SOCIAL SECURITY ADMINISTRATION BALTIMORE, MD 21235-0001

SOCIAL SECURITY

Office of the Chief Actuary

December 8, 2016 

The Honorable Sam Johnson 

Subcommittee on Social Security

Committee on Ways and Means 

United States House of Representatives

Washington, D.C. 20515 

Dear Chairman Johnson: 

I am writing in response to your request for estimates of the financial effects on Social Security 

of H.R. 6489, the Social Security Reform Act of 2016, which you introduced today. The estimates 

provided here reflect the intermediate assumptions of the 2016 Trustees Report. This Bill 

(hereafter referred to as the proposal) includes fifteen provisions with direct effects on the Social 

Security Trust Funds. The estimates and analysis provided here reflect the combined effort of 

many in the Office of the Chief Actuary, but most particularly Karen Glenn, Christopher 

Chaplain, Daniel Nickerson, Kyle Burkhalter, Michael Clingman, Anna Kirjusina, Katie Sutton, 

and Tiffany Bosley. 

The enclosed tables provide estimates of the effects of the fifteen provisions on the cost, income, 

and combined trust fund reserves for the Old Age, Survivors, and Disability Insurance (OASDI) 

program, as well as estimated effects on retired worker benefit levels for selected hypothetical 

workers. In addition, tables 1b and 1b.n provide estimates of the federal budget implications of 

the fifteen provisions. Assuming enactment of the plan, we estimate that the combined OASI and 

DI Trust Funds would be fully solvent (able to pay all scheduled benefits in full on a timely 

basis) throughout the 75-year projection period, under the intermediate assumptions of the 2016 

Trustees Report. In addition, under this plan the OASDI program would meet the further 

conditions for sustainable solvency, because projected combined trust fund reserves would be 

growing as a percentage of the annual cost of the program at the end of the long-range period.

While we estimate that the provisions of this proposal would make the combined OASI and DI 

Trust Funds solvent throughout the 75-year projection period under the intermediate assumptions 

of the 2016 Trustees Report, the two trust funds are separate legal entities. Some modification of 

the allocation of the total payroll tax rate between the OASI Trust Fund and the DI Trust Fund 

might be necessary to ensure that both trust funds would remain solvent for the next 75 years 

under these assumptions. 

The proposal includes fifteen basic provisions with direct effects on the OASDI program. The 

following list briefly identifies each provision: 
Page 2 – The Honorable Sam Johnson 

1) For retired worker and disabled worker beneficiaries becoming initially eligible in 

January 2023 or later, phase in a new benefit formula (from 2023 to 2032). Replace the 

existing two PIA bend points with three new bend points and modified benefit formula 

factors. 

2) Use an annualized “mini-PIA” formula beginning with retired and disabled worker 

beneficiaries becoming newly eligible in 2023, phased in over 10 years. The mini-PIA 

calculation would use a single year’s average monthly indexed earnings (mini-AIME) 

and primary insurance amount (mini-PIA) for each year with taxable earnings. 

3) Replace the current-law Windfall Elimination Provision (WEP) with a new calculation 

for most OASI and DI benefits based on covered and non-covered earnings, phased in for 

beneficiaries becoming newly eligible in 2023 through 2032. 

4) After the normal retirement age (NRA) reaches 67 for those attaining age 62 in 2022, 

increase the NRA by 3 months per year starting for those attaining age 62 in 2023 until it 

reaches 69 for those attaining age 62 in 2030. Increase the age up to which delayed 

retirement credits may be earned from 70 to 72 on the same schedule. 

5) Beginning with the December 2018 COLA, provide no COLA for those with modified 

adjusted gross income (MAGI) above specific thresholds and compute the COLA using 

the chain-weighted version of the CPI-U (C-CPI-U) for all other beneficiaries.

6) For spouses and children of retired workers and disabled workers becoming newly 

eligible beginning in 2023 and phased in for 2023 through 2032, limit their auxiliary 

benefit to the amount based on one-half of the PIA of a hypothetical worker with earnings 

equal to the national average wage index (AWI) each year up to his or her eligibility 

year, and who has the same eligibility year as the worker. 

7) Beginning in January 2019, require full time school enrollment as a condition of 

eligibility for child benefits at age 15 up to 18. 

8) Provide a new minimum benefit for workers with more than 10 years of covered earnings 

above a specified level, phased in for retired and disabled worker beneficiaries becoming 

newly eligible in 2023 through 2032.

9) Beginning in January 2019, eliminate the retirement earnings test for all beneficiaries 

under NRA. 

10) Eliminate federal income taxation of OASDI benefits that is credited to the OASI and DI 

Trust Funds for 2054 and later, phased in from 2045 to 2053. 

11) Provide an option to split the 8-percent delayed retirement credit (DRC) to offer a lump 

sum benefit at initial entitlement equivalent to 2 of the 8 percent DRC earned, and a 6 

percent DRC on subsequent monthly benefits, effective for workers attaining age 62 in 

2023 and later. 
Page 3 – The Honorable Sam Johnson 

12) Beginning in January 2023, provide an addition to monthly benefits for all beneficiaries 

who have been eligible for at least 20 years. The additional amount is calculated based 

on 5 percent of the PIA for a hypothetical worker with earnings equal to the national 

average wage index each year.

13) Beginning in January 2023, for new and current disabled widow(er) beneficiaries, 

change the requirement that disability must occur no later than 7 years after the worker’s 

death, or after surviving spouse with child-in-care benefits were last payable, to no later 

than 10 years. 

14) Beginning in January 2023, for new and current disabled surviving spouse beneficiaries, 

eliminate the requirement to be age 50 or older for receipt of benefits.

15) Beginning in January 2023, for new and current beneficiaries, waive the two-year 

duration of divorce requirement for divorced spouse benefit eligibility in cases where the 

worker (former spouse) remarries someone other than the claimant before the two-year 

period has elapsed. 

The balance of this letter provides a summary of the effects of the fifteen provisions on the 

actuarial status of the OASDI program, our understanding of the specifications and intent of each 

of the fifteen provisions, and descriptions of our detailed financial estimates for trust fund 

operations, benefit levels, and implications for the federal budget. See the “Specification for 

Provisions of the Proposal” section of this letter for a more detailed description of these fifteen

provisions. 

Summary of Effects of the Proposal on OASDI Actuarial Status

Figure 1 illustrates the projected trust fund ratio through 2090 under present law and assuming 

enactment of the proposal. The trust fund ratio is defined as the combined Old-Age and 

Survivors Insurance (OASI) and Disability Insurance (DI) Trust Fund reserves expressed as a 

percent of annual program cost. Assuming enactment of the proposal, the combined OASI and 

DI Trust Funds would be fully solvent throughout the 75-year projection period, under the 

intermediate assumptions of the 2016 Trustees Report. In addition, because the projected trust 

fund ratio is increasing at the end of the period, the plan meets the conditions for sustainable 

solvency. It should be noted, however, that because the projected level of reserves reaches as low 

as 10 percent of annual program cost around 2045, unexpected fluctuations in the economy or 

other factors affecting program cost or revenue could require additional temporary measures to 

maintain solvency through this period. 
Page 4 – The Honorable Sam Johnson 

Note: Trust Fund Ratio for a given year is the ratio of reserves in the combined OASI and DI Trust Funds at the 

beginning of the year to the cost of the program for the year.

Under current law, 79 percent of scheduled benefits are projected to be payable on a timely basis 

in 2034 after depletion of the combined trust fund reserves, with the percentage payable 

declining to 74 percent for 2090. Under the plan, the OASDI program would be solvent 

throughout the 75-year projection period, and would have the ability to pay 100 percent of 

scheduled benefits on a timely basis for the foreseeable future.

Enactment of the fifteen provisions of this proposal would change the long-range OASDI 

actuarial deficit from 2.66 percent of taxable payroll under current law to a positive actuarial 

balance of 0.02 percent of payroll under the proposal. 

Figure 2 illustrates annual projected levels of cost, expenditures, and non-interest income as a 

percent of the current-law taxable payroll. The projected level of cost reflects the full cost of 

scheduled benefits under both current law and the proposal. Under the proposal, projected 

expenditures equal the full cost of scheduled benefits throughout the long-range period. 

0

50

100

150

200

250

300

350

400

2016 2020 2030 2040 2050 2060 2070 2080 2090

Trust Fund Ratio

Figure 1. Present Law and Proposal OASDI Trust Fund Reserves as Percent of 

Annual Cost: 2016 TR Intermediate Assumptions

Present Law Trust Fund Ratio

Proposal
Page 5 – The Honorable Sam Johnson 

OASDI program annual cost under the proposal is higher than under current law, starting in 

2019. This difference decreases and by 2022, annual cost under the proposal is lower than under 

current law. The reduction in cost grows quickly through 2055, reaching over 4 percent of 

current-law payroll, and then gradually, reaching about 5.5 percent of current-law payroll for 

2090. Beginning in 2019, non-interest income under the proposal is projected to be slightly 

higher than under current law through 2022. For 2023 and later, non-interest income under the 

proposal is lower than under current law due to reduced and eventual elimination of revenue 

from income taxation of benefits, with the difference increasing to 0.9 percent of current-law 

payroll for 2090. The annual balance (non-interest income minus program cost) under the 

proposal is slightly worse (more negative) than under current law from 2019 through 2021. For 

2022 and later, the proposal improves the annual balance. 

It is also useful to consider the projected cost, expenditures, and income for the OASDI program 

expressed as a percentage of Gross Domestic Product (GDP). Figure 3 illustrates these levels 

under both current law and the proposal. 

11

12

13

14

15

16

17

18

19

2016 2020 2030 2040 2050 2060 2070 2080 2090

Percent of Present-Law Taxable Payroll

Figure 2. Proposal and Present Law Cost, Expenditures, and Non-Interest Income 

as Percent of Taxable Payroll: 2016 TR Intermediate Assumptions

Present Law Cost

Present Law Non-Interest Income

Present Law Expenditures

Proposal Cost

Proposal Non-Interest Income

Proposal Expenditures
Page 6 – The Honorable Sam Johnson 

Specification for Provisions of the Proposal 

1) For retired worker and disabled worker beneficiaries becoming initially eligible in 

January 2023 or later, phase in a new benefit formula (from 2023 to 2032). Replace the 

existing two PIA bend points with three new bend points and modified benefit formula 

factors. 

The three new bend points are at 25 percent, 100 percent, and 125 percent of one-twelfth the

AWI from two years prior to initial eligibility. The new PIA factors are 95 percent, 27.5 percent, 

5 percent, and 2 percent. During the phase-in, those becoming newly eligible for benefits will 

receive an increasing portion of their benefits based on the new formula, from 10 percent based 

on the new formula in 2023 to 100 percent based on the new formula for those becoming newly 

eligible in 2032 and later. This provision applies to all individuals receiving benefits on the 

account of a retired, disabled, or deceased worker. The new PIA formula would result in slightly 

higher benefit amounts for workers with average indexed earnings levels below 90 percent of the 

AWI, and lower benefit levels for those with higher average indexed earnings. Assuming 

enactment of this provision, we estimate that 51 percent of worker beneficiaries would have a 

higher PIA than under current law, and 49 percent would have a lower PIA. 

4.0

4.5

5.0

5.5

6.0

6.5

2016 2020 2030 2040 2050 2060 2070 2080 2090

Percent of GDP

Figure 3. Proposal and Present Law Cost, Expenditures, and Non-Interest Income 

as Percent of GDP: 2016 TR Intermediate Assumptions

Present Law Cost

Present Law Non-Interest Income

Present Law Expenditures

Proposal Cost

Proposal Non-Interest Income

Proposal Expenditures
Page 7 – The Honorable Sam Johnson 

We estimate that enactment of this provision alone would reduce the long-range OASDI 

actuarial deficit by 0.85 percent of taxable payroll and would reduce the annual deficit for the 

75th projection year (2090) by 1.53 percent of payroll. 

2) Use an annualized “mini-PIA” formula beginning with retired and disabled worker 

beneficiaries becoming newly eligible in 2023, phased in over 10 years. The mini-PIA 

calculation would use a single year’s average monthly indexed earnings (mini-AIME) and 

primary insurance amount (mini-PIA) for each year with taxable earnings. 

