I 

108TH CONGRESS 

1ST SESSION H. R. 75

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 

JANUARY 7, 2003

Mr. SHAW (for himself, Mr. FOLEY, Mr. LEWIS of Kentucky, Mr. NORWOOD, 

and Mr. SMITH of Michigan) introduced the following bill; which was referred to the Committee on Ways and Means 

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 2003’’. 

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. 102. Establishment of the social security guarantee program. 

‘‘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. 105. Annual account Statements. 

Sec. 106. Report on use of social security surpluses. 

TITLE II—BENEFIT UPDATES 

Sec. 201. Elimination of the social security earnings test for individuals who 

have attained age 62 (age 60 in the case of widow’s and widower’s insurance benefits). 

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 occasioned by need to provide child care. 

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

the government pension.

6 SEC. 2. FINDINGS AND STATEMENT OF PURPOSE. 

7 (a) FINDINGS.—The Congress finds as follows: 
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1 (1) The Social Security program provides essen2 tial income security for over 46 million Americans of 

3 all ages through its retirement, disability, and sur4 vivor benefits. Without these benefits, close to half 

5 of seniors would live in poverty. 

6 (2) Social Security’s benefit structure, which is 

7 designed to help lower-wage workers, and its family 

8 benefits are of particular importance to women and 

9 minorities. Without these benefits, about 53 percent 

10 of elderly women and 55 to 60 percent of elderly 

11 Hispanics and African-Americans would live in pov12 erty. 

13 (3) The Board of Trustees of the Social Secu14 rity trust funds project that, because people are liv15 ing longer, families are having fewer children, and 

16 the baby boom generation is approaching retirement, 

17 the Social Security program’s benefit costs will ex18 ceed its tax revenues beginning in 2017. By 2041, 

19 the Social Security trust funds will be depleted and 

20 the program will be able to honor only 73 percent 

21 of benefit commitments, and even less thereafter. 

22 (4) Each payday, American workers send their 

23 hard-earned payroll taxes to Social Security and in 

24 return are promised protection for themselves and 
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1 their families upon retirement, disability, or death. 

2 That commitment must be kept. 

3 (5) Reducing benefits will result in more seniors 

4 and individuals with disabilities living in poverty. 

5 (6) Workers who are more in need of early re6 tirement, such as police officers, firefighters, and 

7 manual laborers, would be especially harmed by in8 creases in the age of eligibility for Social Security 

9 benefits. 

10 (7) Inasmuch as payroll taxes already con11 stitute the single largest tax burden for most Amer12 ican families, further tax increases would contribute 

13 to erosion in public support for Social Security, 

14 would not result in sustainable financing for the 

15 long term, and would further burden employers and 

16 harm job creation. 

17 (8) Allowing the Federal Government to invest 

18 workers’ payroll taxes in private financial assets 

19 risks political interference in investment decisions 

20 and may reduce economic efficiency. 

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

22 own economic security in retirement will continue to 

23 be particularly important, especially for younger 

24 workers.
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1 (10) The creation of Social Security guarantee 

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

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

4 options available to address these challenges, and 

5 the Nation’s interest in preserving and strength6 ening Social Security for the next 75 years and be7 yond. 

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

9 Act is to preserve and strengthen the Social Security pro10 gram through the creation of Social Security guarantee 

11 accounts that will—

12 (1) ensure the payment of Social Security bene13 fits promised under current law, or greater benefits, 

14 to all eligible workers and their families; 

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

16 Social Security program; and 

17 (3) provide personal account assets to be used 

18 exclusively for the financial security of the account 

19 holder and his or her family that this and future 

20 Congresses cannot redirect for any other purpose. 
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1 TITLE I—SOCIAL SECURITY 

2 GUARANTEE PROGRAM 

3 SEC. 101. SOCIAL SECURITY GUARANTEE REFUNDABLE 

4 CREDIT. 

5 (a) IN GENERAL.—Chapter 25 of the Internal Rev6 enue Code of 1986 (relating to general provisions relating 

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

8 the following new section: 

9 ‘‘SEC. 3511. SOCIAL SECURITY GUARANTEE REFUNDABLE 

10 CREDIT. 

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

12 account established under section 253 of the Social Secu13 rity Act for each individual who has filed an election under 

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

15 year following such election, during which such individual 

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

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

18 amount determined under subsection (b) for the individual 

19 for such calendar year. 

20 ‘‘(b) CREDIT AMOUNT.—

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

22 (a), the credit amount determined under this sub23 section for an individual for a calendar year is an 

24 amount equal to the lesser of—

25 ‘‘(A) 4 percent of the sum of—
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1 ‘‘(i) wages (as defined in section 

2 3121(a)) received by such individual dur3 ing such year on which tax is imposed by 

4 section 3101, and 

5 ‘‘(ii) self-employment income (as de6 fined in 1402(b)) of such individual for the 

7 taxable year of such individual ending in 

8 such calendar year on which tax is imposed 

9 by section 1401, or 

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

11 year ending after the date of the enactment of 

12 the Social Security Guarantee Plus Act of 

13 2003) and the amount determined under para14 graph (2) for the calendar year (in the case of 

15 subsequent calendar years). 

16 ‘‘(2) WAGE-BASED ADJUSTMENTS.—The Sec17 retary shall, on or before November 1 of the first 

18 calendar year ending after the date of the enactment 

19 of the Social Security Guarantee Plus Act of 2003 

20 and of every calendar year thereafter, determine and 

21 publish in the Federal Register the dollar amount 

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

23 year. Such amount shall be the larger of—
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1 ‘‘(A) the amount in effect in the calendar 

2 year in which the determination under this 

3 paragraph is made, or 

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

5 of the national average wage index (as defined 

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

7 for the calendar year before the year in which 

8 the determination under this paragraph is made 

9 to the national average wage index (as so de10 fined) for the first of the 2 calendar years pre11 ceding the calendar year ending after the date 

12 of the enactment of the Social Security Guar13 antee Plus Act of 2003, 

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

15 rounded to the next higher multiple of $10 where 

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

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

18 ‘‘(c) SPECIAL RULES.—

19 ‘‘(1) AGREEMENTS BY AMERICAN EMPLOYERS

20 OF FOREIGN AFFILIATES.—Any amounts paid pur21 suant to an agreement under section 3121(l) (relat22 ing to agreements entered into by American employ23 ers with respect to foreign affiliates) which are 

24 equivalent to the taxes referred to in subsection 
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1 (b)(1)(A) shall be treated as taxes referred to in 

2 such subsection. 

3 ‘‘(2) COORDINATION WITH SPECIAL REFUND OF

4 SOCIAL SECURITY TAXES.—For purposes of sub5 section (b)(1)(A), tax imposed by section 3101 shall 

6 not include any taxes to the extent the individual is 

7 entitled to a special refund of such taxes under sec8 tion 6413(c). 

9 ‘‘(d) PAYMENT.—Notwithstanding any other provi10 sion of this title, the payment under subsection (a) shall 

11 be paid only as provided in section 253 of the Social Secu12 rity Act.’’. 

13 (b) CONFORMING AMENDMENT.—The table of sec14 tions for chapter 25 of such Code is amended by adding 

15 at the end the following new item:

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

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

17 this section shall apply to remuneration received, and net 

18 earnings for self-employment for services performed, in 

19 calendar years ending after the date of the enactment of 

20 this Act.

21 SEC. 102. ESTABLISHMENT OF THE SOCIAL SECURITY 

22 GUARANTEE PROGRAM. 

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

24 is amended—
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1 (1) by inserting before section 201 the fol2 lowing: 

3 ‘‘PART A—INSURANCE BENEFITS’’; 

4 and 

5 (2) by adding at the end of such title the fol6 lowing new part: 

7 ‘‘PART B—SOCIAL SECURITY GUARANTEE PROGRAM

8 ‘‘DEFINITIONS

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

10 ‘‘(1) COVERED INDIVIDUAL.—The term ‘cov11 ered individual’ means an individual who has filed 

12 an election under section 253(b). 

13 ‘‘(2) ACCOUNT ASSETS.—The term ‘account as14 sets’ means, with respect to a Social Security guar15 antee account, the total amount transferred to such 

16 account, increased by earnings credited under this 

17 part and reduced by losses and administrative ex18 penses under this part. 

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

20 term ‘certified account manager’ means a person 

21 who is certified under section 257(b). 

22 ‘‘(4) BOARD.—The term ‘Board’ means the So23 cial Security Guarantee Board established under sec24 tion 257(a).
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1 ‘‘(5) COMMISSIONER.—The term ‘Commis2 sioner’ means the Commissioner of Social Security. 

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

4 the Social Security Guarantee Program established 

5 under this part. 

6 ‘‘(7) COVERED MONTHLY INSURANCE BEN7 EFIT.—The term ‘covered monthly insurance benefit’ 

8 means a monthly insurance benefit under section 

9 202 or 223, other than a child’s insurance benefit 

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

11 age 18 (or who is a full-time elementary or sec12 ondary school student (as defined in section 

13 202(d)(7)(A)) and has not attained age 19). 

14 ‘‘ESTABLISHMENT OF PROGRAM

15 ‘‘SEC. 252. There is hereby established a Social Secu16 rity Guarantee Program. The Program shall be governed 

17 by regulations which shall be prescribed by the Social Se18 curity Guarantee Board. The Board, the Executive Direc19 tor appointed by the Board, the Commissioner, and the 

20 Secretary of the Treasury shall consult with each other 

21 in issuing regulations relating to their respective duties 

22 under this part. Such regulations shall provide for appro23 priate exchange of information to assist them in per24 forming their duties under this part. 
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1 ‘‘SOCIAL SECURITY GUARANTEE ACCOUNTS

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

3 Under regulations which shall be prescribed by the Board 

4 in consultation with the Secretary of the Treasury—

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

6 guarantee account for each covered individual (for 

7 whom a Social Security guarantee account has not 

8 otherwise been established under this part) upon ini9 tial receipt of a transfer under subsection (c) with 

10 respect to such covered individual, and 

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

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

13 Security guarantee account for the divorced spouse 

14 referred to in such paragraph (2). 

