I

104TH CONGRESS

2D SESSION H. R. 4274

To require the Commissioner of Social Security and the Secretary of the

Treasury to develop and implement measures to eliminate and prevent

mismatching of earnings information maintained by the Social Security

Administration and the Internal Revenue Service resulting in underpayment of social security benefits.

IN THE HOUSE OF REPRESENTATIVES

SEPTEMBER 28, 1996

Mr. BROWN of California (for himself, Mr. DEFAZIO, Mr. SANDERS, Mr. DELLUMS, Mr. MILLER of California, and Mr. EVANS) introduced the following bill; which was referred to the Committee on Ways and Means

A BILL

To require the Commissioner of Social Security and the

Secretary of the Treasury to develop and implement

measures to eliminate and prevent mismatching of earnings information maintained by the Social Security Administration and the Internal Revenue Service resulting

in underpayment of social security benefits.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,
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1 SECTION 1. FINDINGS AND PURPOSES.

2 (a) INITIAL FINDINGS.—The Congress finds the fol3 lowing:

4 (1) Over the last 5 decades, billions of dollars

5 in social security taxes have been paid by American

6 workers but have not been credited to their social se7 curity earnings records. When the Social Security

8 Administration is not able to match information on

9 annual earnings reports to existing workers’ earn10 ings records, the amount of such earnings reported

11 are credited by the Administration in a ‘‘suspense

12 file’’ of uncredited earnings.

13 (2) Largely due to the inflexible matching pol14 icy of the Social Security Administration and an un15 acceptable number of errors made by employers on

16 annual earnings reports submitted to the Adminis17 tration, the suspense file has accumulated approxi18 mately 200,000,000 individual earnings reports to19 taling approximately $200,000,000,000 in earnings.

20 These numbers continue to grow.

21 (3) Because earnings are used to determine an

22 individual’s eligibility and benefit amount,

23 uncredited earnings can affect social security benefit

24 payments. Current beneficiaries have lost, and con25 tinue to lose, benefits because of the failure of the

26 Social Security Administration to correctly credit
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1 their earnings. This has the practical effect of deny2 ing millions of hard-working Americans up to hun3 dreds of dollars on their monthly retirement or dis4 ability benefits.

5 (b) FURTHER FINDINGS.—The Congress further

6 finds the following:

7 (1) Current and future retirees should receive

8 the full social security benefits to which they are en9 titled.

10 (2) The impact of uncredited earnings on social

11 security beneficiaries has not been adequately deter12 mined. An examination of the practical effects of

13 uncredited earnings on individuals’ benefits should

14 be conducted, in order that beneficiaries who are due

15 higher benefits or retroactive payments can be com16 pensated accordingly.

17 (c) PURPOSE.—It is the purpose of this Act to ensure

18 that the Social Security Administration, together with the

19 Secretary of the Treasury, will take prompt action to—

20 (1) determine and implement an effective proce21 dure to reconcile the wage reports currently in the

22 suspense file to the rightful beneficiaries, and

23 (2) put in place a system that will prevent fur24 ther mismatches.
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1 SEC. 2. STUDY.

2 (a) IN GENERAL.—The Commissioner of Social Secu3 rity and the Secretary of the Treasury shall jointly under4 take, as soon as practicable after the date of the enact5 ment of this Act, a thorough study with respect to the

6 inability of the Social Security Administration to provide

7 for American workers their full social security benefits by

8 reason of insufficiency of information held by the Adminis9 tration necessary for correctly identifying accounts for the

10 earnings of such workers.

11 (b) MATTERS TO BE STUDIED.—The Commissioner

12 and the Secretary, in their study under this section, shall

13 address, analyze, and report specifically on the following

14 matters:

15 (1) the extent of, and the reasons for, the in16 ability of the Social Security Administration to

17 maintain accurate and current records of every

18 worker’s annual earnings sufficient for determining

19 eligibility for, and the correct amount of, monthly in20 surance benefits under title II of the Social Security

21 Act,

22 (2) proposals for an effective procedure for

23 eliminating the current backlog of uncredited earn24 ings in the suspense file maintained by the Social

25 Security Administration,
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1 (3) proposals for an effective procedure for re2 solving new discrepancies which would result in new

3 uncredited earnings, and

4 (4) any additional resources which the Social

5 Security Administration would require to carry out

6 effective procedures described in paragraphs (2) and

7 (3).

8 SEC. 3. REMEDIAL MEASURES.

9 Pursuant to the study carried out under section 2,

10 the Commissioner of Social Security and the Secretary of

11 the Treasury shall promptly—

12 (1) devise and implement a procedure for elimi13 nating, in accordance with an established time14 phased schedule, the backlog of uncredited earnings

15 currently contained in the suspense file maintained

16 by the Administration, and

17 (2) devise and implement a procedure for re18 solving new discrepancies which would prevent the

19 addition of future uncredited earnings in the sus20 pense file.

21 SEC. 4. REPORT.

22 The Commissioner of Social Security and the Sec23 retary of the Treasury shall submit to the Committee on

24 Ways and Means of the House of Representatives and the

25 Committee on Finance of the Senate, not later than 180
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1 days after the date of the enactment of this Act, a report

2 of the findings of the study conducted under section 2 and

3 the progress made in meeting the requirements of section

4 3. Such report shall include any recommendations for fur5 ther legislative action the Commissioner and the Secretary

6 consider appropriate.

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