< Back to H.R. 4245 (103rd Congress, 1993–1994)

Text of the Social Security Long-Range Solvency Act of 1994

This bill was introduced on April 19, 1994, in a previous session of Congress, but was not enacted. The text of the bill below is as of Apr 19, 1994 (Introduced).

Source: GPO

HR 4245 IH

103d CONGRESS

2d Session

H. R. 4245

To amend title II of the Social Security Act and the Internal Revenue Code of 1986 to provide for the long-range solvency of the old-age, survivors, and disability insurance program.

IN THE HOUSE OF REPRESENTATIVES

April 19, 1994

Mr. ROSTENKOWSKI introduced the following bill; which was referred to the Committee on Ways and Means


A BILL

To amend title II of the Social Security Act and the Internal Revenue Code of 1986 to provide for the long-range solvency of the old-age, survivors, and disability insurance program.

    Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.

    This Act may be cited as the ‘Social Security Long-Range Solvency Act of 1994’.

TABLE OF CONTENTS

      Sec. 1. Short title and table of contents.

TITLE I--PROVISIONS RELATING TO FUTURE ENTITLEMENTS

      Sec. 101. Adjustments in formula for determining primary insurance amount.

      Sec. 102. Gradual increase in retirement age to age 67 by the year 2011.

TITLE II--PROVISIONS RELATING TO CURRENT AND FUTURE ENTITLEMENTS

      Sec. 201. Reduction in cost-of-living adjustment payable in 1995.

      Sec. 202. Thresholds for income taxation of social security benefits.

TITLE III--COVERAGE OF NEWLY HIRED STATE AND LOCAL EMPLOYEES

      Sec. 301. Amendments to the Social Security Act.

      Sec. 302. Amendments to the Internal Revenue Code of 1986.

      Sec. 303. Effective date of title.

TITLE IV--SOCIAL SECURITY PAYROLL TAX

      Sec. 401. Level of OASDI tax.

      Sec. 402. Level of self-employment tax.

TITLE I--PROVISIONS RELATING TO FUTURE ENTITLEMENTS

SEC. 101. ADJUSTMENTS IN FORMULA FOR DETERMINING PRIMARY INSURANCE AMOUNT.

    (a) ADDITIONAL EARNINGS BRACKET- Section 215(a)(1)(A) of the Social Security Act (42 U.S.C. 415(a)(1)(A)) is amended--

      (1) in clause (ii), by striking ‘and’;

      (2) in clause (iii), by striking ‘clause (ii),’ and inserting the following: ‘clause (ii), but, in the case of an individual who initially becomes eligible for old-age or disability insurance benefits, or who dies (before becoming eligible for such benefits), after calendar year 2001, do not exceed the amount established for purposes of this clause by subparagraph (B), and’; and

      (3) by inserting after clause (iii) the following new clause:

      ‘(iv) in the case of an individual who initially becomes eligible for old-age or disability insurance benefits, or who dies (before becoming eligible for such benefits), after calendar year 2001, 10 percent of the individual’s average indexed monthly earnings to the extent that such earnings exceed the amount established for purposes of clause (iii),’.

    (b) BEND POINT AMOUNTS- Section 215(a)(1)(B) of such Act (42 U.S.C. 415(a)(1)(B)) is amended--

      (1) in clause (ii), by inserting ‘and before 2002’ after ‘1979’ the first place it appears, and by striking ‘by dividing--’ and all that follows and inserting ‘under clause (ix) of this subparagraph.’;

      (2) by redesignating clause (iii) as clause (xii);

      (3) by inserting after clause (ii) the following new clauses:

    ‘(iii) For individuals who initially become eligible for old-age or disability insurance benefits, or who die (before becoming eligible for such benefits), in any calendar year after 2001, the amount established for purposes of clause (i) of subparagraph (A) shall be an amount equal to the product of the following factors:

      ‘(I) the amount established with respect to calendar year 1979 under clause (i) of this subparagraph for purposes of clause (i) of subparagraph (A), and

      ‘(II) the quotient obtained under clause (ix) of this subparagraph.

    ‘(iv) For individuals who initially become eligible for old-age or disability insurance benefits, or who die (before becoming eligible for such benefits), in any calendar year after 2001 and before 2052, the amount established for purposes of clause (ii) of subparagraph (A) shall be an amount equal to the product of the following factors:

      ‘(I) the amount established with respect to the preceding calendar year under this subparagraph for purposes of clause (ii) of subparagraph (A),

      ‘(II) the quotient obtained under clause (x) of this subparagraph, and

      ‘(III) 0.99.

