SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Individual Social Secu-
rity Retirement Account Act of 1995’’.
SEC. 2. REDUCTION OF SOCIAL SECURITY TAXES.
(a) EMPLOYMENT TAXES.—
(1) TAX
ON
EMPLOYEES.—Subsection (a) of
section 3101 of the Internal Revenue Code of 1986
(relating to OASDI tax on employees) is amended by
adding at the end, after and below the table, the fol-
lowing new sentence:
‘‘The rate of tax specified in the preceding table for any
calendar year shall be reduced by the authorized tax re-
duction for such calendar year determined under section
3128.’’
(2) TAX
ON
EMPLOYERS.—Subsection (a) of
section 3111 of such Code (relating to OASDI tax
on employers) is amended by adding at the end,
after and below the table, the following new sen-
tence:
‘‘The rate of tax specified in the preceding table for any
calendar year shall be reduced by the authorized tax re-
duction for such calendar year determined under section
3128.’’
(3) AUTHORIZED TAX REDUCTION.—
(A) IN GENERAL.—Subchapter C of chap-
ter 21 of such Code is amended—
(i) by redesignating section 3128 as
section 3129; and
(ii) by inserting after section 3127 the
following new section:
‘‘SEC. 3128. AUTHORIZED TAX REDUCTION.
‘‘(a) IN GENERAL.—Except as provided in subsection
(b), for purposes of sections 3101(a) and 3111(a), the
term ‘authorized tax reduction’ for any calendar year
means 50 percent of the sum of—
‘‘(1) the excess of—
‘‘(A) the total unadjusted OASI tax rate
for such calendar year (determined under sub-
section (c)), over
‘‘(B) the adjusted cost rate (determined
under subsection (d)) for such calendar year,
plus
‘‘(2) the value of the projected receipts for such
calendar year of the Federal Old-Age and Survivors
Insurance Trust Fund constituting amounts appro-
priated to such Trust Fund equivalent to tax liabil-
ities under chapter 1 of the Internal Revenue Code
of 1986 attributable to the application of sections 86
and 871(a)(3) of such Code to payments from such
Trust Fund, expressed as a percentage of the sum
of the projected total wages to be paid in such cal-
endar year and self-employment income to be de-
rived in such calendar year.
‘‘(b) DISREGARD OF DEMINIMIS REDUCTIONS.—In
any case in which the authorized tax reduction (as defined
in subsection (a)) for any calendar year does not exceed
0.2 percent, such authorized tax reduction shall be deemed
to be 0 percent.
‘‘(c) TOTAL UNADJUSTED OASI TAX RATE.—
‘‘(1) IN GENERAL.—Not later than November 1
of each calendar year, the Commissioner of Social
Security shall determine and publish in the Federal
Register the total unadjusted OASI tax rate for the
following calendar year. For purposes of this section,
the term ‘total unadjusted OASI tax rate’ for a cal-
endar year means the product derived by multiply-
ing—
‘‘(A) the sum of the rates specified for
such calendar year under sections 3101(a) and
3111(a) (determined without regard to the last
sentence thereof), by
‘‘(B) the OASI appropriation percentage
for such calendar year,
rounded, if not a multiple of 0.01 percent, to the
nearest multiple of 0.01 percent.
‘‘(2) OASI APPROPRIATION PERCENTAGE.—For
purposes of this subsection, the term ‘OASI appro-
priation percentage’ for any calendar year means the
quotient (expressed as a percentage) derived by di-
viding—
‘‘(A) the total amount projected to be ap-
propriated to the Federal Old-Age and Survi-
vors Insurance Trust Fund under section
201(a) of the Social Security Act for the fiscal
year beginning October 1 preceding such cal-
endar year, by
‘‘(B) the total amount projected to be ap-
propriated to such Trust Fund and the Federal
Disability Insurance Trust Fund under section
201 of such Act for such fiscal year,
rounded, if not a multiple of 1 percent, to the near-
est multiple of 1 percent.
‘‘(d) ADJUSTED COST RATE.—
‘‘(1) IN GENERAL.—Not later than November 1
of each calendar year, the Commissioner of Social
Security shall determine and publish in the Federal
Register the adjusted cost rate for the following cal-
endar year. For purposes of this section, the term
‘adjusted cost rate’ for any calendar year means the
quotient (expressed as a percentage) derived by di-
viding—
‘‘(A) the adjusted projected OASI costs for
such calendar year, by
‘‘(B) the sum of the projected total wages
to be paid in such calendar year and projected
self-employment income to be derived in such
calendar year.