15 ‘‘(b) ELECTION OF STATUS AS COVERED INDI16 VIDUAL.—

17 ‘‘(1) IN GENERAL.—Any individual who has at18 tained age 18 and has been assigned a social secu19 rity account number under section 205(c) may elect 

20 to be a covered individual under this part upon filing 

21 an election under this subsection in a form and man22 ner which shall be prescribed in regulations of the 

23 Commissioner of Social Security, in consultation 

24 with the Board. Such regulations shall provide for 

25 the filing of such elections during regularly sched-
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1 uled intervals. Such an election shall be irrevocable 

2 and shall be effective with respect to wages earned, 

3 and self-employment income derived, on or after 

4 January 1 following the date of such filing. 

5 ‘‘(2) REQUIREMENTS.—An election by an indi6 vidual under this subsection is an election, filed with 

7 the Commissioner, in such form and manner as shall 

8 be prescribed in regulations of the Commissioner, 

9 consisting of a written and signed declaration of 

10 such individual’s intention to become a covered indi11 vidual under this part. The Commissioner shall pro12 vide for immediate notification to the Board and the 

13 Executive Director of such election. 

14 ‘‘(c) TRANSFERS OF SOCIAL SECURITY GUARANTEE

15 REFUNDABLE CREDITS.—

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

17 shall be prescribed by the Secretary of the Treasury 

18 in consultation with the Board, as soon as prac19 ticable during the 1-year period after each calendar 

20 year, while minimizing capital market distortions, 

21 the Secretary of the Treasury shall transfer to each 

22 covered individual’s Social Security guarantee ac23 count, from amounts otherwise available in the gen24 eral fund of the Treasury, an amount equal to the 

25 sum of—
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1 ‘‘(A) the amount payable to the covered in2 dividual’s Social Security guarantee account 

3 under section 3511 of the Internal Revenue 

4 Code of 1986 (relating to the Social Security 

5 guarantee refundable credit) with respect to 

6 wages received during such calendar year by the 

7 covered individual and self-employment income 

8 derived by the covered individual during the 

9 such individual’s taxable year ending in such 

10 calendar year, and 

11 ‘‘(B) deemed interest on the amount deter12 mined under subparagraph (A) for the period 

13 commencing with July 1 of such calendar year 

14 and ending with the date of the transfer, com15 puted at a rate equal to the average market 

16 yield (computed by the Managing Trustee on 

17 the basis of market quotations as of the end of 

18 the calendar month next preceding the date of 

19 the transfer) on all marketable interest-bearing 

20 obligations of the United States then forming a 

21 part of the public debt which are not due or 

22 callable earlier than 4 years after the end of 

23 such calendar month (rounding any average 

24 market yield computed under this paragraph 
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which is not a multiple of 1 1 ⁄8 of 1 percent to the 

nearest multiple of 1 2 ⁄8 of 1 percent). 

3 ‘‘(2) TRANSITION RULE.—Notwithstanding 

4 paragraph (1), amounts payable to Social Security 

5 guarantee accounts under paragraph (1) with re6 spect to the first calendar year described in para7 graph (1)(A) ending after the date of the enactment 

8 of the Social Security Guarantee Plus Act of 2003 

9 shall be paid by the Secretary of the Treasury as 

10 soon as practicable after such Secretary determines 

11 that the administrative mechanisms necessary to 

12 provide for accurate and efficient payment of such 

13 amounts have been established. 

14 ‘‘(3) AVAILABILITY OF TRUST FUNDS FOR

15 TRANSFERS.—

16 ‘‘(A) RECOMMENDATIONS BY MANAGING

17 TRUSTEE.—As determined appropriate from 

18 time to time by the Managing Trustee of the 

19 Federal Old-Age and Survivors Insurance Trust 

20 Fund and the Federal Disability Insurance 

21 Trust Fund, the Managing Trustee shall trans22 mit to each House of the Congress the Man23 aging Trustee’s recommendation that amounts 

24 to be transferred to Social Security guarantee 

25 accounts under paragraph (1) be transferred 
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1 from such Trust Funds in lieu of the general 

2 fund. Any such recommendation shall take ef3 fect only upon ratification thereof by an Act of 

4 Congress. 

5 ‘‘(B) DETERMINATIONS OF AVAIL6 ABILITY.—The Managing Trustee may not de7 termine that any such transfer from the Trust 

8 Funds is appropriate at any time unless the 

9 Managing Trustee has determined that 

10 amounts in such Trust Fund are available at 

11 such time for such transfers. For purposes of 

12 this subparagraph, amounts in either of the 

13 Trust Funds shall be considered to be available 

14 for such transfers at any time only to the ex15 tent that the balance in such Trust Fund at 

16 such time exceeds the best estimate of the Man17 aging Trustee of the projected withdrawals oth18 erwise required from such Trust Fund during 

19 the next following 1-year period. 

20 ‘‘(C) ASSUMPTIONS.—In making rec21 ommendations under this paragraph, the Man22 aging Trustee shall utilize the intermediate ac23 tuarial assumptions utilized by the Board of 

24 Trustees of the Trust Funds for its most recent 

25 annual report issued under section 201(c).
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1 ‘‘(D) REPORT ON USE OF SOCIAL SECU2 RITY SURPLUSES.—The Managing Trustee shall 

3 annually prepare a report consisting of—

4 ‘‘(i) the Managing Trustee’s deter5 mination of the extent to which amounts 

6 have been appropriated from the Trust 

7 Funds under this paragraph in connection 

8 with Social Security guarantee refundable 

9 credits under section 3511 of such Code, 

10 and 

11 ‘‘(ii) the Managing Trustee’s rec12 ommendations, based on the Managing 

13 Trustee’s review of the financial status of 

14 such Trust Funds, with respect to whether 

15 or to what extent that portion of the taxes 

16 under chapters 2 and 21 of the Internal 

17 Revenue Code of 1986 to which surpluses 

18 in the Trust Funds may be attributed 

19 should be reduced or should be maintained 

20 so as to allow for continued appropriations 

21 from the Trust Funds under this para22 graph in connection with such credits. 

23 The Board of Trustees of the Trust Funds 

24 shall include such report in the Board’s annual 
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1 report to the President and the Congress under 

2 section 201(c)(2). 

3 ‘‘(d) REQUIREMENTS FOR ACCOUNTS.—The fol4 lowing requirements shall be met with respect to each So5 cial Security guarantee account: 

6 ‘‘(1) Amounts transferred to the account con7 sist solely of amounts transferred pursuant to this 

8 part. 

9 ‘‘(2) In accordance with section 254, the ac10 count assets are held for purposes of investment 

11 under the Program by a certified account manager 

12 designated by (or on behalf of) the covered indi13 vidual for whom such account is established under 

14 the Program. 

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

16 solely in accordance with section 256. 

17 ‘‘(e) ACCOUNTING OF RECEIPTS AND DISBURSE18 MENTS UNDER THE PROGRAM.—The Board shall provide 

19 by regulation for an accounting system for purposes of 

20 this part—

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

22 Executive Director, 

23 ‘‘(2) which shall provide for crediting of earn24 ings from, and debiting of losses and administrative 
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1 expenses from, amounts held in Social Security 

2 guarantee accounts, and 

3 ‘‘(3) under which receipts and disbursements 

4 under the Program which are attributable to each 

5 account are separately accounted for with respect to 

6 such account. 

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

8 The Board, in consultation with the Commissioner, shall 

9 provide by regulation rules similar to paragraphs (4) 

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

11 with respect to the correction of erroneous or omitted 

12 transfers of amounts to Social Security guarantee ac13 counts. 

14 ‘‘INVESTMENT OF ACCOUNTS

15 ‘‘SEC. 254. (a) DESIGNATION OF CERTIFIED AC16 COUNT MANAGERS.—Under the Program, a certified ac17 count manager shall be designated by or on behalf of each 

18 covered individual to hold for investment under this sec19 tion such individual’s Social Security guarantee account 

20 assets. 

21 ‘‘(b) PROCEDURE FOR DESIGNATION.—Any designa22 tion made under subsection (a) shall be made in such form 

23 and manner as shall be prescribed in regulations pre24 scribed by the Board, following the initiation of an edu25 cational campaign as provided in section 257(a)(3)(C). 

26 Such regulations shall provide for annual selection periods 
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1 during which covered individuals may make designations 

2 pursuant to subsection (a). Designations made pursuant 

3 to subsection (a) during any such period shall be irrev4 ocable for the one-year period following such period, ex5 cept that such regulations shall provide for such interim 

6 designations as may be necessitated by the decertification 

7 of a certified account manager. Such regulations shall pro8 vide for such designations made by the Board on behalf 

9 of a covered individual in any case in which a timely des10 ignation is not made by the covered individual. 

11 ‘‘(c) INVESTMENT GUIDELINES.—

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

13 of amounts held in each Social Security guarantee 

14 account, the Board shall provide by regulation for 3 

15 investment options. Such options shall consist of the 

16 60/40 investment option, the 65/35 investment op17 tion, and the 70/30 investment option. 

18 ‘‘(2) ALTERNATIVE INVESTMENT OPTIONS.—

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

20 Under the 60/40 investment option, amounts 

21 are held in the Social Security guarantee ac22 count so as to ensure, to the maximum extent 

23 practicable, that, of the total balance credited 

24 to the account and available for investment 

25 (after allowing for administrative expenses)—
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1 ‘‘(i) 60 percent is invested in common 

2 stock as provided in paragraph (4), and 

3 ‘‘(ii) 40 percent is invested in fixed in4 come securities as provided in paragraph 

5 (5). 

6 For such purpose, certified account managers 

7 shall offer each account holder a choice of one 

8 or more portfolios of each such type of invest9 ment. Except as provided in an election under 

10 paragraph (3), amounts held in a Social Secu11 rity guarantee account shall be invested under 

12 the 60/40 investment option. 

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

14 Under the 65/35 investment option, amounts 

15 are held in the Social Security guarantee ac16 count so as to ensure, to the maximum extent 

17 practicable, that, of the total balance credited 

18 to the account and available for investment 

19 (after allowing for administrative expenses)—

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

21 stock as provided in paragraph (4), and 

22 ‘‘(ii) 35 percent is invested in fixed in23 come securities as provided in paragraph 

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

6 Under the 70/30 investment option, amounts 

7 are held in the Social Security guarantee ac8 count so as to ensure, to the maximum extent 

9 practicable, that, of the total balance credited 

10 to the account and available for investment 

11 (after allowing for administrative expenses)—

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

13 stock as provided in paragraph (4), and 

14 ‘‘(ii) 30 percent is invested in fixed in15 come securities as provided in paragraph 

16 (5). 

17 For such purpose, certified account managers 

18 shall offer each account holder a choice of one 

19 or more portfolios of each such type of invest20 ment. 

21 ‘‘(3) ELECTIONS AMONG INVESTMENT OP22 TIONS.—Pursuant to any individual’s written elec23 tion filed in accordance with regulations of the 

24 Board during annual open seasons specified in such 

25 regulations, the certified account manager of the in-
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1 dividual’s Social Security guarantee account shall, in 

2 accordance with such regulations, provide for dis3 investment and reinvestment of amounts held in the 

4 account under any of the investment options de5 scribed in paragraph (2) so as to provide for invest6 ment of amounts held in the account in any of the 

7 other such investment options specified in such elec8 tion. 

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

10 The Board shall establish by regulation standards 

11 which must be met by any portfolio of common stock 

12 selected for investment of account assets as provided 

13 in subparagraph (A)(i), (B)(i), or (C)(i) of para14 graph (2), consistent with the requirement that such 

15 portfolio replicate the performance of one or more 

16 common stock indices comprised of common stock 

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

18 a reasonably broad representation of publicly held 

19 companies whose shares are traded on the equity 

20 markets. 

21 ‘‘(5) FIXED INCOME SECURITIES REQUIRE22 MENTS.—The Board shall establish by regulation 

23 standards which must be met by fixed income securi24 ties selected for investment of account assets as pro25 vided in subparagraph (A)(ii), (B)(ii), or (C)(ii) of 
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1 paragraph (2). Amounts invested in fixed income se2 curities by a certified account manager under the 

3 Program shall be held in a portfolio which shall con4 sist of a diverse range of high-grade corporate 

5 bonds. 

