1.Short title and table of
contents
(a)This Act may be cited as the Savings Account for Every American Act of
2011
.
(b)The table of contents is as follows:
Sec. 1. Short title and table of contents.
TITLE I—Personal retirement program
Sec. 101. Definitions.
Sec. 102. S.A.F.E. account payroll deduction
programs.
Sec. 103. Designation of S.A.F.E. accounts.
Sec. 104. Self-employed individuals.
Sec. 105. Elective participation.
Sec. 106. Penalties.
Sec. 107. Federal civilian and military personnel.
TITLE II—Tax-exempt S.A.F.E. accounts
Sec. 201. S.A.F.E. accounts.
Sec. 202. Effective date.
TITLE III—Conforming amendments to the Social Security Act and
the Internal Revenue Code of 1986
Sec. 301. Reductions in and exemptions from FICA taxes and SECA
taxes with respect to eligible individuals.
Sec. 302. Exclusion of eligible individuals from old-age,
survivors, and disability insurance coverage.
Sec. 303. Information provided in social security account
statements.
<enum>I</enum><header>Personal
retirement program</header>
<section id="H2FD6740A372A4E2093042842F22655E5"><enum>101.</enum><header>Definitions</header><text display-inline="no-display-inline">For purposes of this title—</text>
<paragraph id="H06BCA752491440129B1AFAF1FAA62D27"><enum>(1)</enum><header>Account
holder</header><text>The term <term>account holder</term> means, with respect
to any S.A.F.E. account, the individual for whose benefit such account is
maintained.</text>
</paragraph><paragraph id="H29101A11BD2047818CE5B4F87B9AEB8B"><enum>(2)</enum><header>Business
day</header><text>The term <term>business day</term> means any day other than a
Saturday, Sunday, or legal holiday in the area involved.</text>
</paragraph><paragraph id="HA6AA3AEE3CC44D2C9E45C9CC3A5CDD70"><enum>(3)</enum><header>Covered
employer</header><text>The term <term>covered employer</term> means, for any
calendar year, a person for whom an eligible individual is engaged in
employment during the year.</text>
</paragraph><paragraph id="H370351E94D154154AB17F98A158D9988"><enum>(4)</enum><header>Eligible
individual</header><text>The term <term>eligible individual</term> means any
individual with respect to whom there is in effect an election under section
105(a).</text>
</paragraph><paragraph id="H0D41350237BA44FF99B515C6E43FEA79"><enum>(5)</enum><header>Employment</header><text>The
term <term>employment</term> has the meaning provided in section 210 of the
<act-name parsable-cite="SSA">Social Security Act</act-name>.</text>
</paragraph><paragraph id="HAEB5220F186E4CC59DE78E7B91A4EAC6"><enum>(6)</enum><header>Prescribed
employee contribution</header><text>The term <term>prescribed employee
contribution</term> means, with respect to any eligible individual who is
engaged in employment for a covered employer during any calendar year, an
amount equal to 6.2 percent of the wages received by such employee with respect
to such employment. The Commissioner of Social Security shall provide by
regulation for exclusion of remuneration paid to any employee during any
calendar year from the total amount of remuneration treated under this
paragraph as <quote>wages</quote> paid to such employee during such calendar
year to the extent that such total amount exceeds the contribution and benefit
base for such calendar year under section 230 of the Social Security
Act.</text>
</paragraph><paragraph id="H189AD46FA5134735A16A569FD6FD5366"><enum>(7)</enum><header>Prescribed
self-employment contribution</header><text>The term <term>prescribed
self-employment contribution</term> means, with respect to the self-employment
income of an eligible individual for any calendar year, the excess (if any)
of—</text>
<subparagraph id="HEECFC8BF65E64BFFB7E74B80EC11EA3B"><enum>(A)</enum><text>6.2 percent of the
amount of such self-employment income for such calendar year, to the extent
that such self-employment income does not exceed, for such calendar year, the
contribution and benefit base for such calendar year under section 230 of the
<act-name parsable-cite="SSA">Social Security Act</act-name>, over</text>
</subparagraph><subparagraph id="HEECE2339A4E446ED803BC006A01054DD"><enum>(B)</enum><text>the total of all
prescribed employee contributions and prescribed employer contributions payable
with respect to such eligible individual for such calendar year.</text>
</subparagraph><continuation-text continuation-text-level="paragraph">Effective
with the commencement of the 16th calendar year for which the eligible
individual’s election under section 105 is in effect, <quote>12.4
percent</quote> shall be substituted for <quote>6.2 percent</quote> in
subparagraph (A).</continuation-text></paragraph><paragraph id="HC016A118F3004AF381D42EF8E20B37C9"><enum>(8)</enum><header>Prescribed
employer contribution</header><text>The term <term>prescribed employer
contribution</term> means, with respect to any eligible individual who is
engaged in employment for a covered employer during any calendar year, an
amount equal to 6.2 percent of the wages received by such employee with respect
to such employment, to the extent that such wages do not exceed, for such
calendar year, the contribution and benefit base for such calendar year under
section 230 of the <act-name parsable-cite="SSA">Social Security
Act</act-name>.</text>
</paragraph><paragraph id="H08C17BA8A08B43DFAD08BE9FBE8FA945"><enum>(9)</enum><header>S.A.F.E.
account</header><text>The term <term>S.A.F.E. account</term> has the meaning
provided in section 224(c) of the Internal Revenue Code of 1986.</text>
</paragraph><paragraph id="HF2B017F7B259438E89BD6FA28AA2EA8A"><enum>(10)</enum><header>Self-employment
income</header><text>The term <term>self-employment income</term> has the
meaning provided in section 211(b) of the <act-name parsable-cite="SSA">Social
Security Act</act-name>.</text>
</paragraph><paragraph id="H45CEF1AC15C342C99AA2D5A6D25770AA"><enum>(11)</enum><header>Wages</header><text>The
term <term>wages</term> has the meaning provided in section 209 of the
<act-name parsable-cite="SSA">Social Security Act</act-name>.</text>
</paragraph></section><section id="H620F07A56C2B422EB48151C208506AE6"><enum>102.</enum><header>S.A.F.E.
account payroll deduction programs</header>
<subsection id="H676EE34B17EC4E83BBE53E9BEB27D0E7"><enum>(a)</enum><header>In
general</header><text>Each person who is a covered employer for any calendar
year shall have in effect throughout such calendar year a S.A.F.E. account
payroll deduction program for such person’s employees who are eligible
individuals.</text>
</subsection><subsection id="H630F3A62EE494C4A9CB4CAF1B7ED7773"><enum>(b)</enum><header>Requirements</header><text>For
purposes of this Act, the term <term>S.A.F.E. account payroll deduction
program</term> means a written program maintained by a covered employer
if—</text>
<paragraph id="H4C42BCD2AA1D4E638DD42DF1A3A69CE1"><enum>(1)</enum><text>under such
program, the prescribed employee contribution is deducted from the wages of
each employee who is an eligible individual and paid as a contribution on
behalf of the employee to a S.A.F.E. account of such employee designated in
accordance with section 103,</text>
</paragraph><paragraph id="H9CDC24985CE2446C8E9FE4BFA4E0F56A"><enum>(2)</enum><text>under such
program, the covered employer—</text>
<subparagraph id="HD324E96E28A240C59FC9ECF50636556F"><enum>(A)</enum><text>makes timely
payment of the amount so deducted as a contribution to the designated S.A.F.E.
