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[Congressional Bills 104th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4215 Introduced in House (IH)]

104th CONGRESS
  2d Session
                                H. R. 4215

  To provide for the establishment and maintenance of personal social 
    security investment accounts for all Americans under the social 
                            security system.

_______________________________________________________________________

                    IN THE HOUSE OF REPRESENTATIVES

                           September 26, 1996

  Mr. Petri introduced the following bill; which was referred to the 
   Committee on Ways and Means, and in addition to the Committee on 
    Government Reform and Oversight, and Rules, for a period to be 
subsequently determined by the Speaker, in each case for consideration 
  of such provisions as fall within the jurisdiction of the committee 
                               concerned

_______________________________________________________________________

                                 A BILL

 
  To provide for the establishment and maintenance of personal social 
    security investment accounts for all Americans under the social 
                            security system.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Retirement Security Act of 1996''.

SEC. 2. INDIVIDUAL RETIREMENT INVESTMENT PROGRAM AND PERSONAL SOCIAL 
              SECURITY INVESTMENT ACCOUNTS.

    (a) In General.--Title II of the Social Security Act is amended--
            (1) by inserting before section 201 the following:

                    ``Part A--Insurance Benefits'';

        and
            (2) by adding at the end the following new part:

           ``Part B--Individual Retirement Investment Program

                             ``definitions

    ``Sec. 251. For purposes of this part--
            ``(1) Account holder.--The term `account holder' means an 
        individual for whom a personal social security investment 
        account is established under section 251(a).
            ``(2) Investment account.--The term `investment account' 
        means a personal social security investment account established 
        under section 251(a).
            ``(3) Trust fund.--The term `Trust Fund' means the Social 
        Security Investment Trust Fund established under section 259.
            ``(4) Executive director.--The term `Executive Director' 
        means the Executive Director under this part authorized to so 
        serve under section 265(b).
            ``(5) Board.--The term `Board' means the Board of Trustees 
        of the Trust Fund authorized to so serve under section 265(a).

             ``personal social security investment accounts

    ``Sec. 252. (a) Certification of Account Numbers.--Not later than 
July 1, 1997, the Commissioner of Social Security shall certify to the 
Executive Director and the Secretary of the Treasury the identity and 
social security account number of each living individual who, as of 
such date, has been issued such a number under section 205(c)(2). Upon 
the issuance thereafter to any individual of a social security account 
number under section 205(c)(2), the Commissioner of Social Security 
shall certify to the Executive Director and the Secretary of the 
Treasury the identity and social security account number of such 
individual.
    ``(b) Establishment of Personal Social Security Investment 
Accounts.--Upon receipt of any such certification with respect to an 
individual, the Executive Director shall establish a personal social 
security investment account for such individual. Amounts in the Social 
Security Investment Trust Fund shall be credited by the Executive 
Director to the investment account in accordance with this part. The 
investment account shall be identified to the account holder by means 
of the account holder's social security account number. The Executive 
Director shall establish an investment account for each account holder 
not later than the later of January 1, 1998, or 30 days after receipt 
of the certification with respect to the account holder.
    ``(c) Initial Contribution.--Upon the establishment of each account 
holder's investment account, the Secretary of the Treasury shall 
transfer, from amounts not otherwise appropriated in the general fund 
of the Treasury to the Trust Fund, for crediting by the Executive 
Director to such investment account under subsection (b), an amount 
equal to $1000.00.
    ``(d) Investment Account Balance.--The balance in an account 
holder's investment account at any time is the excess of--
            ``(1) the sum of--
                    ``(A) the contribution made to the Trust Fund and 
                credited to the investment account pursuant to 
                subsection (c);
                    ``(B) all contributions made to the Trust Fund 
                under section 253, and
                    ``(C) the total amount of the allocations made to 
                and reductions made in the investment account pursuant 
                to subsection (e), over
            ``(2) the amounts paid out of the Trust Fund with respect 
        to such individual under this part.
    ``(e) Allocation of Earnings and Losses.--Pursuant to regulations 
prescribed by the Executive Director, the Executive Director shall 
allocate to each investment account an amount equal to a pro rata share 
of the net earnings and net losses from each investment of sums in the 
Trust Fund attributable to sums credited to such investment account, 
reduced by an appropriate share of the administrative expenses paid out 
of the net earnings under section 256(d), as determined by the 
Executive Director.
    ``(f) Engagement of Qualified Public Accountant.--
            ``(1) In general.--The Executive Director shall annually 
        engage, on behalf of all account holders, an independent 
        qualified public accountant, who shall conduct an examination 
        of all accounts and other books and records maintained in the 
        administration of this part as the public accountant considers 
        necessary to enable the public accountant to make the 
        determination required by paragraph (2). The examination shall 
        be conducted in accordance with generally accepted auditing 
        standards and shall involve such tests of the accounts, books, 
        and records as the public accountant considers necessary.
            ``(2) Examination and report.--The public accountant 
        conducting an examination under paragraph (1) shall determine 
        whether the accounts, books, and records referred to in such 
        paragraph have been maintained in conformity with generally 
        accepted accounting principles applied on a basis consistent 
        with the manner in which such principles were applied during 
        the examination conducted under such paragraph during the 
        preceding year. The public accountant shall transmit to the 
        Board and the Comptroller General of the United States a report 
        on his examination, including his determination under this 
        paragraph.
            ``(3) Reliance on actuary's certifications.--In making a 
        determination under paragraph (2), a public accountant may rely 
        on the correctness of any actuarial matter certified by an 
        enrolled actuary if the public accountant states his reliance 
        in the report transmitted to the Board under such paragraph.
            ``(4) Definition.--For the purposes of this subsection, the 
        term ``qualified public accountant'' shall have the same 
        meaning as provided in section 103(a)(3)(D) of the Employee 
        Retirement Income Security Act of 1974 (29 U.S.C. 
        1023(a)(3)(D)).
    ``(g) Information Required To Be Provided to Account Holders.--
            ``(1) In general.--The Board shall prescribe regulations 
        under which each account holder shall be furnished with--
                    ``(A) a periodic statement relating to the account 
                holder's investment account; and
                    ``(B) a summary description of the investment 
                options under section 254 covering, and an evaluation 
                of, each such option for at least the 5-year period 
                preceding the date as of which such evaluation is made.
            ``(2) Timely provision of information.--Information under 
        this subsection shall be provided at least 30 calendar days 
        before the date provided for each election under section 
        254(c), and in a manner designed to facilitate informed 
        decisionmaking with respect to each such election.
    ``(h) Assumption of Risk.--Each account holder who elects to invest 
in the Fixed Income Investment Fund or the Common Stock Index 
Investment Fund described in subparagraphs (B) and (C), respectively, 
of section 254(a)(1) shall sign an acknowledgement prescribed by the 
Executive Director which states that the account holder understands 
that an investment in either such Fund is made at the account holder's 
risk, that the account holder is not protected by the Government 
against any loss on such investment, and that a return on such 
investment is not guaranteed by the Government.

