Protecting and Preserving Social Security Act

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. Short title and table of contents (a) Short title This Act may be cited as the Protecting and Preserving Social Security Act (b) Table of contents The table of contents of this Act is as follows: Sec. 1. Short title and table of contents. 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 2022. Sec. 202. Inclusion of surplus earnings in Social Security benefit formula. Sec. 203. Preventing an unintended drop in benefits relating to the application of the National Average Wage Index. Title III—Benefit Adjustment of Social Security Income Compensation Sec. 301. Continuation of benefits through month of beneficiary’s death. I Cost-of-Living Increases 101. Consumer Price Index for Elderly Consumers (a) In General The Bureau of Labor Statistics of the Department of Labor shall prepare and publish an index for each calendar month to be known as the Consumer Price Index for Elderly Consumers (b) Effective Date Subsection (a) shall apply with respect to calendar months ending on or after July 31 of the calendar year following the calendar year in which this Act is enacted. (c) Authorization of Appropriations There are authorized to be appropriated such sums as are necessary to carry out the provisions of this section. 102. Computation of cost-of-living increases (a) In general Section 215(i)(1) of the Social Security Act ( 42 U.S.C. 415(i)(1) (H) the term Consumer Price Index . (b) Application to pre-1979 law (1) In general Section 215(i)(1) of the Social Security Act as in effect in December 1978, and as applied in certain cases under the provisions of such Act as in effect after December 1978, is amended by adding at the end the following new subparagraph: (D) the term Consumer Price Index . (2) Conforming amendment Section 215(i)(4) of the Social Security Act ( 42 U.S.C. 415(i)(4) and by section 102 of the Protecting and Preserving Social Security Act 1986 (c) No effect on adjustments under other laws Section 215(i) of the Social Security Act ( 42 U.S.C. 415(i) (6) Any provision of law (other than in this title or title XVI) which provides for adjustment of an amount based on a change in benefit amounts resulting from a determination made under this subsection shall be applied and administered without regard to the amendments made by section 102 of the Protecting and Preserving Social Security Act . (d) No effect on eligibility for SSI and Medicaid Any increase to an individual’s monthly benefit amount under title II of the Social Security Act as a result of the amendments made by this section shall not be regarded as income or resources for any subsequent month, for purposes of determining the eligibility of the recipient (or the recipient's spouse or family) for benefits or assistance, or the amount or extent of benefits or assistance, under the Supplemental Security Income program or the Medicaid program. (e) Effective date The amendments made by this section shall apply to determinations made with respect to cost-of-living computation quarters (as defined in section 215(i)(1)(B) of the Social Security Act ( 42 U.S.C. 415(i)(1)(B) II Contribution and benefit fairness 201. Determination of wages and self-employment income above contribution and benefit base after 2022 (a) Determination of wages above contribution and benefit base after 2022 (1) Amendments to the Internal Revenue Code of 1986 Section 3121 (A) in subsection (a)(1), by inserting the applicable percentage (determined under subsection (c)(1)) of that part of the remuneration (B) in subsection (c), by striking (c) Included and excluded service.— (c) Special rules for wages and employment (1) Applicable percentage of remuneration in determining wages For purposes of paragraph (1) of subsection (a), the applicable percentage for a calendar year, in connection with any calendar year referred to in such subparagraph, shall be the percentage determined in accordance with the following table: The applicable In the case of: percentage is: Calendar year 2023 86 Calendar year 2024 71 Calendar year 2025 57 Calendar year 2026 43 Calendar year 2027 29 Calendar year 2028 14 Calendar years after 2028 0. (2) Included and excluded service For purposes of this chapter, if . (2) Amendments to the Social Security Act Section 209 of the Social Security Act ( 42 U.S.C. 409 (A) in subsection (a)(1)— (i) in subparagraph (I)— (I) by inserting and before 2023 1974 (II) by inserting and (ii) by adding at the end the following new subparagraph: (J) The applicable percentage (determined under subsection (l)) of that part of remuneration which, after remuneration (other than remuneration referred to in