    ‘(v) For individuals who initially become eligible for old-age or disability insurance benefits, or who die (before becoming eligible for such benefits), in any calendar year after 2051, the amount established for purposes of clause (ii) of subparagraph (A) shall be an amount equal to the product of the following factors:

      ‘(I) the amount established with respect to the calendar year 2051 under clause (iv) of this subparagraph for purposes of clause (ii) of subparagraph (A), and

      ‘(II) the quotient obtained under clause (xi) of this subparagraph.

    ‘(vi) For individuals who initially become eligible for old-age or disability insurance benefits, or who die (before becoming eligible for such benefits), in the calendar year 2002, the amount established for purposes of clause (iii) of subparagraph (A) shall be an amount equal to the quotient derived by dividing--

      ‘(I) the amount established with respect to the calendar year 2002 under clause (iv) of this subparagraph for purposes of clause (ii) of subparagraph (A), by

      ‘(II) 0.9950.

    ‘(vii) For individuals who initially become eligible for old-age or disability insurance benefits, or who die (before becoming eligible for such benefits), in any calendar year after 2002 and before 2052, the amount established for purposes of clause (iii) of subparagraph (A) shall be an amount equal to the product of the following factors:

      ‘(I) the amount established with respect to the preceding calendar year under this subparagraph for purposes of clause (iii) of subparagraph (A),

      ‘(II) the quotient obtained under clause (x) of this subparagraph, and

      ‘(III) 0.99.

    ‘(viii) For individuals who initially become eligible for old-age or disability insurance benefits, or who die (before becoming eligible for such benefits), in any calendar year after 2051, the amount established for purposes of clause (iii) of subparagraph (A) shall be an amount equal to the product of the following factors:

      ‘(I) the amount established with respect to calendar year 2051 under clause (vii) of this subparagraph for purposes of clause (iii) of subparagraph (A), and

      ‘(II) the quotient obtained under clause (xi) of this subparagraph.

    ‘(ix) The quotient obtained under this clause is the quotient obtained by dividing--

      ‘(I) the deemed average total wages (as defined in section 209(k)(1)) for the second calendar year preceding the calendar year for which the determination is made, by

      ‘(II) the average of the total wages (as defined in regulations of the Secretary and computed without regard to the limitations specified in section 209(a)(1)) reported to the Secretary of the Treasury or his delegate for the calendar year 1977.

    ‘(x) The quotient obtained under this clause is the quotient obtained by dividing--

      ‘(I) the deemed average total wages (as defined in section 209(k)(1)) for the second calendar year preceding the calendar year for which the determination is made, by

      ‘(II) the deemed average total wages (as defined in section 209(k)(1)) for the third calendar year preceding the calendar year for which the determination is made.

    ‘(xi) The quotient obtained under this clause is the quotient obtained by dividing--

      ‘(I) the deemed average total wages (as defined in section 209(k)(1)) for the second calendar year preceding the calendar year for which the determination is made, by

      ‘(II) the average of the total wages (as defined in regulations of the Secretary and computed without regard to the limitations specified in section 209(a)(1)) reported to the Secretary of the Treasury or his delegate for the calendar year 2049.’; and

      (4) in clause (xii) (as redesignated), by striking ‘clause (ii)’ and inserting ‘the preceding clauses of this subparagraph’.

    (c) EFFECTIVE DATE- The amendments made by this section shall apply with respect to individuals who initially become eligible (within the meaning of section 215(a)(3)(B) of the Social Security Act) for old-age or disability insurance benefits under title II of the Social Security Act, or who die (before becoming eligible for such benefits), in any calendar year after 2001.

SEC. 102. GRADUAL INCREASE IN RETIREMENT AGE TO AGE 67 BY THE YEAR 2011.

    (a) IN GENERAL- Section 216(l) of the Social Security Act (42 U.S.C. 416(l)) is amended--

      (1) by striking subparagraphs (C) and (D) of paragraph (1) and by redesignating subparagraph (E) as subparagraph (C);

      (2) in subparagraph (B) of paragraph (1), by striking ‘January 1, 2005,’ and inserting ‘January 1, 2011,’;

      (3) in subparagraph (C) of paragraph (1) (as redesignated), by striking ‘December 31, 2021,’ and inserting ‘December 31, 2010,’; and

      (4) by striking paragraph (3) and inserting the following:

    ‘(3) The age increase factor for any individual who attains early retirement age in the 11-year period consisting of calendar years 2000 through 2010 shall be equal to 2/12 of the number of months in the period beginning with January 2000 and ending with December of the year in which the individual attains early retirement age.’.