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

7 shall specify by regulation standards governing invest8 ments under this section to ensure prudent diversification 

9 among the investments under the Program. 

10 ‘‘DETERMINATION OF MONTHLY ANNUITY AMOUNTS AND

11 USE IN DETERMINING ACCOUNT DISTRIBUTION SUP12 PLEMENTS

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

14 ‘‘(1) IN GENERAL.—In accordance with regula15 tions of the Board meeting the requirements of this 

16 section, the Commissioner shall determine a monthly 

17 annuity amount in connection with such covered in18 dividual’s Social Security guarantee account, for 

19 each month—

20 ‘‘(A) which commences after such indi21 vidual becomes a covered individual, 

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

23 to a covered monthly insurance benefit under 

24 part A, and 

25 ‘‘(C) which ends prior to or with—
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1 ‘‘(i) the date of the covered individ2 ual’s death, or 

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

4 the covered individual’s spouse (if any), ex5 cept as provided in regulations prescribed 

6 by the Board pursuant to paragraph (5). 

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

8 shall be equal to the amount which would be the ini9 tial monthly payment under—

10 ‘‘(A) if the covered individual is not mar11 ried on such date, an immediate single life an12 nuity for the covered individual, or 

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

14 on such date, an immediate annuity for the 

15 joint lives of the covered individual and the cov16 ered individual’s spouse, together with a sur17 vivor annuity to the one of them who survives 

18 the other of them for the life of the survivor 

payable in monthly installments equal to 662 19 ⁄3

20 percent of the monthly payment of the annuity 

21 that would be payable if both spouses remained 

22 alive, 

23 purchased with the balance of the account (deter24 mined after payment of the initial lump sum pay25 ment under section 256(c)). 
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1 ‘‘(3) ASSUMPTIONS.—The assumptions under 

2 this subsection include the probability of survival for 

3 persons born in the same year as the covered indi4 vidual (and the spouse, in the case of a joint annu5 ity), future projection of investment earnings based 

6 on investment of the account assets in the 65/35 in7 vestment option under section 254(c)(2)(B), and ex8 pected price inflation. Determinations under this 

9 subsection shall be made in accordance with regula10 tions which shall be prescribed by the Board, other11 wise using generally accepted actuarial assumptions, 

12 except that no differentiation shall be made in such 

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

14 or other characteristics other than age. 

15 ‘‘(4) ADJUSTMENTS BASED ON ADDITIONAL SO16 CIAL SECURITY GUARANTEE REFUNDABLE CRED17 ITS.—The Board shall annually augment the month18 ly annuity amount in connection with each Social 

19 Security guarantee account by an additional monthly 

20 annuity amount, determined under this subsection 

21 on the basis of any additional transfer to the ac22 count of a Social Security guarantee refundable 

23 credit for the year (plus deemed interest) under sec24 tion 253(c), after subtracting the amount of the an-
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1 nual lump sum payment made from such account 

2 under section 256(c)(2). 

3 ‘‘(5) TREATMENT OF CHANGES IN MARITAL

4 STATUS AND BENEFIT ELIGIBILITY AFTER COM5 MENCEMENT OF ENTITLEMENT TO BENEFITS.—The 

6 Board shall provide by regulation for recalculation 

7 or adjustment of the monthly annuity amount deter8 mined under this subsection in connection with any 

9 covered individual’s Social Security guarantee ac10 count so as to appropriately take into account any 

11 entry into marriage or divorce or changes in eligi12 bility for benefits. 

13 ‘‘(b) AMOUNT OF ACCOUNT DISTRIBUTION SUPPLE14 MENT.—The Board shall determine for each month the 

15 amount of the monthly account distribution supplement 

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

17 Security guarantee account and shall certify such amount 

18 to the Commissioner so as to allow inclusion of such sup19 plement in each covered monthly insurance benefit pay20 ment pursuant to section 202(z) or 223(j). The amount 

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

22 any) of—

23 ‘‘(1) the sum of—

24 ‘‘(A) the monthly annuity amount in con25 nection with such account, plus 
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1 ‘‘(B) in the case of a covered individual 

2 surviving a deceased spouse, a monthly amount 

3 which would be the monthly equivalent of the 

4 survivor annuity described in paragraph (2)(B) 

5 in connection with the Social Security guar6 antee account of the deceased spouse, over 

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

8 before applying sections 202(z) and 223(j) and be9 fore applying any reduction or deduction applicable 

10 under part A). 

11 ‘‘DISPOSITION OF ACCOUNT ASSETS

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

13 respect to covered individuals shall be distributed solely 

14 as provided in this section. 

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

16 FUNDS.—

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

18 schedule which shall be prescribed in regulations of 

19 the Board, each certified account manager holding 

20 account assets shall make account manager trans21 fers to the Secretary of the Treasury. Such Sec22 retary shall immediately credit each such transfer to 

23 the Federal Old-Age and Survivors Insurance Trust 

24 Fund or the Federal Disability Insurance Trust 

25 Fund, according to an appropriate distribution for26 mula which shall be prescribed in regulations of the 
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1 Executive Director. The Executive Director shall 

2 provide to the certified account manager timely in3 formation necessary to carry out such account man4 ager’s duties under this section. 

5 ‘‘(2) DETERMINATION OF AMOUNT OF ACCOUNT

6 MANAGER TRANSFER.—The amount of each account 

7 manager transfer due from a certified account man8 ager for any period shall be an amount equal to the 

9 sum of—

10 ‘‘(A) the aggregate monthly annuity 

11 amount or amounts determined under para12 graph (3) for the month or months ending dur13 ing such period in connection with the Social 

14 Security guarantee accounts under the manage15 ment of the certified account manager under 

16 the Program, and

17 ‘‘(B) the aggregate monthly account remit18 tance for such period described in paragraph 

19 (4) in connection with such accounts. 

20 ‘‘(3) AGGREGATE MONTHLY ANNUITY

21 AMOUNT.—The aggregate monthly annuity amount 

22 for any month in connection with the Social Security 

23 guarantee accounts under the management of any 

24 certified account manager under the Program is 

25 equal to the sum of all monthly annuity amounts in 
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1 connection with such accounts, determined under 

2 section 255. 

3 ‘‘(4) AGGREGATE MONTHLY ACCOUNT REMIT4 TANCE.—The aggregate monthly account remittance 

5 for any month in connection with the Social Security 

6 guarantee accounts under the management of any 

7 certified account manager under the Program is 

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

9 transferred during such month from the certified ac10 count manager to the Secretary of the Treasury for 

11 crediting to the Federal Old-Age and Survivors In12 surance Trust Fund or the Federal Disability Insur13 ance Trust Fund under subsection (e)(2) in connec14 tion with the deaths of covered individuals for whom 

15 such accounts were established under this part. 

16 ‘‘(5) WITHDRAWALS FROM ACCOUNT BALANCES

17 FOR PURPOSES OF ACCOUNT MANAGER TRANS18 FERS.—In advance of each account manager trans19 fer required under this subsection to be made by a 

20 certified account manager managing one or more 

21 Social Security guarantee accounts under the Pro22 gram, the Commissioner shall certify to the Execu23 tive Director and to such certified account manager 

24 the monthly annuity amount in connection with each 

25 such account for each month during the period for
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1 which such transfer is to be made. At the time of 

2 such transfer, the certified account manager may 

3 withdraw from the assets of each such account the 

4 monthly annuity amount in connection with such ac5 count taken into account in determining each of the 

6 aggregate monthly annuity amounts included in the 

7 amount of the account manager transfer. Such with8 drawn assets shall be available to the certified ac9 count manager solely for purposes of making such 

10 account manager transfer. 

11 ‘‘(c) LUMP SUM PAYMENTS.—Upon initial entitle12 ment of a covered individual to monthly insurance benefits 

13 under part A, such individual shall be entitled to—

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

15 individual’s Social Security guarantee account, equal 

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

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

18 each subsequent transfer to such account (pursuant 

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

20 guarantee refundable credits for years beginning 

21 after commencement of such initial entitlement, pay22 able as soon as practicable after the transfer, equal 

23 to 5 percent of the transferred amount (including 

24 deemed interest). 
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1 The Executive Director shall certify to the certified ac2 count manager managing such account the amount of 

3 each lump sum payment, and upon receipt of such certifi4 cation, the certified account manager shall transfer such 

5 certified amount to the Secretary of the Treasury for sub6 sequent transfer to the covered individual. Such certifi7 cation shall also include such information as may be nec8 essary to make each lump sum payment in a timely man9 ner. 

10 ‘‘(d) SPLITTING OF ACCOUNT ASSETS UPON DI11 VORCE AFTER 1 YEAR OF MARRIAGE.—Upon the divorce 

12 of a covered individual for whom a Social Security guar13 antee account has been established under this part, from 

14 a spouse to whom the covered individual had been married 

15 for at least 1 year—

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

17 been established under this part for the divorced 

18 spouse of the covered individual, the Board shall di19 rect the appropriate certified account manager to 

20 transfer—

21 ‘‘(A) from the Social Security guarantee 

22 account with the greater amount of accruals 

23 (including earnings) during the time of the 

24 marriage, 

25 ‘‘(B) to the other such account, 
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•HR 75 IH 

1 an amount equal to one-half of the difference be2 tween the amounts of such accruals in such ac3 counts, or 

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

5 not been established for the divorced spouse, the 

6 Board shall establish a Social Security guarantee ac7 count for the divorced spouse, and shall direct the 

8 appropriate certified account manager to transfer—

9 ‘‘(A) from the Social Security guarantee 

10 account of the covered individual, 

11 ‘‘(B) to the Social Security guarantee ac12 count of the divorced spouse, 

13 an amount equal to one-half of the amount of accru14 als (including earnings) during the time of the mar15 riage in the Social Security guarantee account of the 

16 covered individual. 

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

18 the Executive Director shall certify to the appropriate cer19 tified account manager the information necessary to make 

20 such transfer. 

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

22 THE COVERED INDIVIDUAL.—

23 ‘‘(1) TRANSFERS UPON DEATH BEFORE ENTI24 TLEMENT.—Upon the death of a covered individual 

25 before the individual has become entitled to covered 
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1 monthly insurance benefits, the Executive Director 

2 shall close out the covered individual’s Social Secu3 rity guarantee account. In closing out the account, 

4 the Executive Director shall certify to the certified 

5 account manager the amount of the account assets, 

6 and, upon receipt of such certification, such certified 

7 account manager shall transfer from such account 

8 an amount equal to such certified amount to the 

9 Secretary of the Treasury for subsequent transfer to 

10 the estate of such covered individual. 

11 ‘‘(2) TRANSFERS UPON DEATH AFTER ENTI12 TLEMENT.—

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

14 the covered individual dies after the individual 

15 has become entitled to covered monthly insur16 ance benefits, the Executive Director shall, ex17 cept as provided in subparagraph (B), close out 

18 the covered individual’s Social Security guar19 antee account upon such covered individual’s 

20 death. 