account, and</text>
</subparagraph><subparagraph id="H7E1DC68A677C4A68BA73D5880B1A9215"><enum>(B)</enum><text>effective upon
receipt from the eligible individual of certification (in accordance with
regulations which shall be prescribed by the Commissioner of Social Security)
of the commencement of the 16th calendar year for which the eligible employee’s
election under section 105 has been in effect, makes timely payment, together
with the amount so deducted, of the prescribed employer contribution with
respect to the eligible individual,</text>
</subparagraph><continuation-text continuation-text-level="paragraph">under
regulations of the Commissioner of Social Security applying the same principles
relating to the timeliness of payment as are applicable under chapter 62 of the
Internal Revenue Code of 1986 with respect to taxes under chapter 21 of such
Code, and</continuation-text></paragraph><paragraph id="H075555E95AAF47879B0FF26501CE500A"><enum>(3)</enum><text>the employer
receives no compensation for the cost of administering such program.</text>
</paragraph></subsection><subsection id="HD4B90CB70E2F4071B0C526564543F843"><enum>(c)</enum><header>Amounts
otherwise payable may be accumulated by employer in certain
cases</header><text>If, under the terms of the governing instruments creating a
S.A.F.E. account designated under section 103, contributions below a specified
amount will not be accepted, the requirements of subsection (b)(2) shall be
treated as met if amounts deducted from the wages of an employee who is an
eligible individual, together with prescribed employer contributions (if any),
are accumulated by the covered employer and paid to such account otherwise in
accordance with subsection (b)(2) with reference to the first day on which the
accumulated amount exceeds such specified amount.</text>
</subsection></section><section id="HB78ECCCFAEF44DF491545733A2087986"><enum>103.</enum><header>Designation of
S.A.F.E. accounts</header>
<subsection id="H795AB1C020174258B513F1CFE96243F5"><enum>(a)</enum><header>In
general</header><text>Except as provided in subsection (b), a S.A.F.E. account
to which contributions with respect to any employee who is an eligible
individual are required to be paid under section 102 shall be such an account
designated by such employee to such employer not later than 10 business days
after the date on which such employee becomes an employee of such employer. Any
such designation shall be made in such form and manner as may be prescribed in
regulations of the Commissioner of Social Security.</text>
</subsection><subsection id="H14A3B5F5E24A4BFF9E87ADA79629CA17"><enum>(b)</enum><header>Designation in
absence of timely designation by employee</header><text>In any case in which no
timely designation of a S.A.F.E. account is made, the covered employer shall
designate such account in accordance with regulations of the Commissioner of
Social Security.</text>
</subsection><subsection id="HA42616FAB11C40E2B7C8950AD954C59E"><enum>(c)</enum><header>Subsequent
substitution of accounts</header><text>The Commissioner of Social Security
shall provide by regulation for subsequent designation of a S.A.F.E. account by
an account holder in lieu of an account previously designated by such account
holder under this section.</text>
</subsection></section><section id="H722FF9AF983743FA9ECD950E6ABB699F"><enum>104.</enum><header>Self-employed
individuals</header>
<subsection id="H6792A63368F44A619705B2D3E24FC6A9"><enum>(a)</enum><header>In
general</header><text>In the case of an eligible individual who has
self-employment income for any calendar year, such individual shall make timely
payments to a S.A.F.E. account designated by such individual of the prescribed
self-employment contribution with respect to such individual for such calendar
year in accordance with regulations of the Commissioner of Social Security,
applying the same principles relating to timeliness of payment as are
applicable under chapter 62 of the Internal Revenue Code of 1986 with respect
to taxes under chapter 2 of such Code.</text>
</subsection><subsection id="HEDA5D214F8354BD885E547C599C99E08"><enum>(b)</enum><header>Designation of
account</header><text>The designation of a S.A.F.E. account for payment of
prescribed self-employment contributions shall be made in such form and manner
as may be prescribed in regulations of the Commissioner of Social
Security.</text>
</subsection><subsection id="HE7AB957AACA8400CBAAD7F8F213156FC"><enum>(c)</enum><header>Periodic
payment</header><text>The Commissioner of Social Security shall provide by
regulation for periodic installment payments during the calendar year of
prescribed self-employment contributions for each eligible individual, taking
into account, as appropriate for each period, prescribed employee contributions
for such individual.</text>
</subsection></section><section id="H0E66FC50014F4630BDF4F819DCE65A36"><enum>105.</enum><header>Elective
participation</header>
<subsection id="HFBF68396ADD74154A0A739EAC58B8668"><enum>(a)</enum><header>Election</header><text>Any
individual who has been assigned a social security account number under section
205(c)(2)(B) of the <act-name parsable-cite="SSA">Social Security
Act</act-name> and has been paid wages or has derived self-employment income
may, on or after January 1, 2012, elect under this section to be an eligible
individual for purposes of this Act. Any such election shall be made by filing
with the Commissioner of Social Security, the Secretary of the Treasury, and
each person (if any) who is an employer of such individual on the date of the
filing, in such form and manner as shall be prescribed in regulations of the
Commissioner (in consultation with the Secretary of the Treasury), a written
and signed declaration of such individual’s intention to be treated as an
eligible individual for purposes of this Act. An election under this section
shall be effective with respect to wages paid, and self-employment income
derived, on or after January 1 following the date of the filing of the
election.</text>
</subsection><subsection id="HC20FC21ADEDA4507BEE6969AB0CB0FD3"><enum>(b)</enum><header>Election
ineffective if entitled to social security benefits</header><text>Any election
under this section shall not take effect if, as of the effective date of the
election, the individual is entitled to an old-age insurance benefit under
section 202(a) of the <act-name parsable-cite="SSA">Social Security
Act</act-name> or to a disability insurance benefit under section 223 of such
Act.</text>
</subsection><subsection id="H02EC9F7E64194B918D54F05686C24F89"><enum>(c)</enum><header>Irrevocability
subject to grace period</header>
<paragraph id="HBBC3BCADB88844D292BC21B1FC19DAC2"><enum>(1)</enum><header>In
general</header><text>Unless revoked in accordance with paragraph (2), an
election under this section shall be irrevocable.</text>
</paragraph><paragraph id="H8105ACB921CB461AB8452C84C7803CE9"><enum>(2)</enum><header>Five-year grace
period</header>
<subparagraph id="H63DB863D096B4FEB9237787441724681"><enum>(A)</enum><header>In
general</header><text display-inline="yes-display-inline">An individual may
revoke an election under this section by filing with the Commissioner of Social
Security, the Secretary of the Treasury, and each person (if any) who is an
employer of such individual on the date of the filing, in such form and manner
as shall be prescribed in regulations of the Commissioner (in consultation with
the Secretary of the Treasury), a written and signed revocation of the election
at any time before the end of the five-year period beginning with the effective
date of the election. A revocation under this subsection shall take effect
January 1 following the date of the filing of the revocation, except that a
revocation filed during the 90-day period beginning with the date of the filing
of the election shall take effect as of the effective date of the election.
