1.Short title and table of
contents
(a)This Act may cited as
the Protecting and Preserving Social
Security Act
.
(b)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 2012.
Sec. 202. Inclusion of surplus earnings in social security
benefit formula.
<enum>I</enum><header>Cost-of-Living
Increases</header>
<section id="HB3BA2512C1D940BC99125091C3AA1552" section-type="subsequent-section"><enum>101.</enum><header>Consumer price index
for elderly consumers</header>
<subsection id="H7692AFEAB0954743BF2C2E867A5B986E"><enum>(a)</enum><header>In
General</header><text>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
<term>Consumer Price Index for Elderly Consumers</term> 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.</text>
</subsection><subsection id="H66AFE64FEBA24983A9B512A4F37D300A"><enum>(b)</enum><header>Effective
Date</header><text>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.</text>
</subsection><subsection id="HE638D0ED137641459398B47994889770"><enum>(c)</enum><header>Authorization of
Appropriations</header><text>There are authorized to be appropriated such sums
as are necessary to carry out the provisions of this section.</text>
</subsection></section><section id="HC4FA42A7AB67452CB3D1CA5C0A596687"><enum>102.</enum><header>Computation of
cost-of-living increases</header>
<subsection id="H45E8B1C906A24BCE90697C96A0E426A9"><enum>(a)</enum><header>In
general</header><text display-inline="yes-display-inline">Section 215(i) of the
Social Security Act (42 U.S.C. 415(i)) is amended—</text>
<paragraph id="H27D402EDB08E4C699B592AE8DEB1B593"><enum>(1)</enum><text>in paragraph
(1)(G), by inserting before the period the following: <quote>, 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</quote>;
and</text>
</paragraph><paragraph id="H803ABE4AF1EC49B88B724FE80BEB5224"><enum>(2)</enum><text>in paragraph (4),
by striking <quote>and by section 9001</quote> and inserting <quote>, by
section 9001</quote>, and by inserting after <quote>1986,</quote> the
following: <quote>and by section 102 of the <short-title>Protecting and Preserving Social Security
Act</short-title>,</quote>.</text>
</paragraph></subsection><subsection id="H37A01ABD8FBD42FB87B4F6DF627FDC57"><enum>(b)</enum><header>Conforming
amendments in applicable former law</header><text>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: <quote>, 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</quote>.</text>
</subsection><subsection id="H31D753181D28474A9185C306F7E7D161"><enum>(c)</enum><header>Effective
date</header><text>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.</text>
</subsection></section><enum>II</enum><header>Contribution and
benefit fairness</header>
<section display-inline="no-display-inline" id="H6471A9278D714A938B193A2648CFD209"><enum>201.</enum><header>Determination
of wages and self-employment income above contribution and benefit base after
2012</header>
<subsection id="HCF95F0F4BFDA4676B3A6629A4D2B90E0"><enum>(a)</enum><header>Determination of
wages above contribution and benefit base after 2012</header>
<paragraph id="HD18619EC358C4426B70A68989D0A8F45"><enum>(1)</enum><header>Amendments to
the Internal Revenue Code of 1986</header><text>Section 3121 of the Internal
Revenue Code of 1986 is amended—</text>
<subparagraph id="H13B5C871F8C6468C8BFAFA07700A9514"><enum>(A)</enum><text>in subsection
(a)(1), by inserting <quote>the applicable percentage (determined under
subsection (c)(1)) of</quote> before <quote>that part of the
remuneration</quote>; and</text>
</subparagraph><subparagraph id="H5944CBEB92D046E598A6C646A72DAB1B"><enum>(B)</enum><text display-inline="yes-display-inline">in subsection (c), by striking <quote>(c)
<header-in-text level="subsection" style="OLC">Included and excluded