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

22 SURVIVING SPOUSE.—If the covered individual 

23 was married at the time of the covered individ24 ual’s death, the Executive Director shall close 

25 out the covered individual’s Social Security 
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•HR 75 IH 

1 guarantee account with the close, upon the sur2 viving spouse’s death, of the period to which the 

3 survivor annuity portion of the monthly annuity 

4 amount in connection with such account is ap5 plicable under section 255(a). The Board shall 

6 from time to time propose to the Congress rec7 ommendations for legislative changes necessary 

8 to provide for closing of the account in a man9 ner and time consistent with regulations pre10 scribed pursuant to section 255(a)(5). 

11 ‘‘(C) CERTIFICATION AND TRANSFER TO

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

13 Executive Director shall certify to the certified 

14 account manager holding the covered individ15 ual’s account assets the amount of the account 

16 assets, and such certified account manager shall 

17 transfer an amount equal to such certified 

18 amount to the Secretary of the Treasury for 

19 crediting to the Federal Old-Age and Survivors 

20 Insurance Trust Fund or the Federal Disability 

21 Insurance Trust Fund, as determined appro22 priate under regulations of the Board. 

23 ‘‘(f) CLOSING OF ACCOUNT OF COVERED INDIVID24 UALS WHO ARE INELIGIBLE FOR BENEFITS UPON AT25 TAINING RETIREMENT AGE.—In any case in which, as of 
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•HR 75 IH 

1 the date on which a covered individual attains retirement 

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

3 eligible for a covered monthly insurance benefit, the Com4 missioner shall so certify to the Executive Director and, 

5 upon receipt of such certification, the Executive Director 

6 shall close out the covered individual’s Social Security 

7 guarantee account. In closing out the account, the Execu8 tive Director shall certify to the certified account manager 

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

10 certification from the Executive Director, the account 

11 manager shall transfer from such account an amount 

12 equal to such certified amount to the Secretary of the 

13 Treasury for subsequent transfer to the covered indi14 vidual. 

15 ‘‘(g) ADMINISTRATIVE EXPENSES.—

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

17 shall be prescribed by the Board, account assets are 

18 available for payment of the reasonable administra19 tive costs of the Program (including reasonable ad20 ministration fees charged by certified account man21 agers under the Program), but in no event to exceed 

22 25 basis points per year of the assets under manage23 ment. 

24 ‘‘(2) TEMPORARY AUTHORIZATION OF APPRO25 PRIATIONS FOR STARTUP ADMINISTRATIVE COSTS.—
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1 For any such administrative costs that remain after 

2 applying paragraph (1) for each of the first five fis3 cal years that end after the date of the enactment 

4 of this part, there are authorized to be appropriated 

5 such sums as may be necessary for each of such fis6 cal years. 

7 ‘‘ADMINISTRATION OF THE PROGRAM

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

9 ‘‘(1) ESTABLISHMENT AND DUTIES OF THE SO10 CIAL SECURITY GUARANTEE BOARD.—

11 ‘‘(A) ESTABLISHMENT.—There is estab12 lished in the Social Security Administration a 

13 Social Security Guarantee Board. 

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

15 composed of 6 members appointed by the Board 

16 of Trustees of the Federal Old-Age and Sur17 vivors Insurance Trust Fund and the Federal 

18 Disability Insurance Trust Fund. One member 

19 shall serve as Chairman, as designated by the 

20 Board of Trustees. Members of the Board shall 

21 have substantial experience, training, and ex22 pertise in the area of pension benefits, finance, 

23 investment, or insurance. 

24 ‘‘(C) TERMS.—

25 ‘‘(i) IN GENERAL.—A member of the 

26 Board shall be appointed for a term of 9 
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1 years, subject only to removal by the 

2 Board of Trustees for cause, except that of 

3 the members first appointed—

4 ‘‘(I) two shall be appointed for a 

5 term of 3 years; 

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

7 term of 6 years; and 

8 ‘‘(III) two shall be appointed for 

9 a term of 9 years. 

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

11 Board shall be filled in the manner in 

12 which the original appointment was made 

13 and shall be subject to any conditions 

14 which applied with respect to the original 

15 appointment. An individual chosen to fill a 

16 vacancy shall be appointed for the unex17 pired term of the member replaced. The 

18 term of any member shall not expire before 

19 the date on which the member’s successor 

20 takes office. 

21 ‘‘(D) POWERS AND DUTIES OF THE

22 BOARD.—

23 ‘‘(i) IN GENERAL.—The Board shall 

24 have powers and duties solely as provided 

25 in this part. The Board shall prescribe by 
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•HR 75 IH 

1 regulation the terms of the Social Security 

2 Guarantee Program established under this 

3 part, including policies for investment 

4 under the Program of account assets, and 

5 policies for the certification and decerti6 fication of account managers under the 

7 Program, which shall include consideration 

8 of the appropriateness of the marketing 

9 materials and plans of such person. 

10 ‘‘(ii) BUDGETARY REQUIREMENTS.—

11 The Board shall prepare and submit to the 

12 President and to the appropriate commit13 tees of Congress an annual budget of the 

14 expenses and other items relating to the 

15 Board which shall be included as a sepa16 rate item in the budget required to be 

17 transmitted to the Congress under section 

18 1105 of title 31, United States Code. The 

19 Board shall provide for low administrative 

20 costs such that, to the extent practicable, 

21 overall administrative costs of the Program 

22 do not exceed 25 basis points in relation to 

23 assets under management under the Pro24 gram. 
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1 ‘‘(E) ADDITIONAL AUTHORITIES OF THE

2 BOARD.—The Board may—

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

4 ‘‘(ii) establish policies with which the 

5 Commissioner shall comply under this 

6 part; and 

7 ‘‘(iii) appoint and remove the Execu8 tive Director, as provided in paragraph (2). 

9 ‘‘(F) INDEPENDENCE OF CERTIFIED AC10 COUNT MANAGERS.—The policies of the Board 

11 may not require a certified account manager to 

12 invest or to cause to be invested any account 

13 assets in a specific asset or to dispose of or 

14 cause to be disposed of any specific asset so 

15 held. 

16 ‘‘(G) MEETINGS OF THE BOARD.—The 

17 Board shall meet at the call of the Chairman or 

18 upon the request of a quorum of the Board. 

19 The Board shall perform the functions and ex20 ercise the powers of the Board on a majority 

21 vote of a quorum of the Board. Four members 

22 of the Board shall constitute a quorum for the 

23 transaction of business. 

24 ‘‘(H) COMPENSATION OF BOARD MEM25 BERS.—
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1 ‘‘(i) IN GENERAL.—Each member of 

2 the Board who is not an officer or em3 ployee of the Federal Government shall be 

4 compensated at the daily rate of basic pay 

5 for level I of the Executive Schedule for 

6 each day during which such member is en7 gaged in performing a function of the 

8 Board. Any member who is such an officer 

9 or employee shall not suffer any loss of pay 

10 or deduction from annual leave on the 

11 basis of any time used by such member in 

12 performing such a function. 

13 ‘‘(ii) TRAVEL, PER DIEM, AND EX14 PENSES.—A member of the Board shall be 

15 paid travel, per diem, and other necessary 

16 expenses under subchapter I of chapter 57 

17 of title 5, United States Code, while trav18 eling away from such member’s home or 

19 regular place of business in the perform20 ance of the duties of the Board. 

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

22 OF RESPONSIBILITIES.—The members of the 

23 Board shall discharge their responsibilities sole24 ly in the interest of covered individuals and the 

25 Program. 
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•HR 75 IH 

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

2 submit an annual report to the President, to 

3 each House of the Congress, and to the Board 

4 of Trustees of the Federal Old-Age and Sur5 vivors Insurance Trust Fund and the Federal 

6 Disability Insurance Trust Fund regarding the 

7 financial and operating condition of the Pro8 gram. 

9 ‘‘(K) PUBLIC ACCOUNTANT.—

10 ‘‘(i) DEFINITION.—For purposes of 

11 this subparagraph, the term ‘qualified pub12 lic accountant’ shall have the same mean13 ing as provided in section 103(a)(3)(D) of 

14 the Employee Retirement Income Security 

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

16 ‘‘(ii) ENGAGEMENT.—The Executive 

17 Director, in consultation with the Board, 

18 shall annually engage, on behalf of all indi19 viduals for whom a Social Security guar20 antee account is established under this 

21 part, an independent qualified public ac22 countant, who shall conduct an examina23 tion of all records maintained in the ad24 ministration of this part that the public ac25 countant considers necessary.
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•HR 75 IH 

1 ‘‘(iii) DUTIES.—The public account2 ant conducting an examination under 

3 clause (ii) shall determine whether the 

4 records referred to in such clause have 

5 been maintained in conformity with gen6 erally accepted accounting principles. The 

7 public accountant shall transmit to the 

8 Board a report on his examination. 

9 ‘‘(iv) RELIANCE ON CERTIFIED ACTU10 ARIAL MATTERS.—In making a determina11 tion under clause (iii), a public accountant 

12 may rely on the correctness of any actu13 arial matter certified by an enrolled actu14 ary if the public accountant states his reli15 ance in the report transmitted to the 

16 Board under such clause. 

17 ‘‘(2) EXECUTIVE DIRECTOR.—

18 ‘‘(A) APPOINTMENT AND REMOVAL.—The 

19 Board shall appoint, without regard to the pro20 visions of law governing appointments in the 

21 competitive service, an Executive Director by 

22 action agreed to by a majority of the members 

23 of the Board. The Executive Director shall have 

24 substantial experience, training, and expertise 

25 in the management of financial investments and 
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•HR 75 IH 

1 pension benefit plans. The Board may, with the 

2 concurrence of 4 members of the Board, remove 

3 the Executive Director from office for good 

4 cause shown. 

5 ‘‘(B) POWERS AND DUTIES OF EXECUTIVE

6 DIRECTOR.—The Executive Director shall—

7 ‘‘(i) carry out the policies established 

8 by the Board, 

9 ‘‘(ii) administer the provisions of this 

10 part in accordance with the policies of the 

11 Board, 

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

13 prescribe such regulations (other than reg14 ulations relating to fiduciary responsibil15 ities) as may be necessary for the adminis16 tration of this part, and 

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

18 Board upon request of the Board. 

19 ‘‘(C) ADMINISTRATIVE AUTHORITIES OF

20 EXECUTIVE DIRECTOR.—The Executive Direc21 tor may—

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

23 necessary to carry out the provisions of 

24 this part, 
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•HR 75 IH 

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

2 procure the services of experts and consult3 ants under section 3109 of title 5, United 

4 States Code, 

5 ‘‘(iii) secure directly from any agency 

6 or instrumentality of the Federal Govern7 ment any information which, in the judg8 ment of the Executive Director, is nec9 essary to carry out the provisions of this 

10 part and the policies of the Board, and 

11 which shall be provided by such agency or 

12 instrumentality upon the request of the 

13 Executive Director, 

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

15 and travel expenses of individuals ap16 pointed under clauses (i), (ii), and (v) of 

17 this subparagraph, subject to such limits 

18 as may be established by the Board, 

19 ‘‘(v) accept and use the services of in20 dividuals employed intermittently in the 

21 Government service and reimburse such in22 dividuals for travel expenses, as authorized 

23 by section 5703 of title 5, United States 

24 Code, including per diem as authorized by 

25 section 5702 of such title, and 
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•HR 75 IH 

1 ‘‘(vi) except as otherwise expressly 

2 prohibited by law or the policies of the 

3 Board, delegate any of the Executive Di4 rector’s functions to such employees under 

5 the Board as the Executive Director may 

6 designate and authorize such successive re7 delegations of such functions to such em8 ployees under the Board as the Executive 

9 Director may consider to be necessary or 

10 appropriate. 

