficiaries will begin on Dec. 29, 2023. The COLA increase also applies for Americans who rely on VA disability, military retirement, and other government benefits.
The purpose of the COLA is to ensure that the purchasing power of Social Security and Supplemental Security Income (SSI) benefits isn’t eroded by inflation. It’s based on the percentage increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W) from the third quarter of the last year a COLA was determined to the third quarter of the current year. This announced increase is significantly lower than last year’s increase of 8.7 percent and the announced increase of 5.9 percent for 2022. The increases for the previous two years were the largest increases since the early 1980s.
COLA Adjustment Applicability
COLA adjustments don’t apply only to Social Security recipients. When you process income certifications, be mindful of the following individuals to which the adjustments also apply:
- Retired military veterans
- Disabled veterans
- Veterans’ pension benefits recipients
- Survivor benefit annuitants
- Surviving families of veterans
- Social Security recipients
- Federal civilian retirees
- Supplemental Security Income (SSI) recipients
- Social Security Disability Insurance (SSDI) recipients
- Medicare Extra Help and Medicaid recipients
- Federal and state food and housing assistance program participants
Projecting 2023 Income
When determining the income of residents or applicants, owners and managers should use the new COLA rate when projecting income for 2024. The 3.2 percent COLA can be applied by multiplying the current award amount by 1.032. Remember to apply the COLA to benefits for the appropriate number of months based on the effective date of the certification.
For example, Bill would like to move in on Dec. 1, 2023. Bill’s 2022 gross Social Security monthly amount is $750. You will calculate his Social Security income as follows:
- $750 x 1 = $750 (December 2023)
- $750 x 1.032 = $774 (2023 monthly amount)
- $774 x 11 = $8,514 (January–November 2023)
Therefore, you would add $750 to $8,514 to come up with $9,264 (12 months) for Bill’s annual anticipated income. If you’ve already processed move-ins for January 2023, you should review the household income and apply the COLA to benefits issued by the SSA since it’s a known anticipated change in income.
You can use the SSA benefit, award letter, or Proof of Income letter provided by the tenant or applicant that includes the COLA adjustment if the date of the letter is within 120 days from the date of receipt by the owner.
For a third-party verification directly from the SSA, don’t send tenants or applicants to the SSA office. Tenants or applicants can request benefit information from the SSA using the SSA’s website or toll-free number.
To obtain benefit information using the SSA’s website, the applicant can visit www.ssa.gov/myaccount/proof-of-benefits.html and log in to My Social Security to obtain a benefit verification letter. A tenant or applicant who hasn’t set up an account can easily create one.
To obtain benefit information using the SSA’s toll-free number, an applicant would call the SSA at 1-800-772-1213. The benefit verification letters may be requested 24 hours a day using the automated telephone service. TTY 1-800-325-0778 is available Monday through Friday between 7 a.m. and 7 p.m. for individuals who are deaf or hard of hearing. This information is free, and the tenant should receive the letter in the mail within 10 days.
Once the site obtains the benefit verification letter for use in calculating a tenant or applicant’s income, you should keep a copy of the letter in the tenant’s file and return the original to the tenant or applicant for their records.