      ``contributions to the social security investment trust fund

    ``Sec. 253. (a) In General.--The Executive Director shall prescribe 
regulations under which each individual who is eligible to claim a 
deduction under section 221 of the Internal Revenue Code of 1986 for 
contributions to a personal social security investment account shall be 
afforded a reasonable opportunity to make contributions to the Trust 
Fund, for crediting to such account, either from time to time or under 
arrangements providing for regular, periodic contributions. Such 
arrangements may include arrangements for contributions of wages by 
employers on behalf of employees. Any such arrangement shall also 
provide individuals a reasonable opportunity to modify the amount to be 
contributed under this part, or to terminate such contributions.
    ``(b) Limitation on Contributions.--Notwithstanding any other 
provision of this section, no contribution may be made under this 
section to any account for any year to the extent that such 
contribution, when added to prior contributions to such account for 
such year, exceeds $7,000.
    ``(c) Crediting Procedures.--Amounts contributed by (or on behalf 
of) an account holder under this section shall be deposited in the 
Trust Fund to the credit of that account holder's investment account in 
accordance with such procedures as the Comptroller General of the 
United States may, in consultation with the Executive Director, 
prescribe in regulations.
    ``(d) Nonforfeitability of Contributions.--All contributions made 
under this section shall be fully nonforfeitable when made.

         ``investment of social security investment trust fund

    ``Sec. 254. (a) Investment Funds.--The Board shall establish--
            ``(1) a Government Securities Investment Fund under which 
        sums in the Trust Fund are invested in securities of the United 
        States Government issued as provided in subsection (e);
            ``(2) a Fixed Income Investment Fund under which sums in 
        the Trust Fund are invested in--
                    ``(A) insurance contracts,
                    ``(B) certificates of deposit, or
                    ``(C) other instruments or obligations selected by 
                qualified professional asset managers,
        which return the amount invested and pay interest, at a 
        specified rate or rates, on that amount during a specified 
        period of time;
            ``(3) a Common Stock Index Investment Fund as provided in 
        subsection (b); and
            ``(4) such other investment fund or funds as the Board may 
        provide by regulation.
    ``(b) Index Governing Common Stock Index Investment Funds.--
            ``(1) Selection of index.--The Board shall select an index 
        which is a commonly recognized index comprised of common stock 
        the aggregate market value of which is a reasonably complete 
        representation of the United States equity markets.
            ``(2) Portfolio design.--The Common Stock Index Investment 
        Fund shall be invested in a portfolio designed to replicate the 
        performance of the index selected under paragraph (1). The 
        portfolio shall be designed such that, to the extent 
        practicable, the percentage of the Common Stock Index 
        Investment Fund that is invested in each stock is the same as 
        the percentage determined by dividing the aggregate market 
        value of all shares of that stock by the aggregate market value 
        of all shares of all stocks included in such index.
    ``(c) Investment According to Elections.--
            ``(1) In general.--The Executive Director shall invest the 
        sums available in the Trust Fund for investment as provided in 
        elections made under subsection (d).
            ``(2) Default investment in absence of election.--If an 
        election has not been made with respect to any sums in the 
        Trust Fund available for investment, the Executive Director 
        shall invest such sums in the Government Securities Investment 
        Fund.
    ``(d) Semiannual Elections.--
            ``(1) In general.--At least twice each year, an account 
        holder may elect the investment funds referred to in subsection 
        (a) into which the sums in the Trust Fund credited to such 
        account holder's investment account are to be invested or 
        reinvested.
            ``(2) Investment according to regulations.--An election may 
        be made under paragraph (1) only in accordance with regulations 
        prescribed by the Executive Director and within such period as 
        the Executive Director shall provide in such regulations.
    ``(e) Issuance of Special Obligations.--
            ``(1) Authorization.--The Secretary of the Treasury is 
        authorized to issue special interest-bearing obligations of the 
        United States for purchase by the Trust Fund for the Government 
        Securities Investment Fund.
            ``(2) Requirements.--
                    ``(A) In general.--Obligations issued for the 
                purpose of this subsection shall have maturities fixed 
                with due regard to the needs of the Trust Fund as 
                determined by the Executive Director, and shall bear 
                interest at a rate equal to the average market yield 
                (computed by the Secretary of the Treasury on the basis 
                of market quotations as of the end of the calendar 
                month next preceding the date of issue of such 
                obligations) on all marketable interest-bearing 
                obligations of the United States then forming a part of 
                the public debt which are not due or callable earlier 
                than 4 years after the end of such calendar month.
                    ``(B) Rounding.--Any average market yield computed 
                under subparagraph (A) which is not a multiple of one-
                eighth of 1 percent, shall be rounded to the nearest 
                multiple of one-eighth of 1 percent.
    ``(f) No Voting Rights in Securities.--The Board, the Executive 
Director, and an account holder may not exercise voting rights 
associated with the ownership of securities by the Social Security 
Investment Trust Fund.

     ``distributions from the social security investment trust fund

    ``Sec. 255. (a) In General.--No distribution may be made from the 
Social Security Investment Trust Fund of any amount credited to the 
investment account of any account holder, unless such distribution is 
in the form of--
            ``(1) a benefit distribution described in subsection (b),
            ``(2) a distribution described in subsection (c), or
            ``(3) a death distribution under subsection (d).
    ``(b) Benefit Distribution.--
            ``(1) In general.--A distribution from an investment 
        account is in the form of a benefit distribution referred to in 
        subsection (a)(1) if such distribution constitutes payment (in 
        whole or in part) of a monthly insurance benefit under part A 
        based on the wages and self-employment income of the account 
        holder.
            ``(2) Payment of monthly insurance benefits.--
        Notwithstanding section 201(h), benefit payments required to be 
        made under part A, other than benefit payments required to be 
        made under section 223 or 226 and benefit payments required to 
        be made under subsection (b), (c), or (d) of section 202 to 
        account holders entitled to benefits on the basis of the wages 
        and self-employment income of any such account holder entitled 
        to disability insurance benefits, shall be made from amounts in 
        the Trust Fund credited to such account holder's investment 
        account, except to the extent that such benefit payments exceed 
        the balance credited to such account holder's investment 
        account. Any amount of such benefit payments in excess of the 
        balance in such account holder's investment account shall be 
        payable as provided in section 201(h). The Commissioner of 
        Social Security shall provide for certification to the 
        Executive Director for payment of such benefits from the Trust 
        Fund, and the Executive Director shall make such payments from 
        the Trust Fund in accordance with such certification.
    ``(c) Annuities and Lump Sum Payments.--A distribution referred to 
in subsection (a)(2) is described in this subsection if--
            ``(1) the distribution is at the election of the account 
        holder made (in such form and manner as shall be prescribed by 
        the Executive Director) on or after the date of the 
        commencement of such account holder's entitlement to old-age 
        insurance benefits under section 202(a),
            ``(2) the amount of each distribution is in an amount, as 
        determined by the Executive Director, which is not greater than 
        the excess of--
                    ``(A) the balance credited to such account holder's 
                investment account, over
                    ``(B) the amount necessary to provide for benefit 
                distributions as required under subsection (a)(1), and
            ``(3) the distributions shall be paid in the form of 
        annuities and other payments under section 256.
    ``(d) Death Distribution.--
            ``(1) In general.--A distribution from an investment 
        account is in the form of a death distribution if such 
        distribution is in the amount remaining credited to the account 
        holder as of the date of such account holder's death and, 
        except as provided in paragraph (2), is distributed in the same 
        manner as is provided for distribution of benefit payments 
        under section 204(d).
            ``(2) Portion of account balance attributable to federal 
        contribution returned to united states.--The portion of the 
        amount remaining credited to the account holder as of the date 
        of such account holder's death which is attributable to the 
        contribution made under section 252(c) shall be paid to the 
        Secretary of the Treasury for deposit into the general fund of 
        the Treasury as miscellaneous receipts. For purposes of the 
        preceding sentence, distributions from a personal social 
        security investment account shall be treated as first made from 
        amounts attributable to the contribution made under section 
        252(c) and then from other amounts.