‘‘(2) DEFINITIONS.—For purposes of this sub-
section—
‘‘(A) 
ADJUSTED
PROJECTED
OASI
COSTS.—The term ‘adjusted projected OASI
costs’ for any calendar year means the sum
of—
‘‘(i) the projected amount of annual
outlays from the Federal Old-Age and Sur-
vivors Insurance Trust Fund for such cal-
endar year, and
‘‘(ii) the contingency reserve adjust-
ment for such calendar year.
‘‘(B) CONTINGENCY
RESERVE
ADJUST-
MENT.—The term ‘contingency reserve adjust-
ment’ for any calendar year means the excess
of—
‘‘(i) 150 percent of the projected an-
nual outlays from the Federal Old-Age and
Survivors Insurance Trust Fund for such
calendar year, determined as of January 1
of such year, over
‘‘(ii) the projected Trust Fund contin-
gency reserve percentage, determined as of
such date, of such projected annual out-
lays.
‘‘(C) TRUST FUND CONTINGENCY RESERVE
PERCENTAGE.—The term ‘Trust Fund contin-
gency reserve percentage’ as of any date means
the quotient (expressed as a percentage) derived
by dividing—
‘‘(i) the balance of the Federal Old-
Age and Survivors Insurance Trust Fund
as of such date, by
‘‘(ii) the projected annual outlays
from the Trust Fund for the year com-
mencing on such date,
rounded, if not a multiple of 1 percent, to the
nearest multiple of 1 percent.’’
(B) CLERICAL AMENDMENT.—The table of
sections for subchapter C of chapter 21 of such
Code is amended by striking the item relating
to section 3128 and inserting the following new
items:
‘‘Sec. 3128. Authorized tax reduction.
‘‘Sec. 3129. Short title.’’
(b) SELF-EMPLOYMENT TAXES.—
(1) IN
GENERAL.—Subsection (a) of section
1401 of such Code (relating to OASDI tax on self-
employment income) is amended by adding at the
end, after and below the table, the following new
sentence:
‘‘The rate of tax specified in the preceding table for any
taxable year shall be reduced by the authorized tax reduc-
tion, determined under section 1403, for the calendar year
in which such taxable year commences.’’
(2) AUTHORIZED TAX REDUCTION.—
(A) IN GENERAL.—Chapter 2 of such Code
is amended—
(i) by redesignating section 1403 as
section 1404; and
(ii) by inserting after section 1402 the
following new section:
‘‘SEC. 1403. AUTHORIZED TAX REDUCTION.
‘‘(a) IN GENERAL.—Except as provided in subsection
(b), for purposes of sections 1401(a), the term ‘authorized
tax reduction’ for any calendar year means the sum of—
‘‘(1) the excess of—
‘‘(A) the total unadjusted OASI tax rate
for such calendar year (determined under sec-
tion 3128(c)), over
‘‘(B) the adjusted cost rate for such cal-
endar year (determined under section 3128(d)),
plus
‘‘(2) the value of the projected receipts for such
calendar year of the Federal Old-Age and Survivors
Insurance Trust Fund constituting amounts appro-
priated to such Trust Fund equivalent to tax liabil-
ities under chapter 1 of the Internal Revenue Code
of 1986 attributable to the application of sections 86
and 871(a)(3) of such Code to payments from such
Trust Fund, expressed as a percentage of the sum
of the projected total wages to be paid in such cal-
endar year and the projected self-employment in-
come to be derived in such calendar year.
‘‘(b) DISREGARD OF DEMINIMIS REDUCTIONS.—In
any case in which the authorized tax reduction (as defined
in subsection (a)) for any year does not exceed 0.4 per-
cent, such authorized tax reduction shall be deemed to be
0 percent.’’
(B) CLERICAL AMENDMENT.—The table of
sections for chapter 2 of such Code is amended
by striking the item relating to section 1403
and inserting the following new items:
‘‘Sec. 1403. Authorized tax reduction.
‘‘Sec. 1404. Miscellaneous provisions.’’
(b) EFFECTIVE DATE.—The amendments made by
this section shall apply with respect to remuneration paid
after December 31, 1996, and with respect to earnings
from self-employment attributable to taxable years begin-
ning after such date.
SEC. 3. CORRESPONDING ADJUSTMENT TO OLD-AGE IN-
SURANCE BENEFITS.
