[Congressional Bills 113th Congress]
[From the U.S. Government Publishing Office]
[S. 567 Introduced in Senate (IS)]
113th CONGRESS
1st Session
S. 567
To improve the retirement security of American families by
strengthening Social Security.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
March 14, 2013
Mr. Harkin introduced the following bill; which was read twice and
referred to the Committee on Finance
_______________________________________________________________________
A BILL
To improve the retirement security of American families by
strengthening Social Security.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Strengthening Social Security Act of
2013''.
SEC. 2. DETERMINATION OF TAXABLE WAGES AND SELF-EMPLOYMENT INCOME ABOVE
CONTRIBUTION AND BENEFIT BASE AFTER 2013.
(a) Determination of Taxable Wages Above Contribution and Benefit
Base After 2013.--
(1) Amendments to the internal revenue code of 1986.--
Section 3121 of the Internal Revenue Code of 1986 is amended--
(A) in subsection (a)(1), by inserting ``the
applicable percentage (determined under subsection
(c)(1)) of'' before ``that part of the remuneration'';
and
(B) in subsection (c), by striking ``(c) Included
and Excluded Service.--For purposes of this chapter,
if'' and inserting the following:
``(c) Special Rules for Wages and Employment.--
``(1) Applicable percentage of remuneration in determining
taxable wages.--For purposes of subsection (a)(1), the
applicable percentage for a calendar year shall be equal to--
``(A) for 2014, 80 percent;
``(B) for 2015 through 2017, the applicable
percentage under this paragraph for the previous year,
decreased by 20 percentage points; and
``(C) for 2018 and each year thereafter, 0 percent.
``(2) Included and excluded service.--For purposes of this
chapter, if''.
(2) Amendments to the social security act.--Section 209 of
the Social Security Act (42 U.S.C. 409) is amended--
(A) in subsection (a)(1)(I)--
(i) by inserting ``and before 2014'' after
``1974''; and
(ii) by inserting ``and'' after the
semicolon;
(B) in subsection (a)(1), by adding at the end the
following new subparagraph:
``(J) 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 2013
with respect to which such contribution and benefit
base is effective, is paid to such individual during
such calendar year;''; and
(C) by adding at the end the following new
subsection:
``(l) For purposes of subsection (a)(1)(J), the applicable
percentage for a calendar year shall be equal to--
``(1) for 2014, 80 percent;
``(2) for 2015 through 2017, the applicable percentage
under this subsection for the previous year, decreased by 20
percentage points; and
``(3) for 2018 and each year thereafter, 0 percent.''.
(3) Effective date.--The amendments made by this subsection
shall apply with respect to remuneration paid in calendar years
after 2013.
(b) Determination of Taxable Self-Employment Income Above
Contribution and Benefit Base After 2013.--
(1) Amendments to the internal revenue code of 1986.--
Section 1402 of the Internal Revenue Code of 1986 is amended--
(A) in subsection (b)(1), by striking ``that part
of the net earnings'' and all that follows through
``minus'' and inserting the following: ``an amount
equal to the applicable percentage (as determined under
subsection (d)(2)) of that part of the net earnings
from self-employment which is in excess of the
difference (not to be less than zero) between (i) an
amount equal to the contribution and benefit base (as
determined under section 230 of the Social Security
Act) which is effective for the calendar year in which
such taxable year begins, and''; and
(B) in subsection (d)--
(i) by striking ``(d) Employee and Wages.--
The term'' and inserting the following:
``(d) Rules and Definitions.--
``(1) Employee and wages.--The term''; and
(ii) by adding at the end the following:
``(2) Applicable percentage of net earnings from self-
employment in determining taxable self-employment income.--For
purposes of subsection (b)(1), the applicable percentage for a
taxable year beginning in any calendar year referred to in such
paragraph shall be equal to--
``(A) for 2014, 80 percent;
``(B) for 2015 through 2017, the applicable
percentage under this paragraph for the previous year,
decreased by 20 percentage points; and
``(C) for 2018 and each year thereafter, 0
percent.''.
(2) Amendments to the social security act.--Section 211 of
the Social Security Act (42 U.S.C. 411) is amended--
(A) in subsection (b)--
(i) in paragraph (1)(I)--
(I) by striking ``or'' after the
semicolon; and
(II) by inserting ``and before
2014'' after ``1974'';
(ii) by redesignating paragraph (2) as
paragraph (3); and
(iii) by inserting after paragraph (1) the
following:
``(2) For any taxable year beginning in any calendar year
after 2013, 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 the difference (not
to be less than zero) between--
``(A) an amount equal to the contribution and
benefit base (as determined under section 230) that is
effective for such calendar year, and
``(B) the amount of the wages paid to such
individual during such taxable year; or''; and
(B) by adding at the end the following:
``(l) For purposes of subsection (b)(2), the applicable percentage
for a taxable year beginning in any calendar year referred to in such
paragraph shall be equal to--
``(1) for 2014, 80 percent;
``(2) for 2015 through 2017, the applicable percentage
under this subsection for the previous year, decreased by 20
percentage points; and
``(3) for 2018 and each year thereafter, 0 percent.''.
(3) Effective date.--The amendments made by this subsection
shall apply with respect to taxable years beginning during or
after calendar year 2014.