For each year of earnings (indexed as under current law in a monthly equivalent form), for 

retired workers compute an individual PIA. Sum these individual PIAs for the 35 highest years 

and divide that total amount by 35 to get the PIA under this provision. For disabled and deceased 

workers, the number of highest mini-PIA years would equal the number of current-law benefit 

computation years. Phase-in over ten years, meaning that in 2023, 90 percent of the benefit 

would be based on the old PIA formula and 10 percent on the new mini-PIA formula, shifting by 

10 percentage points each year until 100 percent is based on the new mini-PIA formula for 

becoming newly eligible in 2032 and later. This provision applies to all individuals receiving 

benefits on the account of a retired, disabled, or deceased worker. 

We estimate that enactment of this provision alone would reduce the long-range OASDI

actuarial deficit by 0.34 percent of taxable payroll and would reduce the annual deficit for the 

75th projection year (2090) by 0.59 percent of payroll. 

3) Replace the current-law Windfall Elimination Provision (WEP) with a new calculation for 

most OASI and DI benefits based on covered and non-covered earnings, phased in for 

beneficiaries becoming newly eligible in 2023 through 2032. 

For this new approach, compute a PIA based on all past earnings (covered and non-covered), and 

multiply by the “non-covered earnings ratio.” This ratio is equal to the current-law concept of the 

average indexed monthly earnings computed without non-covered earnings divided by a 

modified average indexed monthly earnings that includes both covered and non-covered earnings 

in our records. Another way to describe the new approach is that beneficiaries will receive a 

benefit that reflects the replacement rate applicable for a worker with the same career earnings, 

where all earnings had been covered.

In the context of this overall proposal, the new approach under this provision would be applied 

for each individual year of earnings in order to compute modified mini-PIA amounts. 

We estimate that enactment of this provision alone would reduce the long-range OASDI

actuarial deficit by 0.03 percent of taxable payroll and would reduce the annual deficit for the 

75th projection year (2090) by 0.05 percent of payroll. 

4) After the normal retirement age (NRA) reaches 67 for those attaining age 62 in 2022, 

increase the NRA by 3 months per year starting for those attaining age 62 in 2023 until it 

reaches 69 for those attaining age 62 in 2030. Increase the age up to which delayed 

retirement credits may be earned from 70 to 72 on the same schedule. 
Page 8 – The Honorable Sam Johnson 

As the NRA is increased, the potential number of years of early entitlement (prior to NRA) for 

retired worker, aged spouse, and aged widow(er) benefits will increase, ultimately by 2 years.

For retired worker and aged spouse benefits, the additional reduction to monthly benefits for 

early entitlement between 5 and 7 years will be at the rate of 4.5 percentage points per year (9/24 

percentage point per month). For aged widow(er) benefits, the reduction of 28.5 percent will be 

retained for new entitlement at age 60 (as well as for disabled widow(er) benefits), and will be 

phased linearly as under current law to no reduction for age when newly entitled at NRA or 

above. The earliest eligibility age (EEA) for worker, spouse, and widow(er)’s benefits is 

unchanged. 

In addition to increasing the NRA, increase the age up to which delayed retirement credits may 

be earned from 70 to 72 on the same schedule. Increase the widow(er) NRA in the same manner. 

We estimate that enactment of this provision alone would reduce the long-range OASDI 

actuarial deficit by 0.84 percent of taxable payroll and would reduce the annual deficit for the 

75th projection year (2090) by 1.33 percent of payroll. 

5) Beginning with the December 2018 COLA, provide no COLA for those with modified 

adjusted gross income (MAGI) above specific thresholds and compute the COLA using the 

chain-weighted version of the CPI-U (C-CPI-U) for all other beneficiaries. 

For single/head-of-household/married-filing-separate taxpayers with MAGI below $85,000 and 

for joint filers with MAGI below $170,000 for the prior tax year, use the chain-weighted version 

of the Consumer Price Index for All Urban Consumers (C-CPI-U) to calculate the cost-of-living 

adjustment (COLA), beginning with the December 2018 COLA. For those beneficiaries whose 

MAGI is above $85,000 ($170,000 if filed jointly) for the prior tax year, provide no COLA. 

Index the eligibility income threshold amounts to the CPI-U after December 2018. These 

thresholds are the Medicare Income Related Monthly Adjustment Amount (IRMAA) and are 

indexed in the same way.

We estimate that enactment of this provision alone would reduce the long-range OASDI 

actuarial deficit by 1.25 percent of taxable payroll and would reduce the annual deficit for the 

75th projection year (2090) by 2.31 percent of payroll. 

6) For spouses and children of retired workers and disabled workers becoming newly 

eligible beginning in 2023 and phased in for 2023 through 2032, limit their auxiliary benefit 

to the amount based on one-half of the PIA of a hypothetical worker with earnings equal to 

the national average wage index (AWI) each year up to his or her eligibility year, and who 

has the same eligibility year as the worker. 

For retired workers, the PIA is calculated as of age 62 and is increased by COLAs thereafter. For 

disabled workers, the PIA is calculated as of the year of benefit eligibility and is increased by 

COLAs thereafter.

We estimate that enactment of this provision alone would reduce the long-range OASDI 

actuarial deficit by 0.07 percent of taxable payroll and would reduce the annual deficit for the 

75th projection year (2090) by 0.11 percent of payroll. 
Page 9 – The Honorable Sam Johnson 

7) Beginning in January 2019, require full time school enrollment as a condition of eligibility 

for child benefits at age 15 up to 18. 

Under current law, children of qualifying retired, disabled, or deceased workers can receive 

benefits on the worker’s account regardless of school attendance up to age 18. Children attending 

elementary, middle, or high school can continue to receive benefits up to age 19. This provision 

would require full time school enrollment for children age 15 up to age 18 in order to be eligible 

for benefits. Eligibility for disabled adult child benefits after attaining age 18 would be 

unchanged. 

We estimate that enactment of this provision alone would reduce the long-range OASDI 

actuarial deficit by 0.01 percent of taxable payroll and would reduce the annual deficit for the 

75th projection year (2090) by 0.01 percent of payroll. 

8) Provide a new minimum benefit for workers with more than 10 years of covered earnings 

above a specified level, phased in for retired and disabled worker beneficiaries becoming 

newly eligible in 2023 through 2032.

Under this provision, the PIA based on any worker’s account would be set at the higher of (a) the 

amount based on the standard PIA computation or (b) a percentage of the AWI from the second 

year prior to initial eligibility. The percentage under (b) would be set at zero percent of AWI for 

those with 10 or fewer years of work (YOWs), rising to 15 percent of AWI for those with 15 

YOWs, then increasing linearly to 19 percent of AWI for those with 19 YOWs. Then the 

minimum PIA would jump to 25 percent of AWI for those with 20 YOWs, increasing linearly to 

35 percent of AWI for those with 35 or more YOWs. A YOW is equal to earnings at or above 

$10,875 in 2017 (reflecting a full-time worker earning the federal minimum wage), adjusted 

thereafter for average wage growth. Scale the YOW requirements for disabled workers, based on 

years of non-disability. Use the AWI for two years prior to the year of initial eligibility in the 

minimum PIA calculation with COLA increases after the year of initial eligibility. This provision 

applies to all individuals receiving benefits on the account of a retired, disabled, or deceased 

worker. 

We estimate that enactment of this provision alone would increase the long-range OASDI 

actuarial deficit by 0.23 percent of taxable payroll and would increase the annual deficit for the 

75th projection year (2090) by 0.41 percent of payroll. 

9) Beginning in January 2019, eliminate the retirement earnings test for all beneficiaries 

under NRA. 

Under this provision, all beneficiaries under NRA would be exempt, including retired workers, 

aged spouses, aged widow(er)s, young spouses with a child in care, surviving spouses with a 

child in care, and children. Because beneficiaries at or above NRA are already exempt from the 

retirement earnings test under current law, this provision would completely eliminate the 

retirement earnings test for all beneficiaries. 
Page 10 – The Honorable Sam Johnson 

We estimate that enactment of this provision alone would reduce the long-range OASDI 

actuarial deficit by 0.01 percent of taxable payroll and would reduce the annual deficit for the 

75th projection year (2090) by 0.12 percent of payroll. 

10) Eliminate federal income taxation of OASDI benefits that is credited to the OASI and DI 

Trust Funds for 2054 and later, phased in from 2045 to 2053. 

Under current law, single tax filers with combined “income” (approximately equal to adjusted 

gross income plus non-taxable interest income and one-half of their Social Security benefit) 

greater than $25,000 may have to pay income tax on up to 50 percent of the benefits. If 

combined “income” exceeds $34,000, up to 85 percent of the benefits may be taxable. The 

income tax revenue for taxing up to 50 percent of Social Security benefits goes to the OASI and 

DI Trust Funds. The additional income tax revenue derived from taxing benefits in excess of 50 

percent, up to 85 percent, goes to the Hospital Insurance (HI) Trust Fund. The process is similar 

for joint tax filers, with $32,000 and $44,000 thresholds applying for possible taxation of up to 

50 percent or 85 percent of the Social Security benefits, respectively. All threshold levels are 

fixed amounts and not indexed to price inflation or average wage increase. 

Under this provision, the $25,000/$32,000 thresholds would increase from 2045 to 2053, and 

taxation of OASDI benefits that is credited to the OASI and DI Trust Funds would be completely 

eliminated starting in 2054. The 2045 to 2053 thresholds for single and joint filers would be as 

follows: 

• 2045: $32,500/$65,000 

• 2046: $40,000/$80,000 

• 2047: $47,500/$95,000 

• 2048: $55,000/$110000 

• 2049: $62,500/$125,000 

• 2050: $70,000/$140,000 

• 2051: $77,500/$155,000 

• 2052: $85,000/$170,000 

• 2053: $92,500/$185,000. 

We estimate that enactment of this provision alone would increase the long-range OASDI 

actuarial deficit by 0.40 percent of taxable payroll and would increase the annual deficit for the 

75th projection year (2090) by 0.96 percent of payroll. Note that the HI Trust Fund would be held 

harmless relative to current law, with respect to taxation of benefit revenues. 

11) Provide an option to split the 8-percent delayed retirement credit (DRC) to offer a lump 

sum benefit at initial entitlement equivalent to 2 of the 8 percent DRC earned, and a 6 

percent DRC on subsequent monthly benefits, effective for workers attaining age 62 in 2023 

and later. 

Those attaining age 62 in 2023 or later have the option to split the current-law 8 percent DRC 

into two parts, a credit and a lump sum. The credit equals 6 percent for each year (0.5 percent for 

each month) that eligible benefits are not taken within three years after reaching NRA. The lump 
Page 11 – The Honorable Sam Johnson 

sum is equal to the present value at the time of selecting the option of the additional future 

monthly benefits the worker is foregoing by taking the 6 percent rather than the full 8 percent 

DRC. Widows are held harmless from the lump sum decision, meaning that the full 8 percent 

will apply for widow benefits, even when the deceased worker had elected to take the lump sum 

option. 

We estimate that the change in the long-range OASDI annual balance and the change in the 

annual deficit for the 75th projection year (2090) from enactment of this provision alone would 

be negligible: that is, between -0.005 and 0.005 percent of taxable payroll. 

12) Beginning in January 2023, provide an addition to monthly benefits for all beneficiaries 

who have been eligible for at least 20 years. The additional amount is calculated based on 5 

percent of the PIA for a hypothetical worker with earnings equal to the national average 

wage index each year.

Beginning in January 2023, augment the monthly benefit amount (not the PIA) for those of 

qualifying age and eligibility duration with an MAGI below $25,000 if single and below $50,000 

if married. Use the Medicare IRMAA definition of MAGI (AGI plus tax-exempt interest 

income). For this provision, these thresholds are indexed for years after 2023 by the increase in 

the C-CPI-U. The full additional amount is applicable for those born in 1957 and later, once 24 

years elapse from initial eligibility. The basic additional amount is calculated as 5 percent of the 

PIA of for a hypothetical worker with earnings equal to the AWI each year. For those born prior 

to 1957, the full additional amount is multiplied by the number of years they have been affected 

by the C-CPI-U, divided by 24. 

Beneficiaries will receive 20 percent of their additional amount in their 20th year after initial 

benefit eligibility, 40 percent in their 21st year after initial eligibility, ..., and 100 percent of their 

additional amount in their 24th and later years after initial benefit eligibility. 

Retired and disabled worker beneficiaries, dually entitled spouse beneficiaries, and all survivor 

beneficiaries receive their addition as described above. Spousal beneficiaries (aged or with a 

child in care) and child beneficiaries of a living retired or disabled worker receive 50 percent of 

the additional amount described above. Other beneficiary types (such as parents of deceased 

workers) will receive the percentage of the flat benefit that is equal to the percentage of the 

insured worker’s PIA that they receive.