(a) IN GENERAL.—Section 202(a) of the Social Secu-
rity Act (42 U.S.C. 202(a)) is amended—
(1) by redesignating subparagraphs (A) and
(B) as clauses (i) and (ii), respectively;
(2) by redesignating paragraphs (1), (2), and
(3) as subparagraphs (A), (B), and (C), respectively;
(3) in clause (i) (as redesignated), by striking
‘‘paragraphs (1), (2), and (3)’’ and inserting ‘‘sub-
paragraphs (A), (B), and (C)’’;
(4) in clause (ii) (as redesignated), by striking
‘‘paragraphs (1) and (2)’’ and inserting ‘‘subpara-
graphs (A) and (B)’’, and by striking ‘‘paragraph
(3)’’ and inserting ‘‘subparagraph (C)’’;
(5) by striking ‘‘(a) Every’’ and inserting
‘‘(a)(1) Every’’;
(6) in the matter following clause (ii) (as redes-
ignated), by striking ‘‘subsection (q) and subsection
(w)’’ and inserting ‘‘paragraph (2) and subsections
(q) and (w)’’; and
(7) by adding at the end the following new
paragraph:
‘‘(2)(A) An individual’s monthly benefit determined
under paragraph (1) shall be reduced by the authorized
benefit reduction for such individual. The reduction in an
individual’s benefit under this paragraph shall be applied
after any reduction or deduction otherwise applicable
under this title to benefits based on such individual’s
wages and self-employment income.
‘‘(B) For purposes of this paragraph, the term ‘au-
thorized benefit reduction’ for an individual means one-
twelfth of an annuity, stated as an annual amount—
‘‘(i) which has the actuarial present value (de-
termined as of January 1 of the calendar year in
which such individual attains retirement age (as de-
fined in section 216(l)) of the aggregate of all reduc-
tions in taxes under the last sentence of sections
1401(a), 3101(a), and 3111(a) of the Internal Reve-
nue Code of 1986 (including reductions in taxes
under sections 3201(a) and 3221(a) of such Code)
with respect to such individual’s wages (including
compensation referred to in such sections 3201(a)
and 3221(a)) paid, and self-employment income de-
rived, prior to such month, rounded, if not a mul-
tiple of $1, to the nearest multiple of $1,
‘‘(ii) which shall be increased by the Commis-
sioner in accordance with subparagraph (C), and
‘‘(iii) which shall be adjusted by the Commis-
sioner annually for increases in the cost of living, in
accordance with regulations prescribed by the Com-
missioner providing for adjustment procedures simi-
lar to the procedures used to adjust benefit amounts
under section 215(i)(2)(A).
‘‘(C) With respect to all individuals who attain age
62 in any calendar year and who become entitled to old-
age insurance benefits in or after such year, the Commis-
sioner of Social Security may increase the authorized ben-
efit reductions for such individuals under subparagraph
(B) to the extent necessary to compensate appropriately
for the value of amounts credited to the individual social
security retirement accounts of individuals who would have
attained age 62 in such calendar year but died before at-
taining such age. Any authorized benefit reduction so ad-
justed which is not a multiple of $1 shall be rounded to
the nearest multiple of $1.
‘‘(D) In deriving the authorized benefit reduction
under this paragraph, the Commissioner of Social Security
shall utilize generally accepted actuarial assumptions
which shall be prescribed in regulations of the Commis-
sioner, except that—
‘‘(i) determinations shall be made on a gender-
neutral basis,
‘‘(ii) for purposes of determing the actuarial
present value referred to in subparagraph (B)(i), the
Commissioner shall assume, for the cohort of old-age
insurance beneficiaries born during each calendar
year, a discount rate equal to the implicit rate of re-
turn for all individuals in such cohort which would
be represented by their old-age insurance benefits if
reductions under this paragraph were not applied,
determined solely on the basis of total unadjusted
OASI tax rates (as defined in section 3128(c)(1) of
the Internal Revenue Code of 1986) in effect from
year to year, and
‘‘(iii) interest with respect to the annuity shall
be computed for any month at the rate used for
such month under section 201(d), adjusted for pro-
jected inflation.’’.
(b) EFFECTIVE DATE.—The amendments made by
this section shall apply with respect to months after De-
cember 1996.