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

12 SECURITY.—The Commissioner shall—

13 ‘‘(A) prescribe such regulations (supple14 mentary to and consistent with the regulations 

15 prescribed by the Board and the Executive Di16 rector) as may be necessary for carrying out the 

17 duties of the Commissioner under this part, 

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

19 provide information to, the Board upon request 

20 of the Board regarding matters relating to the 

21 Social Security Guarantee Program, and 

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

23 utilizing available Federal agencies and re24 sources, develop a campaign to educate workers 

25 about the Program. 
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•HR 75 IH 

1 ‘‘(b) CERTIFICATION AND OVERSIGHT OF ACCOUNT

2 MANAGERS.—

3 ‘‘(1) CERTIFICATION BY THE BOARD.—

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

5 qualified professional asset manager (as defined 

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

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

8 and manner as shall be provided by the Board 

9 by regulation) for certification under this sub10 section as a certified account manager. In mak11 ing certification decisions, the Board shall con12 sider the applicant’s general character and fit13 ness, financial history and future earnings pros14 pects, and ability to serve covered individuals 

15 under the Program, and such other criteria as 

16 the Board deems necessary to carry out this 

17 part. Certification of any person under this sub18 section shall be contingent upon entry into a 

19 contractual arrangement between the Board 

20 and such person. 

21 ‘‘(B) NONDELEGATION REQUIREMENT.—

22 The authority of the Board to make any deter23 mination to deny any application under this 

24 subsection may not be delegated by the Board. 
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•HR 75 IH 

1 ‘‘(2) OVERSIGHT OF CERTIFIED ACCOUNT MAN2 AGERS.—

3 ‘‘(A) ROLE OF REGULATORY AGENCIES.—

4 The Board may enter into cooperative arrange5 ments with Federal and State regulatory agen6 cies identified by the Board as having jurisdic7 tion over persons eligible for certification under 

8 this subsection so as to ensure that the provi9 sions of this part are enforced with respect to 

10 certified account managers in a manner con11 sistent with and supportive of the requirements 

12 of other provisions of Federal law applicable to 

13 them. Such Federal regulatory agencies shall 

14 cooperate with the Board to the extent that the 

15 Board determines that such cooperation is nec16 essary and appropriate to ensure that the provi17 sions of this part are effectively implemented. 

18 ‘‘(B) ACCESS TO RECORDS.—The Board 

19 may from time to time require any certified ac20 count manager to file such reports as the Board 

21 may specify by regulation as necessary for the 

22 administration of this part. In prescribing such 

23 regulations, the Board shall minimize the regu24 latory burden imposed upon certified account 

25 managers while taking into account the benefit
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•HR 75 IH 

1 of the information to the Board in carrying out 

2 its functions under this part. 

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

4 Board shall provide, in the contractual arrangements 

5 entered into under this subsection with each certified 

6 account manager, for revocation of such person’s 

7 status as a certified account manager upon deter8 mination by the Board of such person’s failure to 

9 comply with the requirements of such contractual ar10 rangements. Such arrangements shall include provi11 sion for notice and opportunity for review of any 

12 such revocation. 

13 ‘‘(c) FIDUCIARY RESPONSIBILITIES.—

14 ‘‘(1) IN GENERAL.—Rules similar to the provi15 sions of section 8477 of title 5, United States Code 

16 (relating to fiduciary responsibilities; liability and 

17 penalties) shall apply in connection with account as18 sets, in accordance with regulations which shall be 

19 issued by the Board. The Board shall issue regula20 tions with respect to the investigative authority of 

21 appropriate Federal agencies in cases involving ac22 count assets. 

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

24 provision in an agreement or instrument which pur25 ports to relieve a fiduciary from responsibility or li-
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•HR 75 IH 

1 ability for any responsibility, obligation, or duty 

2 under this part shall be void. 

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

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

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

6 action in any district court of the United States within 

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

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

9 to the amount in controversy, for appropriate relief to re10 dress the violation or enforce the provisions of this part, 

11 and process in such an action may be served in any dis12 trict. 

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

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

15 any provision of the law of any State or political subdivi16 sion thereof, or prevent a State or political subdivision 

17 thereof from enacting any provision of law with respect 

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

19 that such provision of State law is inconsistent with this 

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

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

22 701(b) of the Social Security Act (42 U.S.C. 901(b)) is 

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

24 title II, the Social Security Guarantee Program under part 

25 B of title II,’’. 
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1 (2) Section 702(a)(4) of the Social Security Act (42 

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

3 those of the Social Security Guarantee Board’’ after ‘‘Ad4 ministration’’, and by striking ‘‘thereof’’ and inserting ‘‘of 

5 the Administration in connection with the exercise of such 

6 powers and the discharge of such duties’’. 

7 SEC. 103. BENEFIT INCREASES. 

8 (a) OLD-AGE INSURANCE BENEFITS AND OTHER

9 BENEFITS UNDER SECTION 202.—Section 202 of the So10 cial Security Act (42 U.S.C. 402) is amended by adding 

11 at the end the following new subsection: 

12 ‘‘Account Distribution Supplements 

13 ‘‘(z) Each monthly insurance benefit under this sec14 tion (after application of any reduction or deduction appli15 cable under this section or under any other provision of 

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

17 distribution supplement determined for such benefit under 

18 section 255.’’. 

19 (b) DISABILITY INSURANCE BENEFITS.—Section 223 

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

21 end the following new subsection: 

22 ‘‘Account Distribution Supplements 

23 ‘‘(j) Each monthly insurance benefit under this sec24 tion (after application of any reduction or deduction appli25 cable under this part) shall be increased by the amount 
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1 of the account distribution supplement determined for 

2 such benefit under section 255.’’. 

3 SEC. 104. TAX TREATMENT. 

4 (a) TAX TREATMENT OF SOCIAL SECURITY GUAR5 ANTEE ACCOUNTS.—Section 7701 of the Internal Revenue 

6 Code of 1986 (relating to definitions) is amended by redes7 ignating subsection (n) as subsection (o) and by inserting 

8 after (m) the following new subsection: 

9 ‘‘(n) TAX TREATMENT OF SOCIAL SECURITY GUAR10 ANTEE ACCOUNTS.—All Social Security guarantee ac11 counts established under part B of title II of the Social 

12 Security Act shall be exempt from taxation under this 

13 title.’’. 

14 (b) BENEFITS TAXABLE AS SOCIAL SECURITY BENE15 FITS.—

16 (1) MONTHLY BENEFITS.—Section 86(d) of 

17 such Code (relating to definition of Social Security 

18 benefit) is amended to read as follows: 

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

20 title II of the Social Security Act (including an 

21 account distribution supplement referred to in 

22 section 202(z) and 223(j) of such Act), or’’. 

23 (2) SPECIAL RULES RELATING TO LUMP SUM

24 PAYMENT UNDER SECTION 256(c) OF SOCIAL SECU25 RITY ACT.—
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1 (A) Section 86(a) of such Code is amended 

2 by adding at the end the following new para3 graph: 

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

5 SUM PAYMENT UNDER SECTION 256(c) OF SOCIAL

6 SECURITY ACT.—

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

8 received under section 256(c) of the Social Se9 curity Act shall be includible in gross income in 

10 the amount provided by subparagraph (B). 

11 Such payment shall not be treated as a social 

12 security benefit for purposes of this section. 

13 ‘‘(B) AMOUNT INCLUDED IN INCOME.—

14 The portion of such lump sum payment that is 

15 includible in gross income shall be equal to an 

16 amount which bears the same ratio to the total 

17 amount of such payment as the portion of so18 cial security benefits included in gross income 

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

20 amount of such benefits.’’. 

21 (B) SPECIAL RULE RELATING TO NON22 RESIDENT ALIEN INDIVIDUALS.—Section 

23 871(a)(3) of such Code is amended by inserting 

24 ‘‘and of any lump sum payment received under 
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1 section 256(c) of the Social Security Act’’ after 

2 ‘‘section 86(d))’’. 

3 (C) TRANSFERS TO TRUST FUNDS.—

4 (i) IN GENERAL.—Paragraph (1) of 

5 section 121(e) of the Social Security 

6 Amendments of 1983 (Public Law 98–21; 

7 42 U.S.C. 401 note) is amended by adding 

8 at the end the following new subparagraph: 

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

10 payor fund amounts equivalent to the aggregate in11 crease in tax liabilities under chapter 1 of the Inter12 nal Revenue Code of 1986 which is attributable to 

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

14 of such Code to lump sum payments received under 

15 section 256(c) of the Social Security Act by individ16 uals entitled to benefits payable from such payor 

17 fund.’’. 

18 (ii) CONFORMING AMENDMENT.—Sec19 tion 121(e)(2) of such Act is amended by 

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

21 ‘‘paragraphs (1)(A) and (B)’’. 

22 (3) SPECIAL RULES RELATING TO DISTRIBU23 TION OF CLOSED ACCOUNT UNDER SECTION 256(f) 

24 OF SOCIAL SECURITY ACT.—Section 86(a) of such
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1 Code is amended by adding at the end the following 

2 new paragraph: 

3 ‘‘(4) EXTENSION OF PARAGRAPH (2)(B) TO DIS4 TRIBUTIONS OF CLOSED ACCOUNT UNDER SECTION

5 256(f) OF SOCIAL SECURITY ACT.—Notwithstanding 

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

7 any amount received pursuant to the closing of an 

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

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

10 and for such purposes the amount allocated to the 

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

12 (4) EFFECTIVE DATE.—The amendments made 

13 by this subsection shall apply to taxable years begin14 ning after the end of the calendar year in which this 

15 Act is enacted. 

16 (c) ESTATE TAX NOT TO APPLY TO ASSETS OF SO17 CIAL SECURITY GUARANTEE ACCOUNTS.—

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

19 chapter 11 of the Internal Revenue Code of 1986 

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

21 the end the following new section: 

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

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

24 the value of the taxable estate shall be determined by de25 ducting from the value of the gross estate an amount 
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1 equal to the value of the assets of a Social Security guar2 antee account transferred by the Secretary to the estate 

3 of the decedent under section 256 of the Social Security 

4 Act.’’. 

5 (2) CLERICAL AMENDMENT.—The table of sec6 tions for part IV of subchapter A of chapter 11 of 

7 such Code is amended by adding at the end the fol8 lowing new item:

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

9 (3) EFFECTIVE DATE.—The amendments made 

10 by this subsection shall apply to decedents dying in 

11 or after the calendar year in which this Act is en12 acted. 