The AWI used is for the second year prior to the beneficiary’s initial eligibility year, with 

applicable COLAs applied up to the age when the addition is received. The additional amount is 

added to the monthly benefit after reductions for early claiming or increases for delayed claiming 

have been applied. 

We estimate that enactment of this provision alone would increase the long-range OASDI 

actuarial deficit by 0.07 percent of taxable payroll and would increase the annual deficit for the 

75th projection year (2090) by 0.07 percent of payroll. 
Page 12 – The Honorable Sam Johnson 

13) Beginning in January 2023, for new and current disabled widow(er) beneficiaries, 

change the requirement that disability must occur no later than 7 years after the worker’s 

death, or after surviving spouse with child-in-care benefits were last payable, to no later than 

10 years. 

We estimate that the change in the long-range OASDI annual balance and the change in the 

annual deficit for the 75th projection year (2090) from enactment of this provision alone would 

be negligible: that is, between -0.005 and 0.005 percent of taxable payroll. 

14) Beginning in January 2023, for new and current disabled surviving spouse beneficiaries, 

eliminate the requirement to be age 50 or older for receipt of benefits.

Under current law, widow(er)s must attain age 50 in order to qualify for benefits as widow(er)s 

on the basis of being disabled. This provision would remove the age-50 requirement. 

We estimate that the change in the long-range OASDI annual balance and the change in the 

annual deficit for the 75th projection year (2090) from enactment of this provision alone would 

be negligible: that is, between -0.005 and 0.005 percent of taxable payroll. 

15) Beginning in January 2023, for new and current beneficiaries, waive the two-year 

duration of divorce requirement for divorced spouse benefit eligibility in cases where the 

worker (former spouse) remarries someone other than the claimant before the two-year 

period has elapsed. 

We estimate that the change in the long-range OASDI annual balance and the change in the 

annual deficit for the 75th projection year (2090) from enactment of this provision alone would 

be negligible: that is, between -0.005 and 0.005 percent of taxable payroll. 

Detailed Financial Results for the Provisions of the Proposal 

Summary Results by Provision 

Table A provides estimates of the effects on the OASDI long-range actuarial balance for each of 

the fifteen provisions of the proposal separately and on a combined basis. The table also includes 

estimates of the effect of each provision on the annual balance (the difference between income 

rate and the cost rate, expressed as a percent of current-law taxable payroll) for the 75th

projection year, 2090. Interaction among individual provisions is reflected only in the total 

estimates for the combined provisions. 

Benefit Illustrations

Tables B1 and B2 provide illustrative examples of the projected change in benefit levels under 

the fifteen provisions that affect benefit levels for beneficiaries retiring at age 65 in future years 

at five selected earnings levels, with selected numbers of years of work. The “Maximum-AIME 

Steady Earner” is assumed to have earnings at ages 22 through 64 that equal the current-law 

taxable maximum level (equivalent to $118,500 for 2016). Table B3 provides additional 

important information on characteristics of retired workers represented by these illustrations. 
Page 13 – The Honorable Sam Johnson 

Table B1 compares the initial scheduled benefit levels, assuming retirement at age 65 under the 

provisions of the proposal, to both scheduled and payable current-law benefit levels. Benefit 

amounts scheduled under the proposal are generally lower than those scheduled in current law, 

because the three provisions included in the table that decrease benefits for most workers (NRA 

increase, COLA decrease, mini-PIA) generally outweigh the other two provisions included 

(change the PIA formula, increase the minimum benefit). Note that two of the hypothetical 

worker examples provided have higher benefits than scheduled under current law because of the 

minimum benefit provision. The final two columns of this table show the level of scheduled 

benefits under the proposal as a percentage of current-law scheduled and current-law payable 

benefits, respectively.

Table B2 compares the change in scheduled benefit levels at ages 65, 75, 85, and 95 under the 

proposal to scheduled benefits under current law, assuming retirement at age 65. Table B2 shows 

that projected scheduled benefits under the provisions of the proposal decrease in relation to 

current-law scheduled benefits between ages 65 and 75 for most earners. The benefit addition 

increases proposal benefits for ages 85 and 95 above the level scheduled in current-law for 

several hypothetical lower-earner examples, and diminishes the decrease relative to current-law

scheduled benefits for other earners.

The hypothetical workers represented in these tables reflect average career-earnings patterns of 

workers who started receiving retirement benefits under the Social Security program in recent 

years. The tables subdivide workers with very low and low career-average earnings levels by 

their numbers of years of non-zero earnings.

Table B3 provides information helpful in interpreting the benefit illustrations in tables B1 and 

B2. Percentages in Table B3 are based on tabulations from a 10-percent sample of newly-entitled 

retired workers in 2007. Table B3 displays the percentages of these newly-entitled retired

workers in 2007 that are closest to each of the illustrative examples and are:

1) “Dually Entitled”, meaning they received a higher spouse or widow(er) benefit based on 

the career earnings of their husband or wife,

2) “WEP” (Windfall Elimination Provision), meaning that they received a reduced benefit 

due to having a pension based on earnings that were not covered under the OASDI 

program (primarily certain government workers), and they had less than 30 years of 

substantial earnings that were taxable under the OASDI program,

3) “Foreign Born”, meaning that they entered the Social Security coverage area after birth 

(and generally after entering working ages), and 

4) “All Others”, meaning they had none of the three characteristics listed above.

The extent to which retired-worker beneficiaries represented by each of the illustrative examples 

have any of the characteristics listed above (dually entitled, WEP, foreign born) is important 

because such individuals are less dependent on the OASDI benefit that relates to their own 

career-average earnings level.
Page 14 – The Honorable Sam Johnson 

Detailed Tables Containing Annual and Summary Projections 

Enclosed with this letter are tables 1, 1a, 1b, 1b.n, 1c, and 1d, which provide annual and 

summary projections for the proposal. 

Trust Fund Operations 

Table 1 provides projections of the financial operations of the OASDI program under the 

proposal and shows that the combined OASDI Trust Funds would be fully solvent throughout the 

75-year projection period. The OASDI program would also be solvent for the foreseeable future 

(sustainably solvent), because the OASDI trust fund ratio is projected to rise by the end of the 

period, 2091. As mentioned earlier, however, the relatively low trust fund ratios projected around 

2045 provide only a small contingency reserve for solvency. Unforeseen economic conditions or 

other events affecting benefits and revenue might require additional measures around that time. 

The table shows the annual cost and income rates, annual balances, and trust fund ratios 

(reserves as percent of annual program cost) for OASDI, as well as the change from current law 

in these cost rates, income rates, and annual balances. Included at the bottom of this table are 

summarized rates for the 75-year (long-range) period.

The annual balance (non-interest income minus program cost) under the proposal is slightly 

worse (more negative) than under current law from 2019 through 2021. For 2022 and later, the 

proposal improves the annual balance. The improvement in the annual balance increases to 3.7 

percent of payroll for 2053, drops to 3.3 for 2054 (due to the full elimination of OASDI taxation 

of benefits starting in that year), and thereafter increases steadily to 4.5 percent of payroll for 

2090. Under the proposal, the annual deficit generally worsens from 1.1 percent of payroll for 

2016 to 2.1 percent of payroll for 2028, and then improves until the annual balance turns positive 

for 2045. The annual balance increases to 0.5 percent of payroll for 2053, drops to 0.2 percent of 

payroll for 2054, and then stays relatively stable through the end of the long-range period, 

ultimately reaching 0.2 percent of payroll for 2090. Under current law, the projected annual 

deficit for 2090 is 4.3 percent of payroll. 

The actuarial balance for the OASDI program over the 75-year projection period is improved by 

2.67 percent of taxable payroll, from an actuarial deficit of 2.66 percent of payroll under current 

law to a positive actuarial balance of 0.02 percent of taxable payroll under the proposal. 

Program Transfers and Trust Fund Reserves 

Column 4 of Table 1a provides a projection of the level of reserves for the theoretical combined 

OASI and DI Trust Funds, assuming enactment of the fifteen Social Security provisions of the 

proposal. These trust fund reserve amounts are expressed in present value dollars discounted to 

January 1, 2016. The table indicates that the provisions include no new specified transfers of 

general revenue to the trust funds. For purpose of comparison, the OASDI Trust Fund reserves, 

expressed in present value dollars, are also shown for the current-law Social Security program 

both without and with the added proposal general fund transfers (zero in this case) in columns 6 

and 7. 
Page 15 – The Honorable Sam Johnson 

Note that negative values in columns 6 and 7 represent the “unfunded obligation” for the 

program through the year. The unfunded obligation is the present value of the shortfall of 

revenue needed to pay full scheduled benefits on a timely basis from the date of trust fund 

reserve depletion through the end of the indicated year. Gross Domestic Product (GDP), 

expressed in present value dollars, is shown in column 5 for comparison with other values in the 

table.

Effect of the Social Security Provisions on the Federal Budget 

Table 1b shows the projected effect, in present value discounted dollars, on the federal budget 

(unified-budget and on-budget) annual cash flows and balances, assuming enactment of the 

fifteen Social Security provisions of the proposal. Table 1b.n provides the estimated nominal 

dollar effect of enactment of the proposal on annual budget balances for years 2016 through 

2026. All values in these tables represent the amount of change from the level projected under 

current law. In addition, changes reflect the budget scoring convention that presumes benefits, 

not payable under the law after depletion of trust fund reserves, would still be paid using revenue 

provided from the General Fund of the Treasury. The reader should be cautioned that this 

presumption of payment of benefits beyond the resources of the trust funds is prohibited under 

current law and is also inconsistent with all past experience under the Social Security program.

We understand that the elimination of taxation of Social Security benefits under provision 10 is 

intended to hold the Medicare HI Trust Fund harmless. The tables provided here for effects on 

the budget do not reflect any change based on revenue provided to HI from taxing OASDI 

benefits.

Column 1 of Table 1b shows the added proposal general fund transfers (zero for this proposal). 

Column 2 shows the net changes in OASDI cash flow from all provisions of the proposal. 

We expect the net effect of the proposal on unified budget cash flow (column 3) to be negative in 

years 2019 through 2021, and then positive in years 2022 and later, with the decrease in program 

cost more than offsetting income decreases. 

Column 4 of Table 1b indicates that the effect of implementing the proposal is a reduction of the 

federal debt held by the public, reaching about $11.9 trillion in present value at the end of the 75-

year projection period. Column 5 provides the projected effect of the proposal on the annual 

unified budget balances, including both the cash flow effect in column 3 and the additional 

interest on the accumulated debt in column 4. Columns 6 and 7 indicate that the provisions of 

this proposal would have no expected direct effects on the on-budget cash flow, or on the total 

federal debt, in the future. 

It is important to note that we base these estimates on the intermediate assumptions of the 2016 

Trustees Report, so these estimates are not consistent with estimates made by the Office of 

Management and Budget or the Congressional Budget Office based on their assumptions. In 

particular, all present values are discounted using trust fund yield assumptions under the 

intermediate assumptions of the 2016 Trustees Report. 
Page 16 – The Honorable Sam Johnson 

Annual Trust Fund Operations as a Percent of GDP 

Table 1c provides annual cost, annual expenditures (amount that would be payable), and annual 

tax income for the OASDI program expressed as a percentage of GDP for both current law and 

assuming enactment of the fifteen Social Security provisions of the proposal. Showing the annual 

trust fund cash flows as a percent of GDP provides an additional perspective on these trust fund 

operations in relation to the total value of goods and services produced in the United States. The 

relationship between income and cost is similar when expressed as a percent of GDP to that 

when expressed as a percent of taxable payroll (Table 1).

Effects on Trust Fund Reserves and Unfunded Obligations 

Table 1d provides estimates of the changes in trust fund reserves and unfunded obligations on an 

annual basis. Values in this table are expressed in present value dollars discounted to January 1, 

2016. 

For the 75-year (long-range) period as a whole, the current-law unfunded obligation of $11.4 

trillion is replaced by a positive trust fund reserve of $0.6 trillion in present value assuming 

enactment of the proposal. This change of $11.9 trillion results from:

• A $2.0 trillion net decrease in revenue (column 2), primarily from eliminating OASDI 

taxation of benefits in 2054 and later, minus

• A $13.9 trillion net decrease in cost (column 3), primarily from increasing the NRA, 

reducing (and, for some, eliminating) the COLA, using a “mini-PIA” calculation, and 

modifying the PIA bend points and factors. 

We hope these estimates are helpful. Please let me know if we may provide further assistance. 

