I
106TH CONGRESS
1ST SESSION
H. R. 107
To amend the Internal Revenue Code of 1986 to repeal the 1993 increase
in income tax on Social Security benefits, to repeal the earnings limita-
tion on Social Security recipients, and to repeal the estate and gift
taxes.
IN THE HOUSE OF REPRESENTATIVES
JANUARY 6, 1999
Mr. KNOLLENBERG introduced the following bill; which was referred to the
Committee on Ways and Means
A BILL
To amend the Internal Revenue Code of 1986 to repeal
the 1993 increase in income tax on Social Security bene-
fits, to repeal the earnings limitation on Social Security
recipients, and to repeal the estate and gift taxes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Senior Tax Relief Act
of 1999’’.
SEC. 2. REPEAL OF 1993 INCREASE IN TAX ON SOCIAL SECU-
RITY BENEFITS.
(a) IN GENERAL.—Paragraph (2) of section 86(a) of
the Internal Revenue Code of 1986 (relating to social se-
curity and tier 1 railroad retirement benefits) is amended
by adding at the end the following new sentence:
‘‘This paragraph shall not apply to any taxable year
beginning after December 31, 1998.’’
(b) CONFORMING AMENDMENTS.—
(1) Paragraph (3) of section 871(a) of such
Code is amended by striking ‘‘85 percent’’ in sub-
paragraph (A) and inserting ‘‘50 percent’’.
(2)(A) Subparagraph (A) of section 121(e)(1)
of the Social Security Amendments of 1983 (Public
Law 98–21) is amended—
(i) by striking ‘‘(A) There’’ and inserting
‘‘There’’;
(ii) by striking ‘‘(i)’’ immediately following
‘‘amounts equivalent to’’; and
(iii) by striking ‘‘, less (ii)’’ and all that
follows and inserting a period.
(B) Paragraph (1) of section 121(e) of such Act
is amended by striking subparagraph (B).
(C) Paragraph (3) of section 121(e) of such Act
is amended by striking subparagraph (B) and by re-
designating subparagraph (C) as subparagraph (B).
(D) Paragraph (2) of section 121(e) of such
Act is amended in the first sentence by striking
‘‘paragraph (1)(A)’’ and inserting ‘‘paragraph (1)’’.
(c) EFFECTIVE DATE.—The amendments made by
this section shall apply to taxable years beginning after
December 31, 1998.
SEC. 3. REMOVAL OF LIMITATION UPON THE AMOUNT OF
OUTSIDE INCOME WHICH A SOCIAL SECU-
RITY BENEFICIARY MAY EARN WHILE RE-
CEIVING BENEFITS.
(a) REPEAL OF PROVISIONS RELATING TO DEDUC-
TIONS ON ACCOUNT OF WORK.—
(1) IN GENERAL.—Subsections (b), (c)(1), (d),
(f), (h), (j), and (k) of section 203 of the Social Se-
curity Act (42 U.S.C. 403) are repealed.
(2) CONFORMING AMENDMENTS.—Section 203
of such Act (as amended by subsection (a)) is fur-
ther amended—
(A) in subsection (c), by redesignating
such subsection as subsection (b), and—
(i) by striking ‘‘Noncovered Work
Outside the United States or’’ in the head-
ing;
(ii) by redesignating paragraphs (2),
(3), and (4) as paragraphs (1), (2), and
(3), respectively;
(iii) by striking ‘‘For purposes of
paragraphs (2), (3), and (4)’’ and inserting
‘‘For purposes of paragraphs (1), (2), and
(3)’’; and
(iv) by striking the last sentence;
(B) in subsection (e), by redesignating
such subsection as subsection (c), and by strik-
ing ‘‘subsections (c) and (d)’’ and inserting
‘‘subsection (b)’’;
(C) in subsection (g), by redesignating
such subsection as subsection (d), and by strik-
ing ‘‘subsection (c)’’ each place it appears and
inserting ‘‘subsection (b)’’; and
(D) in subsection (l), by redesignating such
subsection as subsection (e), and by striking
‘‘subsection (g) or (h)(1)(A)’’ and inserting
‘‘subsection (d)’’.
(b) ADDITIONAL CONFORMING AMENDMENTS.—
(1) PROVISIONS RELATING TO BENEFITS TER-
MINATED UPON DEPORTATION.—Section 202(n)(1)
of the Social Security Act (42 U.S.C. 402(n)(1)) is
amended by striking ‘‘Section 203 (b), (c), and (d)’’
and inserting ‘‘Section 203(b)’’.
(2) PROVISIONS
RELATING
TO
EXEMPTIONS
FROM
REDUCTIONS
BASED
ON
EARLY
RETIRE-
MENT.—
(A) Section 202(q)(5)(B) of such Act (42
U.S.C. 402(q)(5)(B)) is amended by striking
‘‘section 203(c)(2)’’ and inserting ‘‘section
203(b)(1)’’.
(B) Section 202(q)(7)(A) of such Act (42
U.S.C. 402(q)(7)(A)) is amended by striking
‘‘deductions under section 203(b), 203(c)(1),
203(d)(1), or 222(b)’’ and inserting ‘‘deduc-
tions on account of work under section 203 or
deductions under section 222(b)’’.
(3) PROVISIONS
RELATING
TO
EXEMPTIONS
FROM REDUCTIONS BASED ON DISREGARD OF CER-
TAIN ENTITLEMENTS TO CHILD’S INSURANCE BENE-
FITS.—
(A) Section 202(s)(1) of such Act (42
U.S.C. 402(s)(1)) is amended by striking
‘‘paragraphs (2), (3), and (4) of section 203(c)’’
and inserting ‘‘paragraphs (1), (2), and (3) of
section 203(b)’’.