Upon the effective date of a revocation under this subsection, entitlement to
benefits under title II of the <act-name parsable-cite="SSA">Social Security
Act</act-name> shall be determined as if the revoked election had not occurred,
except that, for purposes of any such entitlement, wages paid, and
self-employment income derived, during the period for which the election was in
effect shall not be taken into account. No subsequent election under this
section may take effect with respect to an individual who has filed a
revocation under this subsection (except a revocation filed during the 90-day
period beginning with the date of the filing of the election).</text>
</subparagraph><subparagraph id="H1F4B1EA2601342649633E1A09A7187EF"><enum>(B)</enum><header>Reduction in
benefits</header><text>The primary insurance amount, as determined under
section 215 of the <act-name parsable-cite="SSA">Social Security
Act</act-name>, of any individual who has filed a revocation under this
subsection before the end of the five-year period described in subparagraph (A)
(and after the 90-day period referred to in subparagraph (A)) shall be reduced
(except for purposes of determining benefits under section 223 of such Act, and
before any application of section 215(i) of such Act) by the applicable
percentage specified in the following table:</text>
<table align-to-level="section" blank-lines-before="1" colsep="0" frame="none" line-rules="no-gen" rowsep="0" rule-weights="0.0.0.0.0.0" table-template-name="Generic: 2 text, 1st longer" table-type="Leaderwork">
<tgroup cols="2" grid-typeface="1.1" no-carding="1" rowsep="0" thead-tbody-ldg-size="10.10.12"><colspec coldef="txt" colname="column1" colwidth="406pts" min-data-value="200"></colspec><colspec coldef="fig" colname="column2" colwidth="179pts" min-data-value="15"></colspec>
<thead>
<row><entry align="left" colname="column1" morerows="0" namest="column1"><bold>If the first calendar year for</bold></entry><entry align="center" colname="column2" morerows="0" namest="column2"></entry>
</row>
<row><entry align="left" colname="column1" morerows="0" namest="column1"><bold> which the revocation </bold></entry><entry align="right" colname="column2" morerows="0" namest="column2"><bold>The
applicable</bold></entry>
</row>
<row><entry align="left" colname="column1" morerows="0" namest="column1"><bold> is effective is:</bold></entry><entry align="right" colname="column2" morerows="0" namest="column2"><bold> percentage
is:</bold></entry>
</row>
</thead>
<tbody>
<row><entry align="left" colname="column1" leader-modify="force-ldr-bottom" stub-definition="txt-ldr" stub-hierarchy="1">The first, second, or third calendar year of such five-year
period</entry><entry align="right" colname="column2" leader-modify="clr-ldr">20
percent</entry>
</row>
<row><entry align="left" colname="column1" leader-modify="force-ldr-bottom" stub-definition="txt-ldr" stub-hierarchy="1">The fourth calendar year of such five-year
period</entry><entry align="right" colname="column2" leader-modify="clr-ldr">40
percent</entry>
</row>
<row><entry align="left" colname="column1" leader-modify="force-ldr-bottom" stub-definition="txt-ldr" stub-hierarchy="1">The fifth calendar year of such five-year
period</entry><entry align="right" colname="column2" leader-modify="clr-ldr">60
percent</entry>
</row>
<row><entry align="left" colname="column1" leader-modify="force-ldr-bottom" stub-definition="txt-ldr" stub-hierarchy="1">The calendar year following such five-year
period</entry><entry align="right" colname="column2" leader-modify="clr-ldr">80
percent.</entry>
</row>
</tbody>
</tgroup>
</table>
</subparagraph></paragraph></subsection></section><section id="H5F2716C1F81040EBB173702EDF9A3625"><enum>106.</enum><header>Penalties</header>
<subsection id="H1EA67601591F44D3977AB8F824D8A1D3"><enum>(a)</enum><header>Failure To
establish S.A.F.E. account payroll deduction program</header><text>Any covered
employer who fails to meet the requirements of section 102 for any calendar
year shall be subject to a civil penalty of not to exceed—</text>
<paragraph id="HE9D1154720B04852BD1E0C1C89796CF0"><enum>(1)</enum><text>$250,000, in the
case of an employer who is an individual, or</text>
</paragraph><paragraph id="HF116D13BE9E54830B3EFD0F2F90A42CE"><enum>(2)</enum><text>$500,000, in any
other case.</text>
</paragraph></subsection><subsection id="H132BD0A39508464C938F952A25D7FB3D"><enum>(b)</enum><header>Failure To make
deductions required under program</header><text>Any covered employer who fails
to timely deduct in full the amount from the wages of an employee who is an
eligible individual as required under an applicable S.A.F.E. account payroll
deduction program shall be subject to a civil penalty for each such failure of
not to exceed—</text>
<paragraph id="H7F33776A7A2A434FA7E41682403B2945"><enum>(1)</enum><text>$250,000, in the
case of an employer who is an individual, or</text>
</paragraph><paragraph id="HFC2EC312BDD3450CBA5DC7E2125019FB"><enum>(2)</enum><text>$500,000, in any
other case.</text>
</paragraph></subsection><subsection id="H632EF97ADD22457393807CBFC8603FA5"><enum>(c)</enum><header>Failure To pay
deducted wages to S.A.F.E. account</header><text>If an amount deducted under a
S.A.F.E. account payroll deduction program from the wages of an employee who is
an eligible individual is not timely paid in full to the designated S.A.F.E.