Sincerely,

 Stephen C. Goss, ASA, MAAA 

 Chief Actuary

Enclosures 
Table A—Estimated Long-Range OASDI Financial Effects of H.R. 6489,

the “Social Security Reform Act of 2016,” 

Introduced by Chairman Sam Johnson

Provision

Estimated Change in

Long-Range OASDI 

Actuarial Balance 1

(as a percent of payroll)

Estimated Change 

in Annual Balance 

for 75th year 2

(as a percent of payroll)

1) For retired worker and disabled worker beneficiaries becoming

initially eligible in January 2023 or later, phase in a new benefit 

formula (from 2023 to 2032). Replace the existing two primary 

insurance amount (PIA) bend points with three new bend points as 

follows:

• 25% AWI/12 from 2 years prior to initial eligibility

• 100% AWI/12 from 2 years prior to initial eligibility

• 125% AWI/12 from 2 years prior to initial eligibility

The new PIA factors are 95%, 27.5%, 5% and 2%. During the phase 

in, those becoming newly eligible for benefits will receive an 

increasing portion of their benefits based on the new formula, 

reaching 100% of the new formula in 2032............................................ 0.85 1.53

2) Use an annualized “mini-PIA” formula beginning with retired and 

disabled worker beneficiaries becoming newly eligible in 2023, 

phased in over 10 years. For each year of earnings (indexed as under 

current law in a monthly equivalent form), compute a single year’s

PIA For retired workers, sum these individual PIAs for the 35 

highest years of indexed earnings and divide that total amount by 35 

to get the PIA under this provision. For disabled workers, the 

number of highest mini-PIA years would equal the number of 

current-law benefit computation years. Phase-in over ten years, 

meaning that in 2023, 90 percent of the benefit would be based on 

the old PIA formula and 10 percent on the new mini-PIA formula, 

shifting by 10 percentage points each year until 100 percent is based 

on the new mini-PIA formula for those becoming newly eligible in 

2032 and later......................................................................................... 0.34 0.59

3) Replace the current-law WEP with a new calculation for most 

OASI and DI benefits based on covered and non-covered earnings, 

phased in for beneficiaries becoming newly eligible in 2023 to 

through 2032. For this new approach, compute a PIA based on all 

past earnings (covered and non-covered), and multiply by the “noncovered earnings ratio.” This ratio is equal to the current-law 

concept of the average indexed monthly earnings computed without 

non-covered earnings divided by a modified average indexed 

monthly earnings that includes both covered and non-covered 

earnings in our records ...........................................................................

0.03 0.05
Table A—Estimated Long-Range OASDI Financial Effects of H.R. 6489,

the “Social Security Reform Act of 2016,” 

Introduced by Chairman Sam Johnson

Provision

Estimated Change in

Long-Range OASDI 

Actuarial Balance 1

(as a percent of payroll)

Estimated Change 

in Annual Balance 

for 75th year 2

(as a percent of payroll)

4) After the normal retirement age (NRA) reaches 67 for those 

attaining age 62 in 2022, increase the NRA by 3 months per year 

starting for attaining age 62 in 2023 until it reaches 69 for those

attaining age 62 in 2030. Increase the age up to which delayed 

retirement credits may be earned from 70 to 72 on the same 

schedule. Increase the widow(er) NRA in the same manner. The 

earliest eligibility age (EEA) for worker and widow(er)’s benefit is 

unchanged............................................................................................... 0.84 1.33

5) For single/head-of-household/married-filing-separate taxpayers 

with modified adjusted gross income (MAGI) below $85,000 and for 

joint filers with MAGI below $170,000 for the prior tax year, use the 

chain-weighted version of the Consumer Price Index for All Urban 

Consumers (C-CPI-U) to calculate the cost-of-living adjustment 

(COLA), beginning with the December 2018 COLA. For those 

beneficiaries whose MAGI is above the $85,000/$170,000 for the 

prior tax year, provide no COLA. Index the eligibility income 

threshold amounts to the CPI-U after December 2018........................... 1.25 2.31

6) For spouses and children of retired and disabled workers 

becoming newly eligible beginning in 2023 and phased in for 2023

through 2032, limit their auxiliary benefit to one-half of the PIA for 

a hypothetical worker with earnings equal to the national average 

wage index (AWI) each year.................................................................. 0.07 0.11

7) Beginning in January 2019, require full time school enrollment as 

a condition of eligibility for child benefits at age 15 up to 18................ 0.01 0.01

8) Provide a new minimum benefit for workers with more than 10 

years of covered earnings above a specified level, phased in for

retired and disabled workers becoming newly eligible in 2023 

through 2032. Set the minimum PIA at zero percent of AWI for 

those with 10 or fewer years of work (YOW) to 15 percent of AWI

of those with 15 YOWs, increasing linearly so that it reaches 19

percent for 19 YOWs. Then the minimum PIA would jump up to 25

percent of AWI for those with 20 YOWs, increasing linearly so that 

it equals 35 percent of AWI for those with 35 or more YOWs. A 

YOW is equal to earnings at or above $10,875 in 2017 (reflecting a 

full-time worker earning the federal minimum wage), adjusted 

thereafter for average wage growth. Scale the YOW requirements for 

disabled workers, based on years of non-disability. Use the AWI for 

two years prior to the year of initial eligibility in the minimum PIA 

calculation with COLA increase after the year of initial eligibility........ -0.23 -0.41
Table A—Estimated Long-Range OASDI Financial Effects of H.R. 6489,

the “Social Security Reform Act of 2016,” 

Introduced by Chairman Sam Johnson

Provision

Estimated Change in

Long-Range OASDI 

Actuarial Balance 1

(as a percent of payroll)

Estimated Change 

in Annual Balance 

for 75th year 2

(as a percent of payroll)

9) Beginning in January 2019, eliminate the retirement earnings test 

for all beneficiaries under normal retirement age, including retired 

workers, aged spouses, aged widow(er)s, young spouses with a child 

in care, young surviving spouses with a child in care, and children...... 0.01 0.12

10) Eliminate federal income taxation of OASDI benefits that is 

credited to the OASI and DI Trust Funds for 2054 and later. Phase 

out OASDI taxation of benefits by increasing relevant “income” 

thresholds from 2045 through 2053 as follows, for single/joint tax 

filers: 

• 2045 = $32,500/$65,000 

• 2046 = 40,000/80,000 

• 2047 = 47,500/95,000 

• 2048 = 55,000/110000 

• 2049 = 62,500/125,000 

• 2050 = 70,000/140,000 

• 2051 = 77,500/155,000 

• 2052 = 85,000/170,000 

• 2053 = 92,500/185,000

Taxation of benefits revenues for the Hospital Insurance (HI) Trust 

Fund would be maintained at the same level as if the current-law 

computation applied .............................................................................. -0.40 -0.96

11) Provide an option to split the 8-percent delayed retirement credit

(DRC) to offer a lump sum benefit at initial entitlement equal to 2 

percent of the 8 percent DRC earned, and a 6 percent DRC on 

subsequent monthly benefits, effective for workers attaining age 62 

in 2023 and later. Widows are held harmless from the lump-sum 

decision................................................................................................... 3 4
Table A—Estimated Long-Range OASDI Financial Effects of H.R. 6489,

the “Social Security Reform Act of 2016,” 

Introduced by Chairman Sam Johnson

Provision

Estimated Change in

Long-Range OASDI 

Actuarial Balance 1

(as a percent of payroll)

Estimated Change 

in Annual Balance 

for 75th year 2

(as a percent of payroll)

12) Beginning in January 2023, provide an addition to monthly 

benefits for all beneficiaries who have been eligible for at least 20 

years, with the following specifications: 

• Augment benefits (not the PIA) for those of qualifying age and

eligibility duration with a MAGI below $25,000 if single and $50,000 

if married. MAGI is set to equal the IRMAA definition (AGI plus

tax-exempt interest income). Index these thresholds after 2023 by the 

increase in the C-CPI-U. 

• The full additional amount is applicable for those born 1957 and 

later, once 24 years elapse from initial eligibility. The basic 

additional amount is calculated as 5 percent of the PIA for a 

hypothetical worker with earnings equal to the AWI each year.

• For those born prior to 1957, the full additional amount is multiplied 

by the number of years they have been affected by the C-CPI-U, 

divided by 24.

• Beneficiaries will receive 20 percent of their additional amount in 

their 20th year after initial eligibility, 40 percent in their 21st year after 

initial eligibility,..., and 100 percent of their additional amount in 

their 24th and later years after benefit eligibility. 

• Retired and disabled worker beneficiaries, dually entitled spouse 

beneficiaries, and all survivor beneficiaries received their addition as 

described above. Spousal beneficiaries (aged or with child in care) 

and child beneficiaries of a living retired or disabled worker receive 

50 percent of the additional amount described above. Other

beneficiary types (such as parents of deceased workers) will receive 

the percentage of the flat benefit that equals the percentage of the 

insured worker’s PIA that they receive. 

• The AWI used is for the second year prior to the beneficiary’s initial 

eligibility year, with applicable COLAs applied up to the age when 

the addition is received.

• The additional amount is added to the monthly benefit after 

reductions for early claiming or increases for delayed claiming have 

been applied........................................................................................... -0.07 -0.07

13) Beginning in January 2023, for new and current disabled 

widow(er) beneficiaries, change the requirement that disability must 

occur no later than 7 years after the worker’s death or after surviving 

spouse with child-in-care benefits were last payable, to no later than 

10 years .................................................................................................. 3 4
Table A—Estimated Long-Range OASDI Financial Effects of H.R. 6489,

the “Social Security Reform Act of 2016,” 

Introduced by Chairman Sam Johnson

Provision

Estimated Change in

Long-Range OASDI 

Actuarial Balance 1

(as a percent of payroll)

Estimated Change 

in Annual Balance 

for 75th year 2

(as a percent of payroll)

14) Beginning in January 2023, for new and current disabled 

surviving spouse beneficiaries, eliminate the requirement to be age 

50 or older for receipt of benefits........................................................... 3 4

15) Beginning in January 2023, for new and current beneficiaries, 

waive the two-year duration of divorce requirement for divorced 

spouse benefit eligibility, in cases where the worker (former spouse) 

remarries someone other than the claimant before the two-year 

period has elapsed .................................................................................. 3 4

Total for all provisions, including interaction.......................... 2.67 4.53

1

Under current law, the estimated long-range OASDI actuarial balance is -2.66 percent of taxable payroll. 2

Under current law, the estimated 75th year annual balance is -4.35 percent of taxable payroll. 3

Estimated change in actuarial balance that is negligible; that is, between -0.005 and 0.005 percent of taxable payroll. 4

Estimated change in 75th year annual balance that is negligible; that is, between -0.005 and 0.005 percent of taxable 

payroll. 

Notes: All estimates are based on the intermediate assumptions of the 2016 OASDI Trustees Report. 

 Estimates of individual provisions appear on a stand-alone basis relative to current law, unless otherwise stated.