(B) Section 202(s)(3) of such Act (42
U.S.C. 402(s)(3)) is amended by striking ‘‘The
last sentence of subsection (c) of section 203,
subsection (f)(1)(C) of section 203, and sub-
sections’’ and inserting ‘‘Subsections’’.
(4) PROVISIONS RELATING TO SUSPENSION OF
ALIENS’ BENEFITS.—Section 202(t)(7) of such Act
(42 U.S.C. 402(t)(7)) is amended by striking ‘‘Sub-
sections (b), (c), and (d)’’ and inserting ‘‘Subsection
(b)’’.
(5) PROVISIONS
RELATING
TO
BENEFITS
IN-
CREASED
ON
ACCOUNT
OF
DELAYED
RETIRE-
MENT.—Section 202(w)(2)(B)(ii) of such Act (42
U.S.C. 402(w)(2)(B)(ii)) is amended by striking ‘‘or
203(c)’’.
(6) PROVISIONS RELATING TO REDUCTIONS IN
BENEFITS BASED ON MAXIMUM BENEFITS.—Section
203(a)(3)(B)(iii) 
of 
such 
Act 
(42 
U.S.C.
403(a)(3)(B)(iii)) is amended by striking ‘‘and sub-
sections (b), (c), and (d)’’ and inserting ‘‘and sub-
section (b)’’.
(7) PROVISIONS RELATING TO PENALTIES FOR
MISREPRESENTATIONS CONCERNING EARNINGS FOR
PERIODS SUBJECT TO DEDUCTIONS ON ACCOUNT OF
WORK.—Section 208(a)(1)(C) of such Act (42
U.S.C. 408(a)(1)(C)) is amended by striking ‘‘under
section 203(f) of this title for purposes of deductions
from benefits’’ and inserting ‘‘under section 203 for
purposes of deductions from benefits on account of
work’’.
(8) PROVISIONS TAKING INTO ACCOUNT EARN-
INGS
IN
DETERMINING
BENEFIT
COMPUTATION
YEARS.—Clause (I) in the next to last sentence of
section 215(b)(2)(A) of such Act (42 U.S.C.
415(b)(2)(A)) is amended by striking ‘‘no earnings
as described in section 203(f)(5) in such year’’ and
inserting ‘‘no wages, and no net earnings from self-
employment (in excess of net loss from self-employ-
ment), in such year’’.
(9) PROVISIONS
RELATING
TO
ROUNDING
OF
BENEFITS.—Section 215(g) of such Act (42 U.S.C.
415(g)) is amended by striking ‘‘and any deduction
under section 203(b)’’.
(10) PROVISIONS
RELATING
TO
EARNINGS
TAKEN INTO ACCOUNT IN DETERMINING SUBSTAN-
TIAL GAINFUL ACTIVITY OF BLIND INDIVIDUALS.—
The second sentence of section 223(d)(4) of such
Act (42 U.S.C. 423(d)(4)) is amended by striking
‘‘if section 102 of the Senior Citizens’ Right to
Work Act of 1996 had not been enacted’’ and insert-
ing the following: ‘‘if the amendments to section 203
made by section 102 of the Senior Citizens’ Right to
Work Act of 1996 and by section 3 of the Senior
Tax Relief Act of 1999 had not been enacted’’.
(11) PROVISIONS DEFINING INCOME FOR PUR-
POSES OF SSI.—Section 1612(a) of such Act (42
U.S.C. 1382a(a)) is amended—
(A) by striking ‘‘as determined under sec-
tion 203(f)(5)(C)’’ in paragraph (1)(A) and in-
serting ‘‘as defined in the last two sentences of
this subsection’’; and
(B) by adding at the end (after and below
paragraph (2)(F)) the following new sentences:
‘‘For purposes of paragraph (1)(A), the term ‘wages’
means wages as defined in section 209, but computed
without regard to the limitations as to amounts of remu-
neration specified in paragraphs (1), (6)(B), (6)(C),
(7)(B), and (8) of section 209(a). In making the computa-
tion under the preceding sentence, (A) services which do
not constitute employment as defined in section 210, per-
formed within the United States by an individual as an
employee or performed outside the United States in the
active military or naval services of the United States, shall
be deemed to be employment as so defined if the remu-
neration for such services is not includible in computing
the individual’s net earnings or net loss from self-employ-
ment for purposes of title II, and (B) the term ‘wages’
shall be deemed not to include (i) the amount of any pay-
ment made to, or on behalf of, an employee or any of his
or her dependents (including any amount paid by an em-
ployer for insurance or annuities, or into a fund, to pro-
vide for any such payment) on account of retirement, or
(ii) any payment or series of payments by an employer
to an employee or any of his or her dependents upon or
after the termination of the employee’s employment rela-
tionship because of retirement after attaining an age spec-
ified in a plan referred to in section 209(m)(2) or in a
pension plan of the employer.’’.
(12) REPEAL OF DEDUCTIONS ON ACCOUNT OF
WORK
UNDER
THE
RAILROAD
RETIREMENT
PRO-
GRAM.—Section 2 of the Railroad Retirement Act of
1974 (45 U.S.C. 231a) is amended by striking sub-
sections (f) and (g)(2).
(c) EFFECTIVE DATE.—The amendments and re-
peals made by this section shall apply with respect to tax-
able years ending on or after the date of the enactment
of this Act.
SEC. 4. REPEAL OF ESTATE AND GIFT TAXES.
(a) IN GENERAL.—Subtitle B of the Internal Reve-
nue Code of 1986 (relating to estate, gift, and generation-
skipping taxes) is hereby repealed.
(b) EFFECTIVE DATE.—The repeal made by sub-
section (a) shall apply to estates of decedents dying, and
transfers made, after the date of the enactment of this
Act.
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