account in accordance with section 102, the covered employer failing to make
such payment—</text>
<paragraph id="H63D6D663886943979D79F590133E1029"><enum>(1)</enum><text>shall be subject
to a civil penalty for each such failure of not to exceed—</text>
<subparagraph id="H442059F885974AE89ABE622AD48481FC"><enum>(A)</enum><text>$250,000, in the
case of an employer who is an individual, or</text>
</subparagraph><subparagraph id="HF5343F764FC74A9D9EB2602ADBD4553E"><enum>(B)</enum><text>$500,000, in any
other case, and</text>
</subparagraph></paragraph><paragraph id="H65A5553CA5C44E3FB5C0B10B2570A829"><enum>(2)</enum><text>shall be liable to
the employee for interest on the unpaid amount at a rate equal to 10 percentage
points in excess of the Federal short-term rate under section 1274(d)(1) of the
Internal Revenue Code of 1986, calculated from the last day by which such
amount was required to be so paid to the date on which such amount is paid into
the designated S.A.F.E. account.</text>
</paragraph></subsection><subsection id="HFD472227AB0F4621897E5B3EC67FCCC6"><enum>(d)</enum><header>Failure To pay
prescribed self-Employment contributions to S.A.F.E. account</header><text>Any
eligible individual failing to timely pay in full a prescribed self-employment
contribution to a designated S.A.F.E. account as required under section 104
shall be subject to a civil penalty for each such failure of not to exceed
$250,000, plus interest on the unpaid amount at a rate equal to 10 percentage
points in excess of the Federal short-term rate under section 1274(d)(1) of the
Internal Revenue Code of 1986, calculated from the last day by which such
amount was required to be so paid to the date on which such amount is paid into
the designated S.A.F.E. account.</text>
</subsection><subsection id="H756057765B4646BBBC92408351644D33"><enum>(e)</enum><header>Rules for
application of section</header>
<paragraph id="HA1DC34D7BBC448E0B6AC88618FDA558C"><enum>(1)</enum><header>Penalties
assessed by Commissioner of Social Security</header><text>Any civil penalty
assessed by this section shall be imposed by the Commissioner of Social
Security and collected in a civil action.</text>
</paragraph><paragraph id="H3D153DB4DEAB487CA74E1FE4B58C3CC6"><enum>(2)</enum><header>Compromises</header><text>The
Commissioner may compromise the amount of any civil penalty imposed by this
section.</text>
</paragraph><paragraph id="HEC30EA1D1D344C4998B4CE335BC320F5"><enum>(3)</enum><header>Authority to
waive penalty in certain cases</header><text>The Commissioner may waive the
application of this section with respect to any failure if the Commissioner
determines that such failure is due to reasonable cause and not to intentional
disregard of rules and regulations.</text>
</paragraph></subsection></section><section id="HC84779E7A0904C96B82FBCA14A5867BF"><enum>107.</enum><header>Federal
civilian and military personnel</header>
<subsection id="HEAA654BAD28240BD9BDD47AC58D8F5E1"><enum>(a)</enum><header>In
general</header><text>Not later than December 31, 2011, the Office of Personnel
Management, after appropriate study, shall submit to the President and each
House of Congress a written report containing recommendations on how to provide
for the application of this Act with respect to Federal civilian and military
personnel.</text>
</subsection><subsection id="H91F4C2F01D4F4722803F39845022B150"><enum>(b)</enum><header>Requirements</header><text>The
report—</text>
<paragraph id="H5705988D280D4A64BC48942DCEE5CC57"><enum>(1)</enum><text>shall be prepared
in consultation with the Social Security Administration, the Securities and
Exchange Commission, and other appropriate agencies; and</text>
</paragraph><paragraph id="H8F69AEB505F0462A8D04904469DCFFAF"><enum>(2)</enum><text>shall be
accompanied by draft legislation which, if enacted, would carry out the
recommendations contained in such report.</text>
</paragraph></subsection><subsection id="H0A4F8F1DF7C749E38D1096F2B7063566"><enum>(c)</enum><header>Provisions
relating to the continued operation of existing retirement
systems</header><text>To the extent that the report and draft legislation
relate to provisions of law in effect before the date of enactment of this Act,
each shall address at least the following:</text>
<paragraph id="H9E7E686F51E045D9ADBE66C2F129A577"><enum>(1)</enum><header>Federal
employees’ retirement system</header>
<subparagraph id="H55E96051C54C41D89DDB0126D5BD8521"><enum>(A)</enum><text>Section 8401(11)
of title 5, United States Code (relating to the definition of an
<quote>employee</quote>), which includes the requirement that the individual
concerned be someone whose civilian service is employment for the purposes of
title II of the <act-name parsable-cite="SSA">Social Security Act</act-name>
and chapter 21 of the Internal Revenue Code of 1986.</text>
</subparagraph><subparagraph id="H86E066A4801E4A93A67BED70385997F2"><enum>(B)</enum><text>Section 8421 of
such title (relating to annuity supplement), which includes provisions
incorporating the notion of the period of time for which the individual is or
would be entitled to old-age insurance benefits under title II of the
<act-name parsable-cite="SSA">Social Security Act</act-name>, and provisions
for computing the amount of such supplement based on the amount of certain
benefits to which the individual would be entitled under such Act.</text>
</subparagraph><subparagraph id="HCF33649FEEBF4AA3A21F5F5843FEFC0C"><enum>(C)</enum><text>Section 8442 of
such title (relating to rights of a widow or widower), which includes
provisions under which a supplementary annuity for a widow or widower is not
payable to anyone who would not be entitled to certain benefits under the
<act-name parsable-cite="SSA">Social Security Act</act-name>, and provisions
for the computation of any such annuity based on the amount of certain benefits
which would be payable to that individual under the
<act-name parsable-cite="SSA">Social Security Act</act-name>.</text>
</subparagraph><subparagraph id="HC1E8FD1844644E52B091865EBA4FF728"><enum>(D)</enum><text>Section 8443 of
such title (relating to rights of a child), which includes provisions under
which, as part of the formula for computing the amount of a survivor annuity
for a child, there is incorporated the notion of the amount of child’s
insurance benefits which are or would be payable under title II of the
<act-name parsable-cite="SSA">Social Security Act</act-name>.</text>
</subparagraph></paragraph><paragraph id="H53A6F044119F426FB1D566749C9445C6"><enum>(2)</enum><header>Civil service
retirement system</header>
<subparagraph id="H5806A5F9AD2D4B7CBBFB22D58681717C"><enum>(A)</enum><text>Section 8334(k) of
such title (relating to special rules for determining deductions and
contributions for individuals subject to <quote>offset-83</quote> treatment),
which incorporates the notion of the OASDI contribution made from Federal wages
of the individual concerned.</text>
</subparagraph><subparagraph id="H89F563DFD9F04500BF1091514C23C79B"><enum>(B)</enum><text>Section 8349 of
such title (relating to offset based on certain benefits under the
<act-name parsable-cite="SSA">Social Security Act</act-name>), which
incorporates notions relating to actual or constructive eligibility for
benefits under the <act-name parsable-cite="SSA">Social Security
Act</act-name>, and the amount of those benefits.</text>
</subparagraph></paragraph><paragraph id="H869B5F02269B4818B0C9088C12122933"><enum>(3)</enum><header>Coordination
provisions</header><text>Provisions of law involving a reduction or other
adjustment in retirement benefits (or eligibility therefor), based on any
individual’s eligibility for benefits under title II of the
<act-name parsable-cite="SSA">Social Security Act</act-name>.</text>
</paragraph><paragraph id="H11D793AE86B646F7B2B892D21B2DAD58"><enum>(4)</enum><header>Other retirement
systems</header><text>Similar provisions of law under other retirement systems
covering Federal civilian or military personnel.</text>
</paragraph></subsection><subsection id="HD8C1076BDE384DACA3DAE88A1C778C85"><enum>(d)</enum><header>Provisions
relating to the new system</header><text>To the extent that the report and
draft legislation relate to the implementation of any other title of this Act,
each shall address at least the following:</text>
<paragraph id="H3702EB84C04049B4BBBC0BF60385EB9B"><enum>(1)</enum><text>What the
specifications for the S.A.F.E. account payroll deduction program or programs
covering Federal civilian and military personnel shall be or, alternatively,
how those specifications shall be developed.</text>
</paragraph><paragraph id="H0F2B75060186485D8C4620D8466EA9DC"><enum>(2)</enum><text>Which agencies or
instrumentalities of the Federal Government shall be responsible for operating
or maintaining which aspects of the program or programs referred to in
paragraph (1).</text>
</paragraph><paragraph id="HE59E5B25123C4646A6F9EB4ED1ADC4DE"><enum>(3)</enum><text>Which penalty
provisions are appropriate or inappropriate with respect to the Federal
Government in its capacity as a <quote>covered employer</quote>, subject to
what modifications (if any).</text>
</paragraph></subsection></section><enum>II</enum><header>Tax-exempt
S.A.F.E. accounts</header>
<section id="HF07BCB32A38847488CE186DB5A4DD2CE"><enum>201.</enum><header>S.A.F.E.
accounts</header>
<subsection id="HBC139E9DC0BD4E86BFEC2231BBC44B16"><enum>(a)</enum><header>In
general</header><text>Part VII of subchapter B of chapter 1 of the Internal
Revenue Code of 1986 (relating to additional itemized deductions for
individuals) is amended by redesignating section 224 as section 225 and by
inserting after section 223 the following new section:</text>
<quoted-block id="HDF17EE077A0646C4B021526C8D3C6594">
<section id="H2CB200C0EB4E4C2B91DFB66CA7109EC9"><enum>224.</enum><header>S.A.F.E.
