I 

110TH CONGRESS 

1ST SESSION H. R. 1090 

To amend the Social Security Act and the Internal Revenue Code of 1986 

to preserve and strengthen the Social Security Program through the 

creation of personal Social Security guarantee accounts ensuring full 

benefits for all workers and their families, restoring long-term Social 

Security solvency, to make certain benefit improvements, and for other 

purposes. 

IN THE HOUSE OF REPRESENTATIVES 

FEBRUARY 15, 2007 

Mr. LEWIS of Kentucky introduced the following bill; which was referred to 

the Committee on Ways and Means, and in addition to the Committees 

on the Budget 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 amend the Social Security Act and the Internal Revenue 

Code of 1986 to preserve and strengthen the Social 

Security Program through the creation of personal Social 

Security guarantee accounts ensuring full benefits for 

all workers and their families, restoring long-term Social 

Security solvency, to make certain benefit improvements, 

and for other purposes. 

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. SHORT TITLE; TABLE OF CONTENTS. 

2 (a) SHORT TITLE.—This Act may be cited as the 

3 ‘‘Social Security Guarantee Plus Act of 2007’’. 

4 (b) TABLE OF CONTENTS.—The table of contents is 

5 as follows: 

Sec. 1. Short title; table of contents. 

Sec. 2. Findings and statement of purpose. 

TITLE I—SOCIAL SECURITY GUARANTEE PROGRAM 

Sec. 101. Social Security guarantee refundable credit. 

‘‘Sec. 3511. Social Security guarantee refundable credit. 

Sec. 102. Establishment of the Social Security Guarantee Program. 

‘‘PART A—INSURANCE BENEFITS

‘‘PART B—SOCIAL SECURITY GUARANTEE PROGRAM

‘‘Sec. 251. Definitions. 

‘‘Sec. 252. Establishment of Program. 

‘‘Sec. 253. Social Security guarantee accounts. 

‘‘Sec. 254. Investment of accounts. 

‘‘Sec. 255. Determination of monthly annuity amounts and use in determining account distribution supplements. 

‘‘Sec. 256. Disposition of account assets. 

‘‘Sec. 257. Administration of the Program. 

Sec. 103. Benefit increases. 

Sec. 104. Tax treatment. 

‘‘Sec. 2059. Social Security guarantee accounts. 

Sec. 105. Annual account statements. 

Sec. 106. Protection of social security surpluses. 

‘‘Sec. 316. Lock-box for social security surpluses. 

TITLE II—BENEFIT UPDATES 

Sec. 201. Elimination of the Social Security earnings test for individuals who 

have attained age 62. 

Sec. 202. Increase in widow’s and widower’s insurance benefits. 

Sec. 203. Benefits for disabled widows and widowers without regard to age. 

Sec. 204. Repeal of 7-YEAR restriction on eligibility for widow’s and widower’s 

insurance benefits based on disability. 

Sec. 205. Exemption from two-year waiting period for divorced spouse’s benefits upon other spouse’s remarriage. 

Sec. 206. Increase in amount of wages and self-employment income credited to 

years taken into account in determining average indexed 

monthly earnings for beneficiaries precluded from remunerative 

work by need to provide child care. 

Sec. 207. Government pension offset reduced from two-thirds to one-third of 

the Government pension. 

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1 SEC. 2. FINDINGS AND STATEMENT OF PURPOSE. 

2 (a) FINDINGS.—The Congress finds as follows: 

3 (1) The Social Security program provides essen4 tial income security for about 48 million Americans 

5 of all ages through its retirement, disability, and 

6 survivor benefits. 

7 (2) Social Security’s benefit structure is de8 signed to help lower-wage workers, and its family 

9 benefits are of particular importance to women. 

10 (3) The Board of Trustees of the Social Secu11 rity trust funds project that, because people are liv12 ing longer, families are having fewer children, and 

13 the baby boom generation is approaching retirement, 

14 the Social Security program’s benefit costs will ex15 ceed its tax revenues beginning in 2017. By 2040, 

16 the Social Security trust funds will be depleted and 

17 the program will be able to honor only 74 percent 

18 of benefit commitments, and even less thereafter. 

19 (4) Each payday, American workers send their 

20 hard-earned payroll taxes to Social Security and in 

21 return are promised protection for themselves and 

22 their families upon retirement, disability, or death. 

23 That commitment must be kept. 

24 (5) Reducing benefits will result in more seniors 

25 and individuals with disabilities living in poverty. 

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1 (6) Workers who are more in need of early re2 tirement, such as police officers, firefighters, and 

3 manual laborers, would be especially harmed by in4 creases in the age of eligibility for Social Security 

5 benefits. 

6 (7) Inasmuch as payroll taxes already con7 stitute the single largest tax burden for most Amer8 ican families, further tax increases would contribute 

9 to erosion in public support for Social Security and 

10 would not result in sustainable financing for the 

11 long term. 

12 (8) Allowing the Federal Government to invest 

13 workers’ payroll taxes in private financial assets 

14 risks political interference in investment decisions 

15 and may reduce economic efficiency. 

16 (9) Workers’ ability to save and invest for their 

17 own economic security in retirement will continue to 

18 be particularly important, especially for younger 

19 workers. 

20 (10) The creation of Social Security guarantee 

21 accounts as provided for in this Act is a critical goal 

22 in light of Social Security’s financial challenges, the 

23 options available to address these challenges, and 

24 the Nation’s interest in preserving and strengthmstockstill on PROD1PC66 with BILLS

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1 ening Social Security for the next 75 years and be2 yond. 

3 (b) STATEMENT OF PURPOSE.—The purpose of this 

4 Act is to preserve and strengthen the Social Security pro5 gram through the creation of Social Security guarantee 

6 accounts that will— 

7 (1) ensure the payment of Social Security bene8 fits promised under current law, or greater benefits, 

9 to all eligible workers and their families; 

10 (2) provide for the long-run sustainability of the 

11 Social Security program; and 

12 (3) provide personal account assets to be used 

13 exclusively for the financial security of the account 

14 holder and his or her family that this and future 

15 Congresses cannot redirect for any other purpose. 

16 TITLE I—SOCIAL SECURITY 

17 GUARANTEE PROGRAM 

18 SEC. 101. SOCIAL SECURITY GUARANTEE REFUNDABLE 

19 CREDIT. 

20 (a) IN GENERAL.—Chapter 25 of the Internal Rev21 enue Code of 1986 (relating to general provisions relating 

22 to employment taxes) is amended by adding at the end 

23 the following new section: 

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1 ‘‘SEC. 3511. SOCIAL SECURITY GUARANTEE REFUNDABLE 

2 CREDIT. 

3 ‘‘(a) IN GENERAL.—The Social Security guarantee 

4 account established under section 253 of the Social Secu5 rity Act for each individual who has filed an election under 

6 section 253(b) of such Act shall receive for each calendar 

7 year following such election, during which such individual 

8 has earned wages or to which self-employment income of 

9 such individual is credited, a payment equal to the credit 

10 amount determined under subsection (b) for the individual 

11 for such calendar year. 

12 ‘‘(b) CREDIT AMOUNT.— 

13 ‘‘(1) IN GENERAL.—For purposes of subsection 

14 (a), the credit amount determined under this sub15 section for an individual for a calendar year is an 

16 amount equal to the lesser of— 

17 ‘‘(A) 4 percent of the sum of— 

18 ‘‘(i) wages (as defined in section 

19 3121(a)) received by such individual dur20 ing such year on which tax is imposed by 

21 section 3101, and 

22 ‘‘(ii) self-employment income (as de23 fined in 1402(b)) of such individual for the 

24 taxable year of such individual ending in 

25 such calendar year on which tax is imposed 

26 by section 1401, or 

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1 ‘‘(B) $1,000 (in the case of the calendar 

2 year ending after the date of the enactment of 

3 the Social Security Guarantee Plus Act of 

4 2007) and the amount determined under para5 graph (2) for the calendar year (in the case of 

6 subsequent calendar years). 

7 ‘‘(2) WAGE-BASED ADJUSTMENTS.—The Sec8 retary shall, on or before November 1 of the first 

9 calendar year ending after the date of the enactment 

10 of the Social Security Guarantee Plus Act of 2007 

11 and of every calendar year thereafter, determine and 

12 publish in the Federal Register the dollar amount 

13 under paragraph (1)(B) for the succeeding calendar 

14 year. Such amount shall be the larger of— 

15 ‘‘(A) the amount in effect in the calendar 

16 year in which the determination under this 

17 paragraph is made, or 

18 ‘‘(B) the product of $1,000 and the ratio 

19 of the national average wage index (as defined 

20 in section 209(k)(1) of the Social Security Act) 

21 for the calendar year before the year in which 

22 the determination under this paragraph is made 

23 to the national average wage index (as so de24 fined) for the first of the 2 calendar years pre25 ceding the calendar year ending after the date 

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1 of the enactment of the Social Security Guar2 antee Plus Act of 2007, 

3 with such product, if not a multiple of $10, being 

4 rounded to the next higher multiple of $10 where 

5 such amount is a multiple of $5 but not of $10 and 

6 to the nearest multiple of $10 in any other case. 

7 ‘‘(c) SPECIAL RULES.— 

8 ‘‘(1) AGREEMENTS BY AMERICAN EMPLOYERS

9 OF FOREIGN AFFILIATES.—Any amounts paid pur10 suant to an agreement under section 3121(l) (relat11 ing to agreements entered into by American employ12 ers with respect to foreign affiliates) which are 

13 equivalent to the taxes referred to in subsection 

14 (b)(1)(A) shall be treated as taxes referred to in 

15 such subsection. 

16 ‘‘(2) COORDINATION WITH SPECIAL REFUND OF

17 SOCIAL SECURITY TAXES.—For purposes of sub18 section (b)(1)(A), tax imposed by section 3101 shall 

19 not include any taxes to the extent the individual is 

20 entitled to a special refund of such taxes under sec21 tion 6413(c). 

22 ‘‘(d) PAYMENT.—Notwithstanding any other provi23 sion of this title, the payment under subsection (a) shall 

24 be paid only as provided in section 253 of the Social Secu25 rity Act.’’. 

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1 (b) CONFORMING AMENDMENT.—The table of sec2 tions for chapter 25 of such Code is amended by adding 

3 at the end the following new item: 

‘‘Sec. 3511. Social Security guarantee refundable credit.’’. 

4 (c) EFFECTIVE DATE.—The amendments made by 

5 this section shall apply to remuneration received, and net 

6 earnings for self-employment for services performed, in 

7 calendar years ending after the date of the enactment of 

8 this Act. 

9 SEC. 102. ESTABLISHMENT OF THE SOCIAL SECURITY 

10 GUARANTEE PROGRAM. 

11 (a) IN GENERAL.—Title II of the Social Security Act 

12 is amended— 

13 (1) by inserting before section 201 the fol14 lowing: 

15 ‘‘PART A—INSURANCE BENEFITS’’; 

16 and 

17 (2) by adding at the end of such title the fol18 lowing new part: 

19 ‘‘PART B—SOCIAL SECURITY GUARANTEE PROGRAM

20 ‘‘DEFINITIONS

21 ‘‘SEC. 251. For purposes of this part— 

22 ‘‘(1) COVERED INDIVIDUAL.—The term ‘cov23 ered individual’ means an individual who has filed 

24 an election under section 253(b). 

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1 ‘‘(2) ACCOUNT ASSETS.—The term ‘account as2 sets’ means, with respect to a Social Security guar3 antee account, the total amount transferred to such 

4 account, increased by earnings credited under this 

5 part and reduced by losses and administrative ex6 penses under this part. 

7 ‘‘(3) CERTIFIED ACCOUNT MANAGER.—The 

8 term ‘certified account manager’ means a person 

9 who is certified under section 257(b). 

10 ‘‘(4) BOARD.—The term ‘Board’ means the So11 cial Security Guarantee Board established under sec12 tion 257(a). 

13 ‘‘(5) COMMISSIONER.—The term ‘Commis14 sioner’ means the Commissioner of Social Security. 

15 ‘‘(6) PROGRAM.—The term ‘Program’ means 

16 the Social Security Guarantee Program established 

17 under this part. 

18 ‘‘(7) COVERED MONTHLY INSURANCE BEN19 EFIT.—The term ‘covered monthly insurance benefit’ 

20 means a monthly insurance benefit under section 

21 202 or 223, other than a child’s insurance benefit 

22 under section 202(d) of a child who has not attained 

23 age 18 (or who is a full-time elementary or sec24 ondary school student (as defined in section 

25 202(d)(7)(A)) and has not attained age 19). 

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1 ‘‘ESTABLISHMENT OF PROGRAM

2 ‘‘SEC. 252. There is hereby established a Social Secu3 rity Guarantee Program. The Program shall be governed 

4 by regulations which shall be prescribed by the Social Se5 curity Guarantee Board. The Board, the Executive Direc6 tor appointed by the Board, the Commissioner, and the 

7 Secretary of the Treasury shall consult with each other 

8 in issuing regulations relating to their respective duties 

9 under this part. Such regulations shall provide for appro10 priate exchange of information to assist them in per11 forming their duties under this part. 

12 ‘‘SOCIAL SECURITY GUARANTEE ACCOUNTS

13 ‘‘SEC. 253. (a) ESTABLISHMENT OF ACCOUNTS.— 

14 Under regulations which shall be prescribed by the Board 

15 in consultation with the Secretary of the Treasury— 

16 ‘‘(1) the Board shall establish a Social Security 

17 guarantee account for each covered individual (for 

18 whom a Social Security guarantee account has not 

19 otherwise been established under this part) upon ini20 tial receipt of a transfer under subsection (c) with 

21 respect to such covered individual, and 

22 ‘‘(2) in any case described in paragraph (2) of 

23 section 256(d), the Board shall establish a Social 

24 Security guarantee account for the divorced spouse 

25 referred to in such paragraph (2). 

