Imagine losing $16,500 in yearly income with your spouse. How would that affect you?

A new report from the nonpartisan Committee for a Responsible Federal Budget (CRFB) reveals that a standard dual-income couple could face this loss in Social Security benefits if they retire after the Social Security Old-Age and Survivors Insurance (OASI) trust fund runs out in 2033. For single-income couples, the estimated loss would be $12,400.

Currently, Social Security pays out more in benefits than it collects in income taxes and other revenues, which means it is using its reserves in the OASI trust fund to meet the shortfall. The fund can sustain payouts fully until 2033, after which the law stipulates cutting benefits to match incoming revenue, resulting in a 21% reduction for around 70 million beneficiaries, according to CRFB.

“Former President Donald Trump and Vice President Kamala Harris both claim they will ‘protect’ Social Security,” CRFB notes. “However, neither has offered a substantial plan to achieve this.”

Who Will Suffer the Most?

Couples with low incomes who retire in 2033 could experience benefits reduction of $10,000, while high-income couples would see a decrease of $21,800, CRFB detailed.

“Even though the cut would be smaller for low-income couples reflecting a 21% decrease, it represents a more significant portion of their overall income,” the report emphasized.

Things May Get Worse

CRFB stated that without necessary reforms, the disparity between revenues and the benefits dispensed will only grow. The 21% reduction in 2033 could escalate to a 31% decrease by 2098.

If Trump’s proposal to eliminate taxation on Social Security proceeds is implemented without a complete replacement of that income, it would further weaken the program, CRFB added.

Presently, only seniors earning under $25,000 annually ($32,000 for married couples) in “combined income” are exempt from paying taxes on Social Security benefits. Combined income includes adjusted gross income, nontaxable interest (like from municipal bond investments), plus half of the individual’s Social Security benefits.

This year, the taxation of benefits is anticipated to generate roughly $94 billion, CRFB estimated.

Trump’s tax cut could push the insolvency of Social Security’s retirement trust fund to early 2032, rather than late 2033, and the initial 21% cuts would worsen to a 25% reduction, CRFB asserted.

“Vague reassurances from politicians about not altering Social Security benefits aren’t sufficient,” claimed Mary Johnson, a former analyst for the nonprofit Senior Citizens League. “Voters deserve transparency regarding the funding of their benefits.”

Medora Lee is a journalist covering finance, markets, and personal finance for YSL News.