the succeeding subsections of this section) equal to the contribution and benefit base (determined under section 230) with respect to employment has been paid to an individual during any calendar year after 2022 with respect to which such contribution and benefit base is effective, is paid to such individual during such calendar year; ; and (B) by adding at the end the following new subsection: (l) For purposes of subparagraph (J) of subsection (a)(1), the applicable percentage for a calendar year, in connection with any calendar year referred to in such subparagraph, shall be the percentage determined in accordance with the following table: The applicable In the case of: percentage is: Calendar year 2023 86 Calendar year 2024 71 Calendar year 2025 57 Calendar year 2026 43 Calendar year 2027 29 Calendar year 2028 14 Calendar years after 2028 0. . (3) Effective date The amendments made by this subsection shall apply with respect to remuneration paid in calendar years after 2022. (b) Determination of self-Employment income above contribution and benefit base after 2022 (1) Amendments to the Internal Revenue Code of 1986 Section 1402 (A) in subsection (b)(1), by inserting an amount equal to the applicable percentage (as determined under subsection (d)(2)) of that part of the net earnings from self-employment (B) in subsection (d)— (i) by striking (d) Employee and wages.— (d) Rules and definitions (1) Employee and wages The term ; and (ii) by adding at the end the following: (2) Applicable percentage of net earnings from self-employment in determining self-employment income For purposes of paragraph (1) of subsection (b), the applicable percentage for a taxable year beginning in any calendar year referred to in such paragraph shall be the percentage determined in accordance with the following table: The applicable In the case of: percentage is: Calendar year 2023 86 Calendar year 2024 71 Calendar year 2025 57 Calendar year 2026 43 Calendar year 2027 29 Calendar year 2028 14 Calendar years after 2028 0. . (2) Amendments to the Social Security Act Section 211 of the Social Security Act ( 42 U.S.C. 411 (A) in subsection (b)— (i) in paragraph (1)(I)— (I) by striking or (II) by inserting and before 2023 1974 (ii) by redesignating paragraph (2) as paragraph (3); and (iii) by inserting after paragraph (1) the following new paragraph: (2) For any taxable year beginning in any calendar year after 2022, an amount equal to the applicable percentage (as determined under subsection (l)) of that part of net earnings from self-employment which is in excess of (A) an amount equal to the contribution and benefit base (determined under section 230) that is effective for such calendar year, minus (B) the amount of the wages paid to such individual during such taxable year; or ; and (B) by adding at the end the following: (l) For purposes of paragraph (2) of subsection (b), the applicable percentage for a taxable year beginning in any calendar year referred to in such paragraph, shall be the percentage determined in accordance with the following table: The applicable In the case of: percentage is: Calendar year 2023 86 Calendar year 2024 71 Calendar year 2025 57 Calendar year 2026 43 Calendar year 2027 29 Calendar year 2028 14 Calendar years after 2028 0. . (3) Effective date The amendments made by this subsection shall apply with respect to taxable years beginning during or after calendar year 2023. 202. Inclusion of surplus earnings in Social Security benefit formula (a) Inclusion of surplus average indexed monthly earnings in determination of primary insurance amounts (1) In general Section 215(a)(1)(A) of the Social Security Act ( 42 U.S.C. 415(a)(1)(A) (A) in clauses (i), (ii), and (iii), by inserting basic average indexed monthly earnings (B) in clause (ii), by striking and (C) by inserting after clause (iii) the following new clauses: (iv) 3 percent of the individual’s surplus average indexed monthly earnings to the extent such surplus average indexed monthly earnings do not exceed the excess of the amount established for purposes of this clause by subparagraph (B) over 1/12 (v) 0.25 percent of the sum of the individual’s surplus average indexed monthly earnings plus 1/12 . (2) Bend point for surplus earnings Section 215(a)(1)(B) of such Act ( 42 U.S.C. 415(a)(1)(B) (A) in clause (ii), by striking the amounts so established the amounts established for purposes of clauses (i) and (ii) of subparagraph (A) (B) by redesignating clause (iii) as clause (v); (C) in clause (v) (as redesignated), by inserting or (iv) clause (ii) (D) by inserting after clause (ii) the following new clauses: (iii) For individuals who initially become eligible for old-age or