I
113th CONGRESS
1st Session
H. R. 649
IN THE HOUSE OF REPRESENTATIVES
February 13, 2013
Mr. Deutch (for himself, Ms. Kaptur, Ms. Schakowsky, Ms. Pingree of Maine, Mr. Cicilline, and Mr. Langevin) introduced the following bill; which was referred to the Committee on Ways and Means, and in addition to the Committee on Education and the Workforce, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned
A BILL
To amend title II of the Social Security Act and the Internal Revenue Code of 1986 to make improvements in the old-age, survivors, and disability insurance program, to provide for cash relief for years for which annual COLAs do not take effect under certain cash benefit programs, and to provide for Social Security benefit protection.
Short title and table of contents
Short title
This Act may cited as
the
Protecting and Preserving Social
Security Act
.
Table of contents
The table of contents of this Act is as follows:
Sec. 1. Short title and table of contents.
TITLE I—Cost-of-Living Increases
Sec. 101. Consumer price index for elderly consumers.
Sec. 102. Computation of cost-of-living increases.
TITLE II—Contribution and benefit fairness
Sec. 201. Determination of wages and self-employment income above contribution and benefit base after 2013.
Sec. 202. Inclusion of surplus earnings in social security benefit formula.
Cost-of-Living Increases
Consumer price index for elderly consumers
In General
The Bureau of Labor Statistics of the Department of Labor shall prepare and publish an index for each calendar month to be known as the Consumer Price Index for Elderly Consumers that indicates changes over time in expenditures for consumption which are typical for individuals in the United States who are 62 years of age or older.
Effective Date
Subsection (a) shall apply with respect to calendar months ending on or after July 31 of the calendar year following the calendar year in which this Act is enacted.
Authorization of Appropriations
There are authorized to be appropriated such sums as are necessary to carry out the provisions of this section .
Computation of cost-of-living increases
In general
Section 215(i) of the Social Security Act (42 U.S.C. 415(i)) is amended—
in paragraph
(1)(G), by inserting before the period the following: , and, solely with
respect to any monthly insurance benefit payable under this title to an
individual who has attained age 62, effective for adjustments under this
subsection to the primary insurance amount on which such benefit is based (or
to any such benefit under section 227 or 228) occurring after such individual
attains such age, the applicable Consumer Price Index shall be deemed to be the
Consumer Price Index for Elderly Consumers and such primary insurance amount
shall be deemed adjusted under this subsection using such Index
;
and
in paragraph (4),
by striking and by section 9001
and inserting , by
section 9001
, and by inserting after 1986,
the
following: and by section 102 of the Protecting and Preserving Social Security
Act,
.
Conforming amendments in applicable former law
Section 215(i)(1)(C) of such
Act, as in effect in December 1978 and applied in certain cases under the
provisions of such Act in effect after December 1978, is amended by inserting
before the period the following: , and, solely with respect to any
monthly insurance benefit payable under this title to an individual who has
attained age 62, effective for adjustments under this subsection to the primary
insurance amount on which such benefit is based (or to any such benefit under
section 227 or 228) occurring after such individual attains such age, the
applicable Consumer Price Index shall be deemed to be the Consumer Price Index
for Elderly Consumers and such primary insurance amount shall be deemed
adjusted under this subsection using such Index
.
Effective date
The amendments made by subsection (a) shall apply to determinations made with respect to cost-of-living computation quarters (as defined in section 215(i)(1)(B) of the Social Security Act (42 U.S.C. 415(i)(1)(B))) ending on or after September 30 of the second calendar year following the calendar year in which this Act is enacted.
Contribution and benefit fairness
Determination of wages and self-employment income above contribution and benefit base after 2013
Determination of wages above contribution and benefit base after 2013
Amendments to the Internal Revenue Code of 1986
Section 3121 of the Internal Revenue Code of 1986 is amended—
in subsection
(a)(1), by inserting the applicable percentage (determined under
subsection (c)(1)) of
before that part of the
remuneration
; and
in subsection (c), by striking
(c)
Included and excluded
service.—For purposes of this chapter, if
and
inserting the following:
Special rules for wages and employment
Applicable percentage of remuneration in determining wages
For purposes of paragraph (1) of subsection (a), the applicable percentage for a calendar year, in connection with any calendar year referred to in such subparagraph, shall be the percentage determined in accordance with the following table:
| The applicable | |
| In the case of: | percentage is: |
| Calendar year 2014 | 86% |
| Calendar year 2015 | 71% |
| Calendar year 2016 | 57% |
| Calendar year 2017 | 43% |
| Calendar year 2018 | 29% |
| Calendar year 2019 | 14% |
| Calendar years after 2019 | 0%. |
Included and excluded service
For purposes of this chapter, if
.