Social Security Administration

Office of the Chief Actuary

December 8, 2016
Year Bend Points

Attain Increase Reduced PIA Formula Incremental Minimum

Age 65 (Wage-Indexed (CPI-Indexed NRA4 COLA5 Factors6 Mini PIA7 Benefit8 Total Scheduled Payable

2015 Dollars) 2015 Dollars)

 

2016 718 718 0.0 0.0 0.0 0.0 0.0 0.0 100 100

2030 660 812 -9.1 -0.9 7.0 -7.0 21.5 8.9 109 109

2050 661 1,036 -13.5 -0.9 14.1 -13.2 43.7 22.1 122 153

2080 665 1,469 -13.5 -0.9 14.1 -13.2 43.7 22.1 122 162

 

2016 718 718 0.0 0.0 0.0 0.0 0.0 0.0 100 100

2030 660 812 -9.1 -0.9 7.0 -16.5 1.0 -18.7 81 81

2050 661 1,036 -13.5 -0.9 14.1 -31.0 15.8 -21.8 78 98

2080 665 1,469 -13.5 -0.9 14.1 -31.0 15.8 -21.8 78 104

 

2016 718 718 0.0 0.0 0.0 0.0 0.0 0.0 100 100

2030 660 812 -9.1 -0.9 7.0 -22.8 0.0 -25.6 74 74

2050 661 1,036 -13.5 -0.9 14.1 -42.9 0.0 -44.1 56 70

2080 665 1,469 -13.5 -0.9 14.1 -42.9 0.0 -44.1 56 74

2016 940 940 0.0 0.0 0.0 0.0 0.0 0.0 100 100

2030 863 1,062 -9.1 -0.9 3.7 0.0 11.9 4.5 105 105

2050 865 1,356 -13.5 -0.9 7.4 0.0 19.5 10.1 110 138

2080 869 1,921 -13.5 -0.9 7.5 0.0 19.5 10.1 110 147

2016 940 940 0.0 0.0 0.0 0.0 0.0 0.0 100 100

2030 863 1,062 -9.1 -0.9 3.7 -4.4 8.6 -3.0 97 97

2050 865 1,356 -13.5 -0.9 7.4 -8.5 18.1 -0.4 100 125

2080 869 1,921 -13.5 -0.9 7.5 -8.5 18.1 -0.4 100 133

2016 940 940 0.0 0.0 0.0 0.0 0.0 0.0 100 100

2030 863 1,062 -9.1 -0.9 3.7 -12.8 0.7 -18.0 82 82

2050 865 1,356 -13.5 -0.9 7.4 -24.7 13.3 -21.4 79 99

2080 869 1,921 -13.5 -0.9 7.5 -24.7 13.3 -21.3 79 105

2016 1,548 1,548 0.0 0.0 0.0 0.0 0.0 0.0 100 100

2030 1,423 1,750 -9.1 -0.9 -0.6 -1.0 0.0 -11.4 89 89

2050 1,425 2,234 -13.5 -0.9 -1.2 -2.0 0.0 -16.9 83 104

2080 1,433 3,166 -13.5 -0.9 -1.2 -2.0 0.0 -16.9 83 111

2016 1,548 1,548 0.0 0.0 0.0 0.0 0.0 0.0 100 100

2030 1,423 1,750 -9.1 -0.9 -0.6 -7.5 0.0 -17.2 83 83

2050 1,425 2,234 -13.5 -0.9 -1.2 -15.1 0.0 -28.1 72 90

2080 1,433 3,166 -13.5 -0.9 -1.2 -15.1 0.0 -28.0 72 96

2016 2,053 2,053 0.0 0.0 0.0 0.0 0.0 0.0 100 100

2030 1,885 2,319 -9.1 -0.9 -11.1 0.0 0.0 -19.9 80 80

2050 1,888 2,960 -13.5 -0.9 -22.2 0.0 0.0 -33.2 67 84

2080 1,899 4,195 -13.5 -0.9 -22.2 0.0 0.0 -33.2 67 89

2016 2,492 2,492 0.0 0.0 0.0 0.0 0.0 0.0 100 100

2030 2,308 2,839 -9.1 -0.9 -17.0 0.0 0.0 -25.2 75 75

2050 2,309 3,622 -13.5 -0.9 -34.0 0.0 0.0 -43.3 57 71

2080 2,317 5,119 -13.5 -0.9 -33.8 0.0 0.0 -43.2 57 76

1 Average of highest 35 years of earnings wage indexed to 2016.

2 Projected percent of new retired worker awards in 2050 closest to AIME levels and years of work.

3 After the trust fund reserves deplete under present law continuing taxes are expected to be enough to pay about three fourths of scheduled benefits.

4

5

6

7

8

Note: These tables do not reflect the reduced taxation of OASDI benefits that would go to the Hospital Insurance (HI) Trust Fund assuming enactment of this Bill.

All estimates based on the intermediate assumptions of the 2016 Trustees Report.

Monthly Benefits3 Percent of Present Law:

Table B1. Changes in Benefits for Hypothetical Workers Beginning Benefit Receipt at age 65 

H.R. 6489, the "Social Security Reform Act of 2016," Introduced by Chairman Sam Johnson

Scheduled Benefit Level Percent Change at age 65

Present Law Scheduled Proposal Scheduled Benefit

 High-AIME ($78,594 for 20161) 44-Year Scaled Earner (19.8% of Retirees2)

(Percent change) (Percents)

 Very-Low-AIME ($12,280 for 20161) 30-Year Scaled Earner (8.9% of Retirees2)

 Very-Low-AIME ($12,280 for 20161) 20-Year Scaled Earner (5.2% of Retirees2)

 Very-Low-AIME ($12,280 for 20161) 14-Year Scaled Earner (4.2% of Retirees2)

 Low-AIME ($22,105 for 20161) 44-Year Scaled Earner (16.9% of Retirees2)

 Low-AIME ($22,105 for 20161) 30-Year Scaled Earner (4.4% of Retirees2)

 Low-AIME ($22,105 for 20161) 20-Year Scaled Earner (2.0% of Retirees2)

 Medium-AIME ($49,121 for 20161) 44-Year Scaled Earner (29.2% of Retirees2)

 Medium-AIME ($49,121 for 20161) 30-Year Scaled Earner (3.2% of Retirees2)

Office of the Chief Actuary, Social Security Administration December 8, 2016

 Maximum-AIME ($118,500 for 20161) 43-Year Steady Earner (6.3% of Retirees2)

After NRA reaches 67 in 2022, increase 3 months per year until NRA reaches 69 for those attaining 62 in 2030.

Starting Dec 2018, prior to benefit receipt, compute the COLA using the chain-weighted C-CPI-U, producing 0.3% lower annual COLAs on average.

Starting in 2023, set BP1 equal to 25% of AWI/12, BP2 equal to AWI/12, BP3 equal to 125% AWI/12 (2 year lag), and change the PIA factors to 95%/27.5%/5%/2%. Phase in the new BP and PIA factors 

years of initial eligibility 2023-2032.

Incremental change due to the mini-PIA approach. Phase in the new benefit formula for those newly eligible in years 2023-2032.

Provide a minimum PIA such that a worker with 35/20/19/15/10 years of work would have a PIA of at least 35%/25%/19%/15%/0% of AWI/12. A year of work is equal to $10,875 in 2017, indexed for average 

wage growth. This provision would take full effect for all worker beneficiaries in 2032 and later, phasing in between 2023 and 2032. The Minimum Benefit Percent change is calculated by applying this 

provision after after all other provisions.
Year 

Attain

Age 65 Age 65 Age 75 Age 853 Age 953

2016 100.0 97.7 101.8 100.5

2030 108.9 105.8 112.0 111.0

2050 122.1 118.6 124.3 123.0

2080 122.1 118.6 124.4 123.0

2016 100.0 97.7 101.8 100.5

2030 81.3 79.0 85.9 85.7

2050 78.2 75.9 82.9 82.8

2080 78.2 76.0 82.9 82.8

2016 100.0 97.7 101.8 100.5

2030 74.4 72.2 79.4 79.4

2050 55.9 54.3 61.9 62.4

2080 55.9 54.3 61.9 62.4

2016 100.0 97.7 100.2 98.6

2030 104.5 101.5 105.7 104.3

2050 110.1 106.9 110.9 109.4

2080 110.1 106.9 103.9 100.9

2016 100.0 97.7 100.2 98.6

2030 97.0 94.2 98.5 97.4

2050 99.6 96.7 101.0 99.8

2080 99.6 96.8 94.0 91.3

2016 100.0 97.7 100.2 98.6

2030 82.0 79.7 84.4 83.7

2050 78.6 76.4 81.2 80.6

2080 78.7 76.4 74.2 72.0

2016 100.0 97.7 94.9 92.1

2030 88.6 86.1 83.6 81.2

2050 83.1 80.7 78.3 76.1

2080 83.1 80.7 78.3 76.1

2016 100.0 97.7 94.9 92.1

2030 82.8 80.4 78.1 75.8

2050 71.9 69.9 67.9 65.9

2080 72.0 69.9 67.9 65.9

2016 100.0 97.7 94.9 92.1

2030 80.1 77.8 75.5 73.4

2050 66.8 51.6 40.0 30.9

2080 66.8 51.7 40.0 30.9

2016 100.0 81.4 63.0 48.7

2030 74.8 57.8 44.7 34.6

2050 56.7 43.8 33.9 26.2

2080 56.8 43.9 34.0 26.3

1 Average of highest 35 years of earnings wage indexed to 2016.

2 Projected percent of new retired worker awards in 2050 closest to AIME levels and years of work.

3

Other Changes: 

- After NRA reaches 67 in 2022, increase 3 months per year until NRA reaches 69 for those attaining 62 in 2030.

-

-

Note: These tables do not reflect the reduced taxation of OASDI benefits that would go to the Hospital Insurance (HI) Trust Fund assuming enactment of this Bill.

All estimates based on the intermediate assumptions of the 2016 Trustees Report.

 Very-Low-AIME ($12,280 for 20161) 20-Year Scaled Earner (5.2% of Retirees2

)

Table B2. Changes in Benefits for Hypothetical Workers Beginning Benefit Receipt at age 65 

H.R. 6489, the "Social Security Reform Act of 2016," Introduced by Chairman Sam Johnson

Proposal Scheduled Benefit as Percent of Present Law Scheduled

(Percent)

 Very-Low-AIME ($12,280 for 20161) 30-Year Scaled Earner (8.9% of Retirees2)

Provide a minimum PIA such that a worker with 35/20/19/15/10 years of work would have a PIA of at least 35%/25%/19%/15%/0% of AWI/12. A year of work is equal to $10,875 in 

2017, indexed for average wage growth. This provision would take full effect for all worker beneficiaries in 2032 and later, phasing in between 2023 and 2032. 

 Very-Low-AIME ($12,280 for 20161) 14-Year Scaled Earner (4.2% of Retirees2)

 Low-AIME ($22,105 for 20161) 44-Year Scaled Earner (16.9% of Retirees2

)

 Low-AIME ($22,105 for 20161

) 30-Year Scaled Earner (4.4% of Retirees2)

 Low-AIME ($22,105 for 20161) 20-Year Scaled Earner (2.0% of Retirees2)

 Medium-AIME ($49,121 for 20161) 44-Year Scaled Earner (29.2% of Retirees2)

 Medium-AIME ($49,121 for 20161) 30-Year Scaled Earner (3.2% of Retirees2)

 High-AIME ($78,594 for 20161) 44-Year Scaled Earner (19.8% of Retirees2)

 Maximum-AIME ($118,500 for 20161) 43-Year Steady Earner (6.3% of Retirees2)

Increase the benefit by 5% of an AWI worker for those with a MAGI below $25,000 if single and $50,000 if married beginning at age 81 and phased in over five years starting in 2023. 

Index the MAGI thresholds using C-CPI-U.

Note: Starting in 2018, if MAGI is less than $85,000 if single and $170,000 if married, compute the COLA using the chain-weighted C-CPI-U, producing 0.3 percentage point lower 

annual COLAs on average. If MAGI is above the $85,000 single/$170,000 married threshold, eliminate the COLA. Index the eligibility income threshold amounts using CPI-W.

Starting in 2023, set BP1 equal to 25% of AWI/12, BP2 equal to AWI/12, BP3 equal to 125% AWI/12 (2 year lag), and change the PIA factors to 95%/27.5%/5%/2%. Calculate the 

PIA using the mini-PIA approach. Phase in the new BP, PIA factors, and benefit formula for those newly eligible in years 2023-2032.

Office of the Chief Actuary, Social Security Administration December 8, 2016
Category Dually Entitled2 WEP3 Foreign Born All Others4

Very-Low-AIME ($12,280 for 20161

):

30-Year Scaled Earner (9.3% of Retirees) 47 6 11 40

20-Year Scaled Earner (5.8% of Retirees) 38 16 21 31

14-Year Scaled Earner (5.3% of Retirees) 22 21 45 20

Low-AIME ($22,105 for 20161):

44-Year Scaled Earner (13.1% of Retirees) 15 2 6 78

30-Year Scaled Earner (5.9% of Retirees) 16 9 18 59

20-Year Scaled Earner (3.1% of Retirees) 10 23 35 37

Medium-AIME ($49,121 for 20161

):

44-Year Scaled Earner (23.0% of Retirees) 1 1 5 93

30-Year Scaled Earner (4.4% of Retirees) 1 8 26 67

High-AIME ($78,594 for 20161):

44-Year Scaled Earner (20.5% of Retirees) 0 0 6 93

Maximum-AIME ($118,500 for 20161):

Steady Earner (9.4% of Retirees) 0 0 7 93

1 Average of highest 35 years of earnings wage indexed to 2016.

2

3 Covered by pension from government employment and are subject to the windfall elimination provision (WEP).

4 Neither foreign born, subject to WEP, or dually entitled.

June 22, 2016

Note 3: The sum of the percentages for each category (sum across rows) could be greater than 100 percent because some beneficiaries can be classified in more than one of the 

following groups: dually entitled, WEP, and foreign born. 

Under current law, entitled to an additional benefit based on someone else's account. The dually entitled percent is a minimum value. Some beneficiaries that are not 

currently dually entitled could become dually entitled in the future.

