Social Security Enhancement and Protection Act of 2023

To amend title II of the Social Security Act to make various reforms to Social Security, and for other purposes. 1. Short title This Act may be cited as the Social Security Enhancement and Protection Act of 2023 2. Increase in special minimum benefit for lifetime low earners based on years in the workforce Section 215(a)(1)(C) of the Social Security Act ( 42 U.S.C. 415(a)(1)(C) (C) (i) Effective with respect to the benefits of individuals who become eligible for old-age insurance benefits or disability insurance benefits (or die before becoming so eligible) after 2023, no primary insurance amount computed under subparagraph (A) may be less than the applicable percentage of 1/12 (ii) For purposes of clause (i), the applicable percentage is the percentage specified in connection with the number of years of work, as set forth in the following table: If the number of The applicable years of work is: percentage is: 11 36.7 percent 12 40.0 percent 13 43.3 percent 14 46.7 percent 15 50.0 percent 16 53.3 percent 17 56.7 percent 18 60.0 percent 19 63.3 percent 20 66.7 percent 21 70.0 percent 22 73.3 percent 23 76.7 percent 24 80.0 percent 25 83.3 percent 26 86.7 percent 27 90.0 percent 28 93.3 percent 29 96.7 percent 30 or more 100.0 percent. (iii) The annual dollar amount determined under this clause is— (I) for calendar year 2024, the poverty guideline for 2023; and (II) for any calendar year after 2024, the annual dollar amount for 2024 multiplied by the ratio of— (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, to (bb) the national average wage index (as so defined) for 2022. (iv) For purposes of this subparagraph— (I) the term number of years of work (aa) 1/4 (bb) the number of years (not exceeding 5) in all of which the individual provided care for a child under 6 years of age who resided in the individual’s home; and (II) the term poverty guideline for 2023 . 3. Establishment of an increased benefit for beneficiaries on account of long-term eligibility (a) In general Section 202 of the Social Security Act ( 42 U.S.C. 402 (aa) Increase in benefit amounts on account of long-Term eligibility (1) In the case of an individual who is a qualified beneficiary for a calendar year after 2023, the amount of any monthly insurance benefit of such qualified beneficiary under this section or section 223 for any month in such calendar year shall be increased in accordance with paragraph (3). (2) (A) For purposes of this subsection, the term qualified beneficiary (B) For purposes of this subsection, the applicable date of eligibility for an individual is the date on which the individual on whose wages and self-employment income the monthly insurance benefit is based initially became eligible (or died before becoming eligible) for old-age insurance benefits under subsection (a) or disability insurance benefits under section 223. (3) (A) The increase required under paragraph (1) with respect to the monthly insurance benefit of an individual who is a qualified beneficiary for a calendar year shall be equal to the applicable percentage (specified for such benefit in subparagraph (B)) of the full increase amount for such calendar year (determined under subparagraph (C)). (B) The applicable percentage specified for a monthly insurance benefit under this subparagraph for a calendar year is the percentage specified, in connection with the number of years ending after the applicable date of eligibility for such individual and before such calendar year, in the following table: The applicable If the number of years is: percentage is: 16 20 percent 17 40 percent 18 60 percent 19 80 percent 20 or larger 100 percent. (C) (i) Except as provided in clause (ii), the full increase amount determined under this subparagraph for a calendar year in connection with the monthly insurance benefit of a qualified beneficiary is a dollar amount equal to 5 percent of the amount of the benefit if— (I) such benefit were based on the primary insurance amount determined for January of such calendar year of a putative individual; (II) on January 1 of the calendar year in which occurred the applicable eligibility date with respect to such individual, such putative individual were fully insured, attained retirement age (as defined in section 216(l)(2)) and were otherwise eligible for, and applied for, old-age insurance benefits; and (III) such putative individual’s average indexed monthly earnings taken into account in determining such primary insurance amount were equal to 1/12 (ii) (I) In the case of a monthly insurance benefit under subsection (b) or (c), the full increase amount determined under this subparagraph shall be one-half the amount determined under clause (i); or (II) in the case of a monthly insurance benefit under subsection (d), (g), or (h), the full increase amount determined under this subparagraph shall be the percentage of the amount determined under clause (i) equal to the ratio which the amount of such benefit bears to the primary insurance amount (before the application of section 203(a)) of the individual on whose wages and self-employment income the monthly insurance benefit is based. (4) In the case of a qualified beneficiary who is entitled to two or more monthly insurance benefits under this title for the same month— (A) the earliest applicable date of eligibility for such beneficiary with respect to such benefits shall be treated as the applicable date of eligibility for such beneficiary for the purposes of this subsection; and (B) such beneficiary shall be entitled to an increase with respect only to one such benefit. (5) This subsection shall be applied to monthly insurance benefits after any increase under subsection (w) and any applicable reductions and deductions under this title. (6) In any case in which an individual is entitled to benefits under both this section and section 223, the increase under this subsection shall be paid from the Federal Old-Age and Survivors Insurance Trust Fund. . (b) Conforming amendments (1) Section 202 of such Act ( 42 U.S.C. 402 (A) in the last sentence of subsection (a), by striking subsection (q) and subsection (w) subsections (q), (w), and (aa) (B) in subsection (b)(2), by striking subsections (k)(5) and (q) subsections (k)(5), (q), and (aa) (C) in subsection (c)(2), by striking subsections (k)(5) and (q) subsections (k)(5), (q), and (aa) (D) in subsection (d)(2), by adding at the end the following: This paragraph shall apply subject to subsection (aa). (E) in subsection (e)(2)(A), by striking subsection (k)(5), subsection (q), and subparagraph (D) of this paragraph subsection (k)(5), subsection (q), subsection (aa), and subparagraph (D) of this paragraph (F) in subsection (f)(2)(A), by striking subsection (k)(5), subsection (q), and subparagraph (D) of this paragraph subsection (k)(5), subsection (q), subsection (aa), and subparagraph (D) of this paragraph (G) in subsection (g)(2), by striking Such Except as provided in subsections (k)(5) and (aa), such (H) in subsection (h)(2)(A), by inserting and subsection (aa) subparagraphs (B) and (C) (I) in section 223(a)(2), by striking section 202(q) sections 202(q) and 202(aa) (2) Section 209(k)(1) of such Act ( 402 U.S.C. 409(k)(1) 202(aa)(3)(C)(i)(II), 203(f)(8)(B)(ii) 4. Extension of child’s benefit for full-time post-secondary school students under age 26 (a) In general Section 202(d)(1)(B) of the Social Security Act ( 42 U.S.C. 402(d)(1)(B) (B) at the time such application was filed was unmarried and— (i) had not attained the age of 18, (ii) was a full-time elementary or secondary school student and had not attained the age of 19, (iii) was a full-time post-secondary school student and had not attained the age of 26, or (iv) is under a disability (as defined in section 223(d)) which began before he attained the age of 22, and . (b) Definition of full-Time post-Secondary school student (1) In general Section 202(d)(7) of such Act ( 42 U.S.C. 402(d)(7) (A) in subparagraph (A)— (i) by inserting and a full-time post-secondary school student , as determined by the Commissioner (ii) by inserting or a full-time post-secondary school student if he is paid by his employer (iii) by inserting or a post-secondary educational institution, as applicable, at the request (iv) by inserting or a full-time post-secondary school student for the purpose of this section (v) by inserting or a full-time post-secondary school student shall be deemed (B) in subparagraph (B)— (i) by inserting or a full-time post-secondary school student student (ii) by inserting or a post-secondary educational institution, as applicable at which he has been (iii) by striking an elementary or secondary school such a school (2) Transition from elementary or secondary school Section 202(d)(7)(B) of such Act ( 42 U.S.C. 402(d)(7)(B) An individual who has been in full-time attendance at an elementary or secondary school shall, during a succeeding period of nonattendance at such school, be deemed to be a full-time secondary-school student if (i) such period is 4 calendar months or less, and (ii) the individual shows to the satisfaction of the Commissioner that he intends to be in full-time attendance at a post-secondary educational institution immediately following such period. (c) Definition of post-Secondary educational institution Section 202(d)(7)(C) of such Act ( 42 U.S.C. 402(d)(7)(C) (iii) A post-secondary educational institution (I) is operated or directly supported by the United States, or by any State or local government or political subdivision thereof, (II) has been approved by a State or accredited