SEC. 3. ADJUSTMENTS TO BEND POINTS IN DETERMINING PRIMARY INSURANCE
AMOUNT AND INCLUSION OF SURPLUS EARNINGS FOR BENEFIT
DETERMINATIONS.
(a) Inclusion of Surplus Average Indexed Monthly Earnings in
Determination of Primary Insurance Amounts.--
(1) In general.--Section 215(a)(1)(A) of the Social
Security Act (42 U.S.C. 415(a)(1)(A)) is amended--
(A) in clauses (i), (ii), and (iii), by inserting
``basic'' before ``average indexed monthly earnings''
each place it appears;
(B) in clause (ii), by striking ``and'' at the end;
(C) in clause (iii), by adding ``and'' at the end;
and
(D) by inserting after clause (iii) the following
new clause:
``(iv) 5 percent of the individual's surplus average
indexed monthly earnings,''.
(2) Bend point adjustment.--Section 215(a)(1)(B) of such
Act (42 U.S.C. 415(a)(1)(B)) is amended--
(A) by redesignating clause (iii) as clause (iv);
and
(B) by inserting after clause (ii) the following
new clause:
``(iii) 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
2018, the amount determined under clause (i) of this
subparagraph for purposes of subparagraph (A)(i) for such
calendar year shall be increased by--
``(I) for calendar year 2019, 1 percent;
``(II) for each of calendar years 2020 through
2032, the percent determined under this clause for the
preceding year increased by 1 percentage point; and
``(III) for calendar year 2033 and each year
thereafter, 15 percent.''.
(b) Basic AIME and Surplus AIME.--
(1) Basic aime.--Section 215(b)(1) of such Act (42 U.S.C.
415(b)(1)) is amended--
(A) by inserting ``basic'' before ``average''; and
(B) in subparagraph (A), by striking ``paragraph
(3)'' and inserting ``paragraph (3)(A)'' and by
inserting before the comma the following: ``to the
extent such total does not exceed the contribution and
benefit base for the applicable year''.
(2) Surplus aime.--
(A) In general.--Section 215(b)(1) of such Act (as
amended by paragraph (1)) is amended--
(i) by redesignating subparagraphs (A) and
(B) as clauses (i) and (ii), respectively;
(ii) by inserting ``(A)'' after ``(b)(1)'';
and
(iii) by adding at the end the following
new subparagraph:
``(B)(i) An individual's surplus average indexed monthly earnings
shall be equal to the quotient obtained by dividing--
``(I) 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
``(II) the number of months in those years.
``(ii) 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.''.
(B) Conforming amendment.--The heading for section
215(b) of such Act is amended by striking ``Average
Indexed Monthly Earnings'' and inserting ``Basic
Average Indexed Monthly Earnings; Surplus Average
Indexed Monthly Earnings''.
(3) Adjustment of surplus earnings for purposes of
determining surplus aime.--Section 215(b)(3) of such Act (42
U.S.C. 415(b)(3)) is amended--
(A) in subparagraph (A), by striking ``subparagraph
(B)'' and inserting ``subparagraph (C)'' and by
inserting ``and determination of basic average indexed
monthly income'' after ``paragraph (2)'';
(B) by redesignating subparagraph (B) as
subparagraph (C); and
(C) by inserting after subparagraph (A) the
following new subparagraph:
``(B) 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--
``(i) the individual's surplus earnings for such year (as
determined without regard to this subparagraph), and
``(ii) the quotient described in subparagraph (A)(ii).''.
(c) Effective Date.--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 2018.
SEC. 4. CONSUMER PRICE INDEX FOR ELDERLY CONSUMERS.
(a) In General.--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 ``Consumer Price Index for Elderly Consumers'' that
indicates changes over time in expenditures for consumption which are
typical for individuals in the United States who have attained early
retirement age (as defined under section 216(l)(2) of the Social
Security Act (42 U.S.C. 416(l)(2)) for purposes of an old-age, wife's,
or husband's insurance benefit).
(b) Effective Date.--Subsection (a) shall apply with respect to
calendar months ending on or after June 30 of the calendar year in
which this Act is enacted.
(c) Authorization of Appropriations.--There are authorized to be
appropriated such sums as are necessary to carry out the provisions of
this section.
SEC. 5. COMPUTATION OF COST-OF-LIVING INCREASES FOR SOCIAL SECURITY
BENEFITS.
(a) In General.--Section 215(i) of the Social Security Act (42
U.S.C. 415(i)) is amended--
(1) in paragraph (1)(G), by inserting before the period the
following: ``, and, with respect to any monthly insurance
benefit payable under this title, 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), 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''; and
(2) in paragraph (4), by striking ``and by section 9001''
and inserting ``, by section 9001'', and by inserting after
``1986,'' the following: ``and by section 5(a) of the
Strengthening Social Security Act of 2013,''.
(b) Conforming Amendments in Applicable Former Law.--Section
215(i)(1)(C) of the Social Security 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: ``, and, with respect to any monthly insurance benefit
payable under this title, 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), 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''.
(c) Effective Date.--The amendments made by this section shall
apply to determinations made by the Commissioner of Social Security
under section 215(i)(2) of the Social Security Act (42 U.S.C.
415(i)(2)) with respect to cost-of-living computation quarters ending
on or after September 30, 2014.
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