II 

114TH CONGRESS 

1ST SESSION S. 960 

To amend title II of the Social Security Act and the Internal Revenue 

Code of 1986 to make improvements in the old-age, survivors, and 

disability insurance program, and to provide for Social Security benefit 

protection. 

IN THE SENATE OF THE UNITED STATES 

APRIL 15, 2015 

Ms. HIRONO introduced the following bill; which was read twice and referred 

to the Committee on Finance 

A BILL 

To amend title II of the Social Security Act and the Internal 

Revenue Code of 1986 to make improvements in the 

old-age, survivors, and disability insurance program, and 

to provide for Social Security benefit protection. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE AND TABLE OF CONTENTS. 

4 (a) SHORT TITLE.—This Act may cited as the ‘‘Pro5 tecting and Preserving Social Security Act’’. 

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

7 this Act is as follows: 

Sec. 1. Short title and table of contents. 


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TITLE I—COST-OF-LIVING INCREASES 

Sec. 101. Consumer Price Index for Elderly Consumers. 

Sec. 102. Computation of cost-of-living increases. 

TITLE II—CONTRIBUTION AND BENEFIT FAIRNESS 

Sec. 201. Determination of wages and self-employment income above contribution and benefit base after 2015. 

Sec. 202. Inclusion of surplus earnings in Social Security benefit formula. 

1 TITLE I—COST-OF-LIVING 

2 INCREASES 

3 SEC. 101. CONSUMER PRICE INDEX FOR ELDERLY CON4 SUMERS. 

5 (a) IN GENERAL.—The Bureau of Labor Statistics 

6 of the Department of Labor shall prepare and publish an 

7 index for each calendar month to be known as the ‘‘Con8 sumer Price Index for Elderly Consumers’’ that indicates 

9 changes over time in expenditures for consumption which 

10 are typical for individuals in the United States who are 

11 62 years of age or older. 

12 (b) EFFECTIVE DATE.—Subsection (a) shall apply 

13 with respect to calendar months ending on or after July 

14 31 of the calendar year following the calendar year in 

15 which this Act is enacted. 

16 (c) AUTHORIZATION OF APPROPRIATIONS.—There 

17 are authorized to be appropriated such sums as are nec18 essary to carry out the provisions of this section. 

19 SEC. 102. COMPUTATION OF COST-OF-LIVING INCREASES. 

20 (a) IN GENERAL.—Section 215(i) of the Social Secu21 rity Act (42 U.S.C. 415(i)) is amended— 


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1 (1) in paragraph (1)(G), by inserting before the 

2 period the following: ‘‘, and, solely with respect to 

3 any monthly insurance benefit payable under this 

4 title to an individual who has attained age 62, effec5 tive for adjustments under this subsection to the pri6 mary insurance amount on which such benefit is 

7 based (or to any such benefit under section 227 or 

8 228) occurring after such individual attains such 

9 age, the applicable Consumer Price Index shall be 

10 deemed to be the Consumer Price Index for Elderly 

11 Consumers and such primary insurance amount 

12 shall be deemed adjusted under this subsection using 

13 such Index’’; and 

14 (2) in paragraph (4), by striking ‘‘and by sec15 tion 9001’’ and inserting ‘‘, by section 9001’’, and 

16 by inserting after ‘‘1986,’’ the following: ‘‘and by 

17 section 102 of the Protecting and Preserving Social 

18 Security Act,’’. 

19 (b) CONFORMING AMENDMENTS IN APPLICABLE

20 FORMER LAW.—Section 215(i)(1)(C) of such Act, as in 

21 effect in December 1978 and applied in certain cases 

22 under the provisions of such Act in effect after December 

23 1978, is amended by inserting before the period the fol24 lowing: ‘‘, and, solely with respect to any monthly insur25 ance benefit payable under this title to an individual who 


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1 has attained age 62, effective for adjustments under this 

2 subsection to the primary insurance amount on which such 

3 benefit is based (or to any such benefit under section 227 

4 or 228) occurring after such individual attains such age, 

5 the applicable Consumer Price Index shall be deemed to 

6 be the Consumer Price Index for Elderly Consumers and 

7 such primary insurance amount shall be deemed adjusted 

8 under this subsection using such Index’’. 