  ``annuities and lump sum payments payable from the social security 
                         investment trust fund

    ``Sec. 256. (a) In General.--An account holder who is entitled to 
old-age insurance benefits under section 202(a) is entitled as provided 
in this section to the amount of the balance in the account holder's 
investment account as provided in this section available for 
distribution under this section in accordance with section 255.
    ``(b) Alternative Forms of Distribution.--Subject to section 258, 
any account holder who is entitled to old-age insurance benefits under 
section 202(a) is entitled and may elect--
            ``(1) to receive an immediate annuity from the Trust Fund;
            ``(2) to defer the commencement of the payment of an 
        annuity from the Trust Fund until such date as the account 
        holder specifies, but not later than April 1 of the year 
        following the year in which the account holder becomes 70\1/2\ 
        years of age;
            ``(3) to withdraw the amount of the balance in the account 
        holder's investment account in the Trust Fund in one or more 
        substantially equal payments to be made not less frequently 
        than annually and to commence before April 1 of the year 
        following the year in which the account holder becomes 70\1/2\ 
        years of age; or
            ``(4) to transfer the amount of the balance in the account 
        holder's investment account in the Trust Fund to an eligible 
        retirement plan as provided in subsection (c).
    ``(c) Transfers to Eligible Retirement Plans.--
            ``(1) In general.--The Executive Director shall make each 
        transfer elected under subsection (b)(4) directly to an 
        eligible retirement plan or plans (as defined in section 
        402(a)(5)(E) of the Internal Revenue Code of 1986) identified 
        by the account holder for whom the transfer is made.
            ``(2) Transfer contingent upon receipt of necessary 
        information.--A transfer may not be made for an account holder 
        under paragraph (1) until the Executive Director receives from 
        such account holder the information required by the Executive 
        Director specifically to identify the eligible retirement plan 
        or plans to which the transfer is to be made.
    ``(d) Modification of Elections.--
            ``(1) In general.--Subject to paragraph (3)(A) and 
        subsections (a) and (d) of section 258, an account holder may 
        change an election previously made under this section.
            ``(2) Modification of date for delayed distributions.--
        Subject to paragraph (3)(B) and section 258(d), an account 
        holder who has made an election pursuant to subsection (b)(2) 
        may modify the date specified in such election or in a previous 
        modification under this paragraph.
            ``(3) Limitations.--
                    ``(A) Modifications disallowed upon commencement of 
                distribution.--An account holder may not change an 
                election under this section on or after the date on 
                which a payment is made in accordance with such 
                election or, in the case of an election to receive an 
                annuity, the date on which an annuity contract is 
                purchased to provide for the annuity elected by the 
                account holder.
                    ``(B) Other limitations.--A modification of a date 
                may not be made under paragraph (2) on or after the 
                date on which an annuity contract is purchased to 
                provide for the annuity involved, and may not specify a 
                date for the commencement of an annuity earlier than 90 
                days after the date on which the modification is 
                submitted to the Executive Director (or such period 
                shorter than 90 days as the Executive Director may by 
                regulation prescribe).
    ``(e) Default Means of Distribution.--
            ``(1) Lump sum distributions of minimal amounts.--
        Notwithstanding subsection (b), if an account holder becomes 
        entitled to old-age insurance benefits under section 202(a) and 
        the balance in such account holder's investment account is 
        $3,500 or less, the Executive Director shall pay the balance to 
        the account holder in a single payment unless the account 
        holder elects, at such time and otherwise in such manner as the 
        Executive Director prescribes, one of the options available 
        under subsection (b).
            ``(2) Default annuity commencement date.--Unless otherwise 
        elected under this section, and subject to paragraph (1), the 
        balance in an account holder's investment account shall be paid 
        as an annuity commencing for the account holder on February 1 
        of the year following the year in which the account holder 
        becomes entitled to old-age insurance benefits under section 
        202(a).

                         ``payment of annuities

    ``Sec. 257. (a) Methods of Payment.--The Board shall prescribe 
methods of payment of annuities under this part. The methods of payment 
prescribed under this subsection shall include, but not be limited to--
            ``(1) a method which provides for the payment of a monthly 
        annuity only to an annuitant during the life of the annuitant;
            ``(2) a method which provides for the payment of a monthly 
        annuity to an annuitant for the joint lives of the annuitant 
        and the spouse of the annuitant and an appropriate monthly 
        annuity to the one of them who survives the other of them for 
        the life of the survivor;
            ``(3) a method described in paragraph (1) which provides 
        for automatic adjustments in the amount of the annuity payable 
so long as the amount of the annuity payable in any one year shall not 
be less than the amount payable in the previous year;
            ``(4) a method described in paragraph (2) which provides 
        for automatic adjustments in the amount of the annuity payable 
        so long as the amount of the annuity payable in any one year 
        shall not be less than the amount payable in the previous year; 
        and
            ``(5) a method which provides for the payment of a monthly 
        annuity--
                    ``(A) to the annuitant for the joint lives of the 
                annuitant and an individual who is designated by the 
                annuitant under regulations prescribed by the Executive 
                Director and (i) is a former spouse of the annuitant, 
                or (ii) has an insurable interest in the annuitant; and
                    ``(B) to the one of them who survives the other of 
                them for the life of the survivor.
    ``(b) Requirement of Election.--Subject to section 258(c), under 
such regulations as the Executive Director shall prescribe, an account 
holder who elects under section 256 to receive an annuity under this 
part shall elect, on or before the date on which an annuity contract is 
purchased to provide for that annuity, one of the methods of payment 
prescribed under subsection (a).
    ``(c) Continued Period of 5 Years Availability for Eliminated 
Methods.--Notwithstanding an elimination of a method of payment by the 
Board, an account holder may elect the eliminated method if the 
elimination of such method became effective less than 5 years before 
the date on which the annuity commences.
    ``(d) Contracts for Purchase of Annuities.--
            ``(1) Time limit for entering into contract.--Not earlier 
        than 90 days (or such shorter period as the Executive Director 
        may by regulation prescribe) before an annuity is to commence 
        under this part, the Executive Director shall expend the 
        balance in the annuitant's account to purchase an annuity 
        contract from any entity which, in the normal course of its 
        business, sells and provides annuities.
            ``(2) Assurance of provision of annuity.--The Executive 
        Director shall assure, by contract entered into with each 
        entity from which an annuity contract is purchased under 
        paragraph (1), that the annuity shall be provided in accordance 
        with the provisions of this part.
            ``(3) Terms and conditions.--An annuity contract purchased 
        under paragraph (1) shall include such terms and conditions as 
        the Executive Director requires for the protection of the 
        annuitant.
            ``(4) Bonding.--The Executive Director shall require, from 
        each entity from which an annuity contract is purchased under 
        paragraph (1), a bond or proof of financial responsibility 
        sufficient to protect the annuitant.
    ``(e) Exemption From Local Taxation of Amounts Paid To Purchase 
Annuities.--
            ``(1) In general.--No tax, fee, or other monetary payment 
        may be imposed or collected by any State, or by any political 
        subdivision or other governmental authority thereof, on, or 
        with respect to, any amount paid to purchase an annuity 
        contract under this section.
            ``(2) Taxation of issuer permitted.--Paragraph (1) shall 
        not be construed to exempt any company or other entity issuing 
        an annuity contract under this section from the imposition, 
        payment, or collection of a tax, fee, or other monetary payment 
        on the net income or profit accruing to or realized by that 
        entity from the sale of an annuity contract under this section 
        if that tax, fee, or payment is applicable to a broad range of 
        business activity.