service.—</header-in-text>For purposes of this chapter, if</quote> and
inserting the following:</text>
<quoted-block display-inline="no-display-inline" id="HF3561CB8EB6D442D8F9670438445B579" style="OLC">
<subsection id="H5B3BDBF5318B4F309E83F9086EB89463"><enum>(c)</enum><header>Special rules
for wages and employment</header>
<paragraph id="H4389E941E4E8436FBF1A9D6F6FB0EC3C"><enum>(1)</enum><header>Applicable
percentage of remuneration in determining wages</header><text display-inline="yes-display-inline">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:</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" subformat="S6211" table-template-name="Flush/hang, 1 text, 1 num, bold hds" table-type="Leaderwork">
<tgroup cols="2" rowsep="0"><colspec coldef="txt" colname="column1" colwidth="192.75pt" min-data-value="55"></colspec><colspec coldef="fig" colname="column2" colwidth="231.00pt" min-data-value="9"></colspec>
<thead>
<row><entry align="left" colname="column1" morerows="0" namest="column1" rowsep="0"></entry><entry align="right" colname="column2" morerows="0" namest="column2" rowsep="0"><bold>The applicable</bold></entry>
</row>
<row><entry align="left" colname="column1" morerows="0" namest="column1" rowsep="0"><bold>In the case of:</bold></entry><entry align="right" colname="column2" morerows="0" namest="column2" rowsep="0"><bold>percentage is:</bold></entry>
</row>
</thead>
<tbody>
<row><entry align="left" colname="column1" leader-modify="force-ldr" rowsep="0" stub-definition="txt-ldr">Calendar year
2013</entry><entry align="right" colname="column2" leader-modify="clr-ldr" rowsep="0">86%</entry>
</row>
<row><entry align="left" colname="column1" leader-modify="force-ldr" rowsep="0" stub-definition="txt-ldr">Calendar year
2014</entry><entry align="right" colname="column2" leader-modify="clr-ldr" rowsep="0">71%</entry>
</row>
<row><entry align="left" colname="column1" leader-modify="force-ldr" rowsep="0" stub-definition="txt-ldr">Calendar year
2015</entry><entry align="right" colname="column2" leader-modify="clr-ldr" rowsep="0">57%</entry>
</row>
<row><entry align="left" colname="column1" leader-modify="force-ldr" rowsep="0" stub-definition="txt-ldr">Calendar year
2016</entry><entry align="right" colname="column2" leader-modify="clr-ldr" rowsep="0">43%</entry>
</row>
<row><entry align="left" colname="column1" leader-modify="force-ldr" rowsep="0" stub-definition="txt-ldr">Calendar year
2017</entry><entry align="right" colname="column2" leader-modify="clr-ldr" rowsep="0">29%</entry>
</row>
<row><entry align="left" colname="column1" leader-modify="force-ldr" rowsep="0" stub-definition="txt-ldr">Calendar year
2018</entry><entry align="right" colname="column2" leader-modify="clr-ldr" rowsep="0">14%</entry>
</row>
<row><entry align="left" colname="column1" leader-modify="force-ldr" rowsep="0" stub-definition="txt-ldr">Calendar years
after 2018</entry><entry align="right" colname="column2" leader-modify="clr-ldr" rowsep="0">0%.</entry>
</row>
</tbody>
</tgroup></table>
</paragraph><paragraph id="H20D68718B61C49CB95858B0B2E3B69B9"><enum>(2)</enum><header>Included and
excluded service</header><text display-inline="yes-display-inline">For purposes
of this chapter,
if.</text>
</paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="H104536304CF5425DA6660F30A5024C27"><enum>(2)</enum><header>Amendments to
the Social Security Act</header><text>Section 209 of the Social Security Act
(42 U.S.C. 409) is amended—</text>
<subparagraph id="H0438A8BE061D4FB7B3A0AD5E1DB9C899"><enum>(A)</enum><text>in subsection
(a)(1)(I)—</text>
<clause id="H57D79F5D84F54976B1572E6F1148D217"><enum>(i)</enum><text>by
inserting <quote>and before 2013</quote> after <quote>1974</quote>; and</text>
</clause><clause id="H3FC379D07FA943D09ACBD3FBEF6054F1"><enum>(ii)</enum><text>by