disability insurance benefits, or who die (before becoming eligible for such benefits), in the calendar year 2023, the amount established for purposes of clause (iv) of subparagraph (A) shall be $8,933. (iv) For individuals who initially become eligible for old-age or disability insurance benefits, or who die (before becoming eligible for such benefits), in any calendar year after 2023, the amount established for purposes of clause (iv) of subparagraph (A) shall equal the product of the amount established with respect to the calendar year 2023 under clause (iii) of this subparagraph and the quotient obtained by dividing— (I) (aa) the national average wage index (as defined in section 209(k)(1)) for the second calendar year preceding the calendar year for which the determination is made, or (bb) if higher (and if such second calendar year is after 2023), the highest national average wage index (as so defined) for any calendar year before such second calendar year, by (II) the national average wage index (as so defined) for 2018. . (b) Basic AIME and surplus AIME (1) Basic AIME Section 215(b)(1) of such Act ( 42 U.S.C. 415(b)(1) (A) by inserting basic average (B) in subparagraph (A), by striking paragraph (3) paragraph (3)(A) to the extent such total does not exceed the contribution and benefit base for the applicable year (2) Surplus AIME (A) In general Section 215(b)(1) of such Act (as amended by paragraph (1)) is amended— (i) by redesignating subparagraphs (A) and (B) as clauses (i) and (ii), respectively; (ii) by inserting (A) (b)(1) (iii) by adding at the end the following new subparagraph: (B) (i) An individual’s surplus average indexed monthly earnings shall be equal to the quotient obtained by dividing— (I) the total (after adjustment under paragraph (3)(B)) of such individual’s surplus earnings (determined under clause (ii)) for such individual’s benefit computation years (determined under paragraph (2)), by (II) the number of months in those years. (ii) For purposes of clause (i) and paragraph (3)(B), an individual’s surplus earnings for a benefit computation year are the total of such individual’s wages paid in and self-employment income credited to such benefit computation year, to the extent such total (before adjustment under paragraph (3)(B)) exceeds the contribution and benefit base for such year. . (B) Conforming amendment The heading for section 215(b) of such Act is amended by striking Average Indexed Monthly Earnings Basic Average Indexed Monthly Earnings; Surplus Average Indexed Monthly Earnings (3) Adjustment of surplus earnings for purposes of determining surplus AIME Section 215(b)(3) of such Act ( 42 U.S.C. 415(b)(3) (A) in subparagraph (A), by striking subparagraph (B) subparagraph (C) and determination of basic average indexed monthly income paragraph (2) (B) by redesignating subparagraph (B) as subparagraph (C); and (C) by inserting after subparagraph (A) the following new subparagraph: (B) For purposes of determining under paragraph (1)(B) an individual’s surplus average indexed monthly earnings, the individual’s surplus earnings (described in paragraph (2)(B)(ii)) for a benefit computation year shall be deemed to be equal to the product of— (i) the individual’s surplus earnings for such year (as determined without regard to this subparagraph), and (ii) the quotient described in subparagraph (A)(ii). . (c) Effective date The amendments made by this section shall apply with respect to individuals who initially become eligible (within the meaning of section 215(a)(3)(B) of the Social Security Act) for old-age or disability insurance benefits under title II of the Social Security Act, or who die (before becoming eligible for such benefits), in any calendar year after 2022. 203. Preventing an unintended drop in benefits relating to the application of the National Average Wage Index (a) Modifications related to computation of primary insurance amount Section 215 of the Social Security Act ( 42 U.S.C. 415 (1) in subsection (a)(1)(B)(ii)(I)— (A) in subclause (I)— (i) by striking the national (aa) the national (ii) by striking , by ; or (B) by adding at the end of subclause (I) the following: (bb) if higher (and if such second calendar year is after 2022), the highest national average wage index (as so defined) for any calendar year before such second calendar year, by ; and (2) in subsection (b)(3)(A)(ii)— (A) in subclause (I)— (i) by striking the national (aa) the national (ii) by striking , by ; or (B) by adding at the end of subclause (I) the following: (bb) if higher (and if such second calendar year is after 2022), the highest national average wage index (as so defined) for any calendar year before such second