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1 ‘‘(b) ELECTION OF STATUS AS COVERED INDI2 VIDUAL.— 

3 ‘‘(1) IN GENERAL.—Any individual who has at4 tained age 18 and has been assigned a social secu5 rity account number under section 205(c) may elect 

6 to be a covered individual under this part upon filing 

7 an election under this subsection in a form and man8 ner which shall be prescribed in regulations of the 

9 Commissioner of Social Security, in consultation 

10 with the Board. Such regulations shall provide for 

11 the filing of such elections during regularly sched12 uled intervals. Such an election shall be irrevocable 

13 and shall be effective with respect to wages earned, 

14 and self-employment income derived, on or after 

15 January 1 following the date of such filing. 

16 ‘‘(2) REQUIREMENTS.—An election by an indi17 vidual under this subsection is an election, filed with 

18 the Commissioner, in such form and manner as shall 

19 be prescribed in regulations of the Commissioner, 

20 consisting of a written and signed declaration of 

21 such individual’s intention to become a covered indi22 vidual under this part. The Commissioner shall pro23 vide for immediate notification to the Board and the 

24 Executive Director of such election. 

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1 ‘‘(c) TRANSFERS OF SOCIAL SECURITY GUARANTEE

2 REFUNDABLE CREDITS.— 

3 ‘‘(1) IN GENERAL.—Under regulations which 

4 shall be prescribed by the Secretary of the Treasury 

5 in consultation with the Board, as soon as prac6 ticable during the 1-year period after each calendar 

7 year, while minimizing capital market distortions, 

8 the Secretary of the Treasury shall transfer to each 

9 covered individual’s Social Security guarantee ac10 count, from amounts otherwise available in the gen11 eral fund of the Treasury, an amount equal to the 

12 sum of— 

13 ‘‘(A) the amount payable to the covered in14 dividual’s Social Security guarantee account 

15 under section 3511 of the Internal Revenue 

16 Code of 1986 (relating to the Social Security 

17 guarantee refundable credit) with respect to 

18 wages received during such calendar year by the 

19 covered individual and self-employment income 

20 derived by the covered individual during such 

21 individual’s taxable year ending in such cal22 endar year, and 

23 ‘‘(B) deemed interest on the amount deter24 mined under subparagraph (A) for the period 

25 commencing with July 1 of such calendar year 

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1 and ending with the date of the transfer, com2 puted at a rate equal to the average market 

3 yield (computed by the Managing Trustee on 

4 the basis of market quotations as of the end of 

5 the calendar month next preceding the date of 

6 the transfer) on all marketable interest-bearing 

7 obligations of the United States then forming a 

8 part of the public debt which are not due or 

9 callable earlier than 4 years after the end of 

10 such calendar month (rounding any average 

11 market yield computed under this paragraph 

which is not a multiple of 1 12 ⁄8 of 1 percent to the 

nearest multiple of 1 13 ⁄8 of 1 percent). 

14 ‘‘(2) TRANSITION RULE.—Notwithstanding 

15 paragraph (1), amounts payable to Social Security 

16 guarantee accounts under paragraph (1) with re17 spect to the first calendar year described in para18 graph (1)(A) ending after the date of the enactment 

19 of the Social Security Guarantee Plus Act of 2007 

20 shall be paid by the Secretary of the Treasury as 

21 soon as practicable after such Secretary determines 

22 that the administrative mechanisms necessary to 

23 provide for accurate and efficient payment of such 

24 amounts have been established. 

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1 ‘‘(3) AVAILABILITY OF TRUST FUNDS FOR

2 TRANSFERS.— 

3 ‘‘(A) RECOMMENDATIONS BY MANAGING

4 TRUSTEE.—As determined appropriate from 

5 time to time by the Managing Trustee of the 

6 Federal Old-Age and Survivors Insurance Trust 

7 Fund and the Federal Disability Insurance 

8 Trust Fund, the Managing Trustee shall trans9 mit to each House of the Congress the Man10 aging Trustee’s recommendation that amounts 

11 to be transferred to Social Security guarantee 

12 accounts under paragraph (1) be transferred 

13 from such Trust Funds in lieu of the general 

14 fund. Any such recommendation shall take ef15 fect only upon ratification thereof by an Act of 

16 Congress. 

17 ‘‘(B) DETERMINATIONS OF AVAIL18 ABILITY.—The Managing Trustee may not de19 termine that any such transfer from the Trust 

20 Funds is appropriate at any time unless the 

21 Managing Trustee has determined that 

22 amounts in such Trust Fund are available at 

23 such time for such transfers. For purposes of 

24 this subparagraph, amounts in either of the 

25 Trust Funds shall be considered to be available 

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1 for such transfers at any time only to the ex2 tent that the balance in such Trust Fund at 

3 such time exceeds the best estimate of the Man4 aging Trustee of the projected withdrawals oth5 erwise required from such Trust Fund during 

6 the next following 1-year period. 

7 ‘‘(C) ASSUMPTIONS.—In making rec8 ommendations under this paragraph, the Man9 aging Trustee shall utilize the intermediate ac10 tuarial assumptions utilized by the Board of 

11 Trustees of the Trust Funds for its most recent 

12 annual report issued under section 201(c). 

13 ‘‘(D) REPORT ON USE OF SOCIAL SECU14 RITY SURPLUSES.—The Managing Trustee shall 

15 annually prepare a report consisting of— 

16 ‘‘(i) the Managing Trustee’s deter17 mination of the extent to which amounts 

18 have been appropriated from the Trust 

19 Funds under this paragraph in connection 

20 with Social Security guarantee refundable 

21 credits under section 3511 of such Code, 

22 and 

23 ‘‘(ii) the Managing Trustee’s rec24 ommendations, based on the Managing 

25 Trustee’s review of the financial status of 

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1 such Trust Funds, with respect to whether 

2 or to what extent that portion of the taxes 

3 under chapters 2 and 21 of the Internal 

4 Revenue Code of 1986 to which surpluses 

5 in the Trust Funds may be attributed 

6 should be reduced or should be maintained 

7 so as to allow for continued appropriations 

8 from the Trust Funds under this para9 graph in connection with such credits. 

10 The Board of Trustees of the Trust Funds 

11 shall include such report in the Board’s annual 

12 report to the President and the Congress under 

13 section 201(c)(2). 

14 ‘‘(d) REQUIREMENTS FOR ACCOUNTS.—The fol15 lowing requirements shall be met with respect to each So16 cial Security guarantee account: 

17 ‘‘(1) Amounts transferred to the account con18 sist solely of amounts transferred pursuant to this 

19 part. 

20 ‘‘(2) In accordance with section 254, the ac21 count assets are held for purposes of investment 

22 under the Program by a certified account manager 

23 designated by (or on behalf of) the covered indi24 vidual for whom such account is established under 

25 the Program. 

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1 ‘‘(3) Disposition of the account assets is made 

2 solely in accordance with section 256. 

3 ‘‘(e) ACCOUNTING OF RECEIPTS AND DISBURSE4 MENTS UNDER THE PROGRAM.—The Board shall provide 

5 by regulation for an accounting system for purposes of 

6 this part— 

7 ‘‘(1) which shall be maintained by or under the 

8 Executive Director, 

9 ‘‘(2) which shall provide for crediting of earn10 ings from, and debiting of losses and administrative 

11 expenses from, amounts held in Social Security 

12 guarantee accounts, and 

13 ‘‘(3) under which receipts and disbursements 

14 under the Program which are attributable to each 

15 account are separately accounted for with respect to 

16 such account. 

17 ‘‘(f) CORRECTION OF ERRONEOUS TRANSFERS.— 

18 The Board, in consultation with the Commissioner, shall 

19 provide by regulation rules similar to paragraphs (4) 

20 through (7) and (9) of section 205(c) and section 205(g) 

21 with respect to the correction of erroneous or omitted 

22 transfers of amounts to Social Security guarantee ac23 counts. 

24 ‘‘INVESTMENT OF ACCOUNTS

25 ‘‘SEC. 254. (a) DESIGNATION OF CERTIFIED AC26 COUNT MANAGERS.—Under the Program, a certified acmstockstill on PROD1PC66 with BILLS

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1 count manager shall be designated by or on behalf of each 

2 covered individual to hold for investment under this sec3 tion such individual’s Social Security guarantee account 

4 assets. 

5 ‘‘(b) PROCEDURE FOR DESIGNATION.—Any designa6 tion made under subsection (a) shall be made in such form 

7 and manner as shall be prescribed in regulations pre8 scribed by the Board, following the initiation of an edu9 cational campaign as provided in section 257(a)(3)(C). 

10 Such regulations shall provide for annual selection periods 

11 during which covered individuals may make designations 

12 pursuant to subsection (a). Designations made pursuant 

13 to subsection (a) during any such period shall be irrev14 ocable for the one-year period following such period, ex15 cept that such regulations shall provide for such interim 

16 designations as may be necessitated by the decertification 

17 of a certified account manager. Such regulations shall pro18 vide for such designations made by the Board on behalf 

19 of a covered individual in any case in which a timely des20 ignation is not made by the covered individual. 

21 ‘‘(c) INVESTMENT GUIDELINES.— 

22 ‘‘(1) IN GENERAL.—For purposes of investment 

23 of amounts held in each Social Security guarantee 

24 account, the Board shall provide by regulation for 3 

25 investment options. Such options shall consist of the 

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1 60/40 investment option, the 65/35 investment op2 tion, and the 70/30 investment option. 

3 ‘‘(2) ALTERNATIVE INVESTMENT OPTIONS.— 

4 ‘‘(A) THE 60/40 INVESTMENT OPTION.— 

5 Under the 60/40 investment option, amounts 

6 are held in the Social Security guarantee ac7 count so as to ensure, to the maximum extent 

8 practicable, that, of the total balance credited 

9 to the account and available for investment 

10 (after allowing for administrative expenses)— 

11 ‘‘(i) 60 percent is invested in common 

12 stock as provided in paragraph (4), and 

13 ‘‘(ii) 40 percent is invested in fixed in14 come securities as provided in paragraph 

15 (5). 

16 For such purpose, certified account managers 

17 shall offer each account holder a choice of one 

18 or more portfolios of each such type of invest19 ment. Except as provided in an election under 

20 paragraph (3), amounts held in a Social Secu21 rity guarantee account shall be invested under 

22 the 60/40 investment option. 

23 ‘‘(B) THE 65/35 INVESTMENT OPTION.— 

24 Under the 65/35 investment option, amounts 

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1 count so as to ensure, to the maximum extent 

2 practicable, that, of the total balance credited 

3 to the account and available for investment 

4 (after allowing for administrative expenses)— 

5 ‘‘(i) 65 percent is invested in common 

6 stock as provided in paragraph (4), and 

7 ‘‘(ii) 35 percent is invested in fixed in8 come securities as provided in paragraph 

9 (5). 

10 For such purpose, certified account managers 

11 shall offer each account holder a choice of one 

12 or more portfolios of each such type of invest13 ment. 

14 ‘‘(C) THE 70/30 INVESTMENT OPTION.— 

15 Under the 70/30 investment option, amounts 

16 are held in the Social Security guarantee ac17 count so as to ensure, to the maximum extent 

18 practicable, that, of the total balance credited 

19 to the account and available for investment 

20 (after allowing for administrative expenses)— 

21 ‘‘(i) 70 percent is invested in common 

22 stock as provided in paragraph (4), and 

23 ‘‘(ii) 30 percent is invested in fixed in24 come securities as provided in paragraph 

25 (5). 

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1 For such purpose, certified account managers 

2 shall offer each account holder a choice of one 

3 or more portfolios of each such type of invest4 ment. 

5 ‘‘(3) ELECTIONS AMONG INVESTMENT OP6 TIONS.—Pursuant to any individual’s written elec7 tion filed in accordance with regulations of the 

8 Board during annual open seasons specified in such 

9 regulations, the certified account manager of the in10 dividual’s Social Security guarantee account shall, in 

11 accordance with such regulations, provide for dis12 investment and reinvestment of amounts held in the 

13 account under any of the investment options de14 scribed in paragraph (2) so as to provide for invest15 ment of amounts held in the account in any of the 

16 other such investment options specified in such elec17 tion. 

18 ‘‘(4) COMMON STOCK INDEX REQUIREMENTS.— 

19 The Board shall establish by regulation standards 

20 which must be met by any portfolio of common stock 

21 selected for investment of account assets as provided 

22 in subparagraph (A)(i), (B)(i), or (C)(i) of para23 graph (2), consistent with the requirement that such 

24 portfolio replicate the performance of one or more 

25 common stock indices comprised of common stock 

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1 the aggregate market value of which is, in each case, 

2 a reasonably broad representation of publicly held 

3 companies whose shares are traded on the equity 

4 markets. 

5 ‘‘(5) FIXED INCOME SECURITIES REQUIRE6 MENTS.—The Board shall establish by regulation 

7 standards which must be met by fixed income securi8 ties selected for investment of account assets as pro9 vided in subparagraph (A)(ii), (B)(ii), or (C)(ii) of 

10 paragraph (2). Amounts invested in fixed income se11 curities by a certified account manager under the 

12 Program shall be held in a portfolio which shall con13 sist of a diverse range of high-grade corporate 

14 bonds. 

15 ‘‘(d) DIVERSIFICATION STANDARDS.—The Board 

16 shall specify by regulation standards governing invest17 ments under this section to ensure prudent diversification 

18 among the investments under the Program. 

19 ‘‘DETERMINATION OF MONTHLY ANNUITY AMOUNTS AND

20 USE IN DETERMINING ACCOUNT DISTRIBUTION SUP21 PLEMENTS

22 ‘‘SEC. 255. (a) MONTHLY ANNUITY AMOUNTS.— 

23 ‘‘(1) IN GENERAL.—In accordance with regula24 tions of the Board meeting the requirements of this 

25 section, the Commissioner shall determine a monthly 

26 annuity amount in connection with such covered inmstockstill on PROD1PC66 with BILLS

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1 dividual’s Social Security guarantee account, for 

2 each month— 

3 ‘‘(A) which commences after such indi4 vidual becomes a covered individual, 

5 ‘‘(B) for which such individual is entitled 

6 to a covered monthly insurance benefit under 

7 part A, and 

8 ‘‘(C) which ends prior to or with— 

9 ‘‘(i) the date of the covered individ10 ual’s death, or 

11 ‘‘(ii) if later, the date of the death of 

12 the covered individual’s spouse (if any), ex13 cept as provided in regulations prescribed 

14 by the Board pursuant to paragraph (5). 

15 ‘‘(2) AMOUNT.—The monthly annuity amount 

16 shall be equal to the amount which would be the ini17 tial monthly payment under— 

18 ‘‘(A) if the covered individual is not mar19 ried on such date, an immediate single life an20 nuity for the covered individual, or 

21 ‘‘(B) if the covered individual is married 

22 on such date, an immediate annuity for the 

23 joint lives of the covered individual and the cov24 ered individual’s spouse, together with a sur25 vivor annuity to the one of them who survives 

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1 the other of them for the life of the survivor 

payable in monthly installments equal to 662 2 ⁄3

3 percent of the monthly payment of the annuity 

4 that would be payable if both spouses remained 

5 alive, 

6 purchased with the balance of the account (deter7 mined after payment of the initial lump sum pay8 ment under section 256(c)). 