inserting <quote>and</quote> after the semicolon;</text>
</clause></subparagraph><subparagraph id="H66F6B8FBAAF2498EA7091F06E0632F9C"><enum>(B)</enum><text>in subsection
(a)(1), by adding at the end the following new subparagraph:</text>
<quoted-block display-inline="no-display-inline" id="H475D8F1B5FA84CF286E974FA0FE3EBCE" style="OLC">
<subparagraph id="H1A2BDE0E5C5E4110B8E5F28DA849D468"><enum>(J)</enum><text display-inline="yes-display-inline">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 2012 with respect to which such contribution and benefit base is
effective, is paid to such individual during such calendar
year;</text>
</subparagraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</subparagraph><subparagraph id="H82013BA7497D487CBA92F390750D575F"><enum>(C)</enum><text display-inline="yes-display-inline">by adding at the end the following new
subsection:</text>
<quoted-block display-inline="no-display-inline" id="H73F044050977483F8A3DA500E6A0752C" style="OLC">
<subsection id="H55086AE50DC5411D93512049010B433D"><enum>(l)</enum><text display-inline="yes-display-inline">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:</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" subformat="S6211" table-template-name="Flush/hang, 1 text, 1 num, bold hds" table-type="Leaderwork">
<tgroup cols="2" rowsep="0"><colspec coldef="txt" colname="column1" colwidth="192.75pt" min-data-value="55"></colspec><colspec coldef="fig" colname="column2" colwidth="231.00pt" min-data-value="9"></colspec>
<thead>
<row><entry align="left" colname="column1" morerows="0" namest="column1" rowsep="0"></entry><entry align="right" colname="column2" morerows="0" namest="column2" rowsep="0"><bold>The applicable</bold></entry>
</row>
<row><entry align="left" colname="column1" morerows="0" namest="column1" rowsep="0"><bold>In the case of:</bold></entry><entry align="right" colname="column2" morerows="0" namest="column2" rowsep="0"><bold>percentage is:</bold></entry>
</row>
</thead>
<tbody>
<row><entry align="left" colname="column1" leader-modify="force-ldr" rowsep="0" stub-definition="txt-ldr">Calendar year
2013</entry><entry align="right" colname="column2" leader-modify="clr-ldr" rowsep="0">86%</entry>
</row>
<row><entry align="left" colname="column1" leader-modify="force-ldr" rowsep="0" stub-definition="txt-ldr">Calendar year
2014</entry><entry align="right" colname="column2" leader-modify="clr-ldr" rowsep="0">71%</entry>
</row>
<row><entry align="left" colname="column1" leader-modify="force-ldr" rowsep="0" stub-definition="txt-ldr">Calendar year
2015</entry><entry align="right" colname="column2" leader-modify="clr-ldr" rowsep="0">57%</entry>
</row>
<row><entry align="left" colname="column1" leader-modify="force-ldr" rowsep="0" stub-definition="txt-ldr">Calendar year
2016</entry><entry align="right" colname="column2" leader-modify="clr-ldr" rowsep="0">43%</entry>
</row>
<row><entry align="left" colname="column1" leader-modify="force-ldr" rowsep="0" stub-definition="txt-ldr">Calendar year
2017</entry><entry align="right" colname="column2" leader-modify="clr-ldr" rowsep="0">29%</entry>
</row>
<row><entry align="left" colname="column1" leader-modify="force-ldr" rowsep="0" stub-definition="txt-ldr">Calendar year
2018</entry><entry align="right" colname="column2" leader-modify="clr-ldr" rowsep="0">14%</entry>
</row>
<row><entry align="left" colname="column1" leader-modify="force-ldr" rowsep="0" stub-definition="txt-ldr">Calendar years
after 2018</entry><entry align="right" colname="column2" leader-modify="clr-ldr" rowsep="0">0%.</entry>
</row>
</tbody>
</tgroup></table>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="HFFC539F269D9495F9F0C75989A2F01E0"><enum>(3)</enum><header>Effective