accounts</header>
<subsection id="H3C3DE719E6064ECD9A093424E4EB3654"><enum>(a)</enum><header>Deduction
allowed</header><text>In the case of an individual, there shall be allowed as a
deduction the aggregate amount paid in cash during the taxable year by or on
behalf of such individual to a S.A.F.E. account of such individual.</text>
</subsection><subsection id="H534AED3954EE4CFE88D0B3380543A40E"><enum>(b)</enum><header>Limitation</header><text>The
amount allowable as a deduction under subsection (a) for any taxable year shall
not exceed 6.2 percent of the lesser of—</text>
<paragraph id="H757FF64F3AC5475A938C68960218112C"><enum>(1)</enum><text>the contribution
and benefit base (as determined under section 230 of the
<act-name parsable-cite="SSA">Social Security Act</act-name>) for the calendar
year which ends with or within such taxable year, or</text>
</paragraph><paragraph id="H427D9F17A831421C908EFB97C04E5091"><enum>(2)</enum><text>the sum of—</text>
<subparagraph id="H7183D5A9AACB409ABE5F4099DCD318E6"><enum>(A)</enum><text>the amount of
wages (as defined in section 3121(a)) received during such calendar year,
and</text>
</subparagraph><subparagraph id="H4449D5B17EF1474A944441ECA716F9F9"><enum>(B)</enum><text>the amount of the
self-employment income (as defined in section 1402) of such individual for the
taxable year.</text>
</subparagraph></paragraph><continuation-text continuation-text-level="subsection">Effective
with the commencement of the 16th calendar year for which the individual’s
election under section 105 of the <short-title>Savings
Account for Every American Act of 2011</short-title> is effective, the
limitation under the preceding sentence shall be increased by any prescribed
employer contribution paid to a personal retirement account of such individual
pursuant to section 102(b)(2)(B) of such Act and the portion of any prescribed
self-employment contribution paid to such an account which is attributable to
the increase in such contribution required by the last sentence of section
101(7) of such Act.</continuation-text></subsection><subsection id="H3DEF13B817374D8E8758D480E6DE9FA4"><enum>(c)</enum><header>S.A.F.E.
account</header><text>For purposes of this section, the term <term>S.A.F.E.
account</term> means a trust created or organized in the United States
exclusively for the benefit of an individual or his beneficiaries, but only if
the written governing instrument creating the trust meets the following
requirements:</text>
<paragraph id="H33BB306D037B4CBEBCC21AD241AA24CA"><enum>(1)</enum><text>Except in the case
of rollover contributions from another S.A.F.E. account of such
individual—</text>
<subparagraph id="H83FDE97C36D54FA2BA48D2A28674BA26"><enum>(A)</enum><text>no contribution
will be accepted unless it is in cash,</text>
</subparagraph><subparagraph id="H6DC82A78C91445298C1565CC330DE8CF"><enum>(B)</enum><text>contributions will
not be accepted for the taxable year in excess of 6.2 percent of the
contribution and benefit base (as determined under section 230 of the
<act-name parsable-cite="SSA">Social Security Act</act-name>) for the calendar
year which ends with or within such taxable year, and</text>
</subparagraph><subparagraph id="HAAC8F7B861C24BAA82DEEBC9DA8ED138"><enum>(C)</enum><text>any contributions
with respect to an account holder which are not accepted pursuant to this
paragraph are promptly refunded directly to the account holder.</text>
</subparagraph><continuation-text continuation-text-level="paragraph">In the
case of any such individual, effective for taxable years beginning with or
after the 16th calendar year for which the individual’s election under section
105 of the <short-title>Savings Account for Every American
Act of 2011</short-title> is effective, <quote>12.4 percent</quote> shall be
substituted for <quote>6.2 percent</quote> in subparagraph (B).</continuation-text></paragraph><paragraph id="HC395160A052A4F1FA2CB840C6D5EBF4F"><enum>(2)</enum><text>The trustee is a
bank (as defined in section 408(n)) or such other person who demonstrates to
the satisfaction of the Secretary that the manner in which such other person
will administer the trust will be consistent with the requirements of this
section.</text>
</paragraph><paragraph id="H8CAB6730AFC54DEBAC9CEA1E97A2714F"><enum>(3)</enum><text>No part of the
trust funds will be invested in life insurance contracts.</text>
</paragraph><paragraph id="HCF94C464D57146C6BA4B9446D4C9D8E3"><enum>(4)</enum><text>The interest of an
individual in the balance in his account is nonforfeitable.</text>
</paragraph><paragraph id="H47C0E3E8AB2341848CA02BFC2579253B"><enum>(5)</enum><text>The assets of the
trust will not be commingled with other property except in a common trust fund
or common investment fund.</text>
</paragraph></subsection><subsection id="H6882C08E082C4CA9B946412E3C429684"><enum>(d)</enum><header>Tax treatment of
distributions</header>
<paragraph id="H840FAAEA68404DF190822E125C348506"><enum>(1)</enum><header>In
general</header><text>Except as otherwise provided in this subsection, any
amount distributed out of a S.A.F.E. account shall be included in gross income
of the distributee for the taxable year in which the distribution is received.