Office of the Chief Actuary, Social Security Administration

Table B3. Important Characteristics of Hypothetical Workers in 2007

Percent of Beneficiaries Within Each Category That Are:

Note 1:Table B3 displays the percentages of these newly-entitled retired workers in 2007 that are closest to each of the illustrative examples.

Note 2: Percents based on tabulations of a 10-percent sample of newly entitled retired-worker beneficiaries in 2007 (169,725 records). We can be 95 percent confident that each 

of the values shown above is within 1.4 percentage points of the value we would find using 100 percent of the retirees in 2007.
Table 1 - OASDI Cost Rate, Income Rate, Annual Balance, and Trust Fund Ratio

H.R. 6489, the "Social Security Reform Act of 2016," Introduced by Chairman Sam Johnson

Year Cost Rate

Income

Rate

Annual

Balance Cost Rate

Income

Rate

Annual

Balance

2016 14.05 12.94 -1.10 303 0.00 0.00 0.00

2017 13.72 12.92 -0.80 293 0.00 0.00 0.00

2018 13.86 12.96 -0.90 277 0.00 0.00 0.00

2019 14.23 12.98 -1.25 257 0.24 0.01 -0.23

2020 14.27 12.99 -1.28 242 0.14 0.01 -0.13

2021 14.32 13.01 -1.31 228 0.05 0.00 -0.04

2022 14.46 13.04 -1.43 214 -0.03 0.00 0.03

2023 14.65 13.06 -1.60 199 -0.10 0.00 0.10

2024 14.83 13.09 -1.74 183 -0.19 -0.01 0.19

2025 15.00 13.10 -1.90 168 -0.29 -0.01 0.27

2026 15.09 13.11 -1.98 154 -0.38 -0.02 0.36

2027 15.16 13.12 -2.04 140 -0.49 -0.02 0.47

2028 15.20 13.13 -2.07 126 -0.61 -0.03 0.59

2029 15.18 13.13 -2.04 114 -0.79 -0.03 0.76

2030 15.12 13.14 -1.98 102 -0.98 -0.04 0.94

2031 15.02 13.14 -1.88 91 -1.20 -0.05 1.15

2032 14.89 13.14 -1.76 80 -1.43 -0.06 1.37

2033 14.76 13.13 -1.62 70 -1.65 -0.07 1.58

2034 14.61 13.13 -1.48 61 -1.85 -0.08 1.77

2035 14.44 13.12 -1.32 52 -2.05 -0.09 1.96

2036 14.31 13.12 -1.20 44 -2.24 -0.10 2.14

2037 14.18 13.11 -1.06 37 -2.42 -0.11 2.31

2038 14.02 13.11 -0.91 30 -2.59 -0.12 2.47

2039 13.86 13.10 -0.76 25 -2.75 -0.13 2.62

2040 13.70 13.09 -0.61 20 -2.89 -0.14 2.75

2041 13.55 13.08 -0.46 16 -3.02 -0.15 2.87

2042 13.40 13.08 -0.32 13 -3.14 -0.15 2.98

2043 13.25 13.07 -0.18 11 -3.25 -0.16 3.09

2044 13.11 13.06 -0.05 10 -3.36 -0.17 3.19

2045 12.99 13.02 0.03 10 -3.46 -0.21 3.25

2046 12.87 12.98 0.12 10 -3.56 -0.25 3.31

2047 12.75 12.95 0.20 12 -3.65 -0.28 3.37

2048 12.65 12.92 0.27 13 -3.74 -0.31 3.42

2049 12.55 12.89 0.34 16 -3.82 -0.34 3.48

2050 12.46 12.86 0.41 19 -3.90 -0.37 3.53

2051 12.38 12.84 0.46 23 -3.98 -0.39 3.59

2052 12.32 12.82 0.50 27 -4.05 -0.41 3.64

2053 12.27 12.80 0.53 31 -4.12 -0.43 3.69

2054 12.24 12.40 0.16 36 -4.18 -0.84 3.35

2055 12.22 12.40 0.18 38 -4.25 -0.84 3.41

2056 12.20 12.40 0.20 40 -4.31 -0.85 3.46

2057 12.19 12.40 0.21 42 -4.37 -0.85 3.52

2058 12.18 12.40 0.22 44 -4.42 -0.85 3.57

2059 12.18 12.40 0.22 47 -4.48 -0.86 3.62

2060 12.18 12.40 0.22 49 -4.52 -0.86 3.66

2061 12.19 12.40 0.21 51 -4.56 -0.86 3.70

2062 12.20 12.40 0.20 54 -4.60 -0.87 3.74

2063 12.21 12.40 0.19 56 -4.64 -0.87 3.77

2064 12.22 12.40 0.18 58 -4.68 -0.88 3.81

2065 12.24 12.40 0.16 60 -4.72 -0.88 3.84

2066 12.25 12.40 0.15 62 -4.75 -0.88 3.87

2067 12.27 12.40 0.13 64 -4.79 -0.89 3.90

2068 12.29 12.40 0.12 66 -4.83 -0.89 3.94

2069 12.30 12.40 0.10 67 -4.86 -0.89 3.97

2070 12.32 12.40 0.08 69 -4.90 -0.90 4.00

2071 12.33 12.40 0.07 70 -4.93 -0.90 4.04

2072 12.34 12.40 0.06 72 -4.97 -0.90 4.07

2073 12.34 12.40 0.06 73 -5.00 -0.90 4.10

2074 12.34 12.40 0.06 74 -5.03 -0.91 4.13

2075 12.33 12.40 0.07 76 -5.06 -0.91 4.15

2076 12.32 12.40 0.08 77 -5.09 -0.91 4.18

2077 12.30 12.40 0.10 79 -5.11 -0.91 4.20

2078 12.28 12.40 0.12 81 -5.13 -0.91 4.22

2079 12.26 12.40 0.14 83 -5.15 -0.91 4.23

2080 12.24 12.40 0.16 85 -5.16 -0.91 4.25

2081 12.22 12.40 0.18 88 -5.18 -0.91 4.27

2082 12.21 12.40 0.19 90 -5.20 -0.91 4.28

2083 12.20 12.40 0.20 93 -5.22 -0.91 4.31

2084 12.20 12.40 0.20 96 -5.24 -0.91 4.33

2085 12.19 12.40 0.21 98 -5.27 -0.92 4.36

2086 12.19 12.40 0.21 101 -5.31 -0.92 4.39

2087 12.20 12.40 0.20 104 -5.35 -0.92 4.43

2088 12.20 12.40 0.20 107 -5.38 -0.92 4.46

2089 12.21 12.40 0.19 110 -5.42 -0.92 4.50

2090 12.22 12.40 0.18 113 -5.46 -0.93 4.53

2091 12.23 12.40 0.17 115 -5.49 -0.93 4.56

Summarized Rates: OASDI Summarized Rates: OASDI

Cost Rate Income Rate

Actuarial 

Balance

Change in 

Cost rate

Change in 

Income Rate

Change in 

Actuarial

Balance

2016 - 2090 13.39% 13.41% 0.02% N/A -3.11% -0.44% 2.67%

Based on Intermediate Assumptions of the 2016 Trustees Report. Social Security Administration 1

Under present law the year of combined Trust Fund reserve depletion is 2034.

Change from Present Law

Year of reserve 

depletion1

December 8, 2016

Office of the Chief Actuary

Proposal

Expressed as a percentage of present-law

taxable payroll Trust Fund

Ratio

1-1-year

Expressed as a percentage of present-law

taxable payroll
Table 1a - General Fund Transfers, OASDI Trust Fund Reserves, and Theoretical OASDI Reserves

H.R. 6489, the "Social Security Reform Act of 2016," Introduced by Chairman Sam Johnson

Percentage

of Payroll

Annual

Amounts

Accumulated as of 

End of Year

Gross Domestic 

Product

Without General

Fund Transfers

With Plan General

Fund Transfers

(1) (2) (3) (4) (5) (6) (7)