SEC. 4. INDIVIDUAL SOCIAL SECURITY RETIREMENT AC-
COUNTS FUNDED BY SOCIAL SECURITY PAY-
ROLL DEDUCTION PLANS.
(a) IN GENERAL.—Title II of the Social Security Act
is amended—
(1) by inserting before section 201 the follow-
ing:
‘‘PART A—INSURANCE BENEFITS’’;
and
(2) by adding at the end the following new part:
‘‘PART B—INDIVIDUAL RETIREMENT PROGRAM
‘‘SOCIAL SECURITY PAYROLL DEDUCTION PLANS
‘‘SEC. 251. (a) IN GENERAL.—Each person who is
a covered employer for any calendar year shall have in
effect throughout such calendar year a social security pay-
roll deduction plan for such person’s eligible employees.
‘‘(b) REQUIREMENTS.—For purposes of this part, the
term ‘social security payroll deduction plan’ means a writ-
ten plan of a covered employer if—
‘‘(1) under such plan, the prescribed social se-
curity employee contribution is deducted from each
eligible employee’s wages and paid to an individual
social security retirement account of such employee
designated in accordance with section 252,
‘‘(2) under such plan, the covered employer
pays the amount so deducted to the designated indi-
vidual social security retirement account within 10
business days after the payment of the wages from
which the amount was deducted,
‘‘(3) under such plan, the covered employer
pays to the individual social security retirement ac-
count, together with the contribution paid pursuant
to paragraph (2), the prescribed social security em-
ployer contribution with respect to the eligible em-
ployee, and
‘‘(4) the employer receives no compensation for
the cost of administering such plan.
‘‘(c) AMOUNT DEDUCTED MAY BE ACCUMULATED
BY EMPLOYER IN CERTAIN CASES.—If, under the terms
of an individual social security retirement account selected
under section 252, contributions below a specified amount
will not be accepted, the requirements of subsection (b)(2)
shall be treated as met if amounts deducted from the
wages of an eligible employee are accumulated by the cov-
ered employer and paid to such plan not later than 10
business days after the first day on which the accumulated
amount exceeds such specified amount.
‘‘DESIGNATION OF INDIVIDUAL SOCIAL SECURITY
RETIREMENT ACCOUNTS
‘‘SEC. 252. (a) IN GENERAL.—Except as provided in
subsection (b), the individual social security retirement ac-
count to which contributions with respect to any eligible
employee are required to be paid under section 251 shall
be such an account designated by such employee to such
employer not later than 10 business days after the date
on which such employee becomes an eligible employee of
such employer. Any such designation shall be made in
such form and manner as may be prescribed in regula-
tions of the Commissioner of Social Security.
‘‘(b) DESIGNATION IN ABSENCE OF TIMELY DES-
IGNATION BY EMPLOYEE.—In any case in which no timely
designation of the individual social security retirement ac-
count is made, the covered employer shall designate such
account in accordance with regulations of the Commis-
sioner.
‘‘(c) SUBSEQUENT DESIGNATION
OF OTHER AC-
COUNTS.—The Commissioner shall provide by regulation
for subsequent designation of other individual social secu-
rity retirement accounts of an eligible employee in lieu of
or in addition to accounts previously designated under this
section.
‘‘SELF-EMPLOYED INDIVIDUALS
‘‘SEC. 253. (a) IN GENERAL.—Not later than 30
days after the close of any taxable year for which there
is imposed a tax under section 1401(a) of the Internal
Revenue Code of 1986 on the self-employment income of
an individual, such individual shall pay to an individual
social security retirement account designated by such indi-
vidual the prescribed social security self-employment con-
tribution with respect to such individual for such taxable
year.
‘‘(b) DESIGNATION OF ACCOUNT.—The designation
of an individual social security retirement account for pay-
ment of prescribed social security self-employment con-
tributions shall be made in such form and manner as may
be prescribed in regulations of the Commissioner of Social
Security.
‘‘DEFINITIONS
‘‘SEC. 254. For purposes of this part—
‘‘(1) INDIVIDUAL
SOCIAL
SECURITY
RETIRE-
MENT ACCOUNT.—The term ‘individual social secu-
rity retirement account’ means any individual retire-
ment account (as defined in section 408(a) of the
Internal Revenue Code of 1986) which is adminis-
tered or issued by a bank (as defined in section
408(n) of such Code) and which meets the require-
ments of section 408A of such Code.