Notwithstanding any other provision of this title (including chapters 11 and
12), the basis of any person in such an account is zero.</text>
</paragraph><paragraph id="HDB2700BF5B22499FA002FCD6302D26F4"><enum>(2)</enum><header>Exceptions for
distributions after social security retirement age or
death</header><text>Paragraph (1) shall not apply to any distribution out of a
S.A.F.E. account—</text>
<subparagraph id="HD1F99F87057B4D8AB397FA0189EAFA6C"><enum>(A)</enum><text>made on or after
the date on which the account beneficiary attains retirement age (as defined in
section 216(l) of the Social Security Act), or</text>
</subparagraph><subparagraph id="HCE5199CD5F9C4271BA717300D667CC38"><enum>(B)</enum><text>made to the
account beneficiary (or to the estate of the beneficiary) on or after the death
of the account beneficiary.</text>
</subparagraph></paragraph><paragraph id="H0D24CB53D784442C91592F78E91DC0C2"><enum>(3)</enum><header>Exceptions for
distributions to purchase certain insurance</header><text>Paragraph (1) shall
not apply to any distribution out of a S.A.F.E. account to the account
beneficiary to the extent such distributions do not exceed the sum of the
expenses paid or incurred during the taxable year for—</text>
<subparagraph id="HA4AC20FCB3F74B8CBF73C3786EC5CD7C"><enum>(A)</enum><text>any qualified
long-term care insurance contract (but only to the extent of eligible long-term
care premiums (as defined in section 213(d)(10)),</text>
</subparagraph><subparagraph id="H15E0ED4A6A9D43A6A83EB256F788AB91"><enum>(B)</enum><text>disability
insurance, or</text>
</subparagraph><subparagraph id="HACC2482A9A4C4121A2D458CADDFFB7FE"><enum>(C)</enum><text>term life
insurance.</text>
</subparagraph></paragraph><paragraph id="H3CB2EBA09DD3440BBD26D0C396FD3688"><enum>(4)</enum><header>Exceptions for
certain other distributions</header><text>Rules similar to the rules of
paragraphs (3), (4), (5), and (6) of section 408(d) shall apply for purposes of
this section.</text>
</paragraph></subsection><subsection id="H123C6CFB82444A90A84EE3AFEB9547CA"><enum>(e)</enum><header>Tax treatment of
accounts</header>
<paragraph id="HCAAEE98F6A3D4DB0B44D7EFCE51AFDAF"><enum>(1)</enum><header>Exemption from
tax</header><text>A S.A.F.E. account is exempt from taxation under this
subtitle unless such account has ceased to be a S.A.F.E. account by reason of
paragraph (2). Notwithstanding the preceding sentence, any such account is
subject to the taxes imposed by section 511 (relating to imposition of tax on
unrelated business income of charitable, etc. organizations).</text>
</paragraph><paragraph id="HDA2DF1AD204A4EC39F53BCADEC883A0F"><enum>(2)</enum><header>Account
terminations</header><text>Rules similar to the rules of paragraphs (2) and (4)
of section 408(e) shall apply to S.A.F.E. accounts, and any amount treated as
distributed under such rules shall be treated as not used to pay expenses
described in subsection (d)(3).</text>
</paragraph></subsection><subsection id="HFE01C6B5B2B24D31B9A52B26BCAA77C9"><enum>(f)</enum><header>Additional tax
on amounts included in gross income</header><text>If any distribution from a
S.A.F.E. account is includible in gross income of the account beneficiary, the
tax liability of such beneficiary under this chapter for the taxable year in
which the distribution is received shall be increased by an amount equal to 20
percent of the amount of the distribution.</text>
</subsection><subsection id="HA189EED90C4840479B5EA3EBF37C0EE6"><enum>(g)</enum><header>Other definition
and special rules</header>
<paragraph id="H09321353BBEF481796DA4F77FA3A9521"><enum>(1)</enum><header>Account
beneficiary</header><text>For purposes of this section, the term <term>account
beneficiary</term> means the individual for whose benefit the S.A.F.E. account
was established.</text>
</paragraph><paragraph id="H7EC8955AFDA3408197BA9517CAFEC32C"><enum>(2)</enum><header>Certain rules to
apply</header><text>Rules similar to the following rules shall apply for
purposes of this section:</text>
<subparagraph id="H88A4A2B5C3D845FB8B63507BAE68A94C"><enum>(A)</enum><text>Section 219(d)(2)
(relating to no deduction for rollovers).</text>
</subparagraph><subparagraph id="HCF5135F444064FA894C6FABD1517F736"><enum>(B)</enum><text>Section 219(f)(3)
(relating to time when contributions deemed made).</text>
</subparagraph><subparagraph id="H77BFECEB32964BCDA5E595DEB2605045"><enum>(C)</enum><text>Section 219(f)(5)
(relating to employer payments).</text>
</subparagraph><subparagraph id="HAAC89D604F9F49878933381A144FBC18"><enum>(D)</enum><text>Section 408(g)
(relating to community property laws).</text>
</subparagraph><subparagraph id="H65B98BE48F2742B3A1EB49E32F139F4B"><enum>(E)</enum><text>Section 408(h)
(relating to custodial accounts).</text>
</subparagraph></paragraph></subsection><subsection id="H05CF815F1D1445128FA1079BBCBB8F12"><enum>(h)</enum><header>Reports</header><text>The
trustee of a S.A.F.E. account shall make such reports regarding such account to
the Secretary and to the individual for whose benefit the account is maintained
with respect to contributions, distributions, and such other matters as the
Secretary may by regulation prescribe. The reports required by this subsection
shall be filed at such time and in such manner, and furnished to such
individuals at such time and in such manner, as may be required by such
regulations.</text>
</subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="H1C3BF3C6A39D48B09B198F013C822C5A"><enum>(b)</enum><header>Deduction
allowed in arriving at adjusted gross income</header><text>Subsection (a) of
section 62 of the Internal Revenue Code of 1986 is amended by inserting after
paragraph (21) the following new paragraph:</text>
<quoted-block id="H1CD77D5DA7FF478E9AAB24B9F1BBDE01">
<paragraph id="H99EE7CFB8ECB408288E209F47F3F8239"><enum>(22)</enum><header>S.A.F.E.
account contributions</header><text>The deduction allowed by section
224.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="H8018D6EC7A8248FC8CBF4F144E2F7520"><enum>(c)</enum><header>Tax on excess
contributions</header>
<paragraph id="H43829035A657440FB0BB42F9A504836F"><enum>(1)</enum><text>Subsection (a) of
section 4973 of such Code (relating to tax on excess contributions to
individual retirement accounts, etc.) is amended by striking <quote>or</quote>
at the end of paragraph (4), by inserting <quote>or</quote> at the end of
paragraph (5), and by inserting after paragraph (5) the following new
paragraph:</text>
<quoted-block id="HE60622FDA7944453B1BF06B2706B719A">
<paragraph id="H99078E7027F54553AA97D50BA9BF3148"><enum>(6)</enum><text>a S.A.F.E. account
(within the meaning of section
224(c)),</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph><paragraph id="HE0F47693666A44DC8823938D6628481A"><enum>(2)</enum><text>Section 4973 of
such Code is amended by adding at the end the following new subsection:</text>
<quoted-block id="H26AE61138C8E475492EAEDB889DD7EBD">
<subsection id="HEB8CB6762C754782A25C1009ABD8B673"><enum>(h)</enum><header>Excess
contributions to S.A.F.E. accounts</header><text>For purposes of this section,
in the case of S.A.F.E. accounts (within the meaning of section 224(c)), the
term <term>excess contributions</term> means the sum of—</text>
<paragraph id="H6936484195E640BE9A459D14177FD954"><enum>(1)</enum><text>the excess (if
any) of—</text>
<subparagraph id="HDB092C5915274E79839A197FD6539964"><enum>(A)</enum><text>the aggregate
amount contributed for the taxable year to the accounts (other than rollover
contributions), over</text>
</subparagraph><subparagraph id="HC658E6E7E6CD47529AE6C6CA1DD9EA43"><enum>(B)</enum><text>the amount
allowable as a deduction under section 224 for such contributions, and</text>
</subparagraph></paragraph><paragraph id="HAC760A2703524B54B81FA3D650A7ADE5"><enum>(2)</enum><text>the amount
determined under this subsection for the preceding taxable year, reduced by the
sum of—</text>
<subparagraph id="H1B84ABC4EC7A4B43BA4B1E72BAFC4A5C"><enum>(A)</enum><text>the distributions
out of the accounts which were included in gross income under rules similar to
the rules of section 408(d)(5) which apply to such accounts by reason of
section 224(d)(4), and</text>
</subparagraph><subparagraph id="HADE5F301525D45F588441CDC8F13E65A"><enum>(B)</enum><text>the excess (if
any) of—</text>
<clause id="HBB6B6AE9F73D42028360D218ABA71FD2"><enum>(i)</enum><text>the maximum amount
allowable as a deduction under section 224(b) for the taxable year, over</text>
</clause><clause id="H8E97527BB6674E0BB9C3AD633BF82106"><enum>(ii)</enum><text>the amount
contributed to the accounts for the taxable year.</text>
</clause></subparagraph><continuation-text continuation-text-level="paragraph">For
purposes of this subsection, any contribution which is distributed out of the
S.A.F.E. account in a distribution to which the rules similar to the rules of
section 408(d)(4) which apply to such accounts by reason of section 224(d)(4)
shall be treated as an amount not
contributed.</continuation-text></paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="H3ABF370C09734518B4DDD7576FC8B67D"><enum>(d)</enum><header>Tax on
prohibited transactions</header>
<paragraph id="H9A8160D7551A4E61AE975E812380DD0A"><enum>(1)</enum><header>In
general</header><text>Paragraph (1) of section 4975(e) of such Code (relating
to prohibited transactions) is amended by striking <quote>or</quote> at the end
of subparagraph (F), by redesignating subparagraph (G) as subparagraph (H), and
by inserting after subparagraph (F) the following new subparagraph:</text>
<quoted-block id="H8EF08103286B4B35BF9BA958DC9CBC1D">
<subparagraph id="H2C5D782D446D42F9B129A4EACB0D022F"><enum>(G)</enum><text>a S.A.F.E. account
described in section 224(c),
or</text>
</subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph><paragraph id="H8391DCC60F9641BBA2A1ACAE36433D62"><enum>(2)</enum><header>Special
rule</header><text>Subsection (c) of section 4975 of such Code is amended by
adding at the end the following new paragraph:</text>
<quoted-block id="H36CDF239232A4A428C6633F7F14D1B5D">
<paragraph id="H017021CE69D34DC796A070676B71C5FA"><enum>(7)</enum><header>Special rule for
s.a.f.e. accounts</header><text>An individual for whose benefit a S.A.F.E.