2016 0.0 0.0 0.0 2,741.0 18,368.5 2,741.0 2,741.0

2017 0.0 0.0 0.0 2,687.5 18,780.3 2,687.5 2,687.5

2018 0.0 0.0 0.0 2,625.9 19,199.4 2,625.9 2,625.9

2019 0.0 0.0 0.0 2,538.4 19,590.0 2,554.4 2,554.4

2020 0.0 0.0 0.0 2,446.3 19,948.3 2,471.7 2,471.7

2021 0.0 0.0 0.0 2,350.2 20,275.2 2,378.9 2,378.9

2022 0.0 0.0 0.0 2,244.0 20,546.2 2,270.6 2,270.6

2023 0.0 0.0 0.0 2,123.5 20,765.2 2,142.4 2,142.4

2024 0.0 0.0 0.0 1,990.4 20,965.2 1,994.9 1,994.9

2025 0.0 0.0 0.0 1,844.0 21,141.0 1,827.2 1,827.2

2026 0.0 0.0 0.0 1,690.7 21,283.5 1,645.4 1,645.4

2027 0.0 0.0 0.0 1,532.5 21,355.9 1,450.6 1,450.6

2028 0.0 0.0 0.0 1,372.1 21,346.6 1,244.3 1,244.3

2029 0.0 0.0 0.0 1,214.9 21,259.6 1,028.4 1,028.4

2030 0.0 0.0 0.0 1,063.8 21,099.1 804.8 804.8

2031 0.0 0.0 0.0 922.0 20,898.2 575.3 575.3

2032 0.0 0.0 0.0 790.9 20,696.5 341.0 341.0

2033 0.0 0.0 0.0 671.1 20,500.4 103.7 103.7

2034 0.0 0.0 0.0 563.2 20,306.0 -134.7 -134.7

2035 0.0 0.0 0.0 467.9 20,116.5 -372.8 -372.8

2036 0.0 0.0 0.0 382.7 19,925.6 -612.3 -612.3

2037 0.0 0.0 0.0 308.0 19,743.3 -852.1 -852.1

2038 0.0 0.0 0.0 244.5 19,571.8 -1,090.4 -1,090.4

2039 0.0 0.0 0.0 192.1 19,401.7 -1,326.1 -1,326.1

2040 0.0 0.0 0.0 150.8 19,234.9 -1,558.1 -1,558.1

2041 0.0 0.0 0.0 120.2 19,071.7 -1,786.1 -1,786.1

2042 0.0 0.0 0.0 99.4 18,908.8 -2,010.0 -2,010.0

2043 0.0 0.0 0.0 88.3 18,751.3 -2,229.8 -2,229.8

2044 0.0 0.0 0.0 86.1 18,594.5 -2,445.4 -2,445.4

2045 0.0 0.0 0.0 89.1 18,429.9 -2,657.8 -2,657.8

2046 0.0 0.0 0.0 97.7 18,269.6 -2,866.7 -2,866.7

2047 0.0 0.0 0.0 111.5 18,107.9 -3,072.2 -3,072.2

2048 0.0 0.0 0.0 129.9 17,944.3 -3,274.5 -3,274.5

2049 0.0 0.0 0.0 152.6 17,781.3 -3,473.9 -3,473.9

2050 0.0 0.0 0.0 179.2 17,618.6 -3,670.6 -3,670.6

2051 0.0 0.0 0.0 208.9 17,454.0 -3,865.4 -3,865.4

2052 0.0 0.0 0.0 240.9 17,289.8 -4,059.0 -4,059.0

2053 0.0 0.0 0.0 274.2 17,125.7 -4,251.9 -4,251.9

2054 0.0 0.0 0.0 284.7 16,960.9 -4,444.5 -4,444.5

2055 0.0 0.0 0.0 296.5 16,796.5 -4,637.2 -4,637.2

2056 0.0 0.0 0.0 309.2 16,631.9 -4,830.5 -4,830.5

2057 0.0 0.0 0.0 322.3 16,467.6 -5,024.3 -5,024.3

2058 0.0 0.0 0.0 335.7 16,304.7 -5,218.8 -5,218.8

2059 0.0 0.0 0.0 349.1 16,142.6 -5,413.9 -5,413.9

2060 0.0 0.0 0.0 362.1 15,981.3 -5,609.6 -5,609.6

2061 0.0 0.0 0.0 374.5 15,821.7 -5,805.8 -5,805.8

2062 0.0 0.0 0.0 386.2 15,664.2 -6,002.5 -6,002.5

2063 0.0 0.0 0.0 397.2 15,508.7 -6,199.6 -6,199.6

2064 0.0 0.0 0.0 407.5 15,355.7 -6,397.1 -6,397.1

2065 0.0 0.0 0.0 417.0 15,204.5 -6,595.0 -6,595.0

2066 0.0 0.0 0.0 425.5 15,055.3 -6,793.3 -6,793.3

2067 0.0 0.0 0.0 433.0 14,907.9 -6,992.1 -6,992.1

2068 0.0 0.0 0.0 439.6 14,762.2 -7,191.4 -7,191.4

2069 0.0 0.0 0.0 445.3 14,618.0 -7,391.0 -7,391.0

2070 0.0 0.0 0.0 450.1 14,476.2 -7,591.0 -7,591.0

2071 0.0 0.0 0.0 454.2 14,336.4 -7,791.2 -7,791.2

2072 0.0 0.0 0.0 458.1 14,198.6 -7,991.1 -7,991.1

2073 0.0 0.0 0.0 461.7 14,062.2 -8,190.5 -8,190.5

2074 0.0 0.0 0.0 465.4 13,927.2 -8,389.1 -8,389.1

2075 0.0 0.0 0.0 469.4 13,793.7 -8,586.7 -8,586.7

2076 0.0 0.0 0.0 473.8 13,661.5 -8,782.6 -8,782.6

2077 0.0 0.0 0.0 479.0 13,530.3 -8,976.7 -8,976.7

2078 0.0 0.0 0.0 485.1 13,399.9 -9,168.8 -9,168.8

2079 0.0 0.0 0.0 492.1 13,271.0 -9,358.6 -9,358.6

2080 0.0 0.0 0.0 500.1 13,143.2 -9,546.2 -9,546.2

2081 0.0 0.0 0.0 508.7 13,016.0 -9,731.8 -9,731.8

2082 0.0 0.0 0.0 517.8 12,889.1 -9,915.6 -9,915.6

2083 0.0 0.0 0.0 527.2 12,762.3 -10,098.0 -10,098.0

2084 0.0 0.0 0.0 536.7 12,635.6 -10,279.3 -10,279.3

2085 0.0 0.0 0.0 546.1 12,509.3 -10,459.9 -10,459.9

2086 0.0 0.0 0.0 555.6 12,383.5 -10,639.8 -10,639.8

2087 0.0 0.0 0.0 564.8 12,258.4 -10,819.4 -10,819.4

2088 0.0 0.0 0.0 573.7 12,134.0 -10,998.8 -10,998.8

2089 0.0 0.0 0.0 582.1 12,010.4 -11,177.9 -11,177.9

2090 0.0 0.0 0.0 590.0 11,887.6 -11,356.8 -11,356.8

2091 0.0 0.0 0.0 597.4 11,765.8 -11,535.6 -11,535.6

Total 2016-2090 0.0

Based on the Intermediate Assumptions of the 2016 Trustees Report.

Ultimate Real Trust Fund Yield of 2.7%.

Office of the Chief Actuary 1

 Theoretical Social Security is the current Social Security program with the assumption Social Security Administration

 that the law is modified to permit borrowing from the General Fund of the Treasury. December 8, 2016

Calendar

Year

Proposal General Fund Transfers Present Value in Billions as of 1-1-2016

Proposal

Total OASDI

Trust Fund

Reserves

 at End of Year

Theoretical Social Security1

with Borrowing Authority

Present Value in Billions as of 1-1- 2016 Net OASDI Trust Fund Reserves at End of Year
Table 1b - OASDI Changes & Implications for Federal Budget and Debt of Specified Plan Provision Effects on OASDI1

 (Present Value Dollars)

H.R. 6489, the "Social Security Reform Act of 2016," Introduced by Chairman Sam Johnson

Year

Specified 

General Fund 

Transfers

Basic Changes

in OASDI

Cash Flow

Change

in Annual

Unified Budget

Cash Flow

Change in

Debt Held

by Public at

End of Year

Change

in Annual

Unified Budget

Balance

Change

in Total

Federal Debt

End Of Year

Change

in Annual

On Budget

Balance

(1) (2) (3) (4) (5) (6) (7)

2016 0.0 0.0 0.0 0.0 0.0 0.0 0.0

2017 0.0 0.0 0.0 0.0 0.0 0.0 0.0

2018 0.0 0.0 0.0 0.0 0.0 0.0 0.0

2019 0.0 -16.0 -16.0 16.0 -16.0 0.0 0.0

2020 0.0 -9.4 -9.4 25.4 -9.9 0.0 0.0

2021 0.0 -3.3 -3.3 28.7 -4.1 0.0 0.0

2022 0.0 2.2 2.2 26.6 1.3 0.0 0.0

2023 0.0 7.7 7.7 18.9 6.8 0.0 0.0

2024 0.0 14.4 14.4 4.5 13.7 0.0 0.0

2025 0.0 21.3 21.3 -16.8 21.1 0.0 0.0

2026 0.0 28.4 28.4 -45.2 29.1 0.0 0.0

2027 0.0 36.7 36.7 -81.9 38.5 0.0 0.0

2028 0.0 45.9 45.9 -127.8 49.5 0.0 0.0

2029 0.0 58.8 58.8 -186.5 64.8 0.0 0.0

2030 0.0 72.5 72.5 -259.0 82.0 0.0 0.0

2031 0.0 87.7 87.7 -346.7 100.9 0.0 0.0

2032 0.0 103.2 103.2 -449.9 120.8 0.0 0.0

2033 0.0 117.5 117.5 -567.3 140.4 0.0 0.0

2034 0.0 130.6 130.6 -697.9 159.5 0.0 0.0

2035 0.0 142.9 142.9 -840.8 178.4 0.0 0.0

2036 0.0 154.3 154.3 -995.1 197.1 0.0 0.0

2037 0.0 165.0 165.0 -1,160.1 215.8 0.0 0.0

2038 0.0 174.8 174.8 -1,334.9 233.9 0.0 0.0

2039 0.0 183.3 183.3 -1,518.2 251.3 0.0 0.0

2040 0.0 190.8 190.8 -1,709.0 268.2 0.0 0.0

2041 0.0 197.3 197.3 -1,906.3 284.4 0.0 0.0

2042 0.0 203.2 203.2 -2,109.4 300.3 0.0 0.0

2043 0.0 208.6 208.6 -2,318.0 316.1 0.0 0.0

2044 0.0 213.5 213.5 -2,531.5 331.6 0.0 0.0

2045 0.0 215.4 215.4 -2,747.0 344.5 0.0 0.0

2046 0.0 217.5 217.5 -2,964.4 357.5 0.0 0.0

2047 0.0 219.2 219.2 -3,183.6 370.3 0.0 0.0

2048 0.0 220.8 220.8 -3,404.4 383.0 0.0 0.0

2049 0.0 222.1 222.1 -3,626.5 395.7 0.0 0.0

2050 0.0 223.3 223.3 -3,849.9 408.2 0.0 0.0

2051 0.0 224.5 224.5 -4,074.4 420.7 0.0 0.0

2052 0.0 225.5 225.5 -4,299.9 433.1 0.0 0.0

2053 0.0 226.2 226.2 -4,526.1 445.4 0.0 0.0

2054 0.0 203.1 203.1 -4,729.2 433.8 0.0 0.0

2055 0.0 204.6 204.6 -4,933.7 445.6 0.0 0.0

2056 0.0 205.9 205.9 -5,139.6 457.4 0.0 0.0

2057 0.0 207.0 207.0 -5,346.7 469.0 0.0 0.0

2058 0.0 207.9 207.9 -5,554.5 480.4 0.0 0.0

2059 0.0 208.4 208.4 -5,763.0 491.5 0.0 0.0

2060 0.0 208.7 208.7 -5,971.7 502.4 0.0 0.0

2061 0.0 208.6 208.6 -6,180.3 513.0 0.0 0.0

2062 0.0 208.4 208.4 -6,388.7 523.4 0.0 0.0

2063 0.0 208.1 208.1 -6,596.8 533.7 0.0 0.0

2064 0.0 207.8 207.8 -6,804.6 544.0 0.0 0.0

2065 0.0 207.4 207.4 -7,011.9 554.2 0.0 0.0

2066 0.0 206.8 206.8 -7,218.7 564.2 0.0 0.0

2067 0.0 206.3 206.3 -7,425.1 574.2 0.0 0.0

2068 0.0 205.9 205.9 -7,630.9 584.3 0.0 0.0

2069 0.0 205.4 205.4 -7,836.3 594.3 0.0 0.0

2070 0.0 204.8 204.8 -8,041.1 604.2 0.0 0.0

2071 0.0 204.3 204.3 -8,245.4 614.1 0.0 0.0

2072 0.0 203.7 203.7 -8,449.1 623.9 0.0 0.0

2073 0.0 203.0 203.0 -8,652.2 633.7 0.0 0.0

2074 0.0 202.4 202.4 -8,854.6 643.4 0.0 0.0

2075 0.0 201.5 201.5 -9,056.0 652.8 0.0 0.0

2076 0.0 200.4 200.4 -9,256.5 662.0 0.0 0.0

2077 0.0 199.3 199.3 -9,455.8 671.0 0.0 0.0

2078 0.0 198.1 198.1 -9,653.8 680.0 0.0 0.0

2079 0.0 196.8 196.8 -9,850.7 688.9 0.0 0.0

2080 0.0 195.6 195.6 -10,046.3 697.6 0.0 0.0

2081 0.0 194.2 194.2 -10,240.4 706.2 0.0 0.0

2082 0.0 192.9 192.9 -10,433.4 714.8 0.0 0.0

2083 0.0 191.8 191.8 -10,625.2 723.5 0.0 0.0

2084 0.0 190.8 190.8 -10,816.0 732.4 0.0 0.0

2085 0.0 190.0 190.0 -11,006.0 741.2 0.0 0.0

2086 0.0 189.4 189.4 -11,195.4 750.3 0.0 0.0

2087 0.0 188.8 188.8 -11,384.2 759.4 0.0 0.0

2088 0.0 188.2 188.2 -11,572.4 768.4 0.0 0.0

2089 0.0 187.5 187.5 -11,760.0 777.3 0.0 0.0

2090 0.0 186.9 186.9 -11,946.9 786.2 0.0 0.0

Total 2016-2090 0.0 11,946.9 11,946.9

Based on Intermediate Assumptions of the 2016 Trustees Report.

Ultimate Real Trust Fund Yield of 2.7%.

Note: Changes reflect the budget scoring convention that presumes benefits not payable after reserve depletion would Office of the Chief Actuary

 nonetheless be paid, based on transfers from the General Fund of the Treasury resulting in additional borrowing from the public. Social Security Administration 1

 Effects of tax provisions on the On-Budget are not reflected in this table.

Billions of Present Value Dollars as of 1-1-2016

December 8, 2016
Table 1b.n - OASDI Changes & Implications for Federal Budget and Debt of Specified Plan Provision Effects on OASDI1

 (Nominal Dollars)

H.R. 6489, the "Social Security Reform Act of 2016," Introduced by Chairman Sam Johnson

Year

Specified 

General Fund 

Transfers

Basic Changes

in OASDI

Cash Flow

Change

in Annual

Unified Budget

Cash Flow

Change in

Debt Held

by Public at

End of Year

Change

in Annual

Unified Budget

Balance

Change

in Total

Federal Debt

End of Year

Change

in Annual

On Budget

Balance

(1) (2) (3) (4) (5) (6) (7)

2016 0.0 0.0 0.0 0.0 0.0 0.0 0.0

2017 0.0 0.0 0.0 0.0 0.0 0.0 0.0

2018 0.0 0.0 0.0 0.0 0.0 0.0 0.0

2019 0.0 -17.9 -17.9 18.1 -18.1 0.0 0.0

2020 0.0 -10.8 -10.8 29.7 -11.6 0.0 0.0

2021 0.0 -3.9 -3.9 34.6 -4.9 0.0 0.0

2022 0.0 2.7 2.7 32.9 1.7 0.0 0.0

2023 0.0 9.7 9.7 24.0 9.0 0.0 0.0

2024 0.0 18.8 18.8 5.4 18.5 0.0 0.0

2025 0.0 28.9 28.9 -24.1 29.5 0.0 0.0

2026 0.0 40.1 40.1 -66.2 42.1 0.0 0.0

Based on Intermediate Assumptions of the 2016 Trustees Report.

Note: Changes reflect the budget scoring convention that presumes benefits not payable after reserve depletion would Office of the Chief Actuary

 nonetheless be paid, based on transfers from the General Fund of the Treasury resulting in additional borrowing from the public. Social Security Administration 1

 Effects of tax provisions on the On-Budget are not reflected in this table.