‘‘(2) COVERED EMPLOYER.—The term ‘covered
employer’ means, for any calendar year, any person
on whom an excise tax is imposed under section
3111 or 3221 of the Internal Revenue Code of 1986
with respect to having an individual in his employ to
whom wages were paid by such person during such
calendar year.
‘‘(3) ELIGIBLE EMPLOYEE.—THE TERM ‘ELIGI-
BLE EMPLOYEE’ MEANS, IN CONNECTION WITH ANY
PERSON WHO IS A COVERED EMPLOYER FOR ANY
CALENDAR YEAR, ANY INDIVIDUAL WITH RESPECT
TO WHOSE EMPLOYMENT BY SUCH EMPLOYER DUR-
ING SUCH CALENDAR YEAR THERE IS IMPOSED AN
EXCISE TAX UNDER SECTION 3111 OR 3221 OF THE
INTERNAL REVENUE CODE OF 1986.
‘‘(4) PRESCRIBED SOCIAL SECURITY EMPLOYEE
CONTRIBUTION.—The term ‘prescribed social secu-
rity employee contribution’ means, with respect to
any eligible employee of a covered employer, an
amount equal to the product derived by multiply-
ing—
‘‘(A) the wages received by such employee
with respect to employment by such employer,
by
‘‘(B) the rate of the authorized tax reduc-
tion specified in section 3128(a) of the Internal
Revenue Code of 1986,
rounded, if not a multiple of $1, to the nearest mul-
tiple of $1.
‘‘(5) PRESCRIBED SOCIAL SECURITY EMPLOYER
CONTRIBUTION.—The term ‘prescribed social secu-
rity employer contribution’ means, with respect to a
covered employer of any eligible employee, an
amount equal to the product derived by multiply-
ing—
‘‘(A) the wages paid by such employer to
such employee with respect to employment of
such employee, by
‘‘(B) the rate of the authorized tax reduc-
tion specified in section 3128(a) of the Internal
Revenue Code of 1986,
rounded, if not a multiple of $1, to the nearest mul-
tiple of $1.
‘‘(6) PRESCRIBED
SOCIAL
SECURITY
SELF-
EMPLOYMENT
CONTRIBUTION.—The 
term 
‘pre-
scribed social security self-employment contribution’
means, with respect to the self-employment income
of an individual for any taxable year, an amount
equal to the product derived by multiplying—
‘‘(A) the the amount of such self-employ-
ment income for such taxable year, by
‘‘(B) the rate of the authorized tax reduc-
tion specified in section 1403(a) of the Internal
Revenue Code of 1986,
rounded, if not a multiple of $1, to the nearest mul-
tiple of $1.
‘‘(7) BUSINESS DAY.—The term ‘business day’
means any day other than a Saturday, Sunday, or
legal holiday in the area involved.
‘‘(8) WAGES.—In the case of a covered em-
ployer referred to in section 3221 of the Internal
Revenue Code of 1986, the term ‘wages’ includes
compensation referred to in such section 3221.
‘‘PENALTIES
‘‘SEC. 255. (a) FAILURE TO ESTABLISH SOCIAL SE-
CURITY PAYROLL DEDUCTION PLAN.—Any covered em-
ployer who fails to meet the requirements of section 251
for any calendar year shall be subject to a civil penalty
of not to exceed the greater of—
‘‘(1) $50,000, or
‘‘(2) $1,000 for each eligible employee of such
employer as of the beginning of such calendar year.
‘‘(b) FAILURE TO MAKE DEDUCTIONS REQUIRED
UNDER PLAN.—Any covered employer who fails to timely
deduct in full the amount from the wages of an eligible
employee required under an applicable social security pay-
roll deduction plan shall be subject to a civil penalty of
not to exceed $50 for each such failure.
‘‘(c) FAILURE TO PAY DEDUCTED WAGES TO INDI-
VIDUAL SOCIAL SECURITY RETIREMENT ACCOUNT.—If
an amount deducted from the wages of an eligible em-
ployee under a social security payroll deduction plan is not
timely paid in full to the designated individual social secu-
rity retirement account in accordance with section 251—
‘‘(1) the covered employer failing to make such
payment shall be subject to a civil penalty of not to
exceed 20 percent of the unpaid amount, and
‘‘(2) shall be liable to the eligible employee for
interest on the unpaid amount at a rate equal to
133 percent of the Federal short-term rate under
section 1274(d)(1) of the Internal Revenue Code of
1986, calculated from the last day by which such
amount was required to be so paid to the date on
which such amount is paid into the designated indi-
vidual social security retirement account.