9 ‘‘(3) ASSUMPTIONS.—The assumptions under 

10 this subsection include the probability of survival for 

11 persons born in the same year as the covered indi12 vidual (and the spouse, in the case of a joint annu13 ity), future projection of investment earnings based 

14 on investment of the account assets in the 65/35 in15 vestment option under section 254(c)(2)(B), and ex16 pected price inflation. Determinations under this 

17 subsection shall be made in accordance with regula18 tions which shall be prescribed by the Board, other19 wise using generally accepted actuarial assumptions, 

20 except that no differentiation shall be made in such 

21 assumptions on the basis of sex, race, health status, 

22 or other characteristics other than age. 

23 ‘‘(4) ADJUSTMENTS BASED ON ADDITIONAL SO24 CIAL SECURITY GUARANTEE REFUNDABLE CRED25 ITS.—The Board shall annually augment the monthmstockstill on PROD1PC66 with BILLS

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1 ly annuity amount in connection with each Social 

2 Security guarantee account by an additional monthly 

3 annuity amount, determined under this subsection 

4 on the basis of any additional transfer to the ac5 count of a Social Security guarantee refundable 

6 credit for the year (plus deemed interest) under sec7 tion 253(c), after subtracting the amount of the an8 nual lump sum payment made from such account 

9 under section 256(c)(2). 

10 ‘‘(5) TREATMENT OF CHANGES IN MARITAL

11 STATUS AND BENEFIT ELIGIBILITY AFTER COM12 MENCEMENT OF ENTITLEMENT TO BENEFITS.—The 

13 Board shall provide by regulation for recalculation 

14 or adjustment of the monthly annuity amount deter15 mined under this subsection in connection with any 

16 covered individual’s Social Security guarantee ac17 count so as to appropriately take into account any 

18 entry into marriage or divorce or changes in eligi19 bility for benefits. 

20 ‘‘(b) AMOUNT OF ACCOUNT DISTRIBUTION SUPPLE21 MENT.—The Board shall determine for each month the 

22 amount of the monthly account distribution supplement 

23 (if any) in connection with a covered individual’s Social 

24 Security guarantee account and shall certify such amount 

25 to the Commissioner so as to allow inclusion of such supmstockstill on PROD1PC66 with BILLS

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1 plement in each covered monthly insurance benefit pay2 ment pursuant to section 202(z) or 223(k). The amount 

3 of the supplement for each benefit shall be the excess (if 

4 any) of— 

5 ‘‘(1) the sum of— 

6 ‘‘(A) the monthly annuity amount in con7 nection with such account, plus 

8 ‘‘(B) in the case of a covered individual 

9 surviving a deceased spouse, a monthly amount 

10 which would be the monthly equivalent of the 

11 survivor annuity described in subsection 

12 (a)(2)(B) in connection with the Social Security 

13 guarantee account of the deceased spouse, over 

14 ‘‘(2) the amount of the benefit (as determined 

15 before applying sections 202(z) and 223(k) and be16 fore applying any reduction or deduction applicable 

17 under part A). 

18 ‘‘DISPOSITION OF ACCOUNT ASSETS

19 ‘‘SEC. 256. (a) IN GENERAL.—Account assets with 

20 respect to covered individuals shall be distributed solely 

21 as provided in this section. 

22 ‘‘(b) ACCOUNT MANAGER TRANSFERS TO THE TRUST

23 FUNDS.— 

24 ‘‘(1) IN GENERAL.—In accordance with a 

25 schedule which shall be prescribed in regulations of 

26 the Board, each certified account manager holding 

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1 account assets shall make account manager trans2 fers to the Secretary of the Treasury. Such Sec3 retary shall immediately credit each such transfer to 

4 the Federal Old-Age and Survivors Insurance Trust 

5 Fund or the Federal Disability Insurance Trust 

6 Fund, according to an appropriate distribution for7 mula which shall be prescribed in regulations of the 

8 Executive Director. The Executive Director shall 

9 provide to the certified account manager timely in10 formation necessary to carry out such account man11 ager’s duties under this section. 

12 ‘‘(2) DETERMINATION OF AMOUNT OF ACCOUNT

13 MANAGER TRANSFER.—The amount of each account 

14 manager transfer due from a certified account man15 ager for any period shall be an amount equal to the 

16 sum of— 

17 ‘‘(A) the aggregate monthly annuity 

18 amount or amounts determined under para19 graph (3) for the month or months ending dur20 ing such period in connection with the Social 

21 Security guarantee accounts under the manage22 ment of the certified account manager under 

23 the Program, and 

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1 ‘‘(B) the aggregate monthly account remit2 tance for such period described in paragraph 

3 (4) in connection with such accounts. 

4 ‘‘(3) AGGREGATE MONTHLY ANNUITY

5 AMOUNT.—The aggregate monthly annuity amount 

6 for any month in connection with the Social Security 

7 guarantee accounts under the management of any 

8 certified account manager under the Program is 

9 equal to the sum of all monthly annuity amounts in 

10 connection with such accounts, determined under 

11 section 255. 

12 ‘‘(4) AGGREGATE MONTHLY ACCOUNT REMIT13 TANCE.—The aggregate monthly account remittance 

14 for any month in connection with the Social Security 

15 guarantee accounts under the management of any 

16 certified account manager under the Program is 

17 equal to the sum of all the amounts required to be 

18 transferred during such month from the certified ac19 count manager to the Secretary of the Treasury for 

20 crediting to the Federal Old-Age and Survivors In21 surance Trust Fund or the Federal Disability Insur22 ance Trust Fund under subsection (e)(2) in connec23 tion with the deaths of covered individuals for whom 

24 such accounts were established under this part. 

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1 ‘‘(5) WITHDRAWALS FROM ACCOUNT BALANCES

2 FOR PURPOSES OF ACCOUNT MANAGER TRANS3 FERS.—In advance of each account manager trans4 fer required under this subsection to be made by a 

5 certified account manager managing one or more 

6 Social Security guarantee accounts under the Pro7 gram, the Commissioner shall certify to the Execu8 tive Director and to such certified account manager 

9 the monthly annuity amount in connection with each 

10 such account for each month during the period for 

11 which such transfer is to be made. At the time of 

12 such transfer, the certified account manager may 

13 withdraw from the assets of each such account the 

14 monthly annuity amount in connection with such ac15 count taken into account in determining each of the 

16 aggregate monthly annuity amounts included in the 

17 amount of the account manager transfer. Such with18 drawn assets shall be available to the certified ac19 count manager solely for purposes of making such 

20 account manager transfer. 

21 ‘‘(c) LUMP SUM PAYMENTS.—Upon initial entitle22 ment of a covered individual to covered monthly insurance 

23 benefits under part A, such individual shall be entitled 

24 to— 

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1 ‘‘(1) an initial lump sum payment, from such 

2 individual’s Social Security guarantee account, equal 

3 to 5 percent of the balance in such account, and 

4 ‘‘(2) a lump sum payment in connection with 

5 each subsequent transfer to such account (pursuant 

6 to section 253(c)) of such individual’s social security 

7 guarantee refundable credits for years beginning 

8 after commencement of such initial entitlement, pay9 able as soon as practicable after the transfer, equal 

10 to 5 percent of the transferred amount (including 

11 deemed interest). 

12 The Executive Director shall certify to the certified ac13 count manager managing such account the amount of 

14 each lump sum payment, and upon receipt of such certifi15 cation, the certified account manager shall transfer such 

16 certified amount to the Secretary of the Treasury for sub17 sequent transfer to the covered individual. Such certifi18 cation shall also include such information as may be nec19 essary to make each lump sum payment in a timely man20 ner. 

21 ‘‘(d) SPLITTING OF ACCOUNT ASSETS UPON DI22 VORCE AFTER 1 YEAR OF MARRIAGE.—Upon the divorce 

23 of a covered individual for whom a Social Security guar24 antee account has been established under this part, from 

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1 a spouse to whom the covered individual had been married 

2 for at least 1 year— 

3 ‘‘(1) if a Social Security guarantee account has 

4 been established under this part for the divorced 

5 spouse of the covered individual, the Board shall di6 rect the appropriate certified account manager to 

7 transfer— 

8 ‘‘(A) from the Social Security guarantee 

9 account with the greater amount of accruals 

10 (including earnings) during the time of the 

11 marriage, 

12 ‘‘(B) to the other such account, 

13 an amount equal to one-half of the difference be14 tween the amounts of such accruals in such ac15 counts, or 

16 ‘‘(2) if a Social Security guarantee account has 

17 not been established for the divorced spouse, the 

18 Board shall establish a Social Security guarantee ac19 count for the divorced spouse, and shall direct the 

20 appropriate certified account manager to transfer— 

21 ‘‘(A) from the Social Security guarantee 

22 account of the covered individual, 

23 ‘‘(B) to the Social Security guarantee ac24 count of the divorced spouse, 

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1 an amount equal to one-half of the amount of accru2 als (including earnings) during the time of the mar3 riage in the Social Security guarantee account of the 

4 covered individual. 

5 In the case of any transfer directed under this subsection, 

6 the Executive Director shall certify to the appropriate cer7 tified account manager the information necessary to make 

8 such transfer. 

9 ‘‘(e) CLOSING OF ACCOUNT UPON THE DEATH OF

10 THE COVERED INDIVIDUAL.— 

11 ‘‘(1) TRANSFERS UPON DEATH BEFORE ENTI12 TLEMENT.—Upon the death of a covered individual 

13 before the individual has become entitled to covered 

14 monthly insurance benefits, the Executive Director 

15 shall close out the covered individual’s Social Secu16 rity guarantee account. In closing out the account, 

17 the Executive Director shall certify to the certified 

18 account manager the amount of the account assets, 

19 and, upon receipt of such certification, such certified 

20 account manager shall transfer from such account 

21 an amount equal to such certified amount to the 

22 Secretary of the Treasury for subsequent transfer to 

23 the estate of such covered individual. 

24 ‘‘(2) TRANSFERS UPON DEATH AFTER ENTI25 TLEMENT.— 

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1 ‘‘(A) IN GENERAL.—In any case in which 

2 the covered individual dies after the individual 

3 has become entitled to covered monthly insur4 ance benefits, the Executive Director shall, ex5 cept as provided in subparagraph (B), close out 

6 the covered individual’s Social Security guar7 antee account upon such covered individual’s 

8 death. 

9 ‘‘(B) DELAYED CLOSING IN THE CASE OF

10 SURVIVING SPOUSE.—If the covered individual 

11 was married at the time of the covered individ12 ual’s death, the Executive Director shall close 

13 out the covered individual’s Social Security 

14 guarantee account with the close, upon the sur15 viving spouse’s death, of the period to which the 

16 survivor annuity portion of the monthly annuity 

17 amount in connection with such account is ap18 plicable under section 255(a). The Board shall 

19 from time to time propose to the Congress rec20 ommendations for legislative changes necessary 

21 to provide for closing of the account in a man22 ner and time consistent with regulations pre23 scribed pursuant to section 255(a)(5). 

24 ‘‘(C) CERTIFICATION AND TRANSFER TO

25 TRUST FUNDS.—In closing out the account, the 

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1 Executive Director shall certify to the certified 

2 account manager holding the covered individ3 ual’s account assets the amount of the account 

4 assets, and such certified account manager shall 

5 transfer an amount equal to such certified 

6 amount to the Secretary of the Treasury for 

7 crediting to the Federal Old-Age and Survivors 

8 Insurance Trust Fund or the Federal Disability 

9 Insurance Trust Fund, as determined appro10 priate under regulations of the Board. 

11 ‘‘(f) CLOSING OF ACCOUNT OF COVERED INDIVID12 UALS WHO ARE INELIGIBLE FOR BENEFITS UPON AT13 TAINING RETIREMENT AGE.—In any case in which, as of 

14 the date on which a covered individual attains retirement 

15 age (as defined in section 216(l)), such individual is not 

16 eligible for a covered monthly insurance benefit, the Com17 missioner shall so certify to the Executive Director and, 

18 upon receipt of such certification, the Executive Director 

19 shall close out the covered individual’s Social Security 

20 guarantee account. In closing out the account, the Execu21 tive Director shall certify to the certified account manager 

22 the amount of the account assets, and upon receipt of such 

23 certification from the Executive Director, the account 

24 manager shall transfer from such account an amount 

25 equal to such certified amount to the Secretary of the 

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1 Treasury for subsequent transfer to the covered indi2 vidual. 

3 ‘‘(g) ADMINISTRATIVE EXPENSES.— 

4 ‘‘(1) IN GENERAL.—Under regulations which 

5 shall be prescribed by the Board, account assets are 

6 available for payment of the reasonable administra7 tive costs of the Program (including reasonable ad8 ministration fees charged by certified account man9 agers under the Program), but in no event to exceed 

10 25 basis points per year of the assets under manage11 ment. 

12 ‘‘(2) TEMPORARY AUTHORIZATION OF APPRO13 PRIATIONS FOR STARTUP ADMINISTRATIVE COSTS.— 

14 For any such administrative costs that remain after 

15 applying paragraph (1) for each of the first five fis16 cal years that end after the date of the enactment 

17 of this part, there are authorized to be appropriated 

18 such sums as may be necessary for each of such fis19 cal years. 

20 ‘‘ADMINISTRATION OF THE PROGRAM

21 ‘‘SEC. 257. (a) GENERAL PROVISIONS.— 

22 ‘‘(1) ESTABLISHMENT AND DUTIES OF THE SO23 CIAL SECURITY GUARANTEE BOARD.— 

24 ‘‘(A) ESTABLISHMENT.—There is estab25 lished in the Social Security Administration a 

26 Social Security Guarantee Board. 

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1 ‘‘(B) MEMBERSHIP.—The Board shall be 

2 composed of 6 members appointed by the Board 

3 of Trustees of the Federal Old-Age and Sur4 vivors Insurance Trust Fund and the Federal 

5 Disability Insurance Trust Fund. One member 

6 shall serve as Chairman, as designated by the 

7 Board of Trustees. Members of the Board shall 

8 have substantial experience, training, and ex9 pertise in the area of pension benefits, finance, 

10 investment, or insurance. 