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

10 subsection (a) shall apply to determinations made with re11 spect to cost-of-living computation quarters (as defined in 

12 section 215(i)(1)(B) of the Social Security Act (42 U.S.C. 

13 415(i)(1)(B))) ending on or after September 30 of the sec14 ond calendar year following the calendar year in which this 

15 Act is enacted. 

16 TITLE II—CONTRIBUTION AND 

17 BENEFIT FAIRNESS 

18 SEC. 201. DETERMINATION OF WAGES AND SELF-EMPLOY19 MENT INCOME ABOVE CONTRIBUTION AND 

20 BENEFIT BASE AFTER 2015. 

21 (a) DETERMINATION OF WAGES ABOVE CONTRIBU22 TION AND BENEFIT BASE AFTER 2015.— 

23 (1) AMENDMENTS TO THE INTERNAL REVENUE

24 CODE OF 1986.—Section 3121 of the Internal Rev25 enue Code of 1986 is amended— 


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1 (A) in subsection (a)(1), by inserting ‘‘the 

2 applicable percentage (determined under sub3 section (c)(1)) of’’ before ‘‘that part of the re4 muneration’’; and 

5 (B) in subsection (c), by striking ‘‘(c) IN6 CLUDED AND EXCLUDED SERVICE.—For pur7 poses of this chapter, if’’ and inserting the fol8 lowing: 

9 ‘‘(c) SPECIAL RULES FOR WAGES AND EMPLOY10 MENT.— 

11 ‘‘(1) APPLICABLE PERCENTAGE OF REMUNERA12 TION IN DETERMINING WAGES.—For purposes of 

13 paragraph (1) of subsection (a), the applicable per14 centage for a calendar year, in connection with any 

15 calendar year referred to in such subparagraph, 

16 shall be the percentage determined in accordance 

17 with the following table: 

The applicable 

‘‘In the case of: percentage is: 

Calendar year 2016 ..................................................................... 86%

Calendar year 2017 ..................................................................... 71%

Calendar year 2018 ..................................................................... 57%

Calendar year 2019 ..................................................................... 43%

Calendar year 2020 ..................................................................... 29%

Calendar year 2021 ..................................................................... 14%

Calendar years after 2021 ........................................................... 0%. 

18 ‘‘(2) INCLUDED AND EXCLUDED SERVICE.—For 

19 purposes of this chapter, if’’. 


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1 (2) AMENDMENTS TO THE SOCIAL SECURITY

2 ACT.—Section 209 of the Social Security Act (42 

3 U.S.C. 409) is amended— 

4 (A) in subsection (a)(1)(I)— 

5 (i) by inserting ‘‘and before 2016’’ 

6 after ‘‘1974’’; and 

7 (ii) by inserting ‘‘and’’ after the semi8 colon; 

9 (B) in subsection (a)(1), by adding at the 

10 end the following new subparagraph: 

11 ‘‘(J) The applicable percentage (deter12 mined under subsection (l)) of that part of re13 muneration which, after remuneration (other 

14 than remuneration referred to in the succeeding 

15 subsections of this section) equal to the con16 tribution and benefit base (determined under 

17 section 230) with respect to employment has 

18 been paid to an individual during any calendar 

19 year after 2015 with respect to which such con20 tribution and benefit base is effective, is paid to 

21 such individual during such calendar year;’’; 

22 and 

23 (C) by adding at the end the following new 

24 subsection: 


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1 ‘‘(l) For purposes of subparagraph (J) of subsection 

2 (a)(1), the applicable percentage for a calendar year, in 

3 connection with any calendar year referred to in such sub4 paragraph, shall be the percentage determined in accord5 ance with the following table: 

The applicable 

‘‘In the case of: percentage is: 

Calendar year 2016 ..................................................................... 86%

Calendar year 2017 ..................................................................... 71%

Calendar year 2018 ..................................................................... 57%

Calendar year 2019 ..................................................................... 43%

Calendar year 2020 ..................................................................... 29%

Calendar year 2021 ..................................................................... 14%

Calendar years after 2021 ........................................................... 0%.’’. 