13 SEC. 105. ANNUAL ACCOUNT STATEMENTS. 

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

15 1320b–13) is amended by adding at the end the following 

16 new subsection: 

17 ‘‘Performance of Social Security Guarantee Accounts 

18 ‘‘(d) Beginning not later than 1 year after the date 

19 of the first deposit is made to an eligible individual’s So20 cial Security guaranty account, each statement provided 

21 to such eligible individual under this section shall include 

22 information determined by the Social Security Guarantee 

23 Board as sufficient to fully inform such eligible individual 

24 annually of the balance, investment performance, and ad25 ministrative expenses of such account.’’.
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1 TITLE II—BENEFIT UPDATES 

2 SEC. 201. ELIMINATION OF THE SOCIAL SECURITY EARN3 INGS TEST FOR INDIVIDUALS WHO HAVE AT4 TAINED AGE 62. 

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

6 Act (42 U.S.C. 403) is amended—

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

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

9 ‘‘the age of 62’’; 

10 (2) in clause (B) of the last sentence of sub11 section (f)(1), by striking ‘‘retirement age (as de12 fined in section 216(l))’’ and inserting ‘‘the age of 

13 62’’; 

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

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

16 ‘‘the age of 62’’; 

17 (4) in subsection (h)(1)(A), by striking ‘‘retire18 ment age (as defined in section 216(l))’’ each place 

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

20 (5) in subsection (j)—

21 (A) in the heading, by striking ‘‘Retire22 ment Age’’ and inserting ‘‘Age 62’’; and 

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

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

25 62’’. 
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1 (b) CONFORMING AMENDMENTS ELIMINATING THE

2 SPECIAL EXEMPT AMOUNT FOR YEAR OF ATTAINING RE3 TIREMENT AGE.—

4 (1) UNIFORM EXEMPT AMOUNT.—Section 

5 203(f)(8)(A) of such Act (42 U.S.C. 403(f)(8)(A)) is 

6 amended by striking ‘‘the new exempt amounts (sep7 arately stated for individuals described in subpara8 graph (D) and for other individuals) which are to be 

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

10 which shall be applicable’’. 

11 (2) CONFORMING AMENDMENTS.—Section 

12 203(f)(8)(B) of such Act (42 U.S.C. 403(f)(8)(B)) 

13 is amended—

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

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

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

17 which is applicable for each month of a par18 ticular taxable year shall be whichever’’; 

19 (B) in clause (i), by striking ‘‘cor20 responding’’; 

21 (C) in clause (ii)—

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

23 that follows through ‘‘other individuals), 

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

25 multiplying the exempt amount which is in 
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1 effect with respect to months in the tax2 able year ending after 1993 and before 

3 1995, by’’; and 

4 (ii) by striking subclause (II) and in5 serting the following: 

6 ‘‘(II) the national average wage index 

7 (as so defined) for 1992,’’; and 

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

9 exempt amount’’ and inserting ‘‘the exempt 

10 amount’’. 

11 (3) REPEAL OF BASIS FOR COMPUTATION OF

12 SPECIAL EXEMPT AMOUNT.—Subparagraphs (D) 

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

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

15 (c) ADDITIONAL CONFORMING AMENDMENTS.—

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

17 amended—

18 (A) in subsection (b)(1)—

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

20 and inserting ‘‘(b) Deductions’’; 

21 (ii) by striking ‘‘and from any pay22 ment or payments to which any other per23 sons are entitled on the basis of such indi24 vidual’s wages and self-employment in25 come,’’; 
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1 (iii) by striking ‘‘until the total’’ and 

2 all that follows through ‘‘if for such 

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

4 the total of such deductions equals such in5 dividual’s benefit or benefits under section 

6 202 for any month, if for such month’’; 

7 (iv) by striking ‘‘total of benefits re8 ferred to in clauses (A) and (B)’’ and in9 serting ‘‘the total of such benefits’’; and 

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

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

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

13 (C) by striking subsection (d); 

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

15 amount of’’ and all that follows through ‘‘Not16 withstanding’’ and inserting the following: ‘‘The 

17 amount of an individual’s excess earnings (as 

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

19 months as follows: There shall be charged to 

20 the first month of such taxable year an amount 

21 of his excess earnings equal to the payment to 

22 which he is entitled for such month under sec23 tion 202 (or the total of his excess earnings if 

24 such excess earnings are less than such pay25 ment), and the balance, if any, of such excess
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1 earnings shall be charged to each succeeding 

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

3 of each such month, of the payment to which 

4 such individual is entitled for such month under 

5 section 202, until the total of such excess has 

6 been so charged. Notwithstanding’’; 

(E) in subsection (f)(3), by striking ‘‘331 7 ⁄3

8 percent’’ and all that follows through ‘‘other in9 dividual,’’ and inserting ‘‘50 percent of such in10 dividual’s earnings for such year in excess of 

11 the product of the exempt amount as deter12 mined under paragraph (8),’’; 

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

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

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

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

17 following: 

18 ‘‘(I) such individual’s benefits under sec19 tion 202 are reduced under subsection (a) of 

20 this section for any month in such taxable year, 

21 and 

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

23 person who also is entitled to benefits under 

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

25 section 202 on the basis of the same wages and 
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1 self-employment income and who does not live 

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

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

4 such Act (42 U.S.C. 423(d)(4)) is amended by strik5 ing ‘‘if section 102 of the Senior Citizens’ Right to 

6 Work Act of 1996 had not been enacted’’ and insert7 ing the following: ‘‘if the amendments to section 203 

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

9 Work Act of 1996 and by section 4 of the Social Se10 curity Guarantee Plus Act of 2003 had not been en11 acted’’. 

12 (d) EFFECTIVE DATE AND TRANSITIONAL RULE.—

13 (1) EFFECTIVE DATE.—The amendments and 

14 repeals made by this section shall apply with respect 

15 to taxable years ending after December 31, 2008. 

16 (2) TRANSITIONAL RULE.—Notwithstanding 

17 paragraph (8) of section 203(f) of the Social Secu18 rity Act (42 U.S.C. 403(f)(8)), the exempt amount 

19 which is applicable, for purposes of such section 

20 203(f), to an individual who is entitled to monthly 

21 insurance benefits under section 202 of such Act but 

22 who has not attained retirement age (as defined in 

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

24 taxable year involved shall be—
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1 (A) for each month of any taxable year 

2 ending after 2003 and before 2005, $1,250.00, 

3 (B) for each month of any taxable year 

4 ending after 2004 and before 2006, 

$1,666.662 5 ⁄3, 

6 (C) for each month of any taxable year 

7 ending after 2005 and before 2007, 

$2,083.331 8 ⁄3, 

9 (D) for each month of any taxable year 

10 ending after 2006 and before 2008, $2,500.00, 

11 and 

12 (E) for each month of any taxable year 

13 ending after 2007 and before 2009, 

$2,916.662 14 ⁄3.

15 SEC. 202. INCREASE IN WIDOW’S AND WIDOWER’S INSUR16 ANCE BENEFITS. 

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

18 202(e) of the Social Security Act (42 U.S.C. 402(e)) is 

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

21 ‘‘(10)(A) In any case in which the amount of a wid22 ow’s insurance benefit (as determined under the preceding 

23 paragraphs of this subsection) for the entitlement month 

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

25 minimum benefit amount for such month determined 
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1 under subparagraph (C), the amount of such benefit for 

2 such month and each succeeding month shall be increased 

3 to such minimum benefit amount (or the amount most re4 cently established in lieu thereof under section 215(i)). 

5 ‘‘(B) For purposes of this paragraph, the term ‘enti6 tlement month’ of a widow (or surviving divorced wife) 

7 means, in connection with her benefit under this sub8 section, the first month of her entitlement to such benefit. 

9 ‘‘(C) For purposes of subparagraph (A), the min10 imum benefit amount determined under this subparagraph 

11 for the entitlement month of the widow (or surviving di12 vorced wife) is an amount equal to the lesser of—

13 ‘‘(i) 75 percent of the sum of—

14 ‘‘(I) the imputed deceased individual’s ben15 efit for such month, as determined under sub16 paragraph (D) or (E) (as applicable), and 

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

18 month, as determined under subparagraph (F), 

19 or 

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

21 subparagraph (G) for such month. 

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

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

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

25 or self-employment income or the wages and self-employ-
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1 ment income of the widow (or surviving divorced wife), the 

2 imputed deceased individual’s benefit for the entitlement 

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

4 of—

5 ‘‘(I) the imputed old-age insurance benefit (de6 termined under clause (ii)) of the deceased indi7 vidual for her entitlement month (if any), and 

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

9 (determined under clause (iii)) of the deceased indi10 vidual for her entitlement month (if any). 

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

12 benefit of the deceased individual for the entitlement 

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

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

15 have been entitled for such month—

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

17 individual who had attained age 62 as of the date 

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

19 in the month of his death and had survived through20 out the subsequent period ending with her entitle21 ment month, or 

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

23 individual who died before attaining age 62 but 

24 would have attained age 62 before the end of her en25 titlement month, as if he had survived throughout 
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1 the subsequent period ending with her entitlement 

2 month, and had applied for such benefit during the 

3 first month for which he would have been eligible for 

4 such benefit (assuming a primary insurance amount 

5 for the deceased individual determined under para6 graph (2)(B) of this subsection). 

7 For purposes of determining the deceased individual’s im8 puted old-age insurance benefit under this clause, the de9 termination of whether the deceased individual was a fully10 insured individual (as defined in section 214(a)) shall be 

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

12 the deceased individual died before attaining age 62 and 

13 would not have attained age 62 before the end of the enti14 tlement month of the widow (or surviving divorced wife), 

15 the deceased individual’s imputed old-age insurance ben16 efit shall be deemed to be zero. 

17 ‘‘(iii) The amount of the imputed husband’s insur18 ance benefit of the deceased individual for the entitlement 

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

20 amount of the husband’s insurance benefit under sub21 section (c) to which he would have been entitled for such 

22 month (assuming, for purposes of reduction under sub23 section (k)(3)(A), the entitlement to an old-age insurance 

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

25 (ii))—
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1 ‘‘(I) determined, in the case of such a deceased 

2 individual who had attained age 62 as of the date 

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

4 in the month of his death and had survived through5 out the subsequent period ending with her entitle6 ment month, or 

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

8 individual who died before attaining age 62 but 

9 would have attained age 62 before the end of her en10 titlement month, as if he had survived throughout 

11 the subsequent period ending with her entitlement 

12 month and had applied for such benefit during the 

13 first month for which he would have been eligible for 

14 such benefit. 

15 In any case in which the deceased individual died before 

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

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

18 surviving divorced spouse), the deceased individual’s im19 puted husband’s insurance benefit shall be deemed to be 

20 zero.

21 ‘‘(E)(i) For purposes of subparagraph (C), if the de22 ceased individual died during a month for which he other23 wise would have been entitled (but for his death) to an 

24 old-age insurance benefit under subsection (a) or a dis25 ability insurance benefit under section 223, or to a hus-
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1 band’s insurance benefit under subsection (c) based on the 

2 wages and self-employment income of the widow (or sur3 viving divorced wife), the imputed deceased individual’s 

4 benefit for the entitlement month of the widow (or sur5 viving divorced wife) is the sum of—

6 ‘‘(I) the amount of the old-age or disability in7 surance benefit (if any) to which he would have been 

8 entitled for her entitlement month if he had survived 

9 throughout the period subsequent to his death and 

10 ending with such month, and 

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

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

13 for her entitlement month based on her wages and 

14 self-employment income if he had survived through15 out the period subsequent to his death and ending 

16 with such month (assuming, for purposes of reduc17 tion under subsection (k)(3)(A), the entitlement to 

18 an old-age or disability insurance benefit for such 

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

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

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

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

23 the amount determined under clause (i) shall be deter24 mined as if he had survived throughout the period com25 mencing with the month of his death and ending with the 
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1 entitlement month of the widow (or surviving divorced 

2 wife) and he had remained entitled to disability insurance 

3 benefits throughout such period (or until becoming enti4 tled to old-age insurance benefits under subsection (a) 

5 during such period). 