account is established shall be exempt from the tax imposed by this section
with respect to any transaction concerning such account (which would otherwise
be taxable under this section) if section 224(e)(2) applies with respect to
such
transaction.</text>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="H35951593287A45AAB89A45F1DD0997F7"><enum>(e)</enum><header>Failure To
provide reports on S.A.F.E. accounts</header><text>Paragraph (2) of section
6693(a) of such Code (relating to failure to provide reports on individual
retirement accounts or annuities) is amended by striking <quote>and</quote> at
the end of subparagraph (D), by striking the period at the end of subparagraph
(E) and inserting <quote>, and</quote>, and by adding at the end the following
new subparagraph:</text>
<quoted-block id="HFAF2073F693443AEBB53933B11AE8D41">
<subparagraph id="H8F4436CA400C49A1B82BF8472CA590D4"><enum>(F)</enum><text>Section 224(h)
(relating to S.A.F.E.
accounts).</text>
</subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="HBD6A37FE83E3490D886235DAAF1F941F"><enum>(f)</enum><header>Clerical
amendment</header><text>The table of sections for part VII of subchapter B of
chapter 1 of such Code is amended by striking the item relating to section 224
and inserting the following new items:</text>
<quoted-block id="HE202B7CE661148188AD1C5B30C1CE64E" style="OLC">
<toc regeneration="no-regeneration">
<toc-entry level="section">Sec. 224. S.A.F.E. accounts.</toc-entry>
<toc-entry level="section">Sec. 225. Cross
references.</toc-entry>
</toc>
<after-quoted-block>.</after-quoted-block></quoted-block>
</subsection></section><section id="HB15B714C264A424FAF93DB8F1A478DAC"><enum>202.</enum><header>Effective
date</header><text display-inline="no-display-inline">The amendments made by
this title shall apply to contributions made for taxable years beginning after
December 31, 2011.</text>
</section><enum>III</enum><header>Conforming
amendments to the Social Security Act and the Internal Revenue Code of
1986</header>
<section id="HD7B2111F84264F9E9DF0AC4F1EEF6487"><enum>301.</enum><header>Reductions in
and exemptions from FICA taxes and SECA taxes with respect to eligible
individuals</header>
<subsection id="H0F7008825115402BA9E3E0423B6ED879"><enum>(a)</enum><header>FICA tax on
employees</header><text>Section 3101 of the Internal Revenue Code of 1986
(relating to OASDI tax on employees) is amended—</text>
<paragraph id="H5F249B75A9934D0E9C688AB0157FD226"><enum>(1)</enum><text>in subsection (a),
by striking <quote>In addition</quote> and inserting <quote>Subject to
subsection (c), in addition</quote>;</text>
</paragraph><paragraph id="H8D534CB658FE4A2ABCDB5D969E4050EB"><enum>(2)</enum><text>by redesignating
subsection (c) as subsection (d); and</text>
</paragraph><paragraph id="H4424F9AFC5E34B0F95C431E8D9B271C3"><enum>(3)</enum><text>by inserting after
subsection (b) the following new subsection:</text>
<quoted-block id="H71B498E350C24B4CB6EE98A431887134">
<subsection id="H59FC3F9779A442F8A8ADA26C91BFC189"><enum>(c)</enum><header>Exemption from
OASDI tax for eligible individuals</header><text>Subsection (a) shall not apply
with respect to wages received by an eligible individual (as defined in section
101(4) of the <short-title>Savings Account for Every
American Act of 2011</short-title>).</text>
</subsection><after-quoted-block></after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="H46DD18F6157E408F8FCC0D3AC19EFA64"><enum>(b)</enum><header>FICA tax on
employers</header><text>Section 3111 of such Code (relating to OASDI tax on
employees) is amended—</text>
<paragraph id="HF0F09961D2954584ADE1C967B7D37EFB"><enum>(1)</enum><text>in subsection (a),
by striking <quote>In addition</quote> and inserting <quote>Subject to
subsection (c), in addition</quote>;</text>
</paragraph><paragraph id="HE71B971DA660446E85BD0A08E5F6EF37"><enum>(2)</enum><text>by redesignating
subsection (c) as subsection (d); and</text>
</paragraph><paragraph id="H81CE63C5F9A64EDFB4F171DF620383D4"><enum>(3)</enum><text>by inserting after
subsection (b) the following new subsection:</text>
<quoted-block id="HFA1341B436144416B4DEF222BCD7C451">
<subsection id="H14700F8DCF14443A9CF6E62A6F629537"><enum>(c)</enum><header>Exemption from
OASDI tax with respect to eligible individuals</header><text>In the case of an
eligible individual (as defined in section 101(4) of the
<short-title>Savings Account for Every American Act of
2011</short-title>), effective with the 16th calendar year for which such
individual’s election under section 105 of such Act is effective, subsection
(a) shall not apply with respect to wages received by such
individual.</text>
</subsection><after-quoted-block></after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="H8BC6852B4C0A4C83B235C92A11F30A14"><enum>(c)</enum><header>Reduction in and
exemption from self-Employment tax</header><text>Section 1401 of such Code
(relating to OASDI tax on self-employment income) is amended—</text>
<paragraph id="HDD1180B8A889452B8E54DB96A472457C"><enum>(1)</enum><text>in subsection (a),
by striking <quote>In addition</quote> and inserting <quote>Subject to
subsection (c), in addition</quote>;</text>
</paragraph><paragraph id="H9EB91513211544C395E3D57381D38B67"><enum>(2)</enum><text>by redesignating
subsection (c) as subsection (d); and</text>
</paragraph><paragraph id="H654B7A049D7A43E7A7EDBD1C4F549026"><enum>(3)</enum><text>by inserting after
subsection (b) the following new subsection:</text>
<quoted-block id="H67015C441AF342EBBC6EF71D387EB2DF">
<subsection id="H6A214D4986B34B1091DB98519B00810A"><enum>(c)</enum><header>Adjustment to
OASDI tax</header>
<paragraph id="HE3752BD6EA9B4069B62769AD414BA265"><enum>(1)</enum><header>Reduction</header><text>In
the case of an eligible individual (as defined in section 101(4) of the
<short-title>Savings Account for Every American Act of
2011</short-title>), for taxable years beginning with or during the 1st 15
calendar years for which such individual’s election is in effect under section
105 of such Act, the rate of tax under subsection (a) shall be 6.20
percent.</text>
</paragraph><paragraph id="H6BE6D7F47FCE4905B4FFE5D443E10FE4"><enum>(2)</enum><header>Exemption</header><text>In
the case of such an eligible individual, effective for taxable years beginning
with or during the 16th calendar year for which such individual’s election
under such section 105 is effective, subsection (a) shall not