              ``protections for spouses and former spouses

    ``Sec. 258. (a) Requirement of Spousal Consent.--
            ``(1) In general.--A married account holder may make an 
        election under subsection (b)(3) or (b)(4) of section 256 or 
        change an election previously made under subsection (b)(1) or 
        (b)(2) of such section only if the account holder and the 
        account holder's spouse jointly waive, by written election, any 
        right which the spouse may have to a survivor annuity with 
        respect to such account holder under section 257 or subsection 
        (b).
            ``(2) Exception.--Paragraph (1) shall not apply to an 
        election or change of election by an account holder who 
        establishes to the satisfaction of the Executive Director (at 
        the time of the election or change and in accordance with 
        regulations prescribed by the Executive Director)--
                    ``(A) that the spouse's whereabouts cannot be 
                determined; or
                    ``(B) that, due to exceptional circumstances, 
                requiring the spouse's waiver would otherwise be 
                inappropriate.
    ``(b) Joint and Survivor Annuity Form Applies Unless Otherwise 
Elected.--
            ``(1) In general.--Notwithstanding any election under 
        subsection (b) of section 257, the method described in 
        subsection (a)(2)(B) of such section (or, if more than one form 
        of such method is available, the form which the Board 
        determines to be the one which provides for a surviving spouse 
        a survivor annuity most closely approximating the annuity of a 
        surviving spouse under section 8442 of title 5, United States 
        Code) shall be deemed the applicable method under such 
        subsection (b) in the case of an account holder who is married 
        on the date on which an annuity contract is purchased to 
        provide for the account holder's annuity under this part.
            ``(2) Exception.--Paragraph (1) shall not apply if--
                    ``(A) a joint waiver of such method is made, in 
                writing, by the account holder and the spouse; or
                    ``(B) the account holder waives such method, in 
                writing, after establishing to the satisfaction of the 
                Executive Director that circumstances described under 
                subsection (a)(2) (A) or (B) make the requirement of a 
                joint waiver inappropriate.
    ``(c) Elections and Other Changes Subject to Court Orders.--
            ``(1) In general.--An election, change of election, or 
        modification of the commencement date of a deferred annuity 
        shall not be effective under this part to the extent that the 
        election, change, modification, or transfer conflicts with any 
        court decree, order, or agreement described in paragraph (2).
            ``(2) Requirements.--A court decree, order, or agreement 
        referred to in paragraph (1) is, with respect to an account 
        holder, a court decree of divorce, annulment, or legal 
        separation issued in the case of such account holder and any 
        former spouse of the account holder or any court order or 
        court-approved property settlement agreement incident to such 
        decree if--
                    ``(A) the decree, order, or agreement expressly 
                relates to any portion of the balance in the account 
                holder's investment account; and
                    ``(B) notice of the decree, order, or agreement was 
                received by the Executive Director before--
                            ``(i) the date on which payment is made, or
                            ``(ii) in the case of an annuity, the date 
                        on which an annuity contract is purchased to 
                        provide for the annuity,
                in accordance with the election, change, modification, 
                or contribution referred to in paragraph (1).
            ``(3) Treatment of 2 or more court orders.--The Executive 
        Director shall prescribe regulations under which this 
        subsection shall be applied in any case in which the Executive 
        Director receives two or more decrees, orders, or agreements 
        referred to in paragraph (1).
    ``(d) Rights of Former Spouses.--
            ``(1) In general.--Subject to paragraphs (2) through (7), a 
        former spouse of a deceased account holder who died as a fully 
        insured individual is entitled to a survivor annuity under this 
        subsection if and to the extent that--
                    ``(A) an election under section 257(a)(2)(E), or
                    ``(B) any court decree, order, or agreement 
                (described in subsection (c)(2), without regard to 
                subparagraph (B) of such subsection) which relates to 
                such deceased account holder and such former spouse,
        expressly provides for such survivor annuity.
            ``(2) Written notice required.--Paragraph (1) shall apply 
        only to payments made by the Executive Director after the date 
        on which the Executive Director receives written notice of the 
        election, decree, order, or agreement, and such additional 
        information and documentation as the Executive Director may 
        require.
            ``(3) Limitation on amount.--The amount of the survivor 
        annuity payable from the Trust Fund to a former spouse of a 
        deceased account holder under this section may not exceed the 
        excess, if any, of--
                    ``(A) the amount of the survivor annuity determined 
                for a surviving spouse of the deceased account holder 
                under the method described in subsection (b)(1), over
                    ``(B) the total amount of all other survivor 
                annuities payable under part to other former spouses of 
                such deceased account holder based on the order of 
                precedence provided in paragraph (4).
            ``(4) Order of precedence.--If more than one former spouse 
        of a deceased account holder is entitled to a survivor annuity 
        pursuant to this subsection, the amount of each such survivor 
        annuity shall be limited appropriately to carry out paragraph 
        (3) in the order of precedence established for the entitlements 
        by the chronological order of the dates on which elections are 
        properly made pursuant to section 257(a)(2)(E) and the dates on 
        which the court decrees, orders, or agreements applicable to 
        the entitlement were issued, as the case may be.
            ``(5) Rules for commencement and termination under court 
        orders.--The commencement and termination of an annuity payable 
        under this section shall be governed by the terms of the 
        applicable order, decree, agreement, or election, as the case 
        may be, except that any such annuity--
                    ``(A) shall not commence before--
                            ``(i) the day after the account holder 
                        dies; or
                            ``(ii) the first day of the second month 
                        beginning after the date on which the Executive 
                        Director receives written notice of the order, 
                        decree, agreement, or election, as the case may 
                        be, together with such additional information 
                        or documentation as the Executive Director may 
                        prescribe;
                whichever is later; and
                    ``(B) shall terminate no later than the last day of 
                the month before the former spouse remarries before 
                becoming 55 years of age or dies.
            ``(6) Restriction on modifications.--For purposes of this 
        part, a modification in a decree, order, agreement, or election 
        referred to in this section shall not be effective--
                    ``(A) if such modification is made after the 
                retirement or death of the account holder or annuitant 
                concerned; and
                    ``(B) to the extent that such modification involves 
                an annuity under this part.
            ``(7) Court orders subject to previous joint waivers.--For 
        the purposes of this section, a court decree, order, or 
        agreement or an election referred to in subsection (a) of this 
        section shall not be effective, in the case of a former spouse, 
        to the extent that the election is inconsistent with any joint 
        waiver previously executed with respect to such former spouse 
        under subsection (a)(2) or (b)(2).
            ``(8) Exclusive recovery.--Any payment under this 
        subsection to any individual bars recovery by any other 
        individual.
    ``(f) Waivers and Modifications Subject to Prescribed Procedures.--
Waivers and notifications required by this section and waivers of the 
requirements for such waivers and notifications (as authorized by this 
section) may be made only in accordance with procedures prescribed by 
the Executive Director.
    ``(g) Inapplicability to Minimal Account Balances.--None of the 
provisions of this section requiring notification to, or the consent or 
waiver of, a spouse or former spouse of an account holder shall apply 
in any case in which the balance in the account holder's investment 
account is $3,500 or less.
    ``(h) Applicable Court Orders.--The protections provided by this 
section are in addition to the protections provided by section 263.