11 ‘‘(C) TERMS.— 

12 ‘‘(i) IN GENERAL.—A member of the 

13 Board shall be appointed for a term of 9 

14 years, subject only to removal by the 

15 Board of Trustees for cause, except that of 

16 the members first appointed— 

17 ‘‘(I) two shall be appointed for a 

18 term of 3 years; 

19 ‘‘(II) two shall be appointed for a 

20 term of 6 years; and 

21 ‘‘(III) two shall be appointed for 

22 a term of 9 years. 

23 ‘‘(ii) VACANCIES.—A vacancy on the 

24 Board shall be filled in the manner in 

25 which the original appointment was made 

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1 and shall be subject to any conditions 

2 which applied with respect to the original 

3 appointment. An individual chosen to fill a 

4 vacancy shall be appointed for the unex5 pired term of the member replaced. The 

6 term of any member shall not expire before 

7 the date on which the member’s successor 

8 takes office. 

9 ‘‘(D) POWERS AND DUTIES OF THE

10 BOARD.— 

11 ‘‘(i) IN GENERAL.—The Board shall 

12 have powers and duties solely as provided 

13 in this part. The Board shall prescribe by 

14 regulation the terms of the Social Security 

15 Guarantee Program established under this 

16 part, including policies for investment 

17 under the Program of account assets, and 

18 policies for the certification and decerti19 fication of account managers under the 

20 Program, which shall include consideration 

21 of the appropriateness of the marketing 

22 materials and plans of such person. 

23 ‘‘(ii) BUDGETARY REQUIREMENTS.— 

24 The Board shall prepare and submit to the 

25 President and to the appropriate commitmstockstill on PROD1PC66 with BILLS

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1 tees of Congress an annual budget of the 

2 expenses and other items relating to the 

3 Board which shall be included as a sepa4 rate item in the budget required to be 

5 transmitted to the Congress under section 

6 1105 of title 31, United States Code. The 

7 Board shall provide for low administrative 

8 costs such that, to the extent practicable, 

9 overall administrative costs of the Program 

10 do not exceed 25 basis points in relation to 

11 assets under management under the Pro12 gram. 

13 ‘‘(E) ADDITIONAL AUTHORITIES OF THE

14 BOARD.—The Board may— 

15 ‘‘(i) adopt, alter, and use a seal; 

16 ‘‘(ii) establish policies with which the 

17 Commissioner shall comply under this 

18 part; and 

19 ‘‘(iii) appoint and remove the Execu20 tive Director, as provided in paragraph (2). 

21 ‘‘(F) INDEPENDENCE OF CERTIFIED AC22 COUNT MANAGERS.—The policies of the Board 

23 may not require a certified account manager to 

24 invest or to cause to be invested any account 

25 assets in a specific asset or to dispose of or 

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1 cause to be disposed of any specific asset so 

2 held. 

3 ‘‘(G) MEETINGS OF THE BOARD.—The 

4 Board shall meet at the call of the Chairman or 

5 upon the request of a quorum of the Board. 

6 The Board shall perform the functions and ex7 ercise the powers of the Board on a majority 

8 vote of a quorum of the Board. Four members 

9 of the Board shall constitute a quorum for the 

10 transaction of business. 

11 ‘‘(H) COMPENSATION OF BOARD MEM12 BERS.— 

13 ‘‘(i) IN GENERAL.—Each member of 

14 the Board who is not an officer or em15 ployee of the Federal Government shall be 

16 compensated at the daily rate of basic pay 

17 for level I of the Executive Schedule for 

18 each day during which such member is en19 gaged in performing a function of the 

20 Board. Any member who is such an officer 

21 or employee shall not suffer any loss of pay 

22 or deduction from annual leave on the 

23 basis of any time used by such member in 

24 performing such a function. 

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1 ‘‘(ii) TRAVEL, PER DIEM, AND EX2 PENSES.—A member of the Board shall be 

3 paid travel, per diem, and other necessary 

4 expenses under subchapter I of chapter 57 

5 of title 5, United States Code, while trav6 eling away from such member’s home or 

7 regular place of business in the perform8 ance of the duties of the Board. 

9 ‘‘(I) STANDARD FOR BOARD’S DISCHARGE

10 OF RESPONSIBILITIES.—The members of the 

11 Board shall discharge their responsibilities sole12 ly in the interest of covered individuals and the 

13 Program. 

14 ‘‘(J) ANNUAL REPORT.—The Board shall 

15 submit an annual report to the President, to 

16 each House of the Congress, and to the Board 

17 of Trustees of the Federal Old-Age and Sur18 vivors Insurance Trust Fund and the Federal 

19 Disability Insurance Trust Fund regarding the 

20 financial and operating condition of the Pro21 gram. 

22 ‘‘(K) PUBLIC ACCOUNTANT.— 

23 ‘‘(i) DEFINITION.—For purposes of 

24 this subparagraph, the term ‘qualified pub25 lic accountant’ shall have the same meanmstockstill on PROD1PC66 with BILLS

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1 ing as provided in section 103(a)(3)(D) of 

2 the Employee Retirement Income Security 

3 Act of 1974 (29 U.S.C. 1023(a)(3)(D)). 

4 ‘‘(ii) ENGAGEMENT.—The Executive 

5 Director, in consultation with the Board, 

6 shall annually engage, on behalf of all indi7 viduals for whom a Social Security guar8 antee account is established under this 

9 part, an independent qualified public ac10 countant, who shall conduct an examina11 tion of all records maintained in the ad12 ministration of this part that the public ac13 countant considers necessary. 

14 ‘‘(iii) DUTIES.—The public account15 ant conducting an examination under 

16 clause (ii) shall determine whether the 

17 records referred to in such clause have 

18 been maintained in conformity with gen19 erally accepted accounting principles. The 

20 public accountant shall transmit to the 

21 Board a report on his examination. 

22 ‘‘(iv) RELIANCE ON CERTIFIED ACTU23 ARIAL MATTERS.—In making a determina24 tion under clause (iii), a public accountant 

25 may rely on the correctness of any actumstockstill on PROD1PC66 with BILLS

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1 arial matter certified by an enrolled actu2 ary if the public accountant states his reli3 ance in the report transmitted to the 

4 Board under such clause. 

5 ‘‘(2) EXECUTIVE DIRECTOR.— 

6 ‘‘(A) APPOINTMENT AND REMOVAL.—The 

7 Board shall appoint, without regard to the pro8 visions of law governing appointments in the 

9 competitive service, an Executive Director by 

10 action agreed to by a majority of the members 

11 of the Board. The Executive Director shall have 

12 substantial experience, training, and expertise 

13 in the management of financial investments and 

14 pension benefit plans. The Board may, with the 

15 concurrence of 4 members of the Board, remove 

16 the Executive Director from office for good 

17 cause shown. 

18 ‘‘(B) POWERS AND DUTIES OF EXECUTIVE

19 DIRECTOR.—The Executive Director shall— 

20 ‘‘(i) carry out the policies established 

21 by the Board, 

22 ‘‘(ii) administer the provisions of this 

23 part in accordance with the policies of the 

24 Board, 

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1 ‘‘(iii) in consultation with the Board, 

2 prescribe such regulations (other than reg3 ulations relating to fiduciary responsibil4 ities) as may be necessary for the adminis5 tration of this part, and 

6 ‘‘(iv) meet from time to time with the 

7 Board upon request of the Board. 

8 ‘‘(C) ADMINISTRATIVE AUTHORITIES OF

9 EXECUTIVE DIRECTOR.—The Executive Direc10 tor may— 

11 ‘‘(i) appoint such personnel as may be 

12 necessary to carry out the provisions of 

13 this part, 

14 ‘‘(ii) subject to approval by the Board, 

15 procure the services of experts and consult16 ants under section 3109 of title 5, United 

17 States Code, 

18 ‘‘(iii) secure directly from any agency 

19 or instrumentality of the Federal Govern20 ment any information which, in the judg21 ment of the Executive Director, is nec22 essary to carry out the provisions of this 

23 part and the policies of the Board, and 

24 which shall be provided by such agency or 

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1 instrumentality upon the request of the 

2 Executive Director, 

3 ‘‘(iv) pay the compensation, per diem, 

4 and travel expenses of individuals ap5 pointed under clauses (i), (ii), and (v) of 

6 this subparagraph, subject to such limits 

7 as may be established by the Board, 

8 ‘‘(v) accept and use the services of in9 dividuals employed intermittently in the 

10 Government service and reimburse such in11 dividuals for travel expenses, as authorized 

12 by section 5703 of title 5, United States 

13 Code, including per diem as authorized by 

14 section 5702 of such title, and 

15 ‘‘(vi) except as otherwise expressly 

16 prohibited by law or the policies of the 

17 Board, delegate any of the Executive Di18 rector’s functions to such employees under 

19 the Board as the Executive Director may 

20 designate and authorize such successive re21 delegations of such functions to such em22 ployees under the Board as the Executive 

23 Director may consider to be necessary or 

24 appropriate. 

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1 ‘‘(3) ROLE OF THE COMMISSIONER OF SOCIAL

2 SECURITY.—The Commissioner shall— 

3 ‘‘(A) prescribe such regulations (supple4 mentary to and consistent with the regulations 

5 prescribed by the Board and the Executive Di6 rector) as may be necessary for carrying out the 

7 duties of the Commissioner under this part, 

8 ‘‘(B) meet from time to time with, and 

9 provide information to, the Board upon request 

10 of the Board regarding matters relating to the 

11 Social Security Guarantee Program, and 

12 ‘‘(C) in consultation with the Board and 

13 utilizing available Federal agencies and re14 sources, develop a campaign to educate workers 

15 about the Program. 

16 ‘‘(b) CERTIFICATION AND OVERSIGHT OF ACCOUNT

17 MANAGERS.— 

18 ‘‘(1) CERTIFICATION BY THE BOARD.— 

19 ‘‘(A) IN GENERAL.—Any person that is a 

20 qualified professional asset manager (as defined 

21 in section 8438(a)(8) of title 5, United States 

22 Code) may apply to the Board (in such form 

23 and manner as shall be provided by the Board 

24 by regulation) for certification under this sub25 section as a certified account manager. In makmstockstill on PROD1PC66 with BILLS

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1 ing certification decisions, the Board shall con2 sider the applicant’s general character and fit3 ness, financial history and future earnings pros4 pects, and ability to serve covered individuals 

5 under the Program, and such other criteria as 

6 the Board deems necessary to carry out this 

7 part. Certification of any person under this sub8 section shall be contingent upon entry into a 

9 contractual arrangement between the Board 

10 and such person. 

11 ‘‘(B) NONDELEGATION REQUIREMENT.— 

12 The authority of the Board to make any deter13 mination to deny any application under this 

14 subsection may not be delegated by the Board. 

15 ‘‘(2) OVERSIGHT OF CERTIFIED ACCOUNT MAN16 AGERS.— 

17 ‘‘(A) ROLE OF REGULATORY AGENCIES.— 

18 The Board may enter into cooperative arrange19 ments with Federal and State regulatory agen20 cies identified by the Board as having jurisdic21 tion over persons eligible for certification under 

22 this subsection so as to ensure that the provi23 sions of this part are enforced with respect to 

24 certified account managers in a manner con25 sistent with and supportive of the requirements 

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1 of other provisions of Federal law applicable to 

2 them. Such Federal regulatory agencies shall 

3 cooperate with the Board to the extent that the 

4 Board determines that such cooperation is nec5 essary and appropriate to ensure that the provi6 sions of this part are effectively implemented. 

7 ‘‘(B) ACCESS TO RECORDS.—The Board 

8 may from time to time require any certified ac9 count manager to file such reports as the Board 

10 may specify by regulation as necessary for the 

11 administration of this part. In prescribing such 

12 regulations, the Board shall minimize the regu13 latory burden imposed upon certified account 

14 managers while taking into account the benefit 

15 of the information to the Board in carrying out 

16 its functions under this part. 

17 ‘‘(3) REVOCATION OF CERTIFICATION.—The 

18 Board shall provide, in the contractual arrangements 

19 entered into under this subsection with each certified 

20 account manager, for revocation of such person’s 

21 status as a certified account manager upon deter22 mination by the Board of such person’s failure to 

23 comply with the requirements of such contractual ar24 rangements. Such arrangements shall include provimstockstill on PROD1PC66 with BILLS

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1 sion for notice and opportunity for review of any 

2 such revocation. 

3 ‘‘(c) FIDUCIARY RESPONSIBILITIES.— 

4 ‘‘(1) IN GENERAL.—Rules similar to the provi5 sions of section 8477 of title 5, United States Code 

6 (relating to fiduciary responsibilities; liability and 

7 penalties) shall apply in connection with account as8 sets, in accordance with regulations which shall be 

9 issued by the Board. The Board shall issue regula10 tions with respect to the investigative authority of 

11 appropriate Federal agencies in cases involving ac12 count assets. 

13 ‘‘(2) EXCULPATORY PROVISIONS VOIDED.—Any 

14 provision in an agreement or instrument which pur15 ports to relieve a fiduciary from responsibility or li16 ability for any responsibility, obligation, or duty 

17 under this part shall be void. 

18 ‘‘(d) CIVIL ACTIONS BY BOARD.—If any person fails 

19 to meet any requirement of this part or of any contract 

20 entered into under this part, the Board may bring a civil 

21 action in any district court of the United States within 

22 the jurisdiction of which such person’s assets are located 

23 or in which such person resides or is found, without regard 

24 to the amount in controversy, for appropriate relief to re25 dress the violation or enforce the provisions of this part, 

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1 and process in such an action may be served in any dis2 trict. 

3 ‘‘(e) PREEMPTION OF INCONSISTENT STATE LAW.— 

4 A provision of this part shall not be construed to preempt 

5 any provision of the law of any State or political subdivi6 sion thereof, or prevent a State or political subdivision 

7 thereof from enacting any provision of law with respect 

8 to the subject matter of this part, except to the extent 

9 that such provision of State law is inconsistent with this 

10 part, and then only to the extent of the inconsistency.’’. 

11 (b) CONFORMING AMENDMENTS.—(1) Section 

12 701(b) of the Social Security Act (42 U.S.C. 901(b)) is 

13 amended by striking ‘‘title II’’ and inserting ‘‘part A of 

14 title II, the Social Security Guarantee Program under part 

15 B of title II,’’. 

16 (2) Section 702(a)(4) of the Social Security Act (42 

17 U.S.C. 902(a)(4)) is amended by inserting ‘‘other than 

18 those of the Social Security Guarantee Board’’ after ‘‘Ad19 ministration’’, and by striking ‘‘thereof’’ and inserting ‘‘of 

20 the Administration in connection with the exercise of such 

21 powers and the discharge of such duties’’. 