apply.</text>
</paragraph></subsection><after-quoted-block></after-quoted-block></quoted-block>
</paragraph></subsection><subsection id="HB6D8EDF4F9704675A7FA9A33783B5C64"><enum>(d)</enum><header>Effective
date</header><text>The amendments made by this section shall apply with respect
to wages received after December 31, 2012, and with respect to self-employment
income for taxable years beginning after such date.</text>
</subsection></section><section id="H41FEE7A9EE9F4BBD805AF85063A56791"><enum>302.</enum><header>Exclusion of
eligible individuals from old-age, survivors, and disability insurance
coverage</header>
<subsection id="HDAD27DB400134764946BD07AAFB8BE93"><enum>(a)</enum><header>Monthly
insurance benefits under Section 202</header><text>Section 202 of the
<act-name parsable-cite="SSA">Social Security Act</act-name> (42 U.S.C. 402) is
amended by adding at the end the following new subsection:</text>
<quoted-block act-name="Social Security Act" id="H9832A90C100649B3BEA9069D203D4C14" other-style="archaic" style="other">
<subsection id="H4D8234D5E6CF4B3382455B25C321AD1A"><enum>(z)</enum><header>Limitation on payment to eligible individuals under Savings
Account for Every American Act of 2011</header><paragraph commented="no" display-inline="yes-display-inline" id="H83BBEBD395A24EF989DE241A3293274F"><enum>(1)</enum><text>Notwithstanding any
other provision of this title, no monthly benefits shall be paid under this
section based on the wages and self-employment income of an eligible individual
(as defined in section 101(4) of the <short-title>Savings
Account for Every American Act of 2011</short-title>).</text>
</paragraph><paragraph id="H5C39A6C50C93403884CE4D8565E4B5A5" indent="up1"><enum>(2)</enum><text>Determinations of entitlement to
hospital insurance benefits under section 226 or 226A shall be made without
regard to paragraph
(1).</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="H3EF5C4CCAD244221843FF19552F8C465"><enum>(b)</enum><header>Disability
insurance benefits under Section 223</header><text>Section 223 of such Act (42
U.S.C. 423) is amended by adding at the end the following new
subsection:</text>
<quoted-block id="H7C55768716D14B8ABE2F62E848D558FA" other-style="archaic" style="other"><subsection id="HA1FCEFA3AE19453FAADC913F346C3002"><enum>(k)</enum><header>Limitation on payment to
eligible individuals under Savings Account for every American Act of
2011</header><paragraph commented="no" display-inline="yes-display-inline" id="H3FCF0DD5613E4779A771A0C53DF39E13"><enum>(1)</enum><text>Notwithstanding any
other provision of this title, no monthly benefits shall be paid under this
section based on the wages and self-employment income of an eligible individual
(as defined in section 101(4) of the <short-title>Savings
Account for Every American Act of 2011</short-title>).</text>
</paragraph><paragraph id="HB073CDDCC5E7478FA79A50E8C4FFC879" indent="up1"><enum>(2)</enum><text>Determinations of entitlement to
hospital insurance benefits under section 226 or 226A shall be made without
regard to paragraph
(1).</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection></section><section id="H659EE2F34414400BB4731EBDA71D1CB3"><enum>303.</enum><header>Information
provided in social security account statements</header>
<subsection id="HBCD53901B3754ACEA3CCDCBEEA8FE88E"><enum>(a)</enum><header>In
general</header><text>Section 1143 of the <act-name parsable-cite="SSA">Social
Security Act</act-name> (42 U.S.C. 1320b–13) is amended to read as
follows:</text>
<quoted-block act-name="Social Security Act" id="H76917D678E424B23AC204B9DF56BBCF1" other-style="archaic" style="other">
<section id="H4186C7C885A141E1AE59AE50D8764139"><enum>1143.</enum><header>Social Security Account Statement</header><subsection commented="no" display-inline="yes-display-inline" id="HCB363A14E9AB45D4A5BE7EC865489143"><enum>(a)</enum><header>Provision of annual statements</header><text>The Commissioner of
Social Security shall provide an annual social security account statement
(hereinafter in this section referred to as the <quote>statement</quote>) to
each eligible individual who is not receiving benefits under title II and for
whom a mailing address can be determined through such methods as the
Commissioner determines to be appropriate.</text>
</subsection><subsection id="HEC9328D1D4764326ABCF9A7381982516"><enum>(b)</enum><header>Contents of statement</header><text>Each statement
shall contain—</text>
<paragraph id="H1968AB9BE01144FABC5FCA21F3476D47"><enum>(1)</enum><text>the amount of
wages paid to and self-employment income derived by the eligible individual as
shown by the records of the Commissioner;</text>
</paragraph><paragraph id="H7C26318D77CE4FDDAC4EA73B2FCA1E1C"><enum>(2)</enum><text>an estimate of the
aggregate of the employer, employee, and self-employment contributions of the
eligible individual for old-age, survivors, and disability insurance as shown
by the records of the Commissioner;</text>
</paragraph><paragraph id="HF7C5DF35C2444726ABB45DEC379A2581"><enum>(3)</enum><text>a separate
estimate of the aggregate of the employer, employee, and self-employment
contributions of the eligible individual for hospital insurance as shown by the
records of the Commissioner; and</text>
</paragraph><paragraph id="HE93EA89AFB234E61A90E82C92A997D47"><enum>(4)</enum><text>an estimate of the
potential monthly retirement, disability, survivor, and auxiliary benefits
payable on the eligible individual’s account together with a description of the
benefits payable under the medicare program of title XVIII.</text>
</paragraph></subsection><subsection id="H7CE4D41FEC6944C597836CA44983D0EF"><enum>(c)</enum><header>Eligible individual</header><text>For purposes of
this section, the term <term>eligible individual</term> means an individual
who—</text>
<paragraph id="H9270F30D736B427297035CDF03F216DD"><enum>(1)</enum><text>has a social
security account number, and</text>
</paragraph><paragraph id="HA7BE77CB547341B1BC4450FF5DDBEBD0"><enum>(2)</enum><text>has wages or net
earnings from
self-employment.</text>
</paragraph></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block>
</subsection><subsection id="H20764E8F659E48EAB86AC70B9B49DF79"><enum>(b)</enum><header>Effective
date</header><text>The amendment made by subsection (a) shall apply with
respect to statements provided on or after October 1, 2012.</text>
</subsection></section>