‘‘(d) FAILURE TO PAY PRESCRIBED SOCIAL SECU-
RITY SELF-EMPLOYMENT CONTRIBUTIONS TO INDIVID-
UAL SOCIAL SECURITY RETIREMENT ACCOUNT.—Any in-
dividual failing to timely pay in full a prescribed social
security self-employment contribution to a designated indi-
vidual social security retirement account as required under
section 253 shall be subject to a civil penalty of not to
exceed 20 percent of the unpaid amount, plus interest on
the unpaid amount at a rate equal to 133 percent of the
Federal short-term rate under section 1274(d)(1) of the
Internal Revenue Code of 1986, calculated from the last
day by which such amount was required to be so paid to
the date on which such amount is paid into the designated
individual social security retirement account.
‘‘(e) RULES FOR APPLICATION OF SECTION.—
‘‘(1) PENALTIES ASSESSED BY COMMISSIONER
OF SOCIAL SECURITY.—Any civil penalty assessed by
this section shall be imposed by the Commissioner of
Social Security and collected in a civil action.
‘‘(2) COMPROMISES.—The Commissioner may
compromise the amount of any civil penalty imposed
by this section.
‘‘(3) AUTHORITY TO WAIVE PENALTY IN CER-
TAIN CASES.—The Commissioner may waive the ap-
plication of this section with respect to any failure
if the Commissioner determines that such failure is
due to reasonable cause and not to intentional dis-
regard of rules and regulations.’’.
(b) AMOUNTS DEDUCTED TO BE SHOWN ON W–2
STATEMENTS.—Subsection (a) of section 6051 of the In-
ternal Revenue Code of 1986 (relating to receipts for em-
ployees) is amended—
(1) by striking ‘‘and’’ at the end of paragraph
(8),
(2) by striking the period at the end of para-
graph (9) and inserting ‘‘, and’’, and
(3) by inserting after paragraph (9) the follow-
ing new paragraph:
‘‘(10) the total amount deducted from the em-
ployee’s wages under a social security payroll deduc-
tion plan established under part B of title II of the
Social Security Act.’’
(c) EXEMPTION FROM ERISA REQUIREMENTS.—
Subsection (b) of section 4 of the Employee Retirement
Income Security Act of 1974 (29 U.S.C. 1003(b)) is
amended—
(1) by striking ‘‘or’’ at the end of paragraph
(4);
(2) by striking the period at the end of para-
graph (5) and inserting ‘‘; or’’; and
(3) by adding at the end the following new
paragraph:
‘‘(6) such plan is a social security payroll de-
duction plan established under part B of title II of
the Social Security Act.’’.
(d) EFFECTIVE DATE.—
(1) IN GENERAL.—The amendments made by
subsection (a) shall apply with respect to wages paid
in calendar years beginning on or after January 1,
1997.
(2) 
TRANSITIONAL
RULE.—Notwithstanding
section 252(a) of the Social Security Act (as added
by this Act), the initial designations of individual so-
cial security retirement accounts with respect to eli-
gible employees employed by covered employers as of
January 1, 1997, pursuant to such section may be
made at any time not later than January 15, 1997.
SEC. 5. TAX TREATMENT OF INDIVIDUAL SOCIAL SECURITY
RETIREMENT ACCOUNTS.
(a) IN GENERAL.—Subpart A of part I of subchapter
D of chapter 1 of the Internal Revenue Code of 1986 (re-
lating to pension, profit-sharing, stock bonus plans, etc.)
is amended by inserting after section 408 the following
new section:
‘‘SEC. 408A. INDIVIDUAL SOCIAL SECURITY RETIREMENT
ACCOUNTS.
‘‘(a) GENERAL RULE.—Except as provided in this
section, an individual social security retirement account
shall be treated for purposes of this title in the same man-
ner as an individual retirement plan.
‘‘(b) INDIVIDUAL SOCIAL SECURITY RETIREMENT
ACCOUNT.—For purposes of this section, the term ‘indi-
vidual social security retirement account’ means an ac-
count established and administered in accordance with
part B of title II of the Social Security Act (relating to
individual retirement program).
‘‘(c) CONTRIBUTION RULES.—
‘‘(1) NO DEDUCTION ALLOWED.—No deduction
shall be allowed under section 219 for a contribution
to an individual social security retirement account.
‘‘(2) CONTRIBUTION