                      ``administrative provisions

    ``Sec. 259. (a) Payments and Transfers in Accordance With 
Election.--The Executive Director shall make or provide for payments 
and transfers in accordance with an election of an account holder under 
section 256 or 257(b) or, if applicable, in accordance with section 
258.
    ``(b) Elections and Modifications of Deferred Commencement Dates in 
Writing.--Any election, change of election, or modification of a 
deferred annuity commencement date made under this part shall be in 
writing and shall be filed with the Executive Director in accordance 
with regulations prescribed by the Executive Director.

                ``social security investment trust fund

    ``Sec. 260. (a) In General.--There is established in the Treasury 
of the United States a Social Security Investment Trust Fund.
    ``(b) Amount Comprising the Trust Fund.--The Trust Fund consists of 
the sum of all amounts contributed under sections 252(a) and 253, 
increased by the total net earnings from investments of sums in the 
Trust Fund under section 254 or reduced by the total net losses from 
investments of the Trust Fund under such section, and reduced by the 
total amount of payments made from the Trust Fund (including payments 
for administrative expenses).
    ``(c) Appropriation of Trust Fund Amounts.--The sums in the Trust 
Fund are appropriated and shall remain available without fiscal year 
limitation--
            ``(1) to invest under section 254;
            ``(2) to make distributions or purchase annuity contracts 
        under this part;
            ``(3) to pay the administrative expenses incurred in 
        carrying out this part under subsection (d); and
            ``(4) to purchase insurance as provided in subsection 
        (h)(3)(B).
    ``(d) Administrative Expenses.--Administrative expenses incurred to 
carry out this part shall be paid out of net earnings in the Trust 
Fund.
    ``(e) Assignment or Alienation and Related Matters.--
            ``(1) Exclusive benefit of the account holder.--Subject to 
        subsection (d) and paragraphs (2) and (3), sums in the Trust 
        Fund credited to the account of any account holder may not be 
        used for, or diverted to, purposes other than for the exclusive 
        benefit of the account holder or other persons to whom 
        distributions are made under section 255.
            ``(2) Immunity from assignment, alienation, and certain 
        other legal process.--Except as provided in paragraph (3), sums 
        in the Trust Fund may not be assigned or alienated and are not 
        subject to execution, levy, attachment, garnishment, or other 
        legal process. For the purposes of this paragraph, a loan made 
        from the Trust Fund to an account holder shall not be 
        considered to be an assignment or alienation.
            ``(3) Exceptions.--Moneys due or payable from the Trust 
        Fund to any person and, in the case of an account holder, the 
balance in the individual account of the account holder, shall be 
subject to legal process for the enforcement of the legal obligations 
of such person or account holder to provide child support or make 
alimony payments as provided in section 459 or relating to the 
enforcement of a judgment for physically, sexually, or emotionally 
abusing a child as provided under section 263.
    ``(f) Exclusive Appropriation.--The sums in the Trust Fund shall 
not be appropriated for any purpose other than the purposes specified 
in this section and may not be used for any other purpose.
    ``(g) Contributions and Earnings Held in Trust for Account 
Holders.--All sums contributed to the Trust Fund by an account holder 
and all net earnings in the Trust Fund attributable to investment of 
such sums are held in the Trust Fund in trust for such account holder.
    ``(h) Fiduciary Responsibilities; Enforcement Under the Secretary 
of Labor.--
            ``(1) In general.--Under regulations of the Secretary of 
        Labor, the provisions of sections 8477 and 8478 of title 5, 
        United States Code, shall apply in connection with the Trust 
        Fund in the same manner and to the same extent as such 
        provisions apply in connection with the Thrift Savings Fund.
            ``(2) Investigative authority.--Any authority available to 
        the Secretary of Labor under section 504 of the Employee 
        Retirement Income Security Act of 1974 is hereby made available 
        to the Secretary of Labor, and any officer designated by the 
        Secretary of Labor, to determine whether any person has 
        violated, or is about to violate, any provision applicable 
        under paragraph (1).
            ``(3) Exculpatory provisions; insurance.--
                    ``(A) In general.--Any provision in an agreement or 
                instrument which purports to relieve a fiduciary from 
                responsibility or liability for any responsibility, 
                obligation, or duty under this part shall be void.
                    ``(B) Insurance.--The Trust Fund shall be available 
                and may be used at the discretion of the Executive 
                Director to purchase insurance to cover potential 
                liability of persons who serve in a fiduciary capacity 
                with respect to the Trust Fund, without regard to 
                whether a policy of insurance permits recourse by the 
                insurer against the fiduciary in the case of a breach 
                of a fiduciary obligation.

             ``waiver, allotment and assignment of payments

    ``Sec. 261. (a) Waiver of Entitlement.--An individual entitled to 
an annuity or other payment payable from the Trust Fund may decline to 
accept all or any part of the amount of the payment by a waiver signed 
and filed with the Executive Director. The waiver may be revoked in 
writing at any time. Payment of the annuity waived may not be made for 
the period during which the waiver is in effect.
    ``(b) Allotments or Assignments.--An individual entitled to an 
annuity or other payment payable from the Trust Fund may make 
allotments or assignments of amounts from the annuity or other payment 
for such purposes as the Executive Director considers appropriate.

              ``application for annuity or other payments

    ``Sec. 262. (a) Applications Required.--No payment of an annuity or 
other payment from the Social Security Investment Trust Fund under this 
part may be made unless an application for payment of the annuity or 
other payment is received by the Executive Director before the one 
hundred and fifteenth anniversary of the birth of the account holder.
    ``(b) Applications With Respect to Deceased Account Holders.--
Notwithstanding subsection (a), after the death of an account holder, a 
payment of the annuity or other payment shall not be paid unless an 
application therefor is received by the Executive Director within 30 
years after the death or other event which establishes the entitlement 
to the annuity or other payment.
    ``(c) Payments Due to Minors.--Payment due a minor, or an 
individual mentally incompetent or under other legal disability, may be 
made to the person who is constituted guardian or other fiduciary by 
the law of the State of residence of the claimant or is otherwise 
legally vested with the care of the claimant or his estate. An election 
to be made by a minor, or an individual mentally incompetent or under 
other legal disability, may be made by the person who is constituted 
guardian or other fiduciary by the law of the State of residence of the 
individual or is otherwise legally vested with the care of the 
individual or his estate. In any case in which a guardian or other 
fiduciary of the individual under legal disability has not been 
appointed under the law of the State of residence of the individual, if 
any other person, in the judgment of the Executive Director, is 
responsible for the care of such individual, any payment which is 
otherwise payable to such individual may be made to such person, and 
any election under this part which may otherwise be made by such 
individual may be made by such person, and the payment of an annuity 
payment to such person bars recovery by any other person.

                             ``court orders

    ``Sec. 263. (a) Alternative Payees Under Court Orders.--Payments 
under this part which would otherwise be made to an account holder or 
an annuitant shall be paid (in whole or in part) by the Executive 
Director to another person if and to the extent expressly provided for 
in the terms of--
            ``(1) any court decree of divorce, annulment, or legal 
        separation, or the terms of any court order or court-approved 
        property settlement agreement incident to any court decree of 
        divorce, annulment, or legal separation; or
            ``(2) any court order or other similar process in the 
        nature of garnishment for the enforcement of a judgment 
        rendered against such account holder or annuitant, for 
        physically, sexually, or emotionally abusing a child.
In the event that the Executive Director, as the case may be, is served 
with more than 1 decree, order, or other legal process with respect to 
the same moneys due or payable to any individual, such moneys shall be 
available to satisfy such processes on a first-come, first-served 
basis, with any such process being satisfied out of such moneys as 
remain after the satisfaction of all such processes which have been 
previously served.
    ``(b) Written Notice Requirements.--Subsection (a) shall apply only 
to payments made by the Executive Director under this part after the 
date on which the Executive Director receives written notice of such 
decree, order, other legal process, or agreement, and such additional 
information and documentation as the Executive Director may require.
    ``(c) Definitions.--For the purpose of this section--
            ``(1) the term `judgment rendered for physically, sexually, 
        or emotionally abusing a child' means any legal claim perfected 
        through a final enforceable judgment, which claim is based in 
        whole or in part upon the physical, sexual, or emotional abuse 
        of a child, whether or not that abuse is accompanied by other 
        actionable wrongdoing, such as sexual exploitation or gross 
        negligence; and
            ``(2) the term `child' means an individual under 18 years 
        of age.