    (b) EFFECTIVE DATE- The amendments made by this section shall apply with respect to benefits of individuals attaining early retirement age (as defined in section 216(l)(2) of the Social Security Act) after 1999.

TITLE II--PROVISIONS RELATING TO CURRENT AND FUTURE ENTITLEMENTS

SEC. 201. REDUCTION IN COST-OF-LIVING ADJUSTMENT PAYABLE IN 1995.

    (a) IN GENERAL- For purposes of determining any increase described in section 215(i)(2)(A)(ii) of the Social Security Act (42 U.S.C. 415(i)(2)(A)(ii)) which is effective for December 1994, the applicable increase percentage (as defined in section 215(i)(1)(C) of such Act (42 U.S.C. 415(i)(1)(C))) shall be deemed to be the difference (not less than zero) derived by subtracting 0.5 percent from the applicable increase percentage (as so defined).

    (b) INAPPLICABILITY TO PROVISIONS NOT RELATING TO OASDI BENEFITS OR TIER I RAILROAD RETIREMENT BENEFITS- Subsection (a) shall apply only with respect to adjustments to social security benefits (as defined in section 86(d) of the Internal Revenue Code of 1986) and primary insurance amounts determined under title II of the Social Security Act. For purposes of provisions of law otherwise referring to section 215(i) of the Social Security Act or otherwise basing adjustments on adjustments made under such section 215(i), such section 215(i) shall be applied as if this section had not been enacted.

SEC. 202. THRESHOLDS FOR INCOME TAXATION OF SOCIAL SECURITY BENEFITS.

    (a) UNIFORM APPLICABILITY OF TAX- Subsection (a) of section 86 of the Internal Revenue Code of 1986 (relating to social security and tier 1 railroad retirement benefits) is amended--

      (1) by striking paragraph (2);

      (2) by striking ‘(a) IN GENERAL- ’ and all that follows through ‘paragraph (2), gross’ in paragraph (1) and inserting ‘(a) IN GENERAL- Gross’; and

      (3) by redesignating subparagraphs (A) and (B) of such subsection (as so amended) as paragraphs (1) and (2), respectively.

    (b) CONFORMING AMENDMENTS- Subsection (c) of such section 86 (relating to base amount and adjusted base amount) is amended--

      (1) in the heading, by striking ‘AND ADJUSTED BASE AMOUNT’;

      (2) by striking paragraph (2);

      (3) by striking ‘section--’ and all that follows through ‘The term’ in paragraph (1) and inserting ‘section, the term’;

      (4) by redesignating subparagraphs (A), (B), and (C) of such subsection (as so amended) as paragraphs (1), (2), and (3), respectively; and

      (5) by redesignating clauses (i) and (ii) of paragraph (3) of such subsection (as so redesignated) as subparagraphs (A) and (B), respectively.

    (c) EFFECTIVE DATE- The amendments made by this section shall apply with respect to taxable years beginning after December 31, 1994.

TITLE III--COVERAGE OF NEWLY HIRED STATE AND LOCAL EMPLOYEES

SEC. 301. AMENDMENTS TO THE SOCIAL SECURITY ACT.

    (a) IN GENERAL- Paragraph (7) of section 210(a) of the Social Security Act (42 U.S.C. 410(a)(7)) is amended to read as follows:

      ‘(7) Excluded State or local government employment (as defined in subsection (r));’.

    (b) EXCLUDED STATE OR LOCAL GOVERNMENT EMPLOYMENT-

      (1) IN GENERAL- Section 210 of such Act (42 U.S.C. 410) is amended by adding at the end the following new subsection:

‘Excluded State or Local Government Employment

    ‘(r)(1) IN GENERAL- The term ‘excluded State or local government employment’ means any service performed in the employ of a State, of any political subdivision thereof, or of any instrumentality of any one or more of the foregoing which is wholly owned thereby, if--

      ‘(A)(i) such service would be excluded from the term ‘employment’ for purposes of this title if the preceding provisions of this section as in effect in March 1994 had remained in effect, and (ii) the requirements of paragraph (2) are met with respect to such service, or

      ‘(B) the requirements of paragraph (3) are met with respect to such service.