by a State-recognized or nationally recognized accrediting agency or body, or (III) whose credits are accepted, on transfer, by not less than three institutions which are so accredited, for credit on the same basis as if transferred from an institution so accredited. . (d) Conforming amendments (1) Section 202(d)(1)(E) of such Act ( 42 U.S.C. 402(d)(1)(E) or a full-time post-secondary school student student (2) Section 202(d)(1)(F) of such Act ( 42 U.S.C. 402(d)(1)(F) the earlier of— the age of 19, the earlier of— (i) the first month during no part of which the child is a full-time elementary or secondary school student or a full-time post-secondary school student, (ii) the month in which the child attains the age of 19, but only if the child is not a full-time post-secondary school student during any part of such month, or (iii) the month in which the child attains the age of 26, . (3) Section 202(d)(1)(G) of such Act ( 42 U.S.C. 402(d)(1)(G) (if later) the age of 19, (if later) the earlier of— (i) the first month during no part of which the child is a full-time elementary or secondary school student or a full-time post-secondary school student, (ii) the month in which the child attains the age of 19, but only if the child is not a full-time post-secondary school student during any part of such month, or (iii) the month in which the child attains the age of 26, . (4) Section 202(d)(6)(A) of such Act ( 42 U.S.C. 402(d)(6)(A) (A) (i) is a full-time elementary or secondary school student and has not attained the age of 19, (ii) is a full-time post-secondary school student and has not attained the age of 26, or (iii) is under a disability (as defined in section 223(d)) and has not attained the age of 22, or . (5) Section 202(d)(6)(D) of such Act ( 42 U.S.C. 402(d)(6)(D) (D) the earlier of— (i) the first month during no part of which the child is a full-time elementary or secondary school student or a full-time post-secondary school student, (ii) the month in which the child attains the age of 19, but only if the child is not a full-time post-secondary school student during any part of such month, or (iii) the month in which the child attains the age of 26, but only if he is not under a disability (as so defined) in such earlier month; or . (6) Section 202(d)(6)(E) of such Act ( 42 U.S.C. 402(d)(6)(E) (if later) (if later) the earlier of— (i) the first month during no part of which the child is a full-time elementary or secondary school student or a full-time post-secondary school student, (ii) the month in which the child attains the age of 19, but only if the child is not a full-time post-secondary school student during any part of such month, or (iii) the month in which the child attains the age of 26. . (e) Effective date The amendments made by this section apply with respect to applications for child’s insurance benefits under section 202(d) of the Social Security Act ( 42 U.S.C. 402(d) 5. Determination of taxable wages and self-employment income above contribution and benefit base after 2023 (a) Determination of taxable wages above contribution and benefit base after 2023 (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) (c) Special rules for wages and employment (1) Applicable percentage of remuneration in determining taxable wages For purposes of subsection (a)(1), the applicable percentage for a calendar year shall be determined in accordance with the following table: The applicable In the case of: percentage is: Calendar year 2024 90 percent Calendar year 2025 80 percent Calendar year 2026 70 percent Calendar year 2027 60 percent Calendar year 2028 50 percent Calendar year 2029 40 percent Calendar year 2030 30 percent Calendar year 2031 20 percent Calendar year 2032 10 percent Calendar years after 2033 0 percent. (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)— (i) by inserting and before 2024 1974 (ii) by inserting and (B) in subsection (a)(1), 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 2023 with respect to which such contribution and benefit base is effective, is paid to such individual during such calendar year; ; and (C) by adding at the end the following new subsection: (l) For purposes of subsection (a)(1)(J), the applicable percentage for a calendar year shall be determined in accordance with the following table: The applicable In the case of: percentage is: Calendar year 2024 90 percent Calendar year 2025 80 percent Calendar year 2026 70 percent Calendar year 2027 60 percent Calendar year 2028 50 percent Calendar year 2029 40 percent Calendar year 2030 30 percent Calendar year 2031 20 percent Calendar year 2032 10 percent Calendar years after 2033 0 percent. . (3) Effective date The amendments made by this subsection shall apply with respect to remuneration paid in calendar years after 2023. (b) Determination