calendar year, by . (b) Modification related to reduction of benefits based on disability Section 224(f)(2)(B)(i) of such Act ( 42 U.S.C. 424(f)(2)(B)(i) (or if higher (and if such calendar year is after 2022), the highest national average wage index (as so defined) for any calendar year before such calendar year) made III Benefit Adjustment of Social Security Income Compensation 301. Continuation of benefits through month of beneficiary’s death (a) In general (1) Old-Age insurance benefits Section 202(a) of the Social Security Act 42 U.S.C. 402(a) the month preceding (2) Wife’s insurance benefits (A) In general Section 202(b)(1) of such Act ( 42 U.S.C. 402(b)(1) (i) by striking and ending with the month and ending with the month in which she dies or (if earlier) with the month (ii) by striking subparagraph (E); and (iii) by redesignating subparagraphs (F) through (K) as subparagraphs (E) through (J), respectively. (B) Conforming amendment Section 202(b)(4)(B) of such Act ( 42 U.S.C. 402(b)(4)(B) (E), (F), (H), or (J) (E), (G), or (I) (3) Husband’s insurance benefits (A) In general Section 202(c)(1) of such Act ( 42 U.S.C. 402(c)(1) (i) by striking and ending with the month and ending with the month in which he dies or (if earlier) with the month (ii) by striking subparagraph (E); and (iii) by redesignating subparagraphs (F) through (K) as subparagraphs (E) through (J), respectively. (B) Conforming amendment Section 202(c)(4)(B) of such Act ( 42 U.S.C. 402(c)(4)(B) (E), (F), (H), or (J) (E), (G), or (I) (4) Child’s insurance benefits Section 202(d)(1) of such Act ( 42 U.S.C. 402(d)(1) (A) by striking and ending with the month and ending with the month in which such child dies or (if earlier) with the month (B) by striking dies, or (5) Widow’s insurance benefits Section 202(e)(1) of such Act ( 42 U.S.C. 402(e)(1) ending with the month preceding the first month in which any of the following occurs: she remarries, dies, becomes entitled ending with the month in which she dies or (if earlier) the month preceding the earliest of the first month in which she remarries, the month in which she becomes entitled (6) Widower’s insurance benefits Section 202(f)(1) of such Act ( 42 U.S.C. 402(f)(1) ending with the month preceding the first month in which any of the following occurs: he remarries, dies, or becomes entitled ending with the month in which he dies or (if earlier) the month preceding the earliest of the first month in which he remarries, the month in which he becomes entitled (7) Mother’s and father’s insurance benefits Section 202(g)(1) of such Act ( 42 U.S.C. 402(g)(1) (A) by inserting the month in which he or she dies or (if earlier) and ending with (B) by striking he or she remarries, or he or she dies or he or she remarries (8) Parent’s insurance benefits Section 202(h)(1) of such Act ( 42 U.S.C. 402(h)(1) ending with the month preceding the first month in which any of the following occurs: such parent dies, marries, ending with the month in which such parent dies or (if earlier) the month preceding the first month in which such parent marries (9) Disability insurance benefits Section 223(a)(1) of such Act ( 42 U.S.C. 423(a)(1) ending with the month preceding whichever of the following months is the earliest: the month in which he dies, ending with the month in which he dies or (if earlier) with the month preceding the earlier of 216(l)) (10) Benefits at age 72 for certain uninsured individuals Section 228(a) of such Act ( 42 U.S.C. 428(a) the month preceding (b) Computation and payment of last monthly payment (1) Old-Age and survivors insurance benefits Section 202 of the Social Security Act 42 U.S.C. 402 (aa) Prorated payment due to death (1) Prorated payment for last month of entitlement In the case of any monthly insurance benefit paid to an individual under this section for the last month of entitlement to such benefit (in any case in which eligibility for such benefit ends because of such individual’s death in such month), the amount of such benefit under this section paid for such month shall be an amount equal to— (A) the amount of such benefit (as determined without regard to this subsection), multiplied by (B) a fraction— (i) the numerator of which is the number of days in such month preceding (but not including) the date of such individual’s death, and (ii) the denominator of which is the number of days in such month, rounded, if not a multiple of $1, to the next lower multiple of $1. This subsection shall apply with respect to such benefit after all other adjustments with respect to such benefit provided by this title have been made. Payment of such benefit for such month shall be made as provided in section 