Billions of Nominal Dollars

December 8, 2016
Table 1c - Present Law and Proposal Cost, Expenditures, and Income: As Percent of Gross Domestic Product

Cost

Expenditures

(Payable)

Non-Interest

Income Cost

Expenditures

(Payable)

Non-Interest

Income

(1) (2) (3) (4) (5) (6)

2016 4.98 4.98 4.59 4.98 4.98 4.59

2017 4.91 4.91 4.62 4.91 4.91 4.62

2018 4.98 4.98 4.65 4.98 4.98 4.65

2019 5.05 5.05 4.68 5.13 5.13 4.68

2020 5.12 5.12 4.70 5.17 5.17 4.70

2021 5.18 5.18 4.72 5.20 5.20 4.73

2022 5.28 5.28 4.75 5.27 5.27 4.75

2023 5.39 5.39 4.77 5.35 5.35 4.77

2024 5.50 5.50 4.79 5.43 5.43 4.79

2025 5.60 5.60 4.81 5.50 5.50 4.80

2026 5.67 5.67 4.81 5.53 5.53 4.80

2027 5.73 5.73 4.81 5.55 5.55 4.80

2028 5.78 5.78 4.81 5.55 5.55 4.80

2029 5.83 5.83 4.81 5.54 5.54 4.79

2030 5.87 5.87 4.81 5.51 5.51 4.79

2031 5.91 5.91 4.80 5.47 5.47 4.79

2032 5.94 5.94 4.80 5.42 5.42 4.78

2033 5.96 5.96 4.80 5.36 5.36 4.77

2034 5.98 5.29 4.80 5.30 5.30 4.77

2035 5.98 4.79 4.79 5.24 5.24 4.76

2036 6.00 4.79 4.79 5.18 5.18 4.75

2037 6.01 4.79 4.79 5.13 5.13 4.75

2038 6.01 4.78 4.78 5.07 5.07 4.74

2039 6.00 4.78 4.78 5.01 5.01 4.73

2040 5.99 4.78 4.78 4.95 4.95 4.73

2041 5.97 4.77 4.77 4.89 4.89 4.72

2042 5.96 4.77 4.77 4.83 4.83 4.71

2043 5.94 4.77 4.77 4.77 4.77 4.71

2044 5.93 4.76 4.76 4.72 4.72 4.70

2045 5.92 4.76 4.76 4.67 4.67 4.69

2046 5.91 4.76 4.76 4.63 4.63 4.67

2047 5.90 4.76 4.76 4.59 4.59 4.66

2048 5.89 4.76 4.76 4.55 4.55 4.64

2049 5.88 4.75 4.75 4.51 4.51 4.63

2050 5.87 4.75 4.75 4.47 4.47 4.62

2051 5.87 4.75 4.75 4.44 4.44 4.61

2052 5.87 4.75 4.75 4.42 4.42 4.60

2053 5.88 4.75 4.75 4.40 4.40 4.59

2054 5.89 4.75 4.75 4.39 4.39 4.44

2055 5.90 4.74 4.74 4.38 4.38 4.44

2056 5.91 4.74 4.74 4.37 4.37 4.44

2057 5.92 4.74 4.74 4.36 4.36 4.44

2058 5.94 4.74 4.74 4.36 4.36 4.43

2059 5.95 4.74 4.74 4.35 4.35 4.43

2060 5.97 4.74 4.74 4.35 4.35 4.43

2061 5.98 4.73 4.73 4.35 4.35 4.43

2062 5.99 4.73 4.73 4.35 4.35 4.42

2063 6.01 4.73 4.73 4.35 4.35 4.42

2064 6.02 4.73 4.73 4.35 4.35 4.41

2065 6.03 4.72 4.72 4.35 4.35 4.41

2066 6.04 4.72 4.72 4.35 4.35 4.41

2067 6.06 4.72 4.72 4.36 4.36 4.40

2068 6.07 4.71 4.71 4.36 4.36 4.40

2069 6.08 4.71 4.71 4.36 4.36 4.39

2070 6.09 4.71 4.71 4.36 4.36 4.39

2071 6.10 4.70 4.70 4.36 4.36 4.39

2072 6.11 4.70 4.70 4.36 4.36 4.38

2073 6.12 4.70 4.70 4.36 4.36 4.38

2074 6.12 4.69 4.69 4.35 4.35 4.37

2075 6.13 4.69 4.69 4.34 4.34 4.37

2076 6.12 4.68 4.68 4.33 4.33 4.36

2077 6.12 4.68 4.68 4.32 4.32 4.36

2078 6.11 4.67 4.67 4.31 4.31 4.35

2079 6.11 4.67 4.67 4.30 4.30 4.35

2080 6.10 4.66 4.66 4.29 4.29 4.34

2081 6.09 4.66 4.66 4.28 4.28 4.34

2082 6.09 4.66 4.66 4.27 4.27 4.34

2083 6.09 4.65 4.65 4.26 4.26 4.33

2084 6.09 4.65 4.65 4.26 4.26 4.33

2085 6.09 4.64 4.64 4.25 4.25 4.33

2086 6.10 4.64 4.64 4.25 4.25 4.32

2087 6.11 4.64 4.64 4.25 4.25 4.32

2088 6.12 4.64 4.64 4.25 4.25 4.32

2089 6.13 4.63 4.63 4.25 4.25 4.31

2090 6.14 4.63 4.63 4.25 4.25 4.31

Based on Intermediate Assumptions of the 2016 Trustees Report. Office of the Chief Actuary

Social Security Administration

Present Law OASDI Proposal OASDI

Calendar

Year

H.R. 6489, the "Social Security Reform Act of 2016," Introduced by Chairman Sam Johnson

December 8, 2016
Table 1d - Change in Long-Range Trust Fund Reserves / Unfunded Obligation

H.R. 6489, the "Social Security Reform Act of 2016," Introduced by Chairman Sam Johnson

Year

Present Law OASDI

Trust Fund Reserves /

Unfunded Obligation

Through End of Year

Changes 

in OASDI 

Income

Changes

in OASDI 

Cost

Basic

Changes

in OASDI

Cash Flow

Total Change

Through

End of Year

Proposal OASDI

Trust Fund Reserves /

Unfunded Obligation

Through End of Year

(1) (2) (3) (4) = (2)-(3) (5) = cumulative sum(4) (6) = (1)+(5)

2016 2,741.0 0.0 0.0 0.0 0.0 2,741.0

2017 2,687.5 0.0 0.0 0.0 0.0 2,687.5

2018 2,625.9 0.0 0.0 0.0 0.0 2,625.9

2019 2,554.4 0.9 16.9 -16.0 -16.0 2,538.4

2020 2,471.7 0.6 10.0 -9.4 -25.4 2,446.3

2021 2,378.9 0.3 3.6 -3.3 -28.7 2,350.2

2022 2,270.6 0.1 -2.1 2.2 -26.6 2,244.0

2023 2,142.4 -0.2 -7.9 7.7 -18.9 2,123.5

2024 1,994.9 -0.5 -14.9 14.4 -4.5 1,990.4

2025 1,827.2 -0.9 -22.2 21.3 16.8 1,844.0

2026 1,645.4 -1.3 -29.7 28.4 45.2 1,690.7

2027 1,450.6 -1.7 -38.3 36.7 81.9 1,532.5

2028 1,244.3 -2.1 -47.9 45.9 127.8 1,372.1

2029 1,028.4 -2.7 -61.4 58.8 186.5 1,214.9

2030 804.8 -3.3 -75.8 72.5 259.0 1,063.8

2031 575.3 -4.0 -91.7 87.7 346.7 922.0

2032 341.0 -4.7 -107.9 103.2 449.9 790.9

2033 103.7 -5.4 -122.9 117.5 567.3 671.1

2034 -134.7 -6.1 -136.7 130.6 697.9 563.2

2035 -372.8 -6.8 -149.6 142.9 840.8 467.9

2036 -612.3 -7.5 -161.8 154.3 995.1 382.7

2037 -852.1 -8.2 -173.2 165.0 1,160.1 308.0

2038 -1,090.4 -8.8 -183.6 174.8 1,334.9 244.5

2039 -1,326.1 -9.3 -192.6 183.3 1,518.2 192.1

2040 -1,558.1 -9.8 -200.6 190.8 1,709.0 150.8

2041 -1,786.1 -10.2 -207.5 197.3 1,906.3 120.2

2042 -2,010.0 -10.6 -213.8 203.2 2,109.4 99.4

2043 -2,229.8 -11.0 -219.6 208.6 2,318.0 88.3

2044 -2,445.4 -11.3 -224.8 213.5 2,531.5 86.1

2045 -2,657.8 -14.1 -229.5 215.4 2,747.0 89.1

2046 -2,866.7 -16.3 -233.8 217.5 2,964.4 97.7

2047 -3,072.2 -18.4 -237.6 219.2 3,183.6 111.5

2048 -3,274.5 -20.3 -241.1 220.8 3,404.4 129.9

2049 -3,473.9 -22.0 -244.1 222.1 3,626.5 152.6

2050 -3,670.6 -23.4 -246.8 223.3 3,849.9 179.2

2051 -3,865.4 -24.7 -249.2 224.5 4,074.4 208.9

2052 -4,059.0 -25.8 -251.3 225.5 4,299.9 240.9

2053 -4,251.9 -26.8 -253.0 226.2 4,526.1 274.2

2054 -4,444.5 -51.4 -254.4 203.1 4,729.2 284.7

2055 -4,637.2 -51.0 -255.6 204.6 4,933.7 296.5

2056 -4,830.5 -50.7 -256.6 205.9 5,139.6 309.2

2057 -5,024.3 -50.4 -257.4 207.0 5,346.7 322.3

2058 -5,218.8 -50.1 -257.9 207.9 5,554.5 335.7

2059 -5,413.9 -49.8 -258.2 208.4 5,763.0 349.1

2060 -5,609.6 -49.5 -258.2 208.7 5,971.7 362.1

2061 -5,805.8 -49.1 -257.7 208.6 6,180.3 374.5

2062 -6,002.5 -48.8 -257.2 208.4 6,388.7 386.2

2063 -6,199.6 -48.5 -256.6 208.1 6,596.8 397.2

2064 -6,397.1 -48.2 -255.9 207.8 6,804.6 407.5

2065 -6,595.0 -47.8 -255.2 207.4 7,011.9 417.0

2066 -6,793.3 -47.5 -254.3 206.8 7,218.7 425.5

2067 -6,992.1 -47.2 -253.5 206.3 7,425.1 433.0

2068 -7,191.4 -46.9 -252.8 205.9 7,630.9 439.6

2069 -7,391.0 -46.6 -251.9 205.4 7,836.3 445.3

2070 -7,591.0 -46.2 -251.1 204.8 8,041.1 450.1

2071 -7,791.2 -45.9 -250.2 204.3 8,245.4 454.2

2072 -7,991.1 -45.6 -249.3 203.7 8,449.1 458.1

2073 -8,190.5 -45.2 -248.2 203.0 8,652.2 461.7

2074 -8,389.1 -44.8 -247.2 202.4 8,854.6 465.4

2075 -8,586.7 -44.5 -246.0 201.5 9,056.0 469.4

2076 -8,782.6 -44.1 -244.5 200.4 9,256.5 473.8

2077 -8,976.7 -43.7 -243.0 199.3 9,455.8 479.0

2078 -9,168.8 -43.2 -241.3 198.1 9,653.8 485.1

2079 -9,358.6 -42.8 -239.6 196.8 9,850.7 492.1

2080 -9,546.2 -42.3 -237.9 195.6 10,046.3 500.1

2081 -9,731.8 -41.9 -236.0 194.2 10,240.4 508.7

2082 -9,915.6 -41.4 -234.3 192.9 10,433.4 517.8

2083 -10,098.0 -41.0 -232.8 191.8 10,625.2 527.2

2084 -10,279.3 -40.6 -231.4 190.8 10,816.0 536.7

2085 -10,459.9 -40.2 -230.2 190.0 11,006.0 546.1

2086 -10,639.8 -39.9 -229.3 189.4 11,195.4 555.6

2087 -10,819.4 -39.5 -228.3 188.8 11,384.2 564.8

2088 -10,998.8 -39.2 -227.4 188.2 11,572.4 573.7

2089 -11,177.9 -38.9 -226.4 187.5 11,760.0 582.1

2090 -11,356.8 -38.6 -225.4 186.9 11,946.9 590.0

Total 2016-2090 -1989.1 -13936.0 11946.9

Based on Intermediate Assumptions of the 2016 Trustees Report. Office of the Chief Actuary

Social Security Administration

Ultimate Real Trust Fund Yield of 2.7%. December 8, 2016

(Billions of Dollars, Present Value on 1-1-2016)