date</header><text>The amendments made by this subsection shall apply with
respect to remuneration paid in calendar years after 2012.</text>
</paragraph></subsection><subsection id="H73A4B7B809B9437FB437007C303EDC68"><enum>(b)</enum><header>Determination of
self-Employment income above contribution and benefit base after 2012</header>
<paragraph id="H6024A30892D84EEBBD5D873180F75677"><enum>(1)</enum><header>Amendments to
the Internal Revenue Code of 1986</header><text>Section 1402 of the Internal
Revenue Code of 1986 is amended—</text>
<subparagraph id="H2B2EC22EAF7C487B9426419622189738"><enum>(A)</enum><text>in subsection
(b)(1), by inserting <quote>an amount equal to the applicable percentage (as
determined under subsection (d)(2)) of</quote> before <quote>that part of the
net earnings from self-employment</quote>; and</text>
</subparagraph><subparagraph id="H14F8A714F2EC4337937780AA77CA54A3"><enum>(B)</enum><text>in subsection
(d)—</text>
<clause id="HD8E957D7F6764684A9FFBD15E39B4BA7"><enum>(i)</enum><text>by
striking <quote>(d) <header-in-text level="subsection" style="OLC">Employee and
wages.—</header-in-text>The term</quote> and inserting the following:</text>
<quoted-block display-inline="no-display-inline" id="H6283CE5AEE0C48119B032E0C88D2F3D4" style="OLC">
<subsection id="H67401FD04931460C865B2D1CEE8410B1"><enum>(d)</enum><header>Rules and
definitions</header>
<paragraph id="HA8D10EFD520649E283638258422E47CE"><enum>(1)</enum><header>Employee and
wages</header><text display-inline="yes-display-inline">The
term</text>
</paragraph></subsection><after-quoted-block>;
and</after-quoted-block></quoted-block>
</clause><clause id="H03E9B8B3A1D14C018F771FE56C037220"><enum>(ii)</enum><text>by
adding at the end the following:</text>
<quoted-block display-inline="no-display-inline" id="HF18C3FF44EDD4B79803C46FB3E9545F2" style="OLC">
<paragraph id="HF23A2E81C5604A0399AAE8FD920E85BA"><enum>(2)</enum><header>Applicable
percentage of net earnings from self-employment in determining self-employment
income</header><text display-inline="yes-display-inline">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:</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" subformat="S6211" table-template-name="Flush/hang, 1 text, 1 num, bold hds" table-type="Leaderwork">
<tgroup cols="2" rowsep="0"><colspec coldef="txt" colname="column1" colwidth="192.75pt" min-data-value="55"></colspec><colspec coldef="fig" colname="column2" colwidth="231.00pt" min-data-value="9"></colspec>
<thead>
<row><entry align="left" colname="column1" morerows="0" namest="column1" rowsep="0"></entry><entry align="right" colname="column2" morerows="0" namest="column2" rowsep="0"><bold>The applicable</bold></entry>
</row>
<row><entry align="left" colname="column1" morerows="0" namest="column1" rowsep="0"><bold>In the case of:</bold></entry><entry align="right" colname="column2" morerows="0" namest="column2" rowsep="0"><bold>percentage is:</bold></entry>
</row>
</thead>
<tbody>
<row><entry align="left" colname="column1" leader-modify="force-ldr" rowsep="0" stub-definition="txt-ldr">Calendar year
2013</entry><entry align="right" colname="column2" leader-modify="clr-ldr" rowsep="0">86%</entry>
</row>
<row><entry align="left" colname="column1" leader-modify="force-ldr" rowsep="0" stub-definition="txt-ldr">Calendar year
2014</entry><entry align="right" colname="column2" leader-modify="clr-ldr" rowsep="0">71%</entry>
</row>
<row><entry align="left" colname="column1" leader-modify="force-ldr" rowsep="0" stub-definition="txt-ldr">Calendar year
2015</entry><entry align="right" colname="column2" leader-modify="clr-ldr" rowsep="0">57%</entry>
</row>
<row><entry align="left" colname="column1" leader-modify="force-ldr" rowsep="0" stub-definition="txt-ldr">Calendar year