                  ``withholding of state income taxes

    ``Sec. 264. (a) Withholding Agreements.--The Executive Director 
shall, in accordance with this section, enter into an agreement with 
any State within 120 days of a request for agreement from the proper 
State official. The agreement shall provide that the Executive Director 
shall withhold State income tax in the case of the monthly annuity of 
any annuitant who voluntarily requests, in writing, such withholding. 
The amounts withheld during any calendar quarter shall be held in the 
Trust Fund and disbursed to the States during the month following that 
calendar quarter.
    ``(b) No Multiple Requests.--An annuitant may have in effect at any 
time only one request for withholding under this section, and an 
annuitant may not have more than two such requests in effect during any 
one calendar year.
    ``(c) Changes and Revocations.--Subject to subsection (b), an 
annuitant may change the State designated by that annuitant for 
purposes of having withholdings made, and may request that the 
withholdings be remitted in accordance with such change. An annuitant 
also may revoke any request of that annuitant for withholding. Any 
change in the State designated or revocation is effective on the first 
day of the month after the month in which the request or the revocation 
is processed by the Executive Director, but in no event later than on 
the first day of the second month beginning after the day on which such 
request or revocation is received by the Executive Director.
    ``(d) Reservations to the United States; Repayments of Erroneous 
Withholdings.--This section does not give the consent of the United 
States to the application of a statute which imposes more burdensome 
requirements on the United States than on employers generally, or which 
subjects the United States or any annuitant to a penalty or liability 
because of this section. The Executive Director may not accept pay from 
a State for services performed in withholding State income taxes from 
annuities. Any amount erroneously withheld from an annuity and paid to 
a State by the Executive Director shall be repaid by the State in 
accordance with regulations issued by the Executive Director.
    ``(e) Definition.--For the purpose of this section, the term 
`annuitant' includes a survivor who is receiving an annuity from the 
Trust Fund.

      ``tax treatment of the social security investment trust fund

    ``Sec. 265. The Trust Fund shall be exempt from taxation under 
subtitle A of the Internal Revenue Code of 1986.

                            ``administration

    ``Sec. 266. (a) Board of Trustees.--
            ``(1) In general.--The Federal Retirement Thrift Investment 
        Board established by section 8472(a) of title 5, United States 
        Code, shall also serve as the Board of Trustees of the Social 
        Security Investment Trust Fund.
            ``(2) Duties.--It shall be the duty of the Board to--
                    ``(A) hold the Trust Fund;
                    ``(B) report to the Congress not later than the 
                first day of April of each year on the operation and 
                status of the Trust Fund during the preceding fiscal 
                year and on its expected operation and status during 
                the next ensuing 5 fiscal years;
                    ``(C) develop investment policies which provide 
                for--
                            ``(i) prudent investments suitable for 
                        accumulating funds for payment of retirement 
                        income, and
                            ``(ii) low administrative costs;
                    ``(D) recommend improvements in administrative 
                procedures and policies designed to effectuate the 
                proper coordination of the program established under 
                this part with the old-age, survivors, and disability 
                insurance program established under part A; and
                    ``(E) review the general policies followed in 
                managing the Trust Fund and recommend changes in such 
                policies, including necessary changes in the provisions 
                of the law which govern the way in which the Trust 
                Funds are to be managed and invested.
    ``(b) Executive Director.--
            ``(1) In general.--The Executive Director appointed under 
        section 8474(a) of title 5, United States Code, shall also 
        serve as Executive Director under this part.
            ``(2) Duties.--The Executive Director shall--
                    ``(A) carry out the policies established by the 
                Board under this part;
                    ``(B) invest and manage the Trust Fund in 
                accordance with the investment policies and other 
                policies established by the Board under this part;
                    ``(C) purchase annuity contracts and provide for 
                the payment of other benefits under this part;
                    ``(D) administer the provisions of this part; and
                    ``(E) prescribe such regulations (other than 
                regulations relating to fiduciary responsibilities) as 
                may be necessary for the administration of this part.
            ``(3) Authorized functions.--The Executive Director may--
                    ``(A) prescribe such regulations as may be 
                necessary to carry out the responsibilities of the 
                Executive Director under this part, other than 
                regulations relating to fiduciary responsibilities;
                    ``(B) appoint such personnel as may be necessary to 
                carry out the provisions of this part;
                    ``(C) subject to approval by the Board, procure the 
                services of experts and consultants under section 3109 
                of title 5, United States Code;
                    ``(D) secure directly from other agencies and 
                instrumentalities of the Federal Government any 
                information necessary to carry out the provisions of 
                this part and policies of the Board under this part;
                    ``(E) make such payments out of sums in the Trust 
                Fund as the Executive Director determines are necessary 
                to carry out the provisions of this part and the 
                policies of the Board under this part;
                    ``(F) pay the compensation, per diem, and travel 
                expenses of individuals appointed under subparagraphs 
                (B), (C), and (G) from the Trust Fund;
                    ``(G) accept and use the services of individuals 
                employed intermittently in the Government service and 
                reimburse such individuals for travel expenses, as 
                authorized by section 5703 of title 5, United States 
                Code, including per diem as authorized by section 5702 
                of such title;
                    ``(H) except as otherwise expressly prohibited by 
                law or the policies of the Board, delegate any of the 
                Executive Director's functions to such employees under 
                the Board as the Executive Director may designate and 
                authorize such successive redelegations of such 
                functions to such employees under the Board as the 
                Executive Director may consider to be necessary or 
                appropriate; and
                    ``(I) take such other actions as are appropriate to 
                carry out the functions of the Executive Director.
    ``(c) Source of Compensation.--Notwithstanding paragraph (3) of 
section 8476(d) of title 5, United States Code, basic pay paid for any 
fiscal year as compensation to each member of the Board (and each 
officer and employee of the Board) shall be paid from the Trust Fund 
(in lieu of the Thrift Savings Fund) in an amount which bears the same 
ratio to the total amount of basic pay paid to such member (or officer 
or employee) for such fiscal year as the balance in the Trust Fund as 
of the beginning of such fiscal year bears to the total amount of such 
balance and the balance in the Thrift Savings Fund as of the beginning 
of such fiscal year.