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

7 ‘‘(i) In the case of a widow (or surviving di8 vorced wife) who is entitled for her entitlement 

9 month to an old-age insurance benefit under sub10 section (a) or a disability insurance benefit under 

11 section 223, or otherwise would have been entitled 

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

13 insurance benefit under subsection (b) for such 

14 month, the amount of her imputed survivor benefit 

15 for such month is the sum of—

16 ‘‘(I) the amount of such old-age or dis17 ability insurance benefit (if any), and 

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

19 benefit (if any), assuming, for purposes of re20 duction under subsection (k)(3)(A), the entitle21 ment to an old-age insurance or disability insur22 ance benefit for such month (if any), as de23 scribed in subclause (I). 

24 ‘‘(ii) In the case of a widow (or surviving di25 vorced wife) who is not described in clause (i) but 
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1 has attained (or would attain) age 62 as of the end 

2 of her entitlement month, the amount of her im3 puted survivor benefit is the sum of—

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

5 benefit under subsection (a) to which she would 

6 be entitled for such month if she filed applica7 tion for such benefit during such month, and 

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

9 would have been entitled (but for the deceased 

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

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

12 the deceased individual’s wages and self-employ13 ment income, if she had filed application for 

14 such benefit during such month (assuming a 

15 primary insurance amount for the deceased in16 dividual determined under paragraph (2)(B) of 

17 this subsection and assuming, for purposes of 

18 reduction under subsection (k)(3)(A), the enti19 tlement to an old-age insurance benefit for such 

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

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

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

23 entitlement month, her imputed survivor benefit shall be 

24 deemed to be zero.
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1 ‘‘(G) The increased benefit cap determined under this 

2 subparagraph for the entitlement month of the widow (or 

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

4 amount of a theoretical individual’s old-age insurance ben5 efit under subsection (a) (reduced as provided in sub6 section (q)) if—

7 ‘‘(i) such theoretical individual’s primary insur8 ance amount for the first month of entitlement were 

9 equal to the average of the primary insurance 

10 amounts upon which old-age insurance benefits 

11 under subsection (a) are payable for—

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

13 month of the widow (or surviving divorced wife) 

14 is the month of December, such month, or 

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

16 December preceding such entitlement month, 

17 ‘‘(ii) such first month of such theoretical indi18 vidual’s entitlement to such old-age insurance ben19 efit were the entitlement month of the widow (or 

20 surviving divorced spouse), and 

21 ‘‘(iii) the month in which the theoretical indi22 vidual attained or would attain retirement age (as 

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

24 the widow (or surviving divorced wife) attained or 

25 would attain retirement age (as so defined). 
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1 ‘‘(H) If, in determining the amount of the benefit 

2 under this section pursuant to this paragraph, the im3 puted old-age insurance benefit or imputed husband’s in4 surance benefit of the deceased individual was deemed to 

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

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

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

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

9 effective for any month after the entitlement month of the 

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

11 individual would have attained age 62 or she attains age 

12 62, the Commissioner shall recompute the amount of the 

13 benefit under this paragraph by substituting a reference 

14 to such later month for each reference in the preceding 

15 provisions of this paragraph to her entitlement month. 

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

17 insurance benefit (as determined under the preceding 

18 paragraphs of this subsection) shall be deemed a reference 

19 to such benefit, taking into account all applicable reduc20 tions and deductions under this title. 

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

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

23 benefit described in subparagraph (D), the old-age insur24 ance benefit, disability insurance benefit, or husband’s in25 surance benefit described in subparagraph (E), or the old-
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1 age insurance benefit, disability insurance benefit, or 

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

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

4 account applicable reductions under this section but dis5 regarding reductions or deductions otherwise applicable 

6 under this title. 

7 ‘‘(iii) A widow’s insurance benefit which has been in8 creased under this paragraph shall be subject to all reduc9 tions and deductions otherwise applicable to widow’s in10 surance benefits under this title, except that such benefit 

11 shall not be subject to any reduction otherwise applicable 

12 under subsection (q)(1).’’. 

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

14 202(f) of such Act (42 U.S.C. 402(f)) is amended by add15 ing at the end the following new paragraph: 

16 ‘‘(10)(A) In any case in which the amount of a wid17 ower’s insurance benefit (as determined under the pre18 ceding paragraphs of this subsection) for the entitlement 

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

20 less than the minimum benefit amount for such month de21 termined under subparagraph (C), the amount of such 

22 benefit for such month and each succeeding month shall 

23 be increased to such minimum benefit amount (or the 

24 amount most recently established in lieu thereof under 

25 section 215(i)). 
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1 ‘‘(B) For purposes of this paragraph, the term ‘enti2 tlement month’ of a widower (or surviving divorced hus3 band) means, in connection with his benefit under this 

4 subsection, the first month of his entitlement to such ben5 efit. 

6 ‘‘(C) For purposes of subparagraph (A), the min7 imum benefit amount determined under this subparagraph 

8 for the entitlement month of the widower (or surviving di9 vorced husband) is an amount equal to the lesser of—

10 ‘‘(i) 75 percent of the sum of—

11 ‘‘(I) the imputed deceased individual’s ben12 efit for such month, as determined under sub13 paragraph (D) or (E) (as applicable), and 

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

15 month, as determined under subparagraph (F), 

16 or 

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

18 subparagraph (G) for such month. 

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

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

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

22 or self-employment income or the wages and self-employ23 ment income of the widower (or surviving divorced hus24 band), the imputed deceased individual’s benefit for the 
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1 entitlement month of the widower (or surviving divorced 

2 husband) is the sum of—

3 ‘‘(I) the imputed old-age insurance benefit (de4 termined under clause (ii)) of the deceased indi5 vidual for his entitlement month (if any), and 

6 ‘‘(II) the imputed wife’s insurance benefit (de7 termined under clause (iii)) of the deceased indi8 vidual for his entitlement month (if any). 

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

10 benefit of the deceased individual for the entitlement 

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

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

13 would have been entitled for such month—

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

15 individual who had attained age 62 as of the date 

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

17 in the month of her death and had survived through18 out the subsequent period ending with his entitle19 ment month, or 

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

21 individual who died before attaining age 62 but 

22 would have attained age 62 before the end of his en23 titlement month, as if she had survived throughout 

24 the subsequent period ending with his entitlement 

25 month, and had applied for such benefit during the 
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1 first month for which she would have been eligible 

2 for such benefit (assuming a primary insurance 

3 amount for the deceased individual determined 

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

5 For purposes of determining the deceased individual’s im6 puted old-age insurance benefit under this clause, the de7 termination of whether the deceased individual was a fully8 insured individual (as defined in section 214(a)) shall be 

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

10 the deceased individual died before attaining age 62 and 

11 would not have attained age 62 before the end of the enti12 tlement month of the widower (or surviving divorced hus13 band), the deceased individual’s imputed old-age insurance 

14 benefit shall be deemed to be zero. 

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

16 benefit of the deceased individual for the entitlement 

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

18 the amount of the wife’s insurance benefit under sub19 section (c) to which she would have been entitled for such 

20 month (assuming, for purposes of reduction under sub21 section (k)(3)(A), the entitlement to an old-age insurance 

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

23 (ii))—

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

25 individual who had attained age 62 as of the date
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1 of her death, as if she had applied for such benefit 

2 in the month of her death and had survived through3 out the subsequent period ending with his entitle4 ment month, or 

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

6 individual who died before attaining age 62 but 

7 would have attained age 62 before the end of his en8 titlement month, as if she had survived throughout 

9 the subsequent period ending with his entitlement 

10 month and had applied for such benefit during the 

11 first month for which she would have been eligible 

12 for such benefit. 

13 In any case in which the deceased individual died before 

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

15 before the end of the entitlement month of the widower 

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

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

18 zero. 

19 ‘‘(E)(i) For purposes of subparagraph (C), if the de20 ceased individual died during a month for which she other21 wise would have been entitled (but for his death) to an 

22 old-age insurance benefit under subsection (a) or a dis23 ability insurance benefit under section 223, or to a wife’s 

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

25 and self-employment income of the widower (or surviving 
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1 divorced husband), the imputed deceased individual’s ben2 efit for the entitlement month of the widower (or surviving 

3 divorced husband) is the sum of—

4 ‘‘(I) the amount of the old-age or disability in5 surance benefit (if any) to which she would have 

6 been entitled for his entitlement month if she had 

7 survived throughout the period subsequent to her 

8 death and ending with such month, and 

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

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

11 his entitlement month based on his wages and self12 employment income if she had survived throughout 

13 the period subsequent to her death and ending with 

14 such month (assuming, for purposes of reduction 

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

16 old-age or disability insurance benefit for such 

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

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

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

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

21 the amount determined under clause (i) shall be deter22 mined as if she had survived throughout the period com23 mencing with the month of her death and ending with the 

24 entitlement month of the widower (or surviving divorced 

25 husband) and she had remained entitled to disability in-
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1 surance benefits throughout such period (or until becom2 ing entitled to old-age insurance benefits under subsection 

3 (a) during such period). 

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

5 ‘‘(i) In the case of a widower (or surviving di6 vorced husband) who is entitled for his entitlement 

7 month to an old-age insurance benefit under sub8 section (a) or a disability insurance benefit under 

9 section 223, or otherwise would have been entitled 

10 (but for the deceased individual’s death) to a hus11 band’s insurance benefit under subsection (b) for 

12 such month, the amount of his imputed survivor 

13 benefit for such month is the sum of—

14 ‘‘(I) the amount of such old-age or dis15 ability insurance benefit (if any), and 

16 ‘‘(II) the amount of such husband’s insur17 ance benefit (if any), assuming, for purposes of 

18 reduction under subsection (k)(3)(A), the enti19 tlement to an old-age insurance or disability in20 surance benefit for such month (if any), as de21 scribed in subclause (I). 

22 ‘‘(ii) In the case of a widower (or surviving di23 vorced husband) who is not described in clause (i) 

24 but has attained (or would attain) age 62 as of the 
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1 end of his entitlement month, the amount of his im2 puted survivor benefit is the sum of—

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

4 benefit under subsection (a) to which he would 

5 be entitled for such month if he filed applica6 tion for such benefit during such month, and 

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

8 would have been entitled (but for the deceased 

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

10 benefit under subsection (c) for such month, 

11 based on the deceased individual’s wages and 

12 self-employment income, if he had filed applica13 tion for such benefit during such month (as14 suming a primary insurance amount for the de15 ceased individual determined under paragraph 

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

17 purposes of reduction under subsection 

18 (k)(3)(A), the entitlement to an old-age insur19 ance benefit for such month, if any, as de20 scribed in subclause (I)). 