204(d). (2) Prorated payment for first month of entitlement In the case of any monthly insurance benefit paid to an individual under this section for the first month of entitlement to such benefit (in any case in which eligibility for such benefit begins because of the death in such month of another individual on whose wages and self-employment income such benefit are based), the amount of such benefit paid for such month shall be an amount equal to— (A) the amount of such benefit (as determined without regard to this subsection), multiplied by (B) a fraction— (i) the numerator of which is the number of days in such month following and including the date of the death of the individual on whose wages and self-employment income such benefit is based, and (ii) the denominator of which is the number of days in such month, rounded, if not a multiple of $1, to the next lower multiple of $1. This subsection shall apply with respect to such benefit after all other adjustments with respect to such benefit provided by this title have been made. Payment of such benefit for such month shall be made as provided in section 204(d). (3) Payable to estate Any monthly insurance benefit under this section for the month in which the individual entitled to such benefit dies shall be paid to the estate of the individual unless the individual has named another individual as the payee for such payment. . (2) Disability insurance benefits Section 223 of such Act ( 42 U.S.C. 423 (k) Last payment of benefit terminated by death (1) The amount of any individual’s monthly benefit under this section paid for the month in which the individual dies shall be an amount equal to— (A) the amount of such benefit (as determined without regard to this subsection), multiplied by (B) a fraction— (i) the numerator of which is the number of days in such month preceding (but not including) the date of such individual’s death, and (ii) the denominator of which is the number of days in such month, rounded, if not a multiple of $1, to the next lower multiple of $1. This subsection shall apply with respect to such benefit after all other adjustments with respect to such benefit provided by this title have been made. Payment of such benefit for such month shall be made as provided in section 204(d). (2) Any monthly insurance benefit under this section for the month in which the individual entitled to such benefit dies shall be paid to the estate of the individual unless the individual has named another individual as the payee for such payment. . (3) Benefits at age 72 for certain uninsured individuals Section 228 of such Act ( 42 U.S.C. 428 (i) Last payment of benefit terminated by death (1) The amount of any individual’s monthly benefit under this section paid for the month in which the individual dies shall be an amount equal to— (A) the amount of such benefit (as determined without regard to this subsection), multiplied by (B) a fraction— (i) the numerator of which is the number of days in such month preceding (but not including) the date of such individual’s death, and (ii) the denominator of which is the number of days in such month, rounded, if not a multiple of $1, to the next lower multiple of $1. This subsection shall apply with respect to such benefit after all other adjustments with respect to such benefit provided by this title have been made. Payment of such benefit for such month shall be made as provided in section 204(d). (2) Any monthly insurance benefit under this section for the month in which the individual entitled to such benefit dies shall be paid to the estate of the individual unless the individual has named another individual as the payee for such payment. . (c) Disregard of benefit for month of death under family maximum provisions Section 203(a) of the Social Security Act 42 U.S.C. 403(a) (11) Notwithstanding any other provision of this Act, in applying the preceding provisions of this subsection (and determining maximum family benefits under column V of the table in or deemed to be in section 215(a) as in effect in December 1978) with respect to the month in which the insured individual’s death occurs, the benefit payable to such individual for that month shall be disregarded. . (d) Effective date The amendments made by this section shall apply with respect to deaths occurring in the first month beginning more than 60 days after the date of enactment of this Act.

Summary: Protecting and Preserving Social Security Act This bill revises methods for calculating various aspects of Social Security benefits, eliminates the cap on compensation subject to Social Security taxes, and extends eligibility for Social Security benefits during the month of a beneficiary's death.