[Congressional Bills 108th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3868 Introduced in House (IH)]






108th CONGRESS
  2d Session
                                H. R. 3868

To amend the Internal Revenue Code of 1986 to phaseout the 1993 income 
               tax increase on Social Security benefits.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             March 2, 2004

   Mr. Smith of New Jersey introduced the following bill; which was 
              referred to the Committee on Ways and Means

_______________________________________________________________________

                                 A BILL


 
To amend the Internal Revenue Code of 1986 to phaseout the 1993 income 
               tax increase on Social Security benefits.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Social Security Tax Hike Phaseout 
Act of 2004''.

SEC. 2. PHASEOUT OF 1993 INCOME TAX INCREASE ON SOCIAL SECURITY 
              BENEFITS.

    (a) In General.--Paragraph (2) of section 86(a) of the Internal 
Revenue Code of 1986 is amended--
            (1) by inserting ``of taxable years beginning before 
        January 1, 2009,'' after ``In the case'', and
            (2) by striking ``85 percent'' each place it appears and 
        inserting ``the applicable percentage''.
    (b) Applicable Percentage.--Subsection (c) of section 86 of such 
Code is amended by adding at the end the following new paragraph:
            ``(3) Applicable percentage.--The term `applicable 
        percentage' means the percentage determined in accordance with 
        the following table:

``For taxable years beginning                           The applicable 
  in calendar year--                                    percentage is--
        2005...................................................     75 
        2006...................................................     70 
        2007...................................................     65 
        2008...................................................   60''.
    (c) Conforming Amendments.--
            (1) Subparagraph (A) of section 871(a)(3) of such Code is 
        amended by striking ``85 percent'' and inserting ``50 percent 
        (in the case of calendar years 2005 through 2008, the 
        applicable percentage determined under section 86(c)(3) with 
        respect to such calendar year)''.
            (2) Subparagraph (A) of section 121(e)(1) of the Social 
        Security Amendments of 1983 (Public Law 98-21) is amended by 
        inserting ``(as modified by the amendments made by the Social 
        Security Tax Hike Phaseout Act of 2004)'' before the period at 
        the end.
            (3) The heading of subsection (c) of section 86 of such 
        Code is amended to read as follows: ``Definitions.--''.
    (d) Effective Dates.--
            (1) In general.--Except as otherwise provided in this 
        subsection, the amendments made by this section shall apply to 
        taxable years beginning after December 31, 2004.
            (2) Subsection (c)(1).--The amendment made by subsection 
        (c)(1) shall apply to benefits paid after December 31, 2004.
            (3) Subsection (c)(2).--The amendment made by subsection 
        (c)(2) shall apply to tax liabilities for taxable years 
        beginning after December 31, 2004.

SEC. 3. MAINTENANCE OF TRANSFERS TO HOSPITAL INSURANCE TRUST FUND.

    (a) In General.--There are hereby appropriated to the Federal 
Hospital Insurance Trust Fund established under section 1817 of the 
Social Security Act amounts equal to the reduction in revenues to the 
Treasury by reason of the enactment of this Act. Amounts appropriated 
by the preceding sentence shall be transferred from the general fund at 
such times and in such manner as to replicate to the extent possible 
the transfers which would have occurred to such Trust Fund had this Act 
not been enacted.
    (b) Reports.--The Secretary of the Treasury or the Secretary's 
delegate shall annually report to the Committee on Ways and Means of 
the House of Representatives and the Committee on Finance of the Senate 
the amounts and timing of the transfers under this section.
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