Final answer:
Social Security tax provides benefits for the disabled and their dependents, the dependents of retired workers, and retirement benefits.
Step-by-step explanation:
Social Security tax provides benefits for employees and their dependents in several ways:
- Benefits for the disabled and their dependents: Social Security offers disability benefits to workers who become unable to work due to a disabling condition. To qualify, the disability must be expected to last at least twelve months. Dependents of disabled workers may also be eligible for benefits.
- Benefits for the dependents of retired workers: When a retired worker receives Social Security retirement benefits, their dependents, such as their children or spouse, may also be eligible for benefits.
- Retirement benefits: The primary purpose of Social Security is to provide retirement benefits. Workers who pay into the program during their working years become eligible for monthly retirement benefits once they reach the age of 65 or meet certain other criteria.
Social Security benefits are based on the wages earned while working, and they are not intended to fully replace other forms of income. Lower-income earners receive a higher percentage of their earnings as benefits compared to higher-income earners.