2016</entry><entry align="right" colname="column2" leader-modify="clr-ldr" rowsep="0">43%</entry>
</row>
<row><entry align="left" colname="column1" leader-modify="force-ldr" rowsep="0" stub-definition="txt-ldr">Calendar year
2017</entry><entry align="right" colname="column2" leader-modify="clr-ldr" rowsep="0">29%</entry>
</row>
<row><entry align="left" colname="column1" leader-modify="force-ldr" rowsep="0" stub-definition="txt-ldr">Calendar year
2018</entry><entry align="right" colname="column2" leader-modify="clr-ldr" rowsep="0">14%</entry>
</row>
<row><entry align="left" colname="column1" leader-modify="force-ldr" rowsep="0" stub-definition="txt-ldr">Calendar years
after 2018</entry><entry align="right" colname="column2" leader-modify="clr-ldr" rowsep="0">0%.</entry>
</row>
</tbody>
</tgroup></table>
</paragraph><after-quoted-block>.</after-quoted-block></quoted-block>
</clause></subparagraph></paragraph><paragraph display-inline="no-display-inline" id="HF52FCCAE78E2431D97F5C3CC71CB40C9"><enum>(2)</enum><header>Amendments to
the Social Security Act</header><text>Section 211 of the Social Security Act
(42 U.S.C. 411) is amended—</text>
<subparagraph id="HF8D30941EB734C7FA27728686131899D"><enum>(A)</enum><text>in subsection
(b)(1)(I)—</text>
<clause id="H69BE73D74415403C8D202B006BD8E917"><enum>(i)</enum><text display-inline="yes-display-inline">by striking <quote>or</quote> after the
semicolon; and</text>
</clause><clause id="HB925ED2CC15A445A9954952C0B66101A"><enum>(ii)</enum><text>by
inserting <quote>and before 2013</quote> after <quote>1974</quote>;</text>
</clause></subparagraph><subparagraph id="HE2858E8238B94DA5BB0016D2EEA911E6"><enum>(B)</enum><text>in subsection
(b)—</text>
<clause id="H6116DF5A64884DF9B8BEFBE765C67A52"><enum>(i)</enum><text>by
redesignating paragraph (2) as paragraph (3); and</text>
</clause><clause id="H9F5BD16614E0443590082CCC99EACAC7"><enum>(ii)</enum><text>by
inserting after paragraph (1) the following:</text>
<quoted-block display-inline="no-display-inline" id="H266474D6360E4C6FB4137029FB2443CB" style="OLC">
<paragraph id="H5BE08E0D08324B2885CF353534852BE2"><enum>(2)</enum><text display-inline="yes-display-inline">For any taxable year beginning in any
calendar year after 2012, 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</text>
</paragraph><after-quoted-block>;
and</after-quoted-block></quoted-block>
</clause></subparagraph><subparagraph id="H45D4A60547A8461BAED4B3EC82A4A0A2"><enum>(C)</enum><text>by adding at the
end the following:</text>
<quoted-block display-inline="no-display-inline" id="H8966FBDE7478492385ABB320F67D92A5" style="OLC">
<subsection id="H8B051595C1574AC5A90E69032AEBC58A"><enum>(l)</enum><text display-inline="yes-display-inline">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:</text><pagebreak></pagebreak>
<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" subformat="S6211" table-template-name="Flush/hang, 1 text, 1 num, bold hds" table-type="Leaderwork">
<tgroup cols="2" rowsep="0"><colspec coldef="txt" colname="column1" colwidth="192.75pt" min-data-value="55"></colspec><colspec coldef="fig" colname="column2" colwidth="231.00pt" min-data-value="9"></colspec>
<thead>
<row><entry align="left" colname="column1" morerows="0" namest="column1" rowsep="0"></entry><entry align="right" colname="column2" morerows="0" namest="column2" rowsep="0"><bold>The applicable</bold></entry>
</row>
<row><entry align="left" colname="column1" morerows="0" namest="column1" rowsep="0"><bold>In the case of:</bold></entry><entry align="right" colname="column2" morerows="0" namest="column2" rowsep="0"><bold>percentage is:</bold></entry>
</row>
</thead>
<tbody>
<row><entry align="left" colname="column1" leader-modify="force-ldr" rowsep="0" stub-definition="txt-ldr">Calendar year
