SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Social Security Benefits Fairness 
Act of 1996''.

SEC. 2. COMPUTATION AND PAYMENT OF LAST MONTHLY PAYMENT.

    (a) Old-Age and Survivors Insurance Benefits.--Section 202 of the 
Social Security Act (42 U.S.C. 402) is amended by adding at the end the 
following new subsection:

    ``Last Payment of Monthly Insurance Benefit Terminated by Death

    ``(y)(1) In any case in which an individual dies during the first 
15 days of a calendar month, the amount of such individual's monthly 
insurance benefit under this section paid for such month shall be an 
amount equal to 50 percent of the amount of such benefit (as determined 
without regard to this subsection), rounded, if not a multiple of $1, 
to the next lower multiple of $1. This subsection shall apply with 
respect to such benefit after all other adjustments with respect to 
such benefit provided by this title have been made.
    ``(2) Any payment of an individual's benefit under this section for 
the month in which such individual dies shall be made in accordance 
with section 204(d).''.
    (b) Disability Insurance Benefits.--Section 223 of such Act (42 
U.S.C. 423) is amended by adding at the end the following new 
subsection:

             ``Last Payment of Benefit Terminated by Death

    ``(j)(1) In any case in which an individual dies during the first 
15 days of a calendar month, the amount of such individual's monthly 
insurance benefit under this section paid for such month shall be an 
amount equal to 50 percent of the amount of such benefit (as determined 
without regard to this subsection), rounded, if not a multiple of $1, 
to the next lower multiple of $1. This subsection shall apply with 
respect to such benefit after all other adjustments with respect to 
such benefit provided by this title have been made.
    ``(2) Any payment of an individual's benefit under this section for 
the month in which such individual dies shall be made in accordance 
with section 204(d).''.
    (c) Benefits at Age 72 for Certain Uninsured Individuals.--Section 
228 of such Act (42 U.S.C. 428) is amended by adding at the end the 
following new subsection:

             ``Last Payment of Benefit Terminated by Death

    ``(i)(1) In any case in which an individual dies during the first 
15 days of a calendar month, the amount of such individual's monthly 
insurance benefit under this section paid for such month shall be an 
amount equal to 50 percent of the amount of such benefit (as determined 
without regard to this subsection), rounded, if not a multiple of $1, 
to the next lower multiple of $1. This subsection shall apply with 
respect to such benefit after all other adjustments with respect to 
such benefit provided by this title have been made.
    ``(2) Any payment of an individual's benefit under this section for 
the month in which such individual dies shall be made in accordance 
with section 204(d).''.

SECTION 3. CONFORMING AMENDMENTS REGARDING PAYMENT OF BENEFITS FOR 
              MONTH OF RECIPIENT'S DEATH.