of taxable self-Employment income above contribution and benefit base after 2023 (1) Amendments to the Internal Revenue Code of 1986 Section 1402 (A) in subsection (b)(1), by striking that part of the net earnings minus an amount equal to the applicable percentage (as determined under subsection (d)(2)) of that part of the net earnings from self-employment which is in excess of the difference (not to be less than zero) between (i) an amount equal to the contribution and benefit base (as determined under section 230 of the Social Security Act) which is effective for the calendar year in which such taxable year begins, and (B) in subsection (d)— (i) by striking (d) (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 taxable self-employment income For purposes of subsection (b)(1), the applicable percentage for a taxable year beginning in any calendar year referred to in such paragraph shall be determined in accordance with the following table: The applicable In the case of: percentage is: Calendar year 2024 90 percent Calendar year 2025 80 percent Calendar year 2026 70 percent Calendar year 2027 60 percent Calendar year 2028 50 percent Calendar year 2029 40 percent Calendar year 2030 30 percent Calendar year 2031 20 percent Calendar year 2032 10 percent Calendar years after 2033 0 percent. . (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 2024 1974 (ii) by redesignating paragraph (2) as paragraph (3); and (iii) by inserting after paragraph (1) the following: (2) For any taxable year beginning in any calendar year after 2023, 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 the difference (not to be less than zero) between— (A) an amount equal to the contribution and benefit base (as determined under section 230) that is effective for such calendar year, and (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 subsection (b)(2), the applicable percentage for a taxable year beginning in any calendar year referred to in such paragraph shall be determined in accordance with the following table: The applicable In the case of: percentage is: Calendar year 2024 90 percent Calendar year 2025 80 percent Calendar year 2026 70 percent Calendar year 2027 60 percent Calendar year 2028 50 percent Calendar year 2029 40 percent Calendar year 2030 30 percent Calendar year 2031 20 percent Calendar year 2032 10 percent Calendar years after 2033 0 percent. . (3) Effective date The amendments made by this subsection shall apply with respect to taxable years beginning in calendar years after 2023. (c) Computing average indexed monthly earnings Section 215(e) of the Social Security Act ( 42 U.S.C. 415(e) (1) in paragraph (1)— (A) by striking and before 1975, (B) by inserting and before 2024 after 1974 (C) by inserting , and the applicable percentage of the excess over an amount equal to the contribution and benefit base (as determined under section 230) in the case of any calendar year after 2023 with respect to which such contribution and benefit base is effective, benefit base is effective, (2) by adding at the end the following: (3) For purposes of paragraph (1), the applicable percentage for a year shall be determined in accordance with the following table: The applicable In the case of: percentage is: Calendar year 2024 90 percent Calendar year 2025 80 percent Calendar year 2026 70 percent Calendar year 2027 60 percent Calendar year 2028 50 percent Calendar year 2029 40 percent Calendar year 2030 30 percent Calendar year 2031 20 percent Calendar year 2032 10 percent Calendar years after 2033 0 percent. . (d) Conforming amendment Section 215(i)(2)(C)(i) of the Social Security Act ( 42 U.S.C. 415(i)(2)(C)(i) the Commissioner's estimate of the extent to which the cost of such increase would be met by an increase in the contribution and benefit base under section 230 and the estimated amount of the increase in such base, 6. New bend point for amounts above contribution and benefit base (a) In general Section 215(a)(1) of the Social Security Act ( 42 U.S.C. 415(a)(1) (1) in subparagraph (A)— (A) in clause (ii), by striking and (B) in clause (iii), by striking the comma at the end and inserting the following: but do not exceed the amount established for purposes of this clause by subparagraph (B), and (C) by inserting after clause (iii) the following: (iv) 3 percent of the individual’s average indexed monthly earnings to the extent that such earnings exceed the amount established for purposes of clause (iii), ; and (2) in subparagraph (B)— (A) by inserting and before 2024 1979 (B) by redesignating clause (iii) as clause (v); (C) by inserting after clause (ii) the following: (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 2024— (I) the amounts established for purposes of clauses (i) and (ii) of subparagraph (A) shall be the amounts so established