21 In any case in which the widower (or surviving di22 vorced husband) would not attain age 62 before the 

23 end of his entitlement month, his imputed survivor 

24 benefit shall be deemed to be zero.
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1 ‘‘(G) The increased benefit cap determined under this 

2 subparagraph for the entitlement month of the widower 

3 (or surviving divorced husband) is the amount which 

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

5 insurance benefit under subsection (a) (reduced as pro6 vided in subsection (q)) if—

7 ‘‘(i) such theoretical individual’s primary insur8 ance amount for the first month of entitlement were 

9 equal to the average of the primary insurance 

10 amounts upon which old-age insurance benefits 

11 under subsection (a) are payable for—

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

13 month of the widower (or surviving divorced 

14 husband) is the month of December, such 

15 month, or 

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

17 December preceding such entitlement month, 

18 ‘‘(ii) such first month of such theoretical indi19 vidual’s entitlement to such old-age insurance ben20 efit were the entitlement month of the widower (or 

21 surviving divorced husband), and 

22 ‘‘(iii) the month in which the theoretical indi23 vidual attained or would attain retirement age (as 

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

25 the widower (or surviving divorced husband) at-
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1 tained or would attain retirement age (as so de2 fined). 

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

4 under this section pursuant to this paragraph, the im5 puted old-age insurance benefit or imputed wife’s insur6 ance benefit of the deceased individual was deemed to be 

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

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

9 the widower (or surviving divorced husband) was deemed 

10 to be zero pursuant to the last sentence of subparagraph 

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

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

13 the deceased individual would have attained age 62 or he 

14 attains age 62, the Commissioner shall recompute the 

15 amount of the benefit under this paragraph by sub16 stituting a reference to such later month for each ref17 erence in the preceding provisions of this paragraph to his 

18 entitlement month. 

19 ‘‘(I)(i) Any reference in this paragraph to the wid20 ower’s insurance benefit (as determined under the pre21 ceding paragraphs of this subsection) shall be deemed a 

22 reference to such benefit, taking into account all applicable 

23 reductions and deductions under this title. 

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

25 old-age insurance benefit or imputed wife’s insurance ben-
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1 efit described in subparagraph (D), the old-age insurance 

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

3 benefit described in subparagraph (E), or the old-age in4 surance benefit, disability insurance benefit, or husband’s 

5 insurance benefit described in subparagraph (F) shall be 

6 deemed a reference to such benefit, taking into account 

7 applicable reductions under this section but disregarding 

8 reductions or deductions otherwise applicable under this 

9 title. 

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

11 increased under this paragraph shall be subject to all re12 ductions and deductions otherwise applicable to widower’s 

13 insurance benefits under this title, except that such benefit 

14 shall not be subject to any reduction otherwise applicable 

15 under subsection (q)(1).’’. 

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

17 WIDOW’S AND WIDOWER’S INSURANCE BENEFITS.—Sec18 tion 215(i)(2)(A)(ii) of such Act (42 U.S.C. 

19 415(i)(2)(A)(ii)) is amended—

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

21 end; 

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

23 inserting ‘‘1979, and’’; 

24 (3) by adding at the end the following new sub25 clause: 
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1 ‘‘(IV) the benefit amount to which an individual 

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

3 of section 202 if such benefit amount has been in4 creased under paragraph (10) of such subsection.’’; 

5 and 

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

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

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

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

10 this section shall apply with respect to widow’s and wid11 ower’s insurance benefits for months after November of 

12 the calendar year in which this Act is enacted. 

13 SEC. 203. BENEFITS FOR DISABLED WIDOWS AND WID14 OWERS WITHOUT REGARD TO AGE. 

15 (a) ELIGIBILITY FOR WIDOW’S INSURANCE BENE16 FITS.—Section 202(e)(1)(B)(ii) of the Social Security Act 

17 (42 U.S.C. 402(e)(1)(B)(ii)) is amended by striking ‘‘has 

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

19 (b) ELIGIBILITY FOR WIDOWER’S INSURANCE BENE20 FITS.—Section 202(f)(1)(B)(ii) of such Act (42 U.S.C. 

21 402(f)(1)(B)(ii)) is amended by striking ‘‘has attained age 

22 50 but has not attained age 60 and’’. 

23 (c) CONFORMING AMENDMENT.—Section 

24 202(q)(3)(A) of such Act (42 U.S.C. 402(q)(3)(A)) is 

25 amended by striking ‘‘If the first month’’ and all that fol-
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1 lows through ‘‘widow’s or widower’s insurance benefit)’’ 

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

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

4 and has attained age 62 or for which an individual is enti5 tled to a widow’s or widower’s insurance benefit’’. 

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

7 this section shall apply with respect to monthly insurance 

8 benefits payable under title II of the Social Security Act 

9 for months after November of the calendar year in which 

10 this Act is enacted and for which applications are filed 

11 or pending after November of such year. 

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

13 FOR WIDOW’S AND WIDOWER’S INSURANCE 

14 BENEFITS BASED ON DISABILITY. 

15 (a) WIDOW’S INSURANCE BENEFITS.—

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

17 Security Act (42 U.S.C. 402(e)) is amended—

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

19 ‘‘which began before the end of the period spec20 ified in paragraph (4)’’; 

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

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

23 and (II)’’; 
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1 (C) by striking paragraph (4) and by re2 designating paragraphs (5) through (9) as 

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

4 (D) in paragraph (4)(A)(ii) (as redesig5 nated), by striking ‘‘whichever’’ and all that fol6 lows through ‘‘begins’’ and inserting ‘‘the first 

7 day of the seventeenth month before the month 

8 in which her application is filed’’. 

9 (2) CONFORMING AMENDMENTS.—

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

11 (42 U.S.C. 402(e)(1)(F)(i)) is amended by 

12 striking ‘‘paragraph (5)’’ and inserting ‘‘para13 graph (4)’’. 

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

15 Act (42 U.S.C. 402(e)(2)(C)(ii)(III)) is amend16 ed by striking ‘‘paragraph (8)’’ and inserting 

17 ‘‘paragraph (7)’’. 

18 (C) Section 202(e)(2)(A) of such Act (42 

19 U.S.C. 402(e)(2)(A)) is amended by striking 

20 ‘‘paragraph (7)’’ and inserting ‘‘paragraph 

21 (6)’’. 

22 (D) Section 226(e)(1)(A)(i) of such Act 

23 (42 U.S.C. 426(e)(1)(A)(i)) is amended by 

24 striking ‘‘202(e)(4),’’. 

25 (b) WIDOWER’S INSURANCE BENEFITS.—
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1 (1) IN GENERAL.—Section 202(f) of such Act 

2 (42 U.S.C. 402(f)) is amended—

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

4 ‘‘which began before the end of the period spec5 ified in paragraph (5)’’;

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

7 ‘‘(I) in the period specified in paragraph (5) 

8 and (II)’’; 

9 (C) by striking paragraph (5) and by re10 designating paragraphs (6) through (9) as 

11 paragraphs (5) through (8), respectively; and 

12 (D) in paragraph (5)(A)(ii) (as redesig13 nated), by striking ‘‘whichever’’ and all that fol14 lows through ‘‘begins’’ and inserting ‘‘the first 

15 day of the seventeenth month before the month 

16 in which his application is filed’’. 

17 (2) CONFORMING AMENDMENTS.—

18 (A) Section 202(f)(1)(F)(i) of such Act (42 

19 U.S.C. 402(f)(1)(F)(i)) is amended by striking 

20 ‘‘paragraph (6)’’ and inserting ‘‘paragraph 

21 (5)’’. 

22 (B) Section 202(f)(1)(C)(ii)(III) of such 

23 Act (42 U.S.C. 402(f)(2)(C)(ii)(III)) is amend24 ed by striking ‘‘paragraph (8)’’ and inserting 

25 ‘‘paragraph (7)’’. 
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1 (C) Section 226(e)(1)(A)(i) of such Act (as 

2 amended by subsection (a)(2)) is further 

3 amended by striking ‘‘202(f)(1)(B)(ii), and 

4 202(f)(5)’’ and inserting ‘‘and 

5 202(f)(1)(B)(ii)’’. 

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

7 this section shall apply with respect to benefits for months 

8 after November of the calendar year in which this Act is 

9 enacted and for which applications are filed or pending 

10 after November of such year.

11 SEC. 205. EXEMPTION FROM TWO-YEAR WAITING PERIOD 

12 FOR DIVORCED SPOUSE’S BENEFITS UPON 

13 OTHER SPOUSE’S REMARRIAGE. 

14 (a) WIFE’S INSURANCE BENEFITS.—Section 

15 202(b)(5)(A) of the Social Security Act (42 U.S.C. 

16 402(b)(5)(A)) is amended by adding at the end the fol17 lowing new sentence: ‘‘The criterion for entitlement under 

18 clause (ii) shall be deemed met upon the remarriage of 

19 the insured individual to someone other than the applicant 

20 during the 2-year period referred to in such clause.’’. 

21 (b) HUSBAND’S INSURANCE BENEFITS.—Section 

22 202(c)(5)(A) of such Act (42 U.S.C. 402(c)(5)(A)) is 

23 amended by adding at the end the following new sentence: 

24 ‘‘The criterion for entitlement under clause (ii) shall be 

25 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 OCCASIONED BY NEED TO 

14 PROVIDE 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 

25 wages and self-employment income of such indi-
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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 each spouse 

7 paid in or credited to such year is equal to the 

8 wages and self-employment income of the other 

9 spouse paid in or credited to such year, the amount 

10 determined under clause (ii)(I) in connection with 

11 such calendar year in the case of such individual is 

12 greater than the amount so determined in the case 

13 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) WIFE’S INSURANCE BENEFITS.—Section 

5 202(b)(4)(A) of the Social Security Act (42 U.S.C. 

6 402(b)(4)(A)) is amended by striking ‘‘two-thirds’’ and in7 serting ‘‘one-third’’. 

8 (b) HUSBAND’S INSURANCE BENEFITS.—Section 

9 202(c)(2)(A) of such Act (42 U.S.C. 402(b)(2)(A)) is 

10 amended by striking ‘‘two-thirds’’ and inserting ‘‘one11 third’’. 

12 (c) WIDOW’S INSURANCE BENEFITS.—Section 

13 202(e)(7)(A) of such Act (42 U.S.C. 402(e)(7)(A)) is 

14 amended by striking ‘‘two-thirds’’ and inserting ‘‘one15 third’’. 

16 (d) WIDOWER’S INSURANCE BENEFITS.—Section 

17 202(f)(2)(A) of such Act (42 U.S.C. 402(f)(2)(A)) is 

18 amended by striking ‘‘two-thirds’’ and inserting ‘‘one19 third’’. 

20 (e) MOTHER’S AND FATHER’S INSURANCE BENE21 FITS.—Section 202(g)(4)(A) of such Act (42 U.S.C. 

22 402(g)(4)(A)) is amended by striking ‘‘two-thirds’’ and in23 serting ‘‘one-third’’. 

24 (f) EFFECTIVE DATE.—The amendments made by 

25 this section shall apply with respect to benefits for months 
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1 after November of the calendar year in which this Act is 

2 enacted.

Æ