A major fiscal watchdog, the Committee for a Responsible Federal Budget (CRFB), has issued a warning that Social Security benefits could be cut as soon as 2033. This is due to recent changes in tax law, particularly the One Big Beautiful Bill Act, signed into law on July 4, 2025. While this law was celebrated by some as a financial win for seniors, certain provisions, such as reduced taxation of Social Security benefits, could accelerate the depletion of the Social Security trust fund, putting millions of retirees at risk of future cuts. Here’s what you need to know.
What Changed with the New Law?
President Donald Trump’s One Big Beautiful Bill Act introduced several provisions aimed at easing financial burdens on seniors. However, one key change is raising significant concerns: the reduction in tax revenue collected from Social Security benefits. According to the CRFB, this provision accelerates the timeline for the trust fund’s depletion, now expected by the end of 2032. Once the trust fund is drained, Social Security will rely solely on payroll tax revenues, which are insufficient to fully fund promised benefits, potentially triggering automatic cuts.
What Kind of Cuts Are Expected?
When the Social Security trust fund reserves are exhausted, benefits will be funded primarily through payroll taxes collected from current workers. However, this revenue will not be enough to maintain full benefits. The CRFB estimates that a dual-earning couple retiring in 2033 could face an annual cut of $18,100. This gap between income and benefits is expected to grow over time, affecting not just retirees but also survivors and disabled beneficiaries. The longer Congress delays action, the larger the potential cuts will become.
Why Is This Happening?
Social Security has been facing financial difficulties for many years, driven by several structural challenges:
Aging Population: Baby Boomers are retiring in large numbers, increasing the number of beneficiaries.
Lower Birth Rates: Fewer workers are entering the workforce, reducing the amount of payroll taxes being paid into the system.
Rising Costs: In 2024, Social Security accounted for 23% of all federal spending, paying out $1.5 trillion in benefits.
The reduction in tax revenue caused by the One Big Beautiful Bill Act could make these financial challenges even worse, pushing the Social Security trust fund toward insolvency faster than anticipated.
Will Social Security Checks Ever Stop?
While it’s unlikely that Social Security checks will stop entirely, the system will face substantial cuts unless Congress takes action. Even after the trust fund is depleted, payroll taxes will continue to fund Social Security, but at a reduced level. Experts estimate that retirees could face reductions of 20-25% starting in 2033, with the gap between benefits and revenues widening as time goes on. This would leave many seniors with significantly less financial support during retirement.
What Are Experts Saying?
Experts are sounding the alarm about the potential consequences of inaction. The CRFB has argued that policymakers who promise not to touch Social Security are effectively endorsing deep benefit cuts for over 60 million retirees. The group insists that real solutions must be pursued to restore the solvency of the trust fund.
Howard Gleckman, a senior fellow at the Urban-Brookings Tax Policy Center, added that political leaders are creating misleading expectations about the future of Social Security. “Despite claims that the law fixes Social Security, it did not eliminate Social Security taxes or guarantee full benefits,” Gleckman warned.
What Happens Next?
Without Congressional intervention, Social Security is on track for significant benefit reductions starting in 2033. There are several potential solutions to address the issue, but so far, no bipartisan consensus has been reached. Proposed solutions include:
Raising payroll taxes to increase revenue.
Increasing the retirement age, which would delay benefit payments.
Reducing benefits for higher-income earners to preserve funds for lower-income workers.
Adjusting cost-of-living increases to slow the rate of benefit growth.
The debate continues, but with the clock ticking toward 2032, many experts are urging lawmakers to act sooner rather than later.
The new One Big Beautiful Bill Act could accelerate the depletion of the Social Security trust fund, leading to significant benefit cuts as early as 2033. While Social Security will continue to pay out benefits from payroll taxes, those benefits will be reduced by 20-25% if no action is taken. Retirees and future beneficiaries must stay informed about these developments and urge policymakers to take meaningful steps to secure the program’s future. Without bipartisan action, the promise of Social Security could become much less reliable in the coming decades.