under clause (ii) of this subparagraph for such calendar year; and (II) the amount established for purposes of clause (iii) of subparagraph (A) shall be the amount of the contribution and benefit base with respect to remuneration paid (and taxable years beginning) in calendar year 2024. (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 2024, the amount so established shall equal the product of the corresponding amount established with respect to the calendar year 2024 under clause (iii) of this subparagraph and the quotient obtained by dividing— (I) 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, by (II) the national average wage index (as so defined) for 2022. ; and (D) in clause (v), as so redesignated by subparagraph (A) of this paragraph, by inserting and clause (iv) clause (ii) (b) 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)) 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 2023. 7. Increase in employment tax rate (a) Wages (1) Employees Subsection (a) of section 3101 (a) Old-Age, survivors, and disability insurance (1) In general In addition to other taxes, there is hereby imposed on the income of every individual a tax equal to the applicable percentage of the wages (as defined in section 3121(a)) received by him with respect to employment (as defined in section 3121(b)). (2) Applicable percentage For purposes of paragraph (1), the term applicable percentage The applicable In case of wages received during: percentage 2024 6.25 percent 2025 6.30 percent 2026 6.35 percent 2027 6.40 percent 2028 6.45 percent 2029 or thereafter 6.50 percent. . (2) Employers Subsection (a) of section 3111 of such Code is amended to read as follows: (a) Old-Age, survivors, and disability insurance (1) In general In addition to other taxes, there is hereby imposed on every employer an excise tax, with respect to having individuals in his employ, equal to the applicable percentage of the wages (as defined in section 3121(a)) paid by him with respect to employment (as defined in section 3121(b)). (2) Applicable percentage For purposes of paragraph (1), the term applicable percentage The applicable In case of a taxable year beginning during calendar year: percentage shall be: 2024 6.25 percent 2025 6.30 percent 2026 6.35 percent 2027 6.40 percent 2028 6.45 percent 2029 or thereafter 6.50 percent. . (b) Self-Employment Subsection (a) of section 1401 of such Code is amended to read as follows: (a) Old-Age, survivors, and disability insurance (1) In addition to other taxes, there shall be imposed for each taxable year, on the self-employment income of every individual, a tax equal to the applicable percentage of the amount of the self-employment income for such taxable year. (2) Applicable percentage For purposes of paragraph (1), the term applicable percentage The applicable In case of a taxable year beginning during calendar year: percentage shall be: 2024 12.5 percent 2025 12.6 percent 2026 12.7 percent 2027 12.8 percent 2028 12.9 percent 2029 or thereafter 13.0 percent. . (c) Effective date The amendments made by this section shall apply with respect to remuneration received, and taxable years beginning after, December 31, 2023. 8. Non-application of increase in Social Security benefits for means-tested programs Any increase in monthly insurance benefits under title II of the Social Security Act as a result of the amendments made by this Act shall not be regarded as income or resources for any month after December 2023, 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 any Federal program or under any State or local program financed in whole or in part with Federal funds.

Summary: Social Security Enhancement and Protection Act of 2023 This bill increases certain Social Security taxes and benefits. Under current law, Social Security has a taxable earnings base, which refers to the maximum amount of a worker's earnings that are subject to Social Security payroll taxes (set at $160,200 in 2023). Additionally, the taxable earnings base serves as the maximum amount of earnings used to calculate a worker's Social Security benefits. This bill gradually increases the Social Security payroll tax rate from 6.2% to 6.5% over six years. It also phases out the taxable earnings base, thereby applying the payroll taxes to a greater amount of a worker's earnings, and revises the method to calculate a worker's Social Security benefits to account for earnings in excess of the taxable earnings base. Other changes to benefits include establishing a new method to calculate benefits for lifetime low earners and increasing benefits for certain beneficiaries on account of long-term eligibility. In addition, an eligible child of a retired, disabled, or deceased worker may continue to receive benefits through age 26, provided the child is a full-time student.