1.This Act may be cited as the
Seniors Financial Security Act of
2011
.
2.Repeal of
inclusion in gross income of Social Security benefits and tier 1 railroad
retirement benefits
(a)Section 86 of the Internal Revenue Code of 1986 (relating
to taxation of Social Security and tier 1 railroad retirement benefits) is
hereby repealed.
(b)Technical and
Conforming Amendments
(1)Subparagraph (B)
of section 22(c)(3) of such Code (relating to treatment of certain workmen’s
compensation benefits) is amended by striking any amount treated as a
social security benefit under section 86(d)(3)
and inserting if,
by reason of section 224 of the Social Security
Act (or by reason of section 3(a)(1) of the Railroad Retirement Act
of 1974), any benefit otherwise payable under title II of the
Social Security Act or the Railroad
Retirement Act of 1974 is reduced by reason of the receipt of a benefit under a
workmen’s compensation act, the portion of such benefit received under the
workmen’s compensation act which equals such reduction
.
(2)Paragraph (3) of section 72(r) of such Code
(defining tier 1 railroad retirement benefit) is amended by striking has
the meaning given such term by section 86(d)(4)
and
inserting
means—(A)the amount of the
annuity under the Railroad Retirement Act of 1974 equal to the amount of the
benefit to which the taxpayer would have been entitled under the
Social Security Act if all of the
service after December 31, 1936, of the employee (on whose employment record
the annuity is being paid) had been included in the term
employment as defined in the Social
Security Act, and
(B)a monthly annuity
amount under section 3(f)(3) of the Railroad Retirement Act of
1974.
.
(3)Section
135(c)(4)(B) of such Code is amended by striking 86, 469,
and
inserting 469
.
(4)Sections
137(b)(3)(B), 199(d)(2)(A), 221(b)(2)(C)(ii), and 222(b)(2)(C)(ii) of such Code
are each amended by striking 86,
.
(5)Clause (i) of
section 219(g)(3)(A) of such Code is amended by striking sections 86 and
469
and inserting section 469
.
(6)Subparagraph (F)
of section 469(i)(3) of such Code is amended by striking clause (i) and by
redesignating clauses (ii), (iii), and (iv) as clauses (i), (ii), and (iii),
respectively.
(7)Section 861(a) of
such Code is amended by striking paragraph (8) and by redesignating paragraph
(9) as paragraph (8).
(8)Paragraph (3) of
section 871(a) of such Code (relating to taxation of Social Security benefits
by nonresident aliens) is hereby repealed.
(9)Subsection (g) of
section 1441 of such Code (relating to withholding of tax on nonresident
aliens) is hereby repealed.
(10)Subparagraph (C)
of section 3402(p)(1) of such Code is amended by striking clause (i) and by
redesignating clauses (ii), (iii), and (iv) as clauses (i), (ii), and (iii),
respectively.
(11)Paragraph (4) of
section 6015(d) of such Code is amended by striking the last sentence.
(12)Section 6050F of
such Code (relating to returns relating to Social Security benefits) is hereby
repealed.
(13)Paragraph (1) of
section 6050G(a) of such Code (relating to returns relating to certain railroad
retirement benefits) is amended by striking section 86(d)(4)
and
inserting section 72(r)(3)
.
(14)(A)Section 6103(h) of such
Code (relating to disclosure) is amended by striking paragraph (5) and by
redesignating paragraph (6) as paragraph (5).
(B)Paragraph (4) of section 6103(p) of
such Code is amended by striking (h)(5),
each place it
appears.
(C)Subsection (k) of section 1113 of the
Right to Financial Privacy Act of
1978 is hereby repealed.
(15)The table of
sections for part II of subchapter B of chapter 1 of such Code is amended by
striking the item relating to section 86.
(16)The table of
sections for subpart B of part III of subchapter A of chapter 61 of such Code
is amended by striking the item relating to section 6050F.
(c)The amendments made by this section shall apply to benefits
received after December 31, 2010, in taxable years ending after such
date.
(d)Trust Funds Held
HarmlessThere are hereby appropriated (out of any money in the
Treasury not otherwise appropriated) for each fiscal year to each fund under
the Social Security Act or the
Railroad Retirement Act of 1974 an amount equal to the reduction in the
transfers to such fund for such fiscal year by reason of the amendments made by
this section.