    ‘(2) EXCEPTION FOR CURRENT EMPLOYMENT WHICH CONTINUES-

      ‘(A) IN GENERAL- The requirements of this paragraph are met with respect to service for any employer if--

        ‘(i) such service is performed by an individual--

          ‘(I) who was performing substantial and regular service for remuneration for that employer before January 1, 1995,

          ‘(II) who is a bona fide employee of that employer on December 31, 1994, and

          ‘(III) whose employment relationship with that employer was not entered into for purposes of meeting the requirements of this subparagraph, and

        ‘(ii) the employment relationship with that employer has not been terminated after December 31, 1994.

      ‘(B) TREATMENT OF MULTIPLE AGENCIES AND INSTRUMENTALITIES- For purposes of subparagraph (A), under regulations (consistent with regulations established under section 3121(t)(2)(B) of the Internal Revenue Code of 1986)--

        ‘(i) all agencies and instrumentalities of a State (as defined in section 218(b)) or of the District of Columbia shall be treated as a single employer, and

        ‘(ii) all agencies and instrumentalities of a political subdivision of a State (as so defined) shall be treated as a single employer and shall not be treated as described in clause (i).

    ‘(3) EXCEPTION FOR CERTAIN SERVICES-

      ‘(A) IN GENERAL- The requirements of this paragraph are met with respect to service if such service is performed--

        ‘(i) by an individual who is employed by a State or political subdivison thereof to relieve such individual from unemployment,

        ‘(ii) in a hospital, home, or other institution by a patient or inmate thereof as an employee of a State or political subdivision thereof or of the District of Columbia,

        ‘(iii) by an individual, as an employee of a State or political subdivision thereof or of the District of Columbia, serving on a temporary basis in case of fire, storm, snow, earthquake, flood, or other similar emergency,

        ‘(iv) by any individual as an employee included under section 5351(2) of title 5, United States Code (relating to certain interns, student nurses, and other student employees of hospitals of the District of Columbia Government), other than as a medical or dental intern or a medical or dental resident in training,

        ‘(v) by an election official or election worker if the remuneration paid in a calendar year for such service is less than $1,000 with respect to service performed during 1995, and the adjusted amount determined under subparagraph (C) for any subsequent year with respect to service performed during such subsequent year, except to the extent that service by such election official or election worker is included in employment under an agreement under section 218, or

        ‘(vi) by an employee in a position compensated solely on a fee basis which is treated pursuant to section 211(c)(2)(E) as a trade or business for purposes of inclusion of such fees in net earnings from self-employment.

      ‘(B) DEFINITIONS- As used in this paragraph, the terms ‘State’ and ‘political subdivision’ have the meanings given those terms in section 218(b).

      ‘(C) ADJUSTMENTS TO DOLLAR AMOUNT FOR ELECTION OFFICIALS AND ELECTION WORKERS- For each year after 1995, the Secretary shall adjust the amount referred to in subparagraph (A)(v) at the same time and in the same manner as is provided under section 215(a)(1)(B)(ii) with respect to the amounts referred to in section 215(a)(1)(B)(i), except that--

        ‘(i) for purposes of this subparagraph, 1993 shall be substituted for the calendar year referred to in section 215(a)(1)(B)(ii)(II), and

        ‘(ii) such amount as so adjusted, if not a multiple of $100, shall be rounded to the next higher multiple of $100 where such amount is a multiple of $50 and to the nearest multiple of $100 in any other case.

      The Secretary shall determine and publish in the Federal Register each adjusted amount determined under this subparagraph not later than November 1 preceding the year for which the adjustment is made.’.

      (2) CONFORMING AMENDMENTS-

        (A) Subsection (k) of section 210 of such Act (42 U.S.C. 410(k)) (relating to covered transportation service) is repealed.

        (B) Section 210(p) of such Act (42 U.S.C. 410(p)) is amended--

          (i) in paragraph (2), by striking ‘service is performed’ and all that follows and inserting ‘service is service described in subsection (r)(3)(A).’; and

          (ii) in paragraph (3)(A), by inserting ‘under subsection (a)(7) as in effect in March 1994’ after ‘section’.

    (c) ADDITIONAL AMENDMENTS RELATING TO COVERAGE AGREEMENTS-

      (1) AUTHORIZATION FOR ALL STATES TO EXTEND COVERAGE TO STATE AND LOCAL POLICEMEN AND FIREMEN UNDER EXISTING COVERAGE AGREEMENTS-

        (A) IN GENERAL- Section 218(l) of such Act (42 U.S.C. 418(l)) is amended--

          (i) in paragraph (1), by striking ‘(1)’ after ‘(l)’, and by striking ‘the State of’ and all that follows through ‘prior to the date of enactment of this subsection’ and inserting ‘a State entered into pursuant to this section’; and

          (ii) by striking paragraph (2).