22 SEC. 103. BENEFIT INCREASES. 

23 (a) OLD-AGE INSURANCE BENEFITS AND OTHER

24 BENEFITS UNDER SECTION 202.—Section 202 of the Somstockstill on PROD1PC66 with BILLS

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1 cial Security Act (42 U.S.C. 402) is amended by adding 

2 at the end the following new subsection: 

3 ‘‘Account Distribution Supplements 

4 ‘‘(z) Each monthly insurance benefit under this sec5 tion (after application of any reduction or deduction appli6 cable under this section or under any other provision of 

7 this part) shall be increased by the amount of the account 

8 distribution supplement determined for such benefit under 

9 section 255.’’. 

10 (b) DISABILITY INSURANCE BENEFITS.—Section 223 

11 of such Act (42 U.S.C. 423) is amended by adding at the 

12 end the following new subsection: 

13 ‘‘Account Distribution Supplements 

14 ‘‘(k) Each monthly insurance benefit under this sec15 tion (after application of any reduction or deduction appli16 cable under this part) shall be increased by the amount 

17 of the account distribution supplement determined for 

18 such benefit under section 255.’’. 

19 SEC. 104. TAX TREATMENT. 

20 (a) TAX TREATMENT OF SOCIAL SECURITY GUAR21 ANTEE ACCOUNTS.—Section 7701 of the Internal Revenue 

22 Code of 1986 (relating to definitions) is amended by redes23 ignating subsection (p) as subsection (q) and by inserting 

24 after subsection (o) the following new subsection: 

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1 ‘‘(p) TAX TREATMENT OF SOCIAL SECURITY GUAR2 ANTEE ACCOUNTS.—All Social Security guarantee ac3 counts established under part B of title II of the Social 

4 Security Act shall be exempt from taxation under this 

5 title.’’. 

6 (b) BENEFITS TAXABLE AS SOCIAL SECURITY BENE7 FITS.— 

8 (1) MONTHLY BENEFITS.—Section 86(d)(1)(A) 

9 of such Code (relating to definition of Social Secu10 rity benefit) is amended to read as follows: 

11 ‘‘(A) a monthly benefit under part A of 

12 title II of the Social Security Act (including an 

13 account distribution supplement referred to in 

14 section 202(z) and 223(k) of such Act), or’’. 

15 (2) SPECIAL RULES RELATING TO LUMP SUM

16 PAYMENT UNDER SECTION 256(c) OF SOCIAL SECU17 RITY ACT.— 

18 (A) Section 86(a) of such Code is amended 

19 by adding at the end the following new para20 graph: 

21 ‘‘(3) INCLUSION IN GROSS INCOME OF LUMP

22 SUM PAYMENT UNDER SECTION 256(c) OF SOCIAL

23 SECURITY ACT.— 

24 ‘‘(A) IN GENERAL.—A lump sum payment 

25 received under section 256(c) of the Social Semstockstill on PROD1PC66 with BILLS

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1 curity Act shall be includible in gross income in 

2 the amount provided by subparagraph (B). 

3 Such payment shall not be treated as a social 

4 security benefit for purposes of this section. 

5 ‘‘(B) AMOUNT INCLUDED IN INCOME.— 

6 The portion of such lump sum payment that is 

7 includible in gross income shall be equal to an 

8 amount which bears the same ratio to the total 

9 amount of such payment as the portion of so10 cial security benefits included in gross income 

11 under paragraphs (1) and (2) bears to the total 

12 amount of such benefits.’’. 

13 (B) SPECIAL RULE RELATING TO NON14 RESIDENT ALIEN INDIVIDUALS.—Section 

15 871(a)(3)(A) of such Code is amended by in16 serting ‘‘and of any lump sum payment received 

17 under section 256(c) of the Social Security Act’’ 

18 after ‘‘section 86(d))’’. 

19 (C) TRANSFERS TO TRUST FUNDS.— 

20 (i) IN GENERAL.—Paragraph (1) of 

21 section 121(e) of the Social Security 

22 Amendments of 1983 (Public Law 98–21; 

23 42 U.S.C. 401 note) is amended by adding 

24 at the end the following new subparagraph: 

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1 ‘‘(C) There are hereby appropriated to each 

2 payor fund amounts equivalent to the aggregate in3 crease in tax liabilities under chapter 1 of the Inter4 nal Revenue Code of 1986 which is attributable to 

5 the application of section 86 and section 871(a)(3) 

6 of such Code to lump sum payments received under 

7 section 256(c) of the Social Security Act by individ8 uals entitled to benefits payable from such payor 

9 fund.’’. 

10 (ii) CONFORMING AMENDMENT.—Sec11 tion 121(e)(2) of such Act is amended by 

12 striking ‘‘paragraph (1)(A)’’ and inserting 

13 ‘‘paragraphs (1)(A) and (C)’’. 

14 (3) SPECIAL RULES RELATING TO DISTRIBU15 TION OF CLOSED ACCOUNT UNDER SECTION 256(f) 

16 OF SOCIAL SECURITY ACT.—Section 86(a) of such 

17 Code (as amended by paragraph (2)) is amended by 

18 adding at the end the following new paragraph: 

19 ‘‘(4) EXTENSION OF PARAGRAPH (2)(B) TO DIS20 TRIBUTIONS OF CLOSED ACCOUNT UNDER SECTION

21 256(f) OF SOCIAL SECURITY ACT.—Notwithstanding 

22 any other provision of this subsection, in the case of 

23 any amount received pursuant to the closing of an 

24 account under section 256(f) of the Social Security 

25 Act, paragraph (2)(B) shall apply to such amounts, 

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1 and for such purposes the amount allocated to the 

2 investment in the contract shall be zero.’’. 

3 (4) EFFECTIVE DATE.—The amendments made 

4 by this subsection shall apply to taxable years begin5 ning after the end of the calendar year in which this 

6 Act is enacted. 

7 (c) ESTATE TAX NOT TO APPLY TO ASSETS OF SO8 CIAL SECURITY GUARANTEE ACCOUNTS.— 

9 (1) IN GENERAL.—Part IV of subchapter A of 

10 chapter 11 of the Internal Revenue Code of 1986 

11 (relating to taxable estate) is amended by adding at 

12 the end the following new section: 

13 ‘‘SEC. 2059. SOCIAL SECURITY GUARANTEE ACCOUNTS. 

14 ‘‘For purposes of the tax imposed by section 2001, 

15 the value of the taxable estate shall be determined by de16 ducting from the value of the gross estate an amount 

17 equal to the value of the assets of a Social Security guar18 antee account transferred by the Secretary to the estate 

19 of the decedent under section 256 of the Social Security 

20 Act.’’. 

21 (2) CLERICAL AMENDMENT.—The table of sec22 tions for part IV of subchapter A of chapter 11 of 

23 such Code is amended by adding at the end the fol24 lowing new item: 

‘‘Sec. 2059. Social Security guarantee accounts.’’. 

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1 (3) EFFECTIVE DATE.—The amendments made 

2 by this subsection shall apply to decedents dying in 

3 or after the calendar year in which this Act is en4 acted. 

5 SEC. 105. ANNUAL ACCOUNT STATEMENTS. 

6 Section 1143 of the Social Security Act (42 U.S.C. 

7 1320b–13) is amended by adding at the end the following 

8 new subsection: 

9 ‘‘Performance of Social Security Guarantee Accounts 

10 ‘‘(e) Beginning not later than 1 year after the date 

11 of the first deposit is made to an eligible individual’s So12 cial Security guaranty account, each statement provided 

13 to such eligible individual under this section shall include 

14 information determined by the Social Security Guarantee 

15 Board as sufficient to fully inform such eligible individual 

16 annually of the balance, investment performance, and ad17 ministrative expenses of such account.’’. 

18 SEC. 106. PROTECTION OF SOCIAL SECURITY SURPLUSES. 

19 (a) PROTECTION OF SOCIAL SECURITY SUR20 PLUSES.—Title III of the Congressional Budget Act of 

21 1974 is amended by adding at the end the following new 

22 section: 

23 ‘‘LOCK-BOX FOR SOCIAL SECURITY SURPLUSES

24 ‘‘SEC. 316. (a) LOCK-BOX FOR SOCIAL SECURITY

25 SURPLUSES.— 

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1 ‘‘(1) CONCURRENT RESOLUTIONS ON THE

2 BUDGET.—It shall not be in order in the House of 

3 Representatives or the Senate to consider any con4 current resolution on the budget, or an amendment 

5 thereto or conference report thereon, that would set 

6 forth a deficit for any fiscal year for which there is 

7 a projected net surplus in the Federal Old-Age and 

8 Survivors Insurance Trust Fund and the Federal 

9 Disability Insurance Trust Fund which is attrib10 utable to the Social Security Guarantee Program 

11 under part B of title II of the Social Security Act. 

12 ‘‘(2) SPENDING AND TAX LEGISLATION.—It 

13 shall not be in order in the House of Representatives 

14 or the Senate to consider any bill, joint resolution, 

15 amendment, motion, or conference report if— 

16 ‘‘(A) the enactment of that bill or resolu17 tion, as reported; 

18 ‘‘(B) the adoption and enactment of that 

19 amendment; or 

20 ‘‘(C) the enactment of that bill or resolu21 tion in the form recommended in that con22 ference report, 

23 would cause a deficit for any fiscal year for which 

24 there is a projected net surplus in the Federal Old25 Age and Survivors Insurance Trust Fund and the 

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1 Federal Disability Insurance Trust Fund attrib2 utable to the Social Security Guarantee Program 

3 under part B of title II of the Social Security Act. 

4 ‘‘(b) ENFORCEMENT.— 

5 ‘‘(1) BUDGETARY LEVELS WITH RESPECT TO

6 CONCURRENT RESOLUTIONS ON THE BUDGET.—For 

7 purposes of enforcing any point of order under sub8 section (a)(1), the extent to which there is a deficit 

9 for any fiscal year shall be determined on the basis 

10 of budgetary aggregates set forth in the later of the 

11 concurrent resolution on the budget, as reported, or 

12 in the conference report on the concurrent resolution 

13 on the budget, adjusted to the maximum extent al14 lowable under all procedures that allow budgetary 

15 aggregates to be adjusted for legislation that would 

16 cause a decrease in any surplus or an increase in 

17 any deficit for any fiscal year covered by the concur18 rent resolution on the budget (other than procedures 

19 described in paragraph (2)(A)(ii)). 

20 ‘‘(2) CURRENT LEVELS WITH RESPECT TO

21 SPENDING AND TAX LEGISLATION.— 

22 ‘‘(A) IN GENERAL.—For purposes of en23 forcing subsection (a)(2), the extent to which 

24 there is a deficit for any fiscal year shall be— 

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1 ‘‘(i) calculated using the following as2 sumptions— 

3 ‘‘(I) direct spending and revenue 

4 levels at the baseline levels underlying 

5 the most recently agreed to concur6 rent resolution on the budget; and 

7 ‘‘(II) for the budget year, discre8 tionary spending levels at current law 

9 levels and, for outyears, discretionary 

10 spending levels at the baseline levels 

11 underlying the most recently agreed to 

12 concurrent resolution on the budget; 

13 and 

14 ‘‘(ii) adjusted for changes in the sur15 plus or deficit levels set forth in the most 

16 recently agreed to concurrent resolution on 

17 the budget pursuant to procedures in such 

18 resolution that authorize adjustments in 

19 budgetary aggregates for updated economic 

20 and technical assumptions in the mid-ses21 sion report of the Director of the Congres22 sional Budget Office. 

23 Such revisions shall be included in the first cur24 rent level report on the congressional budget 

25 submitted for publication in the Congressional 

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1 Record after the release of such mid-session re2 port. 

3 ‘‘(c) WAIVER AND APPEAL.—Subsection (a) may be 

4 waived or suspended in the Senate only by an affirmative 

5 vote of three-fifths of the Members, duly chosen and 

6 sworn. An affirmative vote of three-fifths of the Members 

7 of the Senate, duly chosen and sworn, shall be required 

8 in the Senate to sustain an appeal of the ruling of the 

9 Chair on a point of order raised under this section.’’. 

10 (b) CONFORMING AMENDMENT.—The item relating 

11 to section 316 in the table of contents set forth in section 

12 1(b) of the Congressional Budget and Impoundment Con13 trol Act of 1974 is amended to read as follows: 

‘‘Sec. 316. Lock-box for social security surpluses.’’. 

14 TITLE II—BENEFIT UPDATES 

15 SEC. 201. ELIMINATION OF THE SOCIAL SECURITY EARN16 INGS TEST FOR INDIVIDUALS WHO HAVE AT17 TAINED AGE 62. 

18 (a) IN GENERAL.—Section 203 of the Social Security 

19 Act (42 U.S.C. 403) is amended— 

20 (1) in subsection (c)(1), by striking ‘‘retirement 

21 age (as defined in section 216(l))’’ and inserting 

22 ‘‘the age of 62’’; 

23 (2) in clause (B) of the last sentence of sub24 section (f)(1), by striking ‘‘retirement age (as demstockstill on PROD1PC66 with BILLS

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1 fined in section 216(l))’’ and inserting ‘‘the age of 

2 62’’; 

3 (3) in subsection (f)(3), by striking ‘‘retirement 

4 age (as defined in section 216(l))’’ and inserting 

5 ‘‘the age of 62’’; 

6 (4) in subsection (h)(1)(A), by striking ‘‘retire7 ment age (as defined in section 216(l))’’ each place 

8 it appears and inserting ‘‘the age of 62’’; and 

9 (5) in subsection (j)— 

10 (A) in the heading, by striking ‘‘retirement 

11 age’’ and inserting ‘‘Age 62’’; and 

12 (B) by striking ‘‘retirement age (as defined 

13 in section 216(l))’’ and inserting ‘‘the age of 

14 62’’. 

15 (b) CONFORMING AMENDMENTS ELIMINATING THE

16 SPECIAL EXEMPT AMOUNT FOR YEAR OF ATTAINING RE17 TIREMENT AGE.— 

18 (1) UNIFORM EXEMPT AMOUNT.—Section 

19 203(f)(8)(A) of such Act (42 U.S.C. 403(f)(8)(A)) is 

20 amended by striking ‘‘the new exempt amounts (sep21 arately stated for individuals described in subpara22 graph (D) and for other individuals) which are to be 

23 applicable’’ and inserting ‘‘a new exempt amount 

24 which shall be applicable’’. 

