5 things to know about the warning that Social Security fund will run out in 2032

WASHINGTON — A federal report warning that Social Security’s primary trust fund is expected to run dry in late 2032 without congressional intervention has sparked bipartisan calls for lawmakers to move fast on developing a plan to shore up the program’s financial future.

Rep. Tom Suozzi (D-Glen Cove) on Monday filed legislation that would establish a bipartisan independent commission tasked with addressing “the long-term financial solvency” of the program. The legislation, co-sponsored by Rep. Tom Cole (R-Okla.), comes as other lawmakers, including Sen. Kirsten Gillibrand (D-N.Y.), have floated other proposals to keep the program viable.

Should the primary trust fund, known as the Old-Age and Survivors Insurance fund, or OASI, become insolvent by the fourth quarter of 2032 as projected last week in a report by the Social Security Board of Trustees, New Yorkers receiving those benefits could expect to see about 22% less in monthly benefits, or potentially $511 per month, according to a state-by-state analysis released earlier this month by the Committee for a Responsible Federal Budget, a nonpartisan Washington think tank.

“We owe it to current and future retirees to set partisan politics aside and develop responsible solutions that protect and strengthen the program,” Suozzi said in a statement.

Here are five things to know about Social Security’s potential 2032 fiscal cliff:

What is causing the decline in revenue to the trust fund?

The Social Security Board of Trustees, a six-member panel with four Trump administration officials and two vacant trustee positions, is tasked with releasing an annual report laying out the program’s financial health.

Last year, the panel projected the Social Security’s primary trust fund would run dry starting in 2033, but the board’s latest report, released June 9, moved up the projected insolvency date to the final quarter of 2032, citing a reduction in tax revenue from a number of sources, including tax cuts from the sweeping tax-and-spend megabill passed by the Republican-majority Congress and signed into law by President Donald Trump in July 2025.

The cuts in Trump’s “big, beautiful bill” are expected to reduce tax revenue to the main Social Security Trust Fund by $30 billion a year, according to an analysis by the CRFB.

Demographic changes are also cited in the report — an increase in retirements from the Baby Boom generation, coupled with projected declines in the tax-paying immigrant labor force amid the Trump administration’s hard-line immigration policies and a projected decrease in the country’s birthrate. All are expected to reduce the future labor pool and revenue base for the program, according to the report.

Without congressional intervention there will only be enough incoming revenue from the existing labor force to pay 78% of a recipient's monthly payment.

“This should be a wake-up call: Congress needs to act,” AARP chief executive Myechia Minter-Jordan said in a statement. “Americans have worked hard and paid into Social Security their entire lives, and they deserve to count on it when they retire. No family should see any cuts to what they’ve earned in Social Security. Today, more than 71 million people rely on Social Security, and as America ages, ensuring it stays strong will become even more critical.”

What would insolvency mean for New Yorkers collecting Social Security?

More than 3.3 million New York retirees, widows and widowers, and spouses and dependents of deceased workers eligible for benefits could see a $511 monthly drop in benefits if the OASI trust fund becomes insolvent, according to the CRFB.

New York retirees on average receive $2,018 a month, according to data from the Social Security Administration.

Will disability benefits be impacted?

Social Security disability benefits are funded through a separate trust fund that is not facing the same financial strain as OASI, according to the report. The Disability Insurance Trust Fund is financially strong and expected to be solvent for the next 75 years, according to the report.

“The Disability Insurance (DI) Trust Fund is projected to be able to pay 100 percent of total scheduled benefits through at least 2100,” according to the report.

What are lawmakers proposing to bolster OASI?

It’s been 43 years since Congress passed legislation to shore up the trust fund program, underscoring the challenge of finding bipartisan support for a long-term solution.

In 1983, Congress passed a series of changes, including raising the full retirement age from 65 to 67, and making Social Security benefits taxable for individuals earning more than $25,000 a year.

Currently on Capitol Hill, there are competing visions for the future direction of the program, with congressional Democrats mostly calling for lifting its $184,500 tax cap so that higher-income earners can pay more into Social Security; and congressional Republicans floating the prospect of raising the retirement age, or setting limits on the maximum amount high-income earners can receive in monthly benefits.

Over the past week, more calls for a bipartisan solution have cropped up. Besides Suozzi’s proposal, Sen. Rand Paul (R-Ky.) told reporters on Capitol Hill he was pressing congressional leaders to “set up a bicameral, bipartisan” panel “to discuss how to make Social Security and Medicare solvent.”

Outgoing Senate Republicans Thom Tillis of North Carolina and Bill Cassidy of Louisiana, and Democratic Sens. Dick Durbin of Illinois and Tim Kaine of Virginia, who is also stepping down from his post this year, released a statement last week urging lawmakers to start tackling the issues facing Social Security together, saying: “It’s clear now that Congress shouldn’t delay any longer.”

Gillibrand is a co-sponsor of the Social Security Expansion Act, a Democratic-led Senate bill that calls for increasing the Social Security tax cap so that wealthier Americans are paying more into the program. Under the current funding formula, the maximum amount of income subject to the Social Security payroll tax is $184,500. The legislation sponsored by Gillibrand would lift the cap, requiring income above $250,000 to be subject to the payroll tax, which would boost the program’s pool of money.

“We are trying very hard to blow the cap and restore the money into Social Security over time, so that it is fully solvent,” Gillibrand told Newsday during an unrelated news conference Wednesday, when asked about the various proposals being floated.

How has the Trump administration responded to the report?

Social Security Commissioner Frank Bisignano, testifying before a House panel a day after the annual report was released, did not offer recommendations when asked about the looming 2032 date.

“My job was to make it perform as well as possible so you all have a set of options,” Bisignano said.

By Laura Figueroa Hernandez

laura.figueroa@newsday.com@Laura_Figueroa

Laura Figueroa Hernandez is the White House correspondent and previously covered New York City politics and government. She joined Newsday in 2012 after covering state and local politics for The Miami Herald.