        (B) CONFORMING AMENDMENT- Section 218(d)(8)(D) of such Act (42 U.S.C. 418(d)(8)(D)) is amended by striking ‘agreements with the States named in’ and inserting ‘State agreements modified as provided in’.

        (C) EFFECTIVE DATE- The amendments made by this paragraph shall apply with respect to modifications filed by States after the date of the enactment of this Act.

      (2) CONFORMING AMENDMENTS- Section 218(c)(6) of such Act (42 U.S.C. 418(c)(6)) is amended--

        (A) by striking subparagraph (C);

        (B) by redesignating subparagraphs (D) and (E) as subparagraphs (C) and (D), respectively; and

        (C) by striking subparagraph (F) and inserting the following:

      ‘(E) service which is included as employment under section 210(a).’

    (d) AUTHORITY FOR STATES TO MODIFY COVERAGE AGREEMENTS WITH RESPECT TO ELECTION OFFICIALS AND ELECTION WORKERS- Section 218(c)(8) of such Act (42 U.S.C. 418(c)(8)) is amended--

      (1) by striking ‘on or after January 1, 1968,’ and inserting ‘at any time’;

      (2) by striking ‘$100’ and inserting ‘$1,000 with respect to service performed during 1995, and the adjusted amount determined under section 210(r)(3)(C) for any subsequent year with respect to service performed during such subsequent year’; and

      (3) by striking the last sentence and inserting the following new sentence: ‘Any modification of an agreement pursuant to this paragraph shall be effective with respect to services performed in and after the calendar year in which the modification is mailed or delivered by other means to the Secretary.’.

SEC. 302. AMENDMENTS TO THE INTERNAL REVENUE CODE OF 1986.

    (a) IN GENERAL- Paragraph (7) of section 3121(b) of the Internal Revenue Code of 1986 (relating to employment) is amended to read as follows:

      ‘(7) excluded State or local government employment (as defined in subsection (t));’.

    (b) EXCLUDED STATE OR LOCAL GOVERNMENT EMPLOYMENT- Section 3121 of such Code is amended by inserting after subsection (s) the following new subsection:

    ‘(t) EXCLUDED STATE OR LOCAL GOVERNMENT EMPLOYMENT-

      ‘(1) IN GENERAL- For purposes of this chapter, the term ‘excluded State or local government employment’ means any service performed in the employ of a State, of any political subdivision thereof, or of any instrumentality of any one or more of the foregoing which is wholly owned thereby, if--

        ‘(A)(i) such service would be excluded from the term ‘employment’ for purposes of this chapter if the provisions of subsection (b)(7) as in effect in March 1994 had remained in effect, and (ii) the requirements of paragraph (2) are met with respect to such service, or

        ‘(B) the requirements of paragraph (3) are met with respect to such service.

      ‘(2) EXCEPTION FOR CURRENT EMPLOYMENT WHICH CONTINUES-

        ‘(A) IN GENERAL- The requirements of this paragraph are met with respect to service for any employer if--

          ‘(i) such service is performed by an individual--

            ‘(I) who was performing substantial and regular service for remuneration for that employer before January 1, 1995,

            ‘(II) who is a bona fide employee of that employer on December 31, 1994, and

            ‘(III) whose employment relationship with that employer was not entered into for purposes of meeting the requirements of this subparagraph, and

          ‘(ii) the employment relationship with that employer has not been terminated after December 31, 1994.

        ‘(B) TREATMENT OF MULTIPLE AGENCIES AND INSTRUMENTALITIES- For purposes of subparagraph (A), under regulations--

          ‘(i) all agencies and instrumentalities of a State (as defined in section 218(b) of the Social Security Act) or of the District of Columbia shall be treated as a single employer, and

          ‘(ii) all agencies and instrumen- talities of a political subdivision of a State (as so defined) shall be treated as a single employer and shall not be treated as described in clause (i).