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1 (2) CONFORMING AMENDMENTS.—Section 

2 203(f)(8)(B) of such Act (42 U.S.C. 403(f)(8)(B)) 

3 is amended— 

4 (A) in the matter preceding clause (i), by 

5 striking ‘‘Except’’ and all that follows through 

6 ‘‘whichever’’ and inserting ‘‘The exempt amount 

7 which is applicable for each month of a par8 ticular taxable year shall be whichever’’; 

9 (B) in clause (i), by striking ‘‘cor10 responding’’; 

11 (C) in clause (ii)— 

12 (i) by striking ‘‘the product’’ and all 

13 that follows through ‘‘other individuals), 

14 and’’ and inserting ‘‘the product derived by 

15 multiplying the exempt amount which is in 

16 effect with respect to months in the tax17 able year ending after 1993 and before 

18 1995, by’’; and 

19 (ii) by striking subclause (II) and in20 serting the following: 

21 ‘‘(II) the national average wage index 

22 (as so defined) for 1992,’’; and 

23 (D) in the last sentence, by striking ‘‘an 

24 exempt amount’’ and inserting ‘‘the exempt 

25 amount’’. 

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1 (3) REPEAL OF BASIS FOR COMPUTATION OF

2 SPECIAL EXEMPT AMOUNT.—Subparagraphs (D) 

3 and (E) of section 203(f)(8) of such Act (42 U.S.C. 

4 (f)(8)(D), (E)) are repealed. 

5 (c) ADDITIONAL CONFORMING AMENDMENTS.— 

6 (1) Section 203 of such Act (42 U.S.C. 403) is 

7 amended— 

8 (A) in subsection (b)(1)— 

9 (i) by striking ‘‘(b)(1) Deductions’’ 

10 and inserting ‘‘(b) Deductions’’; 

11 (ii) by striking ‘‘and from any pay12 ment or payments to which any other per13 sons are entitled on the basis of such indi14 vidual’s wages and self-employment in15 come,’’; 

16 (iii) by striking ‘‘until the total’’ and 

17 all that follows through ‘‘if for such 

18 month’’ and inserting the following: ‘‘until 

19 the total of such deductions equals such in20 dividual’s benefit or benefits under section 

21 202 for any month, if for such month’’; 

22 (iv) by striking ‘‘total of benefits re23 ferred to in clauses (A) and (B)’’ and in24 serting ‘‘the total of such benefits’’; and 

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1 (v) by striking ‘‘If a child’’ and all 

2 that follows through ‘‘have been made.’’; 

3 (B) by striking subsection (b)(2); 

4 (C) by striking subsection (d); 

5 (D) in subsection (f)(1), by striking ‘‘The 

6 amount of’’ and all that follows through ‘‘Not7 withstanding’’ and inserting the following: ‘‘The 

8 amount of an individual’s excess earnings (as 

9 defined in paragraph (3)) shall be charged to 

10 months as follows: There shall be charged to 

11 the first month of such taxable year an amount 

12 of his excess earnings equal to the payment to 

13 which he is entitled for such month under sec14 tion 202 (or the total of his excess earnings if 

15 such excess earnings are less than such pay16 ment), and the balance, if any, of such excess 

17 earnings shall be charged to each succeeding 

18 month in such year to the extent, in the case 

19 of each such month, of the payment to which 

20 such individual is entitled for such month under 

21 section 202, until the total of such excess has 

22 been so charged. Notwithstanding’’; 

(E) in subsection (f)(3), by striking ‘‘331 23 ⁄3

24 percent’’ and all that follows through ‘‘other in25 dividual,’’ and inserting ‘‘50 percent of such inmstockstill on PROD1PC66 with BILLS

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1 dividual’s earnings for such year in excess of 

2 the product of the exempt amount as deter3 mined under paragraph (8),’’; 

4 (F) by striking subsection (f)(7); 

5 (G) by striking subsection (f)(9); and 

6 (H) in subsection (h)(1)(A)(ii), by striking 

7 subclauses (I), (II), and (III) and inserting the 

8 following: 

9 ‘‘(I) such individual’s benefits under sec10 tion 202 are reduced under subsection (a) of 

11 this section for any month in such taxable year, 

12 and 

13 ‘‘(II) in any such month there is another 

14 person who also is entitled to benefits under 

15 subsection (b), (c), (d), (e), (f), (g), or (h) of 

16 section 202 on the basis of the same wages and 

17 self-employment income and who does not live 

18 in the same household as such individual.’’. 

19 (2) The second sentence of section 223(d)(4) of 

20 such Act (42 U.S.C. 423(d)(4)) is amended by strik21 ing ‘‘if section 102 of the Senior Citizens’ Right to 

22 Work Act of 1996 had not been enacted’’ and insert23 ing the following: if the amendments to section 203 

24 made by section 102 of the Senior Citizens’ Right to 

25 Work Act of 1996 and by section 201 of the Social 

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1 Security Guarantee Plus Act of 2007 had not been 

2 enacted. 

3 (d) EFFECTIVE DATE AND TRANSITIONAL RULE.— 

4 (1) EFFECTIVE DATE.—The amendments and 

5 repeals made by this section shall apply with respect 

6 to taxable years ending after December 31, 2012. 

7 (2) TRANSITIONAL RULE.—Notwithstanding 

8 paragraph (8) of section 203(f) of the Social Secu9 rity Act (42 U.S.C. 403(f)(8)), the exempt amount 

10 which is applicable, for purposes of such section 

11 203(f), to an individual who is entitled to monthly 

12 insurance benefits under section 202 of such Act but 

13 who has not attained retirement age (as defined in 

14 section 216(l) of such Act) before the close of the 

15 taxable year involved shall be— 

16 (A) for each month of any taxable year 

17 ending after 2007 and before 2009, $1,250.00, 

18 (B) for each month of any taxable year 

19 ending after 2008 and before 2010, 

$1,666.662 20 ⁄3, 

21 (C) for each month of any taxable year 

22 ending after 2009 and before 2011, 

$2,083.331 23 ⁄3, 

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1 (D) for each month of any taxable year 

2 ending after 2010 and before 2012, $2,500.00, 

3 and 

4 (E) for each month of any taxable year 

5 ending after 2011 and before 2013, 

$2,916.662 6 ⁄3. 

7 SEC. 202. INCREASE IN WIDOW’S AND WIDOWER’S INSUR8 ANCE BENEFITS. 

9 (a) WIDOW’S INSURANCE BENEFITS.—Section 

10 202(e) of the Social Security Act (42 U.S.C. 402(e)) is 

11 amended by adding at the end the following new para12 graph: 

13 ‘‘(9)(A) In any case in which the amount of a widow’s 

14 insurance benefit (as determined under the preceding 

15 paragraphs of this subsection) for the entitlement month 

16 of the widow (or surviving divorced wife) is less than the 

17 minimum benefit amount for such month determined 

18 under subparagraph (C), the amount of such benefit for 

19 such month and each succeeding month shall be increased 

20 to such minimum benefit amount (or the amount most re21 cently established in lieu thereof under section 215(i)). 

22 ‘‘(B) For purposes of this paragraph, the term ‘enti23 tlement month’ of a widow (or surviving divorced wife) 

24 means, in connection with her benefit under this sub25 section, the first month of her entitlement to such benefit. 

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1 ‘‘(C) For purposes of subparagraph (A), the min2 imum benefit amount determined under this subparagraph 

3 for the entitlement month of the widow (or surviving di4 vorced wife) is an amount equal to the lesser of— 

5 ‘‘(i) 75 percent of the sum of— 

6 ‘‘(I) the imputed deceased individual’s ben7 efit for such month, as determined under sub8 paragraph (D) or (E) (as applicable), and 

9 ‘‘(II) the imputed survivor benefit for such 

10 month, as determined under subparagraph (F), 

11 or 

12 ‘‘(ii) the increased benefit cap determined under 

13 subparagraph (G) for such month. 

14 ‘‘(D)(i) For purposes of subparagraph (C)(i)(I), if the 

15 deceased individual died in a month for which he was not 

16 entitled to any benefit under this title based on his wages 

17 or self-employment income or the wages and self-employ18 ment income of the widow (or surviving divorced wife), the 

19 imputed deceased individual’s benefit for the entitlement 

20 month of the widow (or surviving divorced wife) is the sum 

21 of— 

22 ‘‘(I) the imputed old-age insurance benefit (de23 termined under clause (ii)) of the deceased indi24 vidual for her entitlement month (if any), and 

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1 ‘‘(II) the imputed husband’s insurance benefit 

2 (determined under clause (iii)) of the deceased indi3 vidual for her entitlement month (if any). 

4 ‘‘(ii) The amount of the imputed old-age insurance 

5 benefit of the deceased individual for the entitlement 

6 month of the widow (or surviving divorced wife) is the 

7 amount of the old-age insurance benefit to which he would 

8 have been entitled for such month— 

9 ‘‘(I) determined, in the case of such a deceased 

10 individual who had attained age 62 as of the date 

11 of his death, as if he had applied for such benefit 

12 in the month of his death and had survived through13 out the subsequent period ending with her entitle14 ment month, or 

15 ‘‘(II) determined, in the case of such a deceased 

16 individual who died before attaining age 62 but 

17 would have attained age 62 before the end of her en18 titlement month, as if he had survived throughout 

19 the subsequent period ending with her entitlement 

20 month, and had applied for such benefit during the 

21 first month for which he would have been eligible for 

22 such benefit (assuming a primary insurance amount 

23 for the deceased individual determined under para24 graph (2)(B) of this subsection). 

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1 For purposes of determining the deceased individual’s im2 puted old-age insurance benefit under this clause, the de3 termination of whether the deceased individual was a fully4 insured individual (as defined in section 214(a)) shall be 

5 made as of the date of his death. In any case in which 

6 the deceased individual died before attaining age 62 and 

7 would not have attained age 62 before the end of the enti8 tlement month of the widow (or surviving divorced wife), 

9 the deceased individual’s imputed old-age insurance ben10 efit shall be deemed to be zero. 

11 ‘‘(iii) The amount of the imputed husband’s insur12 ance benefit of the deceased individual for the entitlement 

13 month of the widow (or surviving divorced wife) is the 

14 amount of the husband’s insurance benefit under sub15 section (c) to which he would have been entitled for such 

16 month (assuming, for purposes of reduction under sub17 section (k)(3)(A), the entitlement to an old-age insurance 

18 benefit for such month, if any, as described in clause 

19 (ii))— 

20 ‘‘(I) determined, in the case of such a deceased 

21 individual who had attained age 62 as of the date 

22 of his death, as if he had applied for such benefit 

23 in the month of his death and had survived through24 out the subsequent period ending with her entitle25 ment month, or 

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1 ‘‘(II) determined, in the case of such a deceased 

2 individual who died before attaining age 62 but 

3 would have attained age 62 before the end of her en4 titlement month, as if he had survived throughout 

5 the subsequent period ending with her entitlement 

6 month and had applied for such benefit during the 

7 first month for which he would have been eligible for 

8 such benefit. 

9 In any case in which the deceased individual died before 

10 he attained age 62 and would not have attained age 62 

11 before the end of the entitlement month of the widow (or 

12 surviving divorced spouse), the deceased individual’s im13 puted husband’s insurance benefit shall be deemed to be 

14 zero. 

15 ‘‘(E)(i) For purposes of subparagraph (C), if the de16 ceased individual died during a month for which he other17 wise would have been entitled (but for his death) to an 

18 old-age insurance benefit under subsection (a) or a dis19 ability insurance benefit under section 223, or to a hus20 band’s insurance benefit under subsection (c) based on the 

21 wages and self-employment income of the widow (or sur22 viving divorced wife), the imputed deceased individual’s 

23 benefit for the entitlement month of the widow (or sur24 viving divorced wife) is the sum of— 

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1 ‘‘(I) the amount of the old-age or disability in2 surance benefit (if any) to which he would have been 

3 entitled for her entitlement month if he had survived 

4 throughout the period subsequent to his death and 

5 ending with such month, and 

6 ‘‘(II) the amount of the husband’s insurance 

7 benefit (if any) to which he would have been entitled 

8 for her entitlement month based on her wages and 

9 self-employment income if he had survived through10 out the period subsequent to his death and ending 

11 with such month (assuming, for purposes of reduc12 tion under subsection (k)(3)(A), the entitlement to 

13 an old-age or disability insurance benefit for such 

14 month, if any, as described in subclause (I)). 

15 ‘‘(ii) If the deceased individual otherwise would have 

16 been entitled (but for his death) to a disability insurance 

17 benefit under section 223 for the month in which he died, 

18 the amount determined under clause (i) shall be deter19 mined as if he had survived throughout the period com20 mencing with the month of his death and ending with the 

21 entitlement month of the widow (or surviving divorced 

22 wife) and he had remained entitled to disability insurance 

23 benefits throughout such period (or until becoming enti24 tled to old-age insurance benefits under subsection (a) 

25 during such period). 

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1 ‘‘(F) For purposes of subparagraph (C)(i)(II)— 

2 ‘‘(i) In the case of a widow (or surviving di3 vorced wife) who is entitled for her entitlement 

4 month to an old-age insurance benefit under sub5 section (a) or a disability insurance benefit under 

6 section 223, or otherwise would have been entitled 

7 (but for the deceased individual’s death) to a wife’s 

8 insurance benefit under subsection (b) for such 

9 month, the amount of her imputed survivor benefit 

10 for such month is the sum of— 

11 ‘‘(I) the amount of such old-age or dis12 ability insurance benefit (if any), and 

13 ‘‘(II) the amount of such wife’s insurance 

14 benefit (if any), assuming, for purposes of re15 duction under subsection (k)(3)(A), the entitle16 ment to an old-age insurance or disability insur17 ance benefit for such month (if any), as de18 scribed in subclause (I). 

19 ‘‘(ii) In the case of a widow (or surviving di20 vorced wife) who is not described in clause (i) but 

21 has attained (or would attain) age 62 as of the end 

22 of her entitlement month, the amount of her im23 puted survivor benefit is the sum of— 

24 ‘‘(I) the amount of the old-age insurance 

25 benefit under subsection (a) to which she would 

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1 be entitled for such month if she filed applica2 tion for such benefit during such month, and 

3 ‘‘(II) the amount to which she otherwise 

4 would have been entitled (but for the deceased 

5 individual’s death) as a wife’s insurance benefit 

6 under subsection (b) for such month, based on 

7 the deceased individual’s wages and self-employ8 ment income, if she had filed application for 

9 such benefit during such month (assuming a 

10 primary insurance amount for the deceased in11 dividual determined under paragraph (2)(B) of 

12 this subsection and assuming, for purposes of 

13 reduction under subsection (k)(3)(A), the enti14 tlement to an old-age insurance benefit for such 

15 month, if any, as described in subclause (I)). 