6 (3) EFFECTIVE DATE.—The amendments made 

7 by this subsection shall apply with respect to remu8 neration paid in calendar years after 2015. 

9 (b) DETERMINATION OF SELF-EMPLOYMENT IN10 COME ABOVE CONTRIBUTION AND BENEFIT BASE AFTER

11 2015.— 

12 (1) AMENDMENTS TO THE INTERNAL REVENUE

13 CODE OF 1986.—Section 1402 of the Internal Rev14 enue Code of 1986 is amended— 

15 (A) in subsection (b)(1), by inserting ‘‘an 

16 amount equal to the applicable percentage (as 

17 determined under subsection (d)(2)) of’’ before 

18 ‘‘that part of the net earnings from self-employ19 ment’’; and 

20 (B) in subsection (d)— 


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1 (i) by striking ‘‘(d) EMPLOYEE AND

2 WAGES.—The term’’ and inserting the fol3 lowing: 

4 ‘‘(d) RULES AND DEFINITIONS.— 

5 ‘‘(1) EMPLOYEE AND WAGES.—The term’’; and 

6 (ii) by adding at the end the fol7 lowing: 

8 ‘‘(2) APPLICABLE PERCENTAGE OF NET EARN9 INGS FROM SELF-EMPLOYMENT IN DETERMINING

10 SELF-EMPLOYMENT INCOME.—For purposes of para11 graph (1) of subsection (b), the applicable percent12 age for a taxable year beginning in any calendar 

13 year referred to in such paragraph shall be the per14 centage determined in accordance with the following 

15 table: 

The applicable 

‘‘In the case of: percentage is: 

Calendar year 2016 ..................................................................... 86%

Calendar year 2017 ..................................................................... 71%

Calendar year 2018 ..................................................................... 57%

Calendar year 2019 ..................................................................... 43%

Calendar year 2020 ..................................................................... 29%

Calendar year 2021 ..................................................................... 14%

Calendar years after 2021 ........................................................... 0%.’’. 

16 (2) AMENDMENTS TO THE SOCIAL SECURITY

17 ACT.—Section 211 of the Social Security Act (42 

18 U.S.C. 411) is amended— 

19 (A) in subsection (b)(1)(I)— 

20 (i) by striking ‘‘or’’ after the semi21 colon; and 


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1 (ii) by inserting ‘‘and before 2016’’ 

2 after ‘‘1974’’; 

3 (B) in subsection (b)— 

4 (i) by redesignating paragraph (2) as 

5 paragraph (3); and 

6 (ii) by inserting after paragraph (1) 

7 the following: 

8 ‘‘(2) For any taxable year beginning in any cal9 endar year after 2015, an amount equal to the appli10 cable percentage (as determined under subsection 

11 (l)) of that part of net earnings from self-employ12 ment which is in excess of (A) an amount equal to 

13 the contribution and benefit base (determined under 

14 section 230) that is effective for such calendar year, 

15 minus (B) the amount of the wages paid to such in16 dividual during such taxable year; or’’; and 

17 (C) by adding at the end the following: 

18 ‘‘(l) For purposes of paragraph (2) of subsection (b), 

19 the applicable percentage for a taxable year beginning in 

20 any calendar year referred to in such paragraph, shall be 

21 the percentage determined in accordance with the fol22 lowing table: 

The applicable 

‘‘In the case of: percentage is: 

Calendar year 2016 ..................................................................... 86%

Calendar year 2017 ..................................................................... 71%

Calendar year 2018 ..................................................................... 57%

Calendar year 2019 ..................................................................... 43%

Calendar year 2020 ..................................................................... 29%


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The applicable 

‘‘In the case of: percentage is: 

Calendar year 2021 ..................................................................... 14%

Calendar years after 2021 ........................................................... 0%.’’. 