      ‘(3) EXCEPTION FOR CERTAIN SERVICES-

        ‘(A) IN GENERAL- The requirements of this paragraph are met with respect to service if such service is performed--

          ‘(i) by an individual who is employed by a State or political subdivison thereof to relieve such individual from unemployment,

          ‘(ii) in a hospital, home, or other institution by a patient or inmate thereof as an employee of a State or political subdivision thereof or of the District of Columbia,

          ‘(iii) by an individual, as an employee of a State or political subdivision thereof or of the District of Columbia, serving on a temporary basis in case of fire, storm, snow, earthquake, flood, or other similar emergency,

          ‘(iv) by any individual as an employee included under section 5351(2) of title 5, United States Code (relating to certain interns, student nurses, and other student employees of hospitals of the District of Columbia Government), other than as a medical or dental intern or a medical or dental resident in training,

          ‘(v) by an election official or election worker if the remuneration paid in a calendar year for such service is less than $1,000 with respect to service performed during 1995, and the adjusted amount determined under section 210(r)(3)(C) of the Social Security Act for any subsequent year with respect to service performed during such subsequent year, except to the extent that service by such election official or election worker is included in employment under an agreement under section 218 of the Social Security Act, or

          ‘(vi) by an employee in a position compensated solely on a fee basis which is treated pursuant to section 1402(c)(2)(E) as a trade or business for purposes of inclusion of such fees in net earnings from self-employment.

        ‘(B) DEFINITIONS- As used in this paragraph, the terms ‘State’ and ‘political subdivision’ have the meanings given those terms in section 218(b) of the Social Security Act.’.

    (c) CONFORMING AMENDMENTS-

      (1) Subsection (j) of such section 3121 (relating to covered transportation service) is repealed.

      (2) Paragraph (2) of section 3121(u) of such Code (relating to application of hospital insurance tax to Federal, State, and local employment) is amended--

        (A) in subparagraph (B), by striking ‘service is performed’ in clause (ii) and all that follows through the end of such subparagraph and inserting ‘service is service described in subsection (t)(3)(A).’; and

        (B) in subparagraph (C)(i), by inserting ‘under subsection (b)(7) as in effect in March 1994’ after ‘chapter’.

SEC. 303. EFFECTIVE DATE OF TITLE.

    Except as otherwise provided in this title, the amendments made by this title shall apply with respect to service performed after December 31, 1994.

TITLE IV--SOCIAL SECURITY PAYROLL TAX

SEC. 401. LEVEL OF OASDI TAX.

    (a) TAX ON EMPLOYEES- Subsection (a) of section 3101 of the Internal Revenue Code of 1986 (relating to tax on employees for old-age, survivors, and disability insurance) is amended in the table--

      (1) by striking the following:

‘1990 or thereafter

6.2 percent.’;

      and

      (2) by inserting the following:

‘1990 through 2019

6.2 percent

2020

6.43 percent

2021

6.66 percent

2022

6.89 percent

2023

7.12 percent

2024 through 2054

7.35 percent

2055

7.55 percent

2056

7.75 percent

2057

7.95 percent

2058 or thereafter

8.15 percent.’

    (b) TAX ON EMPLOYERS- Subsection (a) of section 3111 of such Code (relating to tax on employers for old-age, survivors, and disability insurance) is amended in the table--

      (1) by striking the following:

‘1990 or thereafter

6.2 percent.’;

      and

      (2) by inserting the following:

‘1990 through 2019

6.2 percent

2020

6.43 percent

2021

6.66 percent

2022

6.89 percent

2023

7.12 percent

2024 through 2054

7.35 percent

2055

7.55 percent

2056

7.75 percent

2057

7.95 percent

2058 or thereafter

8.15 percent.’

    (c) EFFECTIVE DATE- The amendments made by this section shall apply with respect to remuneration paid after December 31, 1994.

SEC. 402. LEVEL OF SELF-EMPLOYMENT TAX.

    (a) IN GENERAL- Subsection (a) of section 1401 of the Internal Revenue Code of 1986 (relating to rate of tax on self-employment income for old-age, survivors, and disability insurance) is amended in the table--

      (1) by striking the following:

----------------------------
----------------------------
‘December 31, 1989  12.40’; 
----------------------------
      and

      (2) by inserting the following:

-------------------------------------------
-------------------------------------------
‘December 31, 1989 January 1, 2020 12.40   
 December 31, 2019 January 1, 2021 12.86   
 December 31, 2020 January 1, 2022 13.32   
 December 31, 2021 January 1, 2023 13.78   
 December 31, 2022 January 1, 2024 14.24   
 December 31, 2023 January 1, 2055 14.70   
 December 31, 2054 January 1, 2056 15.10   
 December 31, 2055 January 1, 2057 15.50   
 December 31, 2056 January 1, 2058 15.90   
 December 31, 2057                 16.30.’ 
-------------------------------------------
    (b) EFFECTIVE DATE- The amendments made by this section shall apply with respect to taxable years beginning after December 31, 1994.