2013</entry><entry align="right" colname="column2" leader-modify="clr-ldr" rowsep="0">86%</entry>
</row>
<row><entry align="left" colname="column1" leader-modify="force-ldr" rowsep="0" stub-definition="txt-ldr">Calendar year
2014</entry><entry align="right" colname="column2" leader-modify="clr-ldr" rowsep="0">71%</entry>
</row>
<row><entry align="left" colname="column1" leader-modify="force-ldr" rowsep="0" stub-definition="txt-ldr">Calendar year
2015</entry><entry align="right" colname="column2" leader-modify="clr-ldr" rowsep="0">57%</entry>
</row>
<row><entry align="left" colname="column1" leader-modify="force-ldr" rowsep="0" stub-definition="txt-ldr">Calendar year
2016</entry><entry align="right" colname="column2" leader-modify="clr-ldr" rowsep="0">43%</entry>
</row>
<row><entry align="left" colname="column1" leader-modify="force-ldr" rowsep="0" stub-definition="txt-ldr">Calendar year
2017</entry><entry align="right" colname="column2" leader-modify="clr-ldr" rowsep="0">29%</entry>
</row>
<row><entry align="left" colname="column1" leader-modify="force-ldr" rowsep="0" stub-definition="txt-ldr">Calendar year
2018</entry><entry align="right" colname="column2" leader-modify="clr-ldr" rowsep="0">14%</entry>
</row>
<row><entry align="left" colname="column1" leader-modify="force-ldr" rowsep="0" stub-definition="txt-ldr">Calendar years
after 2018</entry><entry align="right" colname="column2" leader-modify="clr-ldr" rowsep="0">0%.</entry>
</row>
</tbody>
</tgroup></table>
</subsection><after-quoted-block>.</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="H4B02B7FF974B4EA0AEFCF72B98353694"><enum>(3)</enum><header>Effective
date</header><text>The amendments made by this subsection shall apply with
respect to taxable years beginning during or after calendar year 2013.</text>
</paragraph></subsection></section><section id="HCF2CC4BF976F4AD0816F02D4F75A2E82"><enum>202.</enum><header>Inclusion of
surplus earnings in social security benefit formula</header>
<subsection id="HED3DDD51F8E047BD901221162E2416DC"><enum>(a)</enum><header>Inclusion of
surplus average indexed monthly earnings in determination of primary insurance
amounts</header>
<paragraph id="H85F6668B3A5243B8933B44C4F0C1BECE"><enum>(1)</enum><header>In
general</header><text>Section 215(a)(1)(A) of the Social Security Act (42
U.S.C. 415(a)(1)(A)) is amended—</text>
<subparagraph id="H3DBE8752260D4CF8823EAB8797F2F72B"><enum>(A)</enum><text>in clauses (i),
(ii), and (iii), by inserting <quote>basic</quote> before <quote>average
indexed monthly earnings</quote> each place it appears;</text>
</subparagraph><subparagraph id="H8F51BDC572884991B2E107335EE7EF44"><enum>(B)</enum><text>in clause (ii), by
striking <quote>and</quote> at the end; and</text>
</subparagraph><subparagraph id="HF3339AA4C3D245A4A7776E5BB9DFAD76"><enum>(C)</enum><text>by inserting after
clause (iii) the following new clauses:</text>
<quoted-block display-inline="no-display-inline" id="HCDCED4378A244DF29467DE42E81B499C" style="traditional">
<clause id="HA2E24C2C48C84B8BB8286B39581020DC" indent="up2"><enum>(iv)</enum><text>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 <fraction>1/12</fraction> of
the contribution and benefit base for the last of such individual’s computation
base years, and</text>
</clause><clause id="H3EF1FA7E9AB64CF18ABB7FF2C62F3344" indent="up2"><enum>(v)</enum><text>0.25 percent of the sum of the
individual’s surplus average indexed monthly earnings plus
<fraction>1/12</fraction> 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).</text>
</clause><after-quoted-block>.</after-quoted-block></quoted-block>
</subparagraph></paragraph><paragraph id="H4B8992D0ECD040D29EC8A65378C98413"><enum>(2)</enum><header>Bend point for
surplus earnings</header><text>Section 215(a)(1)(B) of such Act (42 U.S.C.