16 In any case in which the widow (or surviving divorced 

17 wife) would not attain age 62 before the end of the her 

18 entitlement month, her imputed survivor benefit shall be 

19 deemed to be zero. 

20 ‘‘(G) The increased benefit cap determined under this 

21 subparagraph for the entitlement month of the widow (or 

22 surviving divorced wife) is the amount which would be the 

23 amount of a theoretical individual’s old-age insurance ben24 efit under subsection (a) (reduced as provided in sub25 section (q)) if— 

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1 ‘‘(i) such theoretical individual’s primary insur2 ance amount for the first month of entitlement were 

3 equal to the average of the primary insurance 

4 amounts upon which old-age insurance benefits 

5 under subsection (a) are payable for— 

6 ‘‘(I) in any case in which the entitlement 

7 month of the widow (or surviving divorced wife) 

8 is the month of December, such month, or 

9 ‘‘(II) in any other case, the latest month of 

10 December preceding such entitlement month, 

11 ‘‘(ii) such first month of such theoretical indi12 vidual’s entitlement to such old-age insurance ben13 efit were the entitlement month of the widow (or 

14 surviving divorced spouse), and 

15 ‘‘(iii) the month in which the theoretical indi16 vidual attained or would attain retirement age (as 

17 defined in section 216(l)) were the month in which 

18 the widow (or surviving divorced wife) attained or 

19 would attain retirement age (as so defined). 

20 ‘‘(H) If, in determining the amount of the benefit 

21 under this section pursuant to this paragraph, the im22 puted old-age insurance benefit or imputed husband’s in23 surance benefit of the deceased individual was deemed to 

24 be zero pursuant to the last sentence of clause (ii) or (iii) 

25 of subparagraph (D), or the imputed survivor benefit of 

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1 the widow (or surviving divorced wife) was deemed to be 

2 zero pursuant to the last sentence of subparagraph (F), 

3 effective for any month after the entitlement month of the 

4 widow (or surviving divorced wife) in which the deceased 

5 individual would have attained age 62 or she attains age 

6 62, the Commissioner shall recompute the amount of the 

7 benefit under this paragraph by substituting a reference 

8 to such later month for each reference in the preceding 

9 provisions of this paragraph to her entitlement month. 

10 ‘‘(I)(i) Any reference in this paragraph to the widow’s 

11 insurance benefit (as determined under the preceding 

12 paragraphs of this subsection) shall be deemed a reference 

13 to such benefit, taking into account all applicable reduc14 tions and deductions under this title. 

15 ‘‘(ii) Any reference in this paragraph to the imputed 

16 old-age insurance benefit or imputed husband’s insurance 

17 benefit described in subparagraph (D), the old-age insur18 ance benefit, disability insurance benefit, or husband’s in19 surance benefit described in subparagraph (E), or the old20 age insurance benefit, disability insurance benefit, or 

21 wife’s insurance benefit described in subparagraph (F) 

22 shall be deemed a reference to such benefit, taking into 

23 account applicable reductions under this section but dis24 regarding reductions or deductions otherwise applicable 

25 under this title. 

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1 ‘‘(iii) A widow’s insurance benefit which has been in2 creased under this paragraph shall be subject to all reduc3 tions and deductions otherwise applicable to widow’s in4 surance benefits under this title, except that such benefit 

5 shall not be subject to any reduction otherwise applicable 

6 under subsection (q)(1).’’. 

7 (b) WIDOWER’S INSURANCE BENEFITS.—Section 

8 202(f) of such Act (42 U.S.C. 402(f)) is amended by add9 ing at the end the following new paragraph: 

10 ‘‘(9)(A) In any case in which the amount of a wid11 ower’s insurance benefit (as determined under the pre12 ceding paragraphs of this subsection) for the entitlement 

13 month of the widower (or surviving divorced husband) is 

14 less than the minimum benefit amount for such month de15 termined under subparagraph (C), the amount of such 

16 benefit for such month and each succeeding month shall 

17 be increased to such minimum benefit amount (or the 

18 amount most recently established in lieu thereof under 

19 section 215(i)). 

20 ‘‘(B) For purposes of this paragraph, the term ‘enti21 tlement month’ of a widower (or surviving divorced hus22 band) means, in connection with his benefit under this 

23 subsection, the first month of his entitlement to such ben24 efit. 

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1 ‘‘(C) For purposes of subparagraph (A), the min2 imum benefit amount determined under this subparagraph 

3 for the entitlement month of the widower (or surviving di4 vorced husband) is an amount equal to the lesser of— 

5 ‘‘(i) 75 percent of the sum of— 

6 ‘‘(I) the imputed deceased individual’s ben7 efit for such month, as determined under sub8 paragraph (D) or (E) (as applicable), and 

9 ‘‘(II) the imputed survivor benefit for such 

10 month, as determined under subparagraph (F), 

11 or 

12 ‘‘(ii) the increased benefit cap determined under 

13 subparagraph (G) for such month. 

14 ‘‘(D)(i) For purposes of subparagraph (C)(i)(I), if the 

15 deceased individual died in a month for which she was not 

16 entitled to any benefit under this title based on her wages 

17 or self-employment income or the wages and self-employ18 ment income of the widower (or surviving divorced hus19 band), the imputed deceased individual’s benefit for the 

20 entitlement month of the widower (or surviving divorced 

21 husband) is the sum of— 

22 ‘‘(I) the imputed old-age insurance benefit (de23 termined under clause (ii)) of the deceased indi24 vidual for his entitlement month (if any), and 

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1 ‘‘(II) the imputed wife’s insurance benefit (de2 termined under clause (iii)) of the deceased indi3 vidual for his entitlement month (if any). 

4 ‘‘(ii) The amount of the imputed old-age insurance 

5 benefit of the deceased individual for the entitlement 

6 month of the widower (or surviving divorced husband) is 

7 the amount of the old-age insurance benefit to which she 

8 would have been entitled for such month— 

9 ‘‘(I) determined, in the case of such a deceased 

10 individual who had attained age 62 as of the date 

11 of her death, as if she had applied for such benefit 

12 in the month of her death and had survived through13 out the subsequent period ending with his entitle14 ment month, or 

15 ‘‘(II) determined, in the case of such a deceased 

16 individual who died before attaining age 62 but 

17 would have attained age 62 before the end of his en18 titlement month, as if she had survived throughout 

19 the subsequent period ending with his entitlement 

20 month, and had applied for such benefit during the 

21 first month for which she would have been eligible 

22 for such benefit (assuming a primary insurance 

23 amount for the deceased individual determined 

24 under paragraph (2)(B) of this subsection). 

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1 For purposes of determining the deceased individual’s im2 puted old-age insurance benefit under this clause, the de3 termination of whether the deceased individual was a fully4 insured individual (as defined in section 214(a)) shall be 

5 made as of the date of her death. In any case in which 

6 the deceased individual died before attaining age 62 and 

7 would not have attained age 62 before the end of the enti8 tlement month of the widower (or surviving divorced hus9 band), the deceased individual’s imputed old-age insurance 

10 benefit shall be deemed to be zero. 

11 ‘‘(iii) The amount of the imputed wife’s insurance 

12 benefit of the deceased individual for the entitlement 

13 month of the widower (or surviving divorced husband) is 

14 the amount of the wife’s insurance benefit under sub15 section (c) to which she would have been entitled for such 

16 month (assuming, for purposes of reduction under sub17 section (k)(3)(A), the entitlement to an old-age insurance 

18 benefit for such month, if any, as described in clause 

19 (ii))— 

20 ‘‘(I) determined, in the case of such a deceased 

21 individual who had attained age 62 as of the date 

22 of her death, as if she had applied for such benefit 

23 in the month of her death and had survived through24 out the subsequent period ending with his entitle25 ment month, or 

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1 ‘‘(II) determined, in the case of such a deceased 

2 individual who died before attaining age 62 but 

3 would have attained age 62 before the end of his en4 titlement month, as if she had survived throughout 

5 the subsequent period ending with his entitlement 

6 month and had applied for such benefit during the 

7 first month for which she would have been eligible 

8 for such benefit. 

9 In any case in which the deceased individual died before 

10 she attained age 62 and would not have attained age 62 

11 before the end of the entitlement month of the widower 

12 (or surviving divorced husband), the deceased individual’s 

13 imputed wife’s insurance benefit shall be deemed to be 

14 zero. 

15 ‘‘(E)(i) For purposes of subparagraph (C), if the de16 ceased individual died during a month for which she other17 wise would have been entitled (but for his death) to an 

18 old-age insurance benefit under subsection (a) or a dis19 ability insurance benefit under section 223, or to a wife’s 

20 insurance benefit under subsection (c) based on the wages 

21 and self-employment income of the widower (or surviving 

22 divorced husband), the imputed deceased individual’s ben23 efit for the entitlement month of the widower (or surviving 

24 divorced husband) is the sum of— 

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1 ‘‘(I) the amount of the old-age or disability in2 surance benefit (if any) to which she would have 

3 been entitled for his entitlement month if she had 

4 survived throughout the period subsequent to her 

5 death and ending with such month, and 

6 ‘‘(II) the amount of the wife’s insurance benefit 

7 (if any) to which she would have been entitled for 

8 his entitlement month based on his wages and self9 employment income if she had survived throughout 

10 the period subsequent to her death and ending with 

11 such month (assuming, for purposes of reduction 

12 under subsection (k)(3)(A), the entitlement to an 

13 old-age or disability insurance benefit for such 

14 month, if any, as described in subclause (I)). 

15 ‘‘(ii) If the deceased individual otherwise would have 

16 been entitled (but for her death) to a disability insurance 

17 benefit under section 223 for the month in which she died, 

18 the amount determined under clause (i) shall be deter19 mined as if she had survived throughout the period com20 mencing with the month of her death and ending with the 

21 entitlement month of the widower (or surviving divorced 

22 husband) and she had remained entitled to disability in23 surance benefits throughout such period (or until becom24 ing entitled to old-age insurance benefits under subsection 

25 (a) during such period). 

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1 ‘‘(F) For purposes of subparagraph (C)(i)(II)— 

2 ‘‘(i) In the case of a widower (or surviving di3 vorced husband) who is entitled for his entitlement 

4 month to an old-age insurance benefit under sub5 section (a) or a disability insurance benefit under 

6 section 223, or otherwise would have been entitled 

7 (but for the deceased individual’s death) to a hus8 band’s insurance benefit under subsection (b) for 

9 such month, the amount of his imputed survivor 

10 benefit for such month is the sum of— 

11 ‘‘(I) the amount of such old-age or dis12 ability insurance benefit (if any), and 

13 ‘‘(II) the amount of such husband’s insur14 ance benefit (if any), assuming, for purposes of 

15 reduction under subsection (k)(3)(A), the enti16 tlement to an old-age insurance or disability in17 surance benefit for such month (if any), as de18 scribed in subclause (I). 

19 ‘‘(ii) In the case of a widower (or surviving di20 vorced husband) who is not described in clause (i) 

21 but has attained (or would attain) age 62 as of the 

22 end of his entitlement month, the amount of his im23 puted survivor benefit is the sum of— 

24 ‘‘(I) the amount of the old-age insurance 

25 benefit under subsection (a) to which he would 

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1 be entitled for such month if he filed applica2 tion for such benefit during such month, and 

3 ‘‘(II) the amount to which he otherwise 

4 would have been entitled (but for the deceased 

5 individual’s death) as a husband’s insurance 

6 benefit under subsection (c) for such month, 

7 based on the deceased individual’s wages and 

8 self-employment income, if he had filed applica9 tion for such benefit during such month (as10 suming a primary insurance amount for the de11 ceased individual determined under paragraph 

12 (2)(B) of this subsection and assuming, for 

13 purposes of reduction under subsection 

14 (k)(3)(A), the entitlement to an old-age insur15 ance benefit for such month, if any, as de16 scribed in subclause (I)). 

17 In any case in which the widower (or surviving divorced 

18 husband) would not attain age 62 before the end of his 

19 entitlement month, his imputed survivor benefit shall be 

20 deemed to be zero. 

21 ‘‘(G) The increased benefit cap determined under this 

22 subparagraph for the entitlement month of the widower 

23 (or surviving divorced husband) is the amount which 

24 would be the amount of a theoretical individual’s old-age 

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1 insurance benefit under subsection (a) (reduced as pro2 vided in subsection (q)) if— 

3 ‘‘(i) such theoretical individual’s primary insur4 ance amount for the first month of entitlement were 

5 equal to the average of the primary insurance 

6 amounts upon which old-age insurance benefits 

7 under subsection (a) are payable for— 

8 ‘‘(I) in any case in which the entitlement 

9 month of the widower (or surviving divorced 

10 husband) is the month of December, such 

11 month, or 

12 ‘‘(II) in any other case, the latest month of 

13 December preceding such entitlement month, 

14 ‘‘(ii) such first month of such theoretical indi15 vidual’s entitlement to such old-age insurance ben16 efit were the entitlement month of the widower (or 

17 surviving divorced husband), and 

18 ‘‘(iii) the month in which the theoretical indi19 vidual attained or would attain retirement age (as 

20 defined in section 216(l)) were the month in which 

21 the widower (or surviving divorced husband) at22 tained or would attain retirement age (as so de23 fined). 

24 ‘‘(H) If, in determining the amount of the benefit 

25 under this section pursuant to this paragraph, the immstockstill on PROD1PC66 with BILLS

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1 puted old-age insurance benefit or imputed wife’s insur2 ance benefit of the deceased individual was deemed to be 

3 zero pursuant to the last sentence of clause (ii) or (iii) 

4 of subparagraph (D), or the imputed survivor benefit of 

5 the widower (or surviving divorced husband) was deemed 

6 to be zero pursuant to the last sentence of subparagraph 

7 (F), effective for any month after the entitlement month 

8 of the widower (or surviving divorced husband) in which 

9 the deceased individual would have attained age 62 or he 

10 attains age 62, the Commissioner shall recompute the 

11 amount of the benefit under this paragraph by sub12 stituting a reference to such later month for each ref13 erence in the preceding provisions of this paragraph to his 

14 entitlement month. 