Amendments to the Social Security Act
Section 209 of the Social Security Act (42 U.S.C. 409) is amended—
in subsection (a)(1)(I)—
by
inserting and before 2014
after 1974
; and
by
inserting and
after the semicolon;
in subsection (a)(1), by adding at the end the following new subparagraph:
The applicable percentage (determined under subsection (l)) of that part of remuneration which, after remuneration (other than remuneration referred to in the succeeding subsections of this section) equal to the contribution and benefit base (determined under section 230) with respect to employment has been paid to an individual during any calendar year after 2013 with respect to which such contribution and benefit base is effective, is paid to such individual during such calendar year;
; and
by adding at the end the following new subsection:
For purposes of subparagraph (J) of subsection (a)(1), the applicable percentage for a calendar year, in connection with any calendar year referred to in such subparagraph, shall be the percentage determined in accordance with the following table:
| The applicable | |
| In the case of: | percentage is: |
| Calendar year 2014 | 86% |
| Calendar year 2015 | 71% |
| Calendar year 2016 | 57% |
| Calendar year 2017 | 43% |
| Calendar year 2018 | 29% |
| Calendar year 2019 | 14% |
| Calendar years after 2019 | 0%. |
.
Effective date
The amendments made by this subsection shall apply with respect to remuneration paid in calendar years after 2013.
Determination of self-Employment income above contribution and benefit base after 2013
Amendments to the Internal Revenue Code of 1986
Section 1402 of the Internal Revenue Code of 1986 is amended—
in subsection
(b)(1), by inserting an amount equal to the applicable percentage (as
determined under subsection (d)(2)) of
before that part of the
net earnings from self-employment
; and
in subsection (d)—
by
striking
(d) Employee and
wages.—The term
and inserting the following:
Rules and definitions
Employee and wages
The term
; and
by adding at the end the following:
Applicable percentage of net earnings from self-employment in determining self-employment income
For purposes of paragraph (1) of subsection (b), the applicable percentage for a taxable year beginning in any calendar year referred to in such paragraph shall be the percentage determined in accordance with the following table:
| The applicable | |
| In the case of: | percentage is: |
| Calendar year 2014 | 86% |
| Calendar year 2015 | 71% |
| Calendar year 2016 | 57% |
| Calendar year 2017 | 43% |
| Calendar year 2018 | 29% |
| Calendar year 2019 | 14% |
| Calendar years after 2019 | 0%. |
.
Amendments to the Social Security Act
Section 211 of the Social Security Act (42 U.S.C. 411) is amended—
in subsection (b)(1)(I)—
by striking or
after the
semicolon; and
by
inserting and before 2014
after 1974
;
in subsection (b)—
by redesignating paragraph (2) as paragraph (3); and
by inserting after paragraph (1) the following:
For any taxable year beginning in any calendar year after 2013, an amount equal to the applicable percentage (as determined under subsection (l)) of that part of net earnings from self-employment which is in excess of (A) an amount equal to the contribution and benefit base (determined under section 230) that is effective for such calendar year, minus (B) the amount of the wages paid to such individual during such taxable year; or
; and
by adding at the end the following:
For purposes of paragraph (2) of subsection (b), the applicable percentage for a taxable year beginning in any calendar year referred to in such paragraph, shall be the percentage determined in accordance with the following table:
| The applicable | |
| In the case of: | percentage is: |
| Calendar year 2014 | 86% |
| Calendar year 2015 | 71% |
| Calendar year 2016 | 57% |
| Calendar year 2017 | 43% |
| Calendar year 2018 | 29% |
| Calendar year 2019 | 14% |
| Calendar years after 2019 | 0%. |
.
Effective date
The amendments made by this subsection shall apply with respect to taxable years beginning during or after calendar year 2014.
Inclusion of surplus earnings in social security benefit formula
Inclusion of surplus average indexed monthly earnings in determination of primary insurance amounts
In general
Section 215(a)(1)(A) of the Social Security Act (42 U.S.C. 415(a)(1)(A)) is amended—
in clauses (i),
(ii), and (iii), by inserting basic
before average
indexed monthly earnings
each place it appears;
in clause (ii), by
striking and
at the end; and
by inserting after clause (iii) the following new clauses:
3 percent of the individual’s surplus average indexed monthly earnings to the extent such surplus average indexed monthly earnings do not exceed the excess of the amount established for purposes of this clause by subparagraph (B) over 1/12 of the contribution and benefit base for the last of such individual’s computation base years, and
0.25 percent of the sum of the individual’s surplus average indexed monthly earnings plus 1/12 of the contribution and benefit base for the last of such individual’s computation base years, to the extent such sum exceeds the amount established for purposes of clause (iv) by subparagraph (B).
.
Bend point for surplus earnings
Section 215(a)(1)(B) of such Act (42 U.S.C. 415(a)(1)(B)) is amended—
in clause (ii), by
striking the amounts so established
and inserting the
amounts established for purposes of clauses (i) and (ii) of subparagraph
(A)
;
by redesignating clause (iii) as clause (v);
in clause (v) (as redesignated), by
inserting or (iv)
after
clause (ii)
; and
by inserting after clause (ii) the following new clauses:
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 2014, the amount established for purposes of clause (iv) of subparagraph (A) shall be $11,358.
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 2014, the amount established for purposes of clause (iv) of subparagraph (A) shall equal the product of the amount established with respect to the calendar year 2014 under clause (iii) of this subparagraph and the quotient obtained by dividing—
the national average wage index (as defined in section 209(k)(1)) for the second calendar year preceding the calendar year for which the determination is made, by
the national average wage index (as so defined) for 2012.
.
Basic AIME and surplus AIME
Basic AIME
Section 215(b)(1) of such Act (42 U.S.C. 415(b)(1)) is amended—
by inserting basic
before
average
; and
in subparagraph
(A), by striking
paragraph (3)
and inserting
paragraph
(3)(A)
and by inserting before the comma the following: to the
extent such total does not exceed the contribution and benefit base for the
applicable year
.
Surplus AIME
In general
Section 215(b)(1) of such Act (as amended by paragraph (1)) is amended—
by redesignating subparagraphs (A) and (B) as clauses (i) and (ii), respectively;
by
inserting
(A)
after
(b)(1)
; and
by adding at the end the following new subparagraph:
An individual’s surplus average indexed monthly earnings shall be equal to the quotient obtained by dividing—
the total (after adjustment under paragraph (3)(B)) of such individual’s surplus earnings (determined under clause (ii)) for such individual’s benefit computation years (determined under paragraph (2)), by
the number of months in those years.
For purposes of clause (i) and paragraph (3)(B), an individual’s surplus earnings for a benefit computation year are the total of such individual’s wages paid in and self-employment income credited to such benefit computation year, to the extent such total (before adjustment under paragraph (3)(B)) exceeds the contribution and benefit base for such year.
.
Conforming amendment
The heading for section 215(b) of such Act is amended
by striking Average Indexed Monthly Earnings
and inserting
Basic Average Indexed Monthly Earnings; Surplus Average Indexed Monthly
Earnings
.
Adjustment of surplus earnings for purposes of determining surplus AIME
Section 215(b)(3) of such Act (42 U.S.C. 415(b)(3)) is amended—
in subparagraph
(A), by striking
subparagraph (B)
and inserting
subparagraph (C)
and by inserting and determination of
basic average indexed monthly income
after
paragraph
(2)
;
by redesignating subparagraph (B) as subparagraph (C); and
by inserting after subparagraph (A) the following new subparagraph:
For purposes of determining under paragraph (1)(B) an individual’s surplus average indexed monthly earnings, the individual’s surplus earnings (described in paragraph (2)(B)(ii)) for a benefit computation year shall be deemed to be equal to the product of—
the individual’s surplus earnings for such year (as determined without regard to this subparagraph), and
the quotient described in subparagraph (A)(ii).
.
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 2013.