415(a)(1)(B)) is amended—</text>
<subparagraph id="H4C98335B8EAA4AD3BD4A77E31D5A77D3"><enum>(A)</enum><text>in clause (ii), by
striking <quote>the amounts so established</quote> and inserting <quote>the
amounts established for purposes of clauses (i) and (ii) of subparagraph
(A)</quote>;</text>
</subparagraph><subparagraph id="H051548281C1A4387B86BB7A49376EB2D"><enum>(B)</enum><text>by redesignating
clause (iii) as clause (v);</text>
</subparagraph><subparagraph id="H803378DD0B294BF3B7CF634E37B258E1"><enum>(C)</enum><text display-inline="yes-display-inline">in clause (v) (as redesignated), by
inserting <quote>or (iv) </quote> after <quote>clause (ii)</quote>; and</text>
</subparagraph><subparagraph id="HCE0E1E06AA8B4340B7555ED79E374DFF"><enum>(D)</enum><text>by inserting after
clause (ii) the following new clauses:</text>
<quoted-block display-inline="no-display-inline" id="H925E2871B2ED426FB871A451F8CD6896" style="traditional">
<clause id="H6AB9FA415B2B4A9A92DABE42FDDBBCE6" indent="up3"><enum>(iii)</enum><text>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 2013, the
amount established for purposes of clause (iv) of subparagraph (A) shall be
$11,933.</text>
</clause><clause id="H98199D2205C94A27AB73CEE74968E3A6" indent="up3"><enum>(iv)</enum><text>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 2013, 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 2013
under clause (iii) of this subparagraph and the quotient obtained by
dividing—</text>
<subclause id="H9E1CCEEB04ED4FED84DF98122E8E2910"><enum>(I)</enum><text display-inline="yes-display-inline">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</text>
</subclause><subclause id="H6BFC671CE27B474480027562EC12BAA4"><enum>(II)</enum><text>the national average wage index (as
so defined) for
2011.</text>
</subclause></clause><after-quoted-block>.</after-quoted-block></quoted-block>
</subparagraph></paragraph></subsection><subsection id="HE3363585873A4F7F8C8FFC4840F2A2B8"><enum>(b)</enum><header>Basic AIME and
surplus AIME</header>
<paragraph id="H8C52DF19C8864132AAF502180D50E4FC"><enum>(1)</enum><header>Basic
AIME</header><text display-inline="yes-display-inline">Section 215(b)(1) of
such Act (42 U.S.C. 415(b)(1)) is amended—</text>
<subparagraph id="HA3DC56F202224681BF23B686FA7FC108"><enum>(A)</enum><text display-inline="yes-display-inline">by inserting <quote>basic</quote> before
<quote>average</quote>; and</text>
</subparagraph><subparagraph id="H9C4781D9FA4F483998859C36F029FBD9"><enum>(B)</enum><text>in subparagraph
(A), by striking <quote>paragraph (3)</quote> and inserting <quote>paragraph
(3)(A)</quote> and by inserting before the comma the following: <quote>to the
extent such total does not exceed the contribution and benefit base for the
applicable year</quote>.</text>
</subparagraph></paragraph><paragraph id="H590F35BE9B32434D9B2976EDC3F87336"><enum>(2)</enum><header>Surplus
AIME</header>
<subparagraph id="H4109C37F429B45E78931B59078BA1D9C"><enum>(A)</enum><header>In
general</header><text>Section 215(b)(1) of such Act (as amended by paragraph
(1)) is amended—</text>
<clause id="H02661C66D95F457DB3272781410EBA85"><enum>(i)</enum><text>by
redesignating subparagraphs (A) and (B) as clauses (i) and (ii),
respectively;</text>
</clause><clause id="H615695D052D24A5999F50B381D0DC085"><enum>(ii)</enum><text>by
inserting <quote>(A)</quote> after <quote>(b)(1)</quote>; and</text>