1 (3) EFFECTIVE DATE.—The amendments made 

2 by this subsection shall apply with respect to taxable 

3 years beginning during or after calendar year 2016. 

4 SEC. 202. INCLUSION OF SURPLUS EARNINGS IN SOCIAL SE5 CURITY BENEFIT FORMULA. 

6 (a) INCLUSION OF SURPLUS AVERAGE INDEXED

7 MONTHLY EARNINGS IN DETERMINATION OF PRIMARY

8 INSURANCE AMOUNTS.— 

9 (1) IN GENERAL.—Section 215(a)(1)(A) of the 

10 Social Security Act (42 U.S.C. 415(a)(1)(A)) is 

11 amended— 

12 (A) in clauses (i), (ii), and (iii), by insert13 ing ‘‘basic’’ before ‘‘average indexed monthly 

14 earnings’’ each place it appears; 

15 (B) in clause (ii), by striking ‘‘and’’ at the 

16 end; and 

17 (C) by inserting after clause (iii) the fol18 lowing new clauses: 

19 ‘‘(iv) 3 percent of the individual’s surplus aver20 age indexed monthly earnings to the extent such 

21 surplus average indexed monthly earnings do not ex22 ceed the excess of the amount established for purposes of this clause by subparagraph (B) over 1 23 ⁄12


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1 of the contribution and benefit base for the last of 

2 such individual’s computation base years, and 

3 ‘‘(v) 0.25 percent of the sum of the individual’s 

surplus average indexed monthly earnings plus 1 4 ⁄12

5 of the contribution and benefit base for the last of 

6 such individual’s computation base years, to the ex7 tent such sum exceeds the amount established for 

8 purposes of clause (iv) by subparagraph (B).’’. 

9 (2) BEND POINT FOR SURPLUS EARNINGS.— 

10 Section 215(a)(1)(B) of such Act (42 U.S.C. 

11 415(a)(1)(B)) is amended— 

12 (A) in clause (ii), by striking ‘‘the amounts 

13 so established’’ and inserting ‘‘the amounts es14 tablished for purposes of clauses (i) and (ii) of 

15 subparagraph (A)’’; 

16 (B) by redesignating clause (iii) as clause 

17 (v); 

18 (C) in clause (v) (as redesignated), by in19 serting ‘‘or (iv)’’ after ‘‘clause (ii)’’; and 

20 (D) by inserting after clause (ii) the fol21 lowing new clauses: 

22 ‘‘(iii) For individuals who initially become eligible for 

23 old-age or disability insurance benefits, or who die (before 

24 becoming eligible for such benefits), in the calendar year 


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1 2016, the amount established for purposes of clause (iv) 

2 of subparagraph (A) shall be $11,358. 

3 ‘‘(iv) For individuals who initially become eligible for 

4 old-age or disability insurance benefits, or who die (before 

5 becoming eligible for such benefits), in any calendar year 

6 after 2016, the amount established for purposes of clause 

7 (iv) of subparagraph (A) shall equal the product of the 

8 amount established with respect to the calendar year 2016 

9 under clause (iii) of this subparagraph and the quotient 

10 obtained by dividing— 

11 ‘‘(I) the national average wage index (as de12 fined in section 209(k)(1)) for the second calendar 

13 year preceding the calendar year for which the de14 termination is made, by 

15 ‘‘(II) the national average wage index (as so de16 fined) for 2014.’’. 

