[Congressional Record Volume 140, Number 144 (Thursday, October 6, 1994)]
[Senate]
[Page S]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


[Congressional Record: October 6, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]

 
  SOCIAL SECURITY DOMESTIC EMPLOYMENT REFORM ACT OF 1994--CONFERENCE 
                                 REPORT

  Mr. MOYNIHAN. Mr. President, I submit a report of the committee of 
conference on H.R. 4278 and ask for its immediate consideration.
  The PRESIDING OFFICER. The report will be stated.
  The legislative clerk read as follows:

       The committee of conference on the disagreeing votes of the 
     two Houses on the amendment of the Senate to the bill (H.R. 
     4278) to make improvements in the old-age, survivors, and 
     disability insurance program under title II of the Social 
     Security Act, having met, after full and free conference, 
     have agreed to recommend and do recommend to their respective 
     Houses this report, signed by all of the conferees.

  The PRESIDING OFFICER. Without objection, the Senate will proceed to 
the consideration of the conference report.
  (The conference report is printed in the House proceedings of the 
Record of October 4, 1994.)
  Mr. MOYNIHAN. Mr. President, I am pleased to bring to the floor today 
the conference report on H.R. 4278, the Social Security Domestic 
Employment Reform Act of 1994. Earlier today the House voted to approve 
the report by a recorded vote of 423 to 0.
  Let me begin by thanking the distinguished ranking minority member of 
the Finance Committee, Senator Packwood, for his assistance in bringing 
this bill to enactment.
  Indeed, I would be remiss if I failed to note that there has been 
remarkable support for this legislation on both sides of the aisle. 
Senators will recall that on May 12 of this year H.R. 4278 was passed 
by the House of Representatives by a recorded vote of 420 to 0. It 
passed the Senate on May 25 by unanimous consent.
  This conference agreement, which the House and Senate conferees 
concluded just late yesterday, updates and increases the $50 wage 
threshold used since 1951 to determine whether an employer must pay 
Social Security taxes on wages paid to domestic employees.
  It repeals the current requirements for quarterly filing of domestic 
employment taxes. Henceforth, employers will be able to file annual 
reports of the domestic wages they have paid during the year at the 
same time they file their personal income tax returns.
  Finally, this legislation exempts from Social Security taxes the 
wages paid to domestic workers under the age of 18, with the exception 
of a young worker whose principal employment is domestic service. Thus 
it completely exempts wages paid to the teenager who is the occasional 
babysitter or who mows the neighbor's lawn.
  As events of the last 2 years have shown, these changes are long 
overdue. The Department of the Treasury estimates that fewer than one-
quarter of employers report the wages they pay to their domestic 
employees. This widespread problem of noncompliance in payment of 
Social Security taxes for domestic employees was brought to the 
attention of the public by the unhappy experience of several nominees 
for high government office.
  But the most unfortunate effect of the current law is the fact that 
many thousands of domestic workers have not been receiving the Social 
Security wage credits they have rightfully earned. This is a most 
serious denial of fairness that cannot go untended.
  The $50-per-quarter threshold for domestic employees was adopted in 
1950, some 44 years ago. At a hearing by the Committee on Finance on 
July 21, 1993, every witness who appeared supported increasing the 
threshold and simplifying the wage reporting requirements. Among those 
testifying was Robert J. Myers, Chief Actuary of the Social Security 
Administration for 23 years, who told the committee that legislation to 
this effect would greatly improve coverage compliance for domestic 
workers. The committee heard similar testimony from the Department of 
the Treasury.
  Under the conference report, beginning in 1995 the threshold will 
increase to $1,000. In subsequent years the threshold will be adjusted 
for growth in wages, with increases occurring in $100 increments.
  In addition, the conference report simplifies the way employers can 
pay the taxes they owe on wages they pay to domestic employees. 
Currently, these employers must sit down every 3 months, figure their 
payroll taxes, and write a check to the IRS for the amount due. Under 
the conference report, for 3 years--1995, 1996, and 1997--employers 
will be able to pay the payroll taxes they owe on wages paid to their 
domestic employees at the end of the year, when they file their 
personal income tax returns. In subsequent years, employers will be 
allowed either to increase the rate of withholding from their own 
salaries to cover their anticipated payroll tax liability on wages paid 
to domestic employees or to make quarterly estimated tax payments.
  The conference report includes other improvements in the Social 
Security program.
  It prohibits payment of Social Security benefits to individuals who 
are found to be not guilty of an offense by reason of insanity, but who 
are, as a result of such a verdict, confined in a public institution. 
This extends to these individuals the same rule that applies to Social 
Security beneficiaries who are confined in correctional facilities 
after having been convicted of a felony offense.
  There are also two provisions concerning overpayments. One will help 
prevent them from happening in the first place, and the second will 
allow the Social Security Administration to use additional procedures 
to recover overpayments after they have been made.
  More specifically, nursing homes will be asked to help prevent 
overpayments that sometime occur when Supplemental Security Income 
recipients are first admitted by requiring the nursing home to report 
the admission of these recipients within 2 weeks of the date of 
admission. Under the law, a SSI recipient's benefit is reduced to $30 
per month while in a nursing home, because the cost of care is being 
paid by Medicaid.
  The conference report also strengthens SSA's ability to recover 
overpayments by giving the agency the same authority to use certain 
debt collection tools that are currently used by other Federal 
agencies. Under this provision, the Social Security Administration will 
be able to recover debts owed by former Social Security beneficiaries 
by withholding other Federal payments to which the debtor is entitled, 
by reporting delinquent debtors to credit reporting agencies, and by 
hiring private debt collection agencies to recover outstanding 
obligations.
  The conference report assures the solvency of the disability 
insurance program by allocating a greater portion of Social Security 
taxes to the Disability Insurance Trust Fund. This reallocation was 
necessitated by the recent growth in the disability rolls, a phenomenon 
which is not yet fully understood. The conferees agreed to require the 
Commissioner of Social Security to conduct a study of the rising costs 
of the disability program and to report to the Congress by October 1, 
1995, on the findings of the study and any recommendations for 
legislative changes.
  Mr. President, passage of this legislation is long over due. I ask 
that my colleagues join me in supporting the conference report on H.R. 
4278.
  Mr. President, I ask unanimous consent that the conference report be 
agreed to; that the motion to reconsider laid on the table; and that 
any statements thereon appear in the Record at the appropriate place as 
though read.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  So the conference report was agreed.
  Mr. MOYNIHAN. Mr. President, may I say, indeed, at long last, after 
44 years, we have decriminalized babysitting.

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