                ``financing of government contributions

    ``Sec. 267. (a) Availability of Receipts From Asset Sales.--
            ``(1) Deposit of federal share of receipts.--Except as 
        provided in paragraph (2), the Federal share of receipts 
        received by the United States pursuant to a payment law that, 
        but for this subsection, would be covered into miscellaneous 
        receipts in the Treasury without restrictions, shall be 
        available for each fiscal year solely for purposes of making 
        initial contributions to investment accounts pursuant to 
        section 252(b).
            ``(2) Reversion of excess receipts.--Any amounts made 
        available for any fiscal year for the purposes described in 
        paragraph (2) which remain available as of the end of such 
        fiscal year shall revert to the general fund of the Treasury as 
        miscellaneous receipts.
            ``(3) Payment law defined.--For the purposes of paragraph 
        (1), the term `payment law' has the meaning given such term by 
        section 6903(1) of title 31, United States Code.
    ``(b) Congressional Consideration of Presidential Recommendations 
for Additional Asset Sales.--
            ``(1) Presidential findings.--As soon as practicable after 
        the date of the enactment of the Retirement Security Act of 
        1996, the President shall make findings regarding the extent to 
        which additional funds are or will be required to make initial 
        contributions to the Social Security Investment Trust Fund 
        pursuant to section 252(b) and shall recommend what additional 
        sales of Federal assets should be undertaken to obtain such 
        additional funds.
            ``(2) Recommendations.--
                    ``(A) In general.--The President shall make 
                specific recommendations to the Congress regarding the 
                President's findings under paragraph (1) not later than 
                January 1, 1997, and from time to time thereafter as 
                the President deems appropriate. The President shall 
                include with such recommendations legislative language 
                necessary for carrying out such recommendations. The 
                President shall actively consult with the appropriate 
                Committees of each House of the Congress, the 
                Comptroller General of the United States, and the 
                Director of the Office of Management and Budget in 
                compiling such legislative language. The President 
                shall promptly provide, upon request, to any Member of 
                Congress a description of any information used by the 
                President in making such recommendations.
                    ``(B) Accompanying report by cbo.--The Comptroller 
                General of the United States shall provide appropriate 
                assistance to the President in the preparation of the 
                President's report and shall transmit to each House of 
                the Congress at the time of the President's transmittal 
                a report containing a detailed analysis of the 
                President's recommendations.
            ``(3) Introduction of recommendations.--The legislative 
        language transmitted pursuant to paragraph (2) with the 
        recommendations of the President shall be in the form of a 
        joint resolution. Such joint resolution may be introduced in 
        either House of the Congress by any member thereof.
            ``(4) Terms of the resolution.--For purposes of this 
        subsection, the term `joint resolution' means a joint 
        resolution that--
                    ``(A) does not have a preamble;
                    ``(B) sets forth after the resolving clause only 
                the legislative language contained in the report from 
                the President; and
                    ``(C) is entitled a `Joint resolution approving the 
                recommendations of the President regarding additional 
                Federal asset sales for purposes of part B of title II 
                of the Social Security Act.'.
            ``(5) Expedited procedure.--
                    ``(A) Referral.--A joint resolution that is 
                introduced in the House of Representatives shall be 
                referred to the Committee on Resources of the House of 
                Representatives. A joint resolution that is introduced 
                in the Senate shall be referred to the Committee on 
                Environment and Public Works of the Senate.
                    ``(B) Discharge.--If the committee to which a joint 
                resolution is referred has not reported the resolution 
                (or an identical resolution) by the end of the 90-day 
                period beginning on the date on which the President 
                transmits the report to the Congress, such committee 
                shall, at the end of that period, be discharged from 
                further consideration of the resolution, and 
the resolution shall be placed on the appropriate calendar of the House 
of Representatives or the Senate, as the case may be.
                    ``(C) Consideration.--
                            ``(i) In general.--On or after the first 
                        day after the date on which the committee to 
                        which a joint resolution is referred has 
                        reported, or has been discharged (under 
                        subparagraph (B)) from further consideration 
                        of, such a resolution, it is in order (even 
                        though a previous motion to the same effect has 
                        been disagreed to) for any member of the House 
                        of Representatives or the Senate, respectively, 
                        to move to proceed to the consideration of the 
                        resolution (but only on the date after the 
                        calendar day on which the member announces to 
                        the House concerned the member's intention to 
                        do so).
                            ``(ii) Points of order waived.--All points 
                        of order against a joint resolution (and 
                        against consideration of the resolution) are 
                        waived.
                            ``(iii) Motion to proceed.--A motion to 
                        proceed to the consideration of a joint 
                        resolution is highly privileged in the House of 
                        Representatives and is privileged in the Senate 
                        and is not debatable. The motion is not subject 
                        to amendment, to a motion to postpone 
                        consideration of the resolution, or to a motion 
                        to proceed to the consideration of other 
                        business. A motion to reconsider the vote by 
                        which the motion to proceed is agreed to or not 
                        agreed to shall not be in order. If the motion 
                        to proceed is agreed to, the House of 
                        Representatives or the Senate, as the case may 
                        be, shall immediately proceed to consideration 
                        of the joint resolution without intervening 
                        motion, order, or other business, and the 
                        resolution shall remain the unfinished business 
                        of the House of Representatives or the Senate, 
                        as the case may be, until disposed of.
                            ``(iv) Limited debate.--Debate on a joint 
                        resolution and on all debatable motions and 
                        appeals in connection therewith shall be 
                        limited to not more than 5 hours, which shall 
                        be divided equally between those favoring and 
                        those opposing the resolution. A motion further 
                        to limit debate on a joint resolution is in 
                        order and not debatable.
                            ``(v) Amendments not in order.--An 
                        amendment to a joint resolution is not in 
                        order.
                            ``(vi) Other motions not in order.--A 
                        motion to postpone consideration of a joint 
                        resolution, a motion to proceed to the 
                        consideration of other business, or a motion to 
                        recommit the resolution is not in order. A 
                        motion to reconsider the vote by which a joint 
                        resolution is agreed to or not agreed to is not 
                        in order.
                            ``(vii) Vote on final passage.--Immediately 
                        following the conclusion of the debate on a 
                        joint resolution and a single quorum call at 
                        the conclusion of the debate if requested in 
                        accordance with the rules of the House of 
                        Representatives or the Senate, as the case may 
                        be, the vote on final passage of the resolution 
                        shall occur.
                            ``(viii) Appeals.--Appeals from the 
                        decisions of the Chair relating to the 
                        application of the rules of the House of 
                        Representatives or of the Senate, as the case 
                        may be, to the procedure relating to a joint 
                        resolution shall be decided without debate.
                    ``(D) Consideration by other house.--If, before the 
                passage by one House of a joint resolution that was 
                introduced in such House, such House receives from the 
                other House a joint resolution as passed by such other 
                House--
                            ``(i) the resolution of the other House 
                        shall not be referred to a committee and may 
                        not be considered in the House that receives it 
                        otherwise than on final passage under 
                        subparagraph (C);
                            ``(ii) the procedure in the House in 
                        receipt of the resolution of the other House, 
                        with respect to the joint resolution that was 
                        introduced in the House in receipt of the 
                        resolution of the other House, shall be the 
                        same as if no resolution had been received from 
                        the other House; and
                            ``(iii) notwithstanding clause (ii), the 
                        vote on final passage shall be on the 
                        resolution of the other House.
                Upon disposition of a joint resolution that is received 
                by one House from the other House, it shall no longer 
                be in order to consider the joint resolution that was 
                introduced in the receiving House.
                    ``(E) Date certain.--If the Senate and the House of 
                Representatives have not acted upon the joint 
                resolution by the 120-day period beginning on the date 
                on which the President transmits the report to the 
                Congress, then on that day or the next day of session 
                thereafter the joint resolution shall be called up by 
                the Presiding Officer of each House upon convening and 
                a roll call vote shall be conducted on passage. If the 
                joint resolution passes one House a vote on final 
                passage shall be immediately conducted in the other 
                House.
                    ``(F) Rules of the senate and house of 
                representatives.--This subsection is enacted by 
                Congress--
                            ``(i) as an exercise of the rulemaking 
                        power of the Senate and House of 
                        Representatives, respectively, and is deemed to 
                        be part of the rules of each House, 
                        respectively, but applicable only with respect 
                        to the procedure to be followed in that House 
                        in the case of a joint resolution, and it 
                        supersedes other rules only to the extent that 
                        it is inconsistent with such rules; and
                            ``(ii) with full recognition of the 
                        constitutional right of either House to change 
                        the rules (so far as they relate to the 
                        procedure of that House) at any time, in the 
                        same manner, and to the same extent as in the 
                        case of any other rule of that House.''.
    (b) Conforming Amendments.--Section 201(h) of such Act (42 U.S.C. 
401(h)) is amended--
            (1) by striking ``All other'' in the second sentence and 
        inserting ``Except as provided in section 255, all other''; and
            (2) by adding at the end the following new sentence: ``Any 
        reference in this part to benefits under this title shall be 
        deemed a reference to benefits entitlement to which arises 
        under this part.''.
    (c) Effective Date.--The amendments made by this section shall 
apply with respect to payments of old-age insurance benefits for months 
after December 1997.