    (a) Old-Age Insurance Benefits.--Section 202(a) of the Social 
Security Act (42 U.S.C. 402(a)) is amended by striking ``the month 
preceding'' in the matter following subparagraph (B).
    (b) Wife's Insurance Benefits.--
            (1) In general.--Section 202(b)(1) of such Act (42 U.S.C. 
        402(b)(1)) is amended--
                    (A) by striking ``and ending with the month'' in 
                the matter immediately following clause (ii) and 
                inserting ``and ending with the month in which she dies 
                or (if earlier) with the month'';
                    (B) by striking subparagraph (E); and
                    (C) by redesignating subparagraphs (F) through (K) 
                as subparagraphs (E) through (J), respectively.
            (2) Conforming amendment.--Section 202(b)(5)(B) of such Act 
        (42 U.S.C. 402(b)(5)(B)) is amended by striking ``(E), (F), 
        (H), or (J)'' and inserting ``(E), (G), or (I)''.
    (c) Husband's Insurance Benefits.--
            (1) In general.--Section 202(c)(1) of such Act (42 U.S.C. 
        402(c)(1)) is amended--
                    (A) by striking ``and ending with the month'' in 
                the matter immediately following clause (ii) and 
                inserting ``and ending with the month in which he dies 
                or (if earlier) with the month'';
                    (B) by striking subparagraph (E); and
                    (C) by redesignating subparagraphs (F) through (K) 
                as subparagraphs (E) through (J), respectively.
            (2) Conforming amendment.--Section 202(c)(5)(B) of such Act 
        (42 U.S.C. 402(c)(5)(B)) is amended by striking ``(E), (F), 
        (H), or (J)'' and inserting ``(E), (G), or (I)''.
    (d) Child's Insurance Benefits.--Section 202(d)(1) of such Act (42 
U.S.C. 402(d)(1)) is amended--
            (1) by striking ``and ending with the month'' in the matter 
        immediately preceding subparagraph (D) and inserting ``and 
        ending with the month in which such child dies or (if earlier) 
        with the month''; and
            (2) by striking ``dies, or'' in subparagraph (D).
    (e) Widow's Insurance Benefits.--Section 202(e)(1) of such Act (42 
U.S.C. 402(e)(1)) is amended by striking ``ending with the month 
preceding the first month in which any of the following occurs: she 
remarries, dies,'' in the matter following subparagraph (F) and 
inserting ``ending with the month in which she dies or (if earlier) 
with the month preceding the first month in which any of the following 
occurs: she remarries, or''.
    (f) Widower's Insurance Benefits.--Section 202(f)(1) of such Act 
(42 U.S.C. 402(f)(1)) is amended by striking ``ending with the month 
preceding the first month in which any of the following occurs: he 
remarries, dies,'' in the matter following subparagraph (F) and 
inserting ``ending with the month in which he dies or (if earlier) with 
the month preceding the first month in which any of the following 
occurs: he remarries,''.
    (g) Mother's and Father's Insurance Benefits.--Section 202(g)(1) of 
such Act (42 U.S.C. 402(g)(1)) is amended--
            (1) by inserting ``with the month in which he or she dies 
        or (if earlier)'' after ``and ending'' in the matter following 
        subparagraph (F); and
            (2) by striking ``he or she remarries, or he or she dies'' 
        and inserting ``or he or she remarries''.
    (h) Parent's Insurance Benefits.--Section 202(h)(1) of such Act (42 
U.S.C. 402(h)(1)) is amended by striking ``ending with the month 
preceding the first month in which any of the following occurs: such 
parent dies, marries,'' in the matter following subparagraph (E) and 
inserting ``ending with the month in which such parent dies or (if 
earlier) with the month preceding the first month in which any of the 
following occurs: such parent marries,''.
    (i) Disability Insurance Benefits.--Section 223(a)(1) of such Act 
(42 U.S.C. 423(a)(1)) is amended by striking ``ending with the month 
preceding whichever of the following months is the earliest: the month 
in which he dies,'' in the matter following subparagraph (D) and 
inserting the following: ``ending with the month in which he dies or 
(if earlier) with whichever of the following months is the earliest:''.
    (j) Benefits at Age 72 for Certain Uninsured Individuals.--Section 
228(a) of such Act (42 U.S.C. 428(a)) is amended by striking ``the 
month preceding'' in the matter following paragraph (4).
    (k) Exemption From Maximum Benefit Cap.--Section 203 of such Act 
(42 U.S.C. 403 is amended by adding at the end the following new 
subsection:

                  ``Exemption From Maximum Benefit Cap

    ``(m) Notwithstanding any other provision of this section, the 
application of this section shall be made without regard to any benefit 
of an individual under section 202, 223, or 228 for the month in which 
such individual dies.''.

SEC. 4. EFFECTIVE DATE.

    The amendments made by this Act shall apply with respect to deaths 
occurring after 180 days after the date of the enactment of this Act.
Social Security Benefits Fairness Act of 1996 - Amends title II (Old Age, Survivors and Disability Insurance) (OASDI) of the Social Security Act to provide that a monthly OASDI benefit shall be paid for the month in which the recipient dies, subject to a reduction of 50 percent if the recipient dies during the first 15 days of such month.
Social Security Benefits Fairness Act of 1996