17 (b) BASIC AIME AND SURPLUS AIME.— 

18 (1) BASIC AIME.—Section 215(b)(1) of such 

19 Act (42 U.S.C. 415(b)(1)) is amended— 

20 (A) by inserting ‘‘basic’’ before ‘‘average’’; 

21 and 

22 (B) in subparagraph (A), by striking 

23 ‘‘paragraph (3)’’ and inserting ‘‘paragraph 

24 (3)(A)’’ and by inserting before the comma the 

25 following: ‘‘to the extent such total does not exVerDate Sep 11 2014 03:39 Apr 22, 2015 Jkt 049200 PO 00000 Frm 00012 Fmt 6652 Sfmt 6201 E:\BILLS\S960.IS S960

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1 ceed the contribution and benefit base for the 

2 applicable year’’. 

3 (2) SURPLUS AIME.— 

4 (A) IN GENERAL.—Section 215(b)(1) of 

5 such Act (as amended by paragraph (1)) is 

6 amended— 

7 (i) by redesignating subparagraphs 

8 (A) and (B) as clauses (i) and (ii), respec9 tively; 

10 (ii) by inserting ‘‘(A)’’ after ‘‘(b)(1)’’; 

11 and 

12 (iii) by adding at the end the fol13 lowing new subparagraph: 

14 ‘‘(B)(i) An individual’s surplus average indexed 

15 monthly earnings shall be equal to the quotient obtained 

16 by dividing— 

17 ‘‘(I) the total (after adjustment under para18 graph (3)(B)) of such individual’s surplus earnings 

19 (determined under clause (ii)) for such individual’s 

20 benefit computation years (determined under para21 graph (2)), by 

22 ‘‘(II) the number of months in those years. 

23 ‘‘(ii) For purposes of clause (i) and paragraph (3)(B), 

24 an individual’s surplus earnings for a benefit computation 

25 year are the total of such individual’s wages paid in and 


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1 self-employment income credited to such benefit computa2 tion year, to the extent such total (before adjustment 

3 under paragraph (3)(B)) exceeds the contribution and 

4 benefit base for such year.’’. 

5 (B) CONFORMING AMENDMENT.—The 

6 heading for section 215(b) of such Act is 

7 amended by striking ‘‘Average Indexed Monthly 

8 Earnings’’ and inserting ‘‘Basic Average In9 dexed Monthly Earnings; Surplus Average In10 dexed Monthly Earnings’’. 

11 (3) ADJUSTMENT OF SURPLUS EARNINGS FOR

12 PURPOSES OF DETERMINING SURPLUS AIME.—Sec13 tion 215(b)(3) of such Act (42 U.S.C. 415(b)(3)) is 

14 amended— 

15 (A) in subparagraph (A), by striking ‘‘sub16 paragraph (B)’’ and inserting ‘‘subparagraph 

17 (C)’’ and by inserting ‘‘and determination of 

18 basic average indexed monthly income’’ after 

19 ‘‘paragraph (2)’’; 

20 (B) by redesignating subparagraph (B) as 

21 subparagraph (C); and 

22 (C) by inserting after subparagraph (A) 

23 the following new subparagraph: 

24 ‘‘(B) For purposes of determining under paragraph 

25 (1)(B) an individual’s surplus average indexed monthly 


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1 earnings, the individual’s surplus earnings (described in 

2 paragraph (2)(B)(ii)) for a benefit computation year shall 

3 be deemed to be equal to the product of— 

4 ‘‘(i) the individual’s surplus earnings for such 

5 year (as determined without regard to this subpara6 graph), and 

7 ‘‘(ii) the quotient described in subparagraph 

8 (A)(ii).’’. 

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

10 this section shall apply with respect to individuals who ini11 tially become eligible (within the meaning of section 

12 215(a)(3)(B) of the Social Security Act) for old-age or dis13 ability insurance benefits under title II of the Social Secu14 rity Act, or who die (before becoming eligible for such ben15 efits), in any calendar year after 2015. 

Æ 


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