SEC. 3. TAX TREATMENT OF AMOUNTS CONTRIBUTED TO, AND DISTRIBUTIONS 
              FROM, PERSONAL SOCIAL SECURITY INVESTMENT ACCOUNTS.

    (a) In General.--Part VII of subchapter B of chapter 1 of the 
Internal Revenue Code of 1986 (relating to additional itemized 
deductions for individuals) is amended by redesignating section 221 as 
section 222 and by inserting after section 220 the following new 
section:

``SEC. 221. PERSONAL SOCIAL SECURITY INVESTMENT ACCOUNTS.

    ``(a) Allowance of Deduction.--In the case of an individual, there 
shall be allowed as a deduction for the taxable year an amount equal to 
the amount contributed in cash for such taxable year to the personal 
social security investment account of any eligible individual.
    ``(b) Maximum Amount of Deduction.--
            ``(1) In general.--The amount allowable as a deduction 
        under subsection (a) for any taxable year for contributions to 
        the personal social security investment account of an eligible 
        individual shall not exceed $2,000.
            ``(2) Special rule.--If the account holder of any personal 
        social security investment account makes a contribution to such 
        account for any taxable year, no other taxpayer shall be 
        allowed a deduction for any amount contributed to such account 
        for such taxable year.
    ``(c) Definitions.--For purposes of this section--
            ``(1) Personal social security investment account.--The 
        term `personal social security investment account' means an 
        account established under section 251 of the Social Security 
        Act.
            ``(2) Eligible individual.--The term `eligible individual' 
        means, with respect to the taxpayer--
                    ``(A) the taxpayer,
                    ``(B) the taxpayer's spouse, and
                    ``(C) any individual with respect to whom a 
                deduction under section 151(c) is allowed to the 
                taxpayer.
Subparagraph (B) shall not apply unless the taxpayer files a joint 
return for the taxable year.
    ``(d) Tax Treatment of Distributions.--
            ``(1) In general.--Except as otherwise provided in this 
        subsection, any amount paid or distributed out of a personal 
        social security investment account shall be included in gross 
        income by the payee or distributee, as the case may be, in the 
        manner provided under section 72.
            ``(2) Special rules for applying section 72.--For purposes 
        of applying section 72 to any amount described in paragraph 
        (1)--
                    ``(A) all personal social security investment 
                accounts of the same individual shall be treated as 1 
                contract,
                    ``(B) all distributions during any taxable year 
                shall be treated as 1 distribution, and
                    ``(C) the value of the contract, income on the 
                contract, and investment in the contract shall be 
                computed as of the close of the calendar year in which 
                the taxable year begins.
        For purposes of subparagraph (C), the value of the contract 
        shall be increased by the amount of any distributions during 
        the calendar year.
            ``(3) Treatment of distributions of social security 
        benefits.--
                    ``(A) In general.--Notwithstanding paragraph (1), 
                the amount of any benefit distribution described in 
                section 255(b) of the Social Security Act shall be 
                included in gross income to the extent provided in 
                section 86.
                    ``(B) Allocation of investment in the contract.--
                For purposes of section 72, the portion of the account 
                which the Executive Director (as defined in section 251 
                of the Social Security Act) determines is necessary to 
                fund the benefit distributions referred to in 
                subparagraph (A) for the taxable year and all 
                succeeding taxable years shall be treated as a separate 
                contract with respect to which no premium or other 
                consideration was paid.
                    ``(4) Cross reference.--

                                ``For excise tax on certain 
distributions, see section 72(t).
    ``(e) Special Rules.--
            ``(1) Time when contributions deemed made.--For purposes of 
        this section, a taxpayer shall be deemed to have made a 
        contribution to a personal social security investment account 
        on the last day of the preceding taxable year if the 
        contribution is made on account of such taxable year and is 
        made not later than the time prescribed by law for filing the 
        return for such taxable year (not including extensions 
        thereof).
            ``(2) Beneficiary must be under age 70\1/2\.--No deduction 
        shall be allowed under this section with respect to any 
        contribution to personal social security investment account if 
        the account holder has attained age 70\1/2\ before the close of 
        such holder's taxable year for which the contribution was 
        made.''
    (b) Deduction Allowed Whether or Not Taxpayer Itemizes Other 
Deductions.--Subsection (a) of section 62 of such Code is amended by 
inserting after paragraph (15) the following new paragraph:
            ``(16) Personal social security investment account 
        contributions.--The deduction allowed by section 221.''.
    (c) Conforming Amendments.--
            (1) Penalty for failure to meet minimum distribution 
        requirement.--Subsection (c) of section 4974 of such Code is 
        amended by striking ``or'' at the end of paragraph (4), by 
        striking the period at the end of paragraph (5) and inserting 
        ``, or'', and by inserting after paragraph (5) the following 
        new paragraph:
            ``(6) any personal social security investment account (as 
        defined in section 221(c)).''.
            (2) Tax on excess distributions from qualified retirement 
        plans to apply.--
                    (A) Subparagraph (A) of section 4980A(d)(3) of such 
                Code is amended by striking ``and individual retirement 
                plans'' and inserting ``, individual retirement plans, 
                and personal social security investment accounts (as 
                defined in section 221(c))''.
                    (B) Paragraph (1) of section 4980A(e) of such Code 
                is amended by striking ``and'' at the end of 
                subparagraph (A), by striking the period at the end of 
                subparagraph (B) and inserting ``, and'', and by adding 
                at the end the following new paragraph:
                    ``(C) any personal social security investment 
                account (as defined in section 221(c)).''.
            (3) Treatment like individual retirement plan under excise 
        tax on certain premature distributions.--Subparagraph (A) of 
        section 72(t) of such Code is amended--
            (1) by inserting ``or from a personal social security 
        investment account (as defined in section 221(c))'' before the 
        period at the end, and
            (2) by inserting ``or from personal social security 
        investment accounts'' after ``plans'' in the subparagraph 
        heading.
    (d) Clerical Amendment.--The table of sections for part VII of 
subchapter B of chapter 1 of such Code is amended by striking the last 
item and inserting the following new items:

                              ``Sec. 221. Personal social security 
                                        investment accounts.
                              ``Sec. 222. Cross reference.''.
    (e) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 1997.
                                 <all>
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