15 ‘‘(I)(i) Any reference in this paragraph to the wid16 ower’s insurance benefit (as determined under the pre17 ceding paragraphs of this subsection) shall be deemed a 

18 reference to such benefit, taking into account all applicable 

19 reductions and deductions under this title. 

20 ‘‘(ii) Any reference in this paragraph to the imputed 

21 old-age insurance benefit or imputed wife’s insurance ben22 efit described in subparagraph (D), the old-age insurance 

23 benefit, disability insurance benefit, or wife’s insurance 

24 benefit described in subparagraph (E), or the old-age in25 surance benefit, disability insurance benefit, or husband’s 

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1 insurance benefit described in subparagraph (F) shall be 

2 deemed a reference to such benefit, taking into account 

3 applicable reductions under this section but disregarding 

4 reductions or deductions otherwise applicable under this 

5 title. 

6 ‘‘(iii) A widower’s insurance benefit which has been 

7 increased under this paragraph shall be subject to all re8 ductions and deductions otherwise applicable to widower’s 

9 insurance benefits under this title, except that such benefit 

10 shall not be subject to any reduction otherwise applicable 

11 under subsection (q)(1).’’. 

12 (c) COST-OF-LIVING ADJUSTMENTS TO GUARANTEED

13 WIDOW’S AND WIDOWER’S INSURANCE BENEFITS.—Sec14 tion 215(i)(2)(A)(ii) of such Act (42 U.S.C. 

15 415(i)(2)(A)(ii)) is amended— 

16 (1) in subclause (II), by striking ‘‘and’’ at the 

17 end; 

18 (2) in subclause (III), by striking ‘‘1978.’’ and 

19 inserting ‘‘1979, and’’; 

20 (3) by adding at the end the following new sub21 clause: 

22 ‘‘(IV) the benefit amount to which an individual 

23 is entitled for that month under subsection (e) or (f) 

24 of section 202 if such benefit amount has been inmstockstill on PROD1PC66 with BILLS

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1 creased under paragraph (9) of such subsection.’’; 

2 and 

3 (4) in the matter following subclause (IV) 

4 (added by paragraph (3)), by striking ‘‘(I), (II), and 

5 (III)’’ and inserting ‘‘(I), (II), (III), and (IV)’’. 

6 (d) EFFECTIVE DATE.—The amendments made by 

7 this section shall apply with respect to widow’s and wid8 ower’s insurance benefits for months after November of 

9 the calendar year in which this Act is enacted. 

10 SEC. 203. BENEFITS FOR DISABLED WIDOWS AND WID11 OWERS WITHOUT REGARD TO AGE. 

12 (a) ELIGIBILITY FOR WIDOW’S INSURANCE BENE13 FITS.—Section 202(e)(1)(B)(ii) of the Social Security Act 

14 (42 U.S.C. 402(e)(1)(B)(ii)) is amended by striking ‘‘has 

15 attained age 50 but has not attained age 60 and’’. 

16 (b) ELIGIBILITY FOR WIDOWER’S INSURANCE BENE17 FITS.—Section 202(f)(1)(B)(ii) of such Act (42 U.S.C. 

18 402(f)(1)(B)(ii)) is amended by striking ‘‘has attained age 

19 50 but has not attained age 60 and’’. 

20 (c) CONFORMING AMENDMENT.—Section 

21 202(q)(3)(A) of such Act (42 U.S.C. 402(q)(3)(A)) is 

22 amended by striking ‘‘If the first month’’ and all that fol23 lows through ‘‘widow’s or widower’s insurance benefit)’’ 

24 and inserting ‘‘If the first month for which an individual 

25 both is entitled to a wife’s or husband’s insurance benefit 

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1 and has attained age 62 or for which an individual is enti2 tled to a widow’s or widower’s insurance benefit’’. 

3 (d) EFFECTIVE DATE.—The amendments made by 

4 this section shall apply with respect to monthly insurance 

5 benefits payable under title II of the Social Security Act 

6 for months after November of the calendar year in which 

7 this Act is enacted and for which applications are filed 

8 or pending after November of such year. 

9 SEC. 204. REPEAL OF 7-YEAR RESTRICTION ON ELIGIBILITY 

10 FOR WIDOW’S AND WIDOWER’S INSURANCE 

11 BENEFITS BASED ON DISABILITY. 

12 (a) WIDOW’S INSURANCE BENEFITS.— 

13 (1) IN GENERAL.—Section 202(e) of the Social 

14 Security Act (as amended by section 202(a) of this 

15 Act) is further amended— 

16 (A) in paragraph (1)(B)(ii), by striking 

17 ‘‘which began before the end of the period spec18 ified in paragraph (4)’’; 

19 (B) in paragraph (1)(F)(ii), by striking 

20 ‘‘(I) in the period specified in paragraph (4) 

21 and (II)’’; 

22 (C) by striking paragraph (4) and by re23 designating paragraphs (5) through (9) as 

24 paragraphs (4) through (8), respectively; and 

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1 (D) in paragraph (4)(A)(ii) (as redesig2 nated), by striking ‘‘whichever’’ and all that fol3 lows through ‘‘begins’’ and inserting ‘‘the first 

4 day of the seventeenth month before the month 

5 in which her application is filed’’. 

6 (2) CONFORMING AMENDMENTS.— 

7 (A) Section 202(e)(1)(F)(i) of such Act 

8 (42 U.S.C. 402(e)(1)(F)(i)) is amended by 

9 striking ‘‘paragraph (5)’’ and inserting ‘‘para10 graph (4)’’. 

11 (B) Section 202(e)(1)(C)(ii)(III) of such 

12 Act (42 U.S.C. 402(e)(2)(C)(ii)(III)) is amend13 ed by striking ‘‘paragraph (8)’’ and inserting 

14 ‘‘paragraph (6)’’. 

15 (C) Section 226(e)(1)(A)(i) of such Act 

16 (42 U.S.C. 426(e)(1)(A)(i)) is amended by 

17 striking ‘‘202(e)(4),’’. 

18 (b) WIDOWER’S INSURANCE BENEFITS.— 

19 (1) IN GENERAL.—Section 202(f) of such Act 

20 (as amended by section 202(b) of this Act) is fur21 ther amended— 

22 (A) in paragraph (1)(B)(ii), by striking 

23 ‘‘which began before the end of the period spec24 ified in paragraph (4)’’; 

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1 (B) in paragraph (1)(F)(ii), by striking 

2 ‘‘(I) in the period specified in paragraph (4) 

3 and (II)’’; 

4 (C) by striking paragraph (4) and by re5 designating paragraphs (5) through (9) as 

6 paragraphs (4) through (8), respectively; and 

7 (D) in paragraph (4)(A)(ii) (as redesig8 nated), by striking ‘‘whichever’’ and all that fol9 lows through ‘‘begins’’ and inserting ‘‘the first 

10 day of the seventeenth month before the month 

11 in which his application is filed’’. 

12 (2) CONFORMING AMENDMENTS.— 

13 (A) Section 202(f)(1)(F)(i) of such Act (42 

14 U.S.C. 402(f)(1)(F)(i)) is amended by striking 

15 ‘‘paragraph (5)’’ and inserting ‘‘paragraph 

16 (4)’’. 

17 (B) Section 202(f)(1)(C)(ii)(III) of such 

18 Act (42 U.S.C. 402(f)(2)(C)(ii)(III)) is amend19 ed by striking ‘‘paragraph (8)’’ and inserting 

20 ‘‘paragraph (6)’’. 

21 (C) Section 226(e)(1)(A)(i) of such Act (as 

22 amended by subsection (a)(2)) is further 

23 amended by striking ‘‘202(f)(1)(B)(ii), and 

24 202(f)(4)’’ and inserting ‘‘and 

25 202(f)(1)(B)(ii)’’. 

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1 (c) CONFORMING AMENDMENT.—Section 

2 215(i)(2)(A)(ii)(IV) of such Act (as added by section 

3 202(c)(3) of this Act) is amended by striking ‘‘paragraph 

4 (9)’’ and inserting ‘‘paragraph (8)’’. 

5 (d) EFFECTIVE DATE.—The amendments made by 

6 this section shall apply with respect to benefits for months 

7 after November of the calendar year in which this Act is 

8 enacted and for which applications are filed or pending 

9 after November of such year. 

10 SEC. 205. EXEMPTION FROM TWO-YEAR WAITING PERIOD 

11 FOR DIVORCED SPOUSE’S BENEFITS UPON 

12 OTHER SPOUSE’S REMARRIAGE. 

13 (a) WIFE’S INSURANCE BENEFITS.—Section 

14 202(b)(4)(A) of the Social Security Act (42 U.S.C. 

15 402(b)(4)(A)) is amended by adding at the end the fol16 lowing new sentence: ‘‘The criterion for entitlement under 

17 clause (ii) shall be deemed met upon the remarriage of 

18 the insured individual to someone other than the applicant 

19 during the 2-year period referred to in such clause.’’. 

20 (b) HUSBAND’S INSURANCE BENEFITS.—Section 

21 202(c)(4)(A) of such Act (42 U.S.C. 402(c)(4)(A)) is 

22 amended by adding at the end the following new sentence: 

23 ‘‘The criterion for entitlement under clause (ii) shall be 

24 deemed met upon the remarriage of the insured individual 

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1 to someone other than the applicant during the 2-year pe2 riod referred to in such clause.’’. 

3 (c) EFFECTIVE DATE.—The amendments made by 

4 this section shall apply with respect to benefits for months 

5 after November of the calendar year in which this Act is 

6 enacted and for which applications are filed or pending 

7 after November of such year. 

8 SEC. 206. INCREASE IN AMOUNT OF WAGES AND SELF-EM9 PLOYMENT INCOME CREDITED TO YEARS 

10 TAKEN INTO ACCOUNT IN DETERMINING AV11 ERAGE INDEXED MONTHLY EARNINGS FOR 

12 BENEFICIARIES PRECLUDED FROM REMU13 NERATIVE WORK BY NEED TO PROVIDE 

14 CHILD CARE. 

15 (a) IN GENERAL.—Section 215(b)(3) of the Social 

16 Security Act (42 U.S.C. 415(b)(3)) is amended— 

17 (1) in subparagraph (A), by striking ‘‘subpara18 graph (B)’’ and inserting ‘‘subparagraphs (B) and 

19 (C)’’, and 

20 (2) by adding at the end the following new sub21 paragraph: 

22 ‘‘(C)(i) Subject to clause (iii), in any case in which— 

23 ‘‘(I) in any calendar year which is included in 

24 an individual’s elapsed years, such individual was 

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1 living with a child (of such individual or his or her 

2 spouse) under the age of 7, and 

3 ‘‘(II) at any time during or after such calendar 

4 year and on or before the date of the application by 

5 such individual for benefits based on such individ6 ual’s wages and self-employment income, such indi7 vidual submits to the Commissioner, in such form as 

8 the Commissioner shall prescribe by regulation, a 

9 written statement that the requirements of subclause 

10 (I) are met with respect to such calendar year, 

11 the amount of the wages and self-employment income paid 

12 in or credited to such year under subparagraph (A), if less 

13 than the minimum credit amount for such individual for 

14 such year, shall be deemed equal to such minimum credit 

15 amount. 

16 ‘‘(ii) For purposes of clause (i), the minimum credit 

17 amount for an individual described in clause (i) for any 

18 calendar year shall be an amount equal to the product de19 rived by multiplying— 

‘‘(I) subject to clause (iii), 1 20 ⁄4 of the average in21 dexed monthly earnings of such individual, deter22 mined as if such individual became entitled to dis23 ability insurance benefits on January 1 of such year 

24 (disregarding any elapsed year with respect to which 

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1 vidual are deemed to be increased under this sub2 paragraph), by 

3 ‘‘(II) the number of months in such year during 

4 which such individual meets the requirements of 

5 clause (i)(I). 

6 ‘‘(iii) In any case in which a minimum credit amount 

7 for an individual is determined under clause (ii) for 2 or 

8 more elapsed years, the amount determined in the case 

9 of such individual under clause (ii)(I) in connection with 

10 each such elapsed year shall not be less than the amount 

11 determined under clause (ii)(I) for such individual under 

12 clause (ii)(I) in connection with the latest of such 2 or 

13 more elapsed years. 

14 ‘‘(iv) Clause (i) shall apply only with respect to not 

15 more than 5 elapsed years designated by the individual 

16 described in clause (i) with respect to which such indi17 vidual submits a statement under clause (i)(II). 

18 ‘‘(v) Clause (i) shall not apply in the case of an indi19 vidual with respect to any calendar year referred to in 

20 clause (i)(I), if such individual’s spouse referred to in such 

21 clause was also living with the child referred to in such 

22 clause in such year, and— 

23 ‘‘(I) the amount of such individual’s wages and 

24 self-employment income paid in or credited to such 

25 year (as determined before the application of this 

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1 subparagraph) is greater than the amount of the 

2 wages and self-employment income paid in or cred3 ited to such year (as so determined) of such spouse, 

4 or 

5 ‘‘(II) in any case in which the amount of the 

6 wages and self-employment income of such indi7 vidual paid in or credited to such year is equal to 

8 the wages and self-employment income of such indi9 vidual’s spouse paid in or credited to such year, the 

10 amount determined under clause (ii)(I) in connection 

11 with such calendar year in the case of such indi12 vidual is greater than the amount so determined in 

13 the case of such individual’s spouse. 

14 In any case in which the requirements of neither subclause 

15 (I) nor subclause (II) are met in the case of such indi16 vidual with respect to any calendar year, the Commis17 sioner of Social Security shall provide by regulation for 

18 the application of clause (i) only with respect to one of 

19 the two spouses in accordance with the equities of the 

20 case.’’. 

21 (b) EFFECTIVE DATE.—The amendments made by 

22 this section shall apply with respect to benefits for months 

23 after November of the calendar year in which this Act is 

24 enacted. 

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1 SEC. 207. GOVERNMENT PENSION OFFSET REDUCED FROM 

2 TWO-THIRDS TO ONE-THIRD OF THE GOVERN3 MENT PENSION. 

4 (a) IN GENERAL.—Section 202(k)(5)(A) of the Social 

5 Security Act (42 U.S.C. 402(k)(5)(A)) is amended by 

6 striking ‘‘two-thirds’’ and inserting ‘‘one-third’’. 

7 (b) EFFECTIVE DATE.—The amendment made by 

8 this section shall apply with respect to benefits for months 

9 after November of the calendar year in which this Act is 

10 enacted. 

Æ 

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