</clause><clause id="H1F3F357D826D4E3582660165EBE63608"><enum>(iii)</enum><text>by
adding at the end the following new subparagraph:</text>
<quoted-block display-inline="no-display-inline" id="H52E6FBE32EB74CEA839B3524A4F18756" style="traditional">
<subparagraph id="HE3E9B22F9EAC44AE971CF0F2124D46A8" indent="up2"><enum>(B)</enum><clause commented="no" display-inline="yes-display-inline" id="H30233B7339664199B4225CF91E19F67F"><enum>(i)</enum><text>An individual’s surplus
average indexed monthly earnings shall be equal to the quotient obtained by
dividing—</text>
<subclause id="HB736AB37B9534FF58FECEFE8E8AB45AB" indent="up1"><enum>(I)</enum><text>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</text>
</subclause><subclause id="H10D195BDF7D04AE48FE7FC0575CC83C3" indent="up1"><enum>(II)</enum><text>the number of months in those
years.</text>
</subclause></clause><clause id="HDBA6FFB698844087BB89699E822C0B59" indent="up1"><enum>(ii)</enum><text display-inline="yes-display-inline">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.</text>
</clause></subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</clause></subparagraph><subparagraph id="H176592843E7D4DDEBA1B8197AF716FD0"><enum>(B)</enum><header>Conforming
amendment</header><text>The heading for section 215(b) of such Act is amended
by striking <quote>Average Indexed Monthly Earnings</quote> and inserting
<quote>Basic Average Indexed Monthly Earnings; Surplus Average Indexed Monthly
Earnings</quote>.</text>
</subparagraph></paragraph><paragraph id="H72AEB2C1EEA2477E9778E8FE562D60A8"><enum>(3)</enum><header>Adjustment of
surplus earnings for purposes of determining surplus AIME</header><text>Section
215(b)(3) of such Act (42 U.S.C. 415(b)(3)) is amended—</text>
<subparagraph id="H2E2931F24991444E95EF50C6C62FCFDB"><enum>(A)</enum><text>in subparagraph
(A), by striking <quote>subparagraph (B)</quote> and inserting
<quote>subparagraph (C)</quote> and by inserting <quote>and determination of
basic average indexed monthly income</quote> after <quote>paragraph
(2)</quote>;</text>
</subparagraph><subparagraph id="H301E09B6536148CD880DFABBD28F2205"><enum>(B)</enum><text>by redesignating
subparagraph (B) as subparagraph (C); and</text>
</subparagraph><subparagraph id="H7739575AF083412AB49F1A7BA7C36ED1"><enum>(C)</enum><text>by inserting after
subparagraph (A) the following new subparagraph:</text>
<quoted-block display-inline="no-display-inline" id="H36F1DEE8F969410FB4A31FB40E3BF85E" style="traditional">
<subparagraph id="H7DBAB0726EC14DDCAFF989E3E808EC05" indent="up2"><enum>(B)</enum><text>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—</text>
<clause id="HC95E822A1C464972B0DFB3C6DB4601B8"><enum>(i)</enum><text>the individual’s surplus earnings for
such year (as determined without regard to this subparagraph), and</text>
</clause><clause id="HA7686727E6464FC89001191EBB3BFD0A"><enum>(ii)</enum><text>the quotient described in
subparagraph
(A)(ii).</text>
</clause></subparagraph><after-quoted-block>.</after-quoted-block></quoted-block>
</subparagraph></paragraph></subsection><subsection display-inline="no-display-inline" id="H71BD043BC763449B8E546CCEA57BA0BE"><enum>(c)</enum><header>Effective
date</header><text display-inline="yes-display-inline">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 2012.</text>
</subsection></section>