[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[S. 2304 Introduced in Senate (IS)]







106th CONGRESS
  2d Session
                                S. 2304

To amend the Internal Revenue Code of 1986 to phase out the taxation of 
                       social security benefits.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             March 28, 2000

  Mr. Shelby introduced the following bill; which was read twice and 
                  referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL


 
To amend the Internal Revenue Code of 1986 to phase out the taxation of 
                       social security benefits.

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

SECTION 1. PHASEOUT OF TAXATION OF SOCIAL SECURITY BENEFITS.

    (a) Repeal of Increase in Tax on Social Security Benefits.--
            (1) In general.--Paragraph (2) of section 86(a) of the 
        Internal Revenue Code of 1986 (relating to social security and 
        tier 1 railroad retirement benefits) is amended by adding at 
        the end the following new flush sentence:
        ``This paragraph shall not apply to any taxable year beginning 
        after December 31, 1999.''
            (2) Effective date.--The amendment made by this subsection 
        shall apply to taxable years beginning after December 31, 1999.
    (b) Phaseout of Base Tax.--
            (1) In general.--Subsection (a) of section 86 of the 
        Internal Revenue Code of 1986 (relating to social security and 
        tier 1 railroad retirement benefits) is amended by adding at 
        the end the following new paragraph:
            ``(3) Phaseout of base tax.--In the case of any taxable 
        year beginning in a calendar year after 2000 and before 2005, 
        paragraph (1) shall be applied by substituting the percentage 
        determined under the following table for `one-half' each place 
        it appears:

        ``In the case of a taxable
                                                                       
          year beginning in cal-
                                                                       
          endar year:
                                                     The percentage is:
                2001.................................       40 percent 
                2002.................................       30 percent 
                2003.................................       20 percent 
                2004.................................     10 percent.''
            (2) Termination of base tax.--Paragraph (1) of section 
        86(a) of such Code is amended by adding at the end the 
        following new flush sentence:
        ``This paragraph shall not apply to any taxable year beginning 
        after December 31, 2004.''
            (3) Effective date.--The amendments made by this subsection 
        shall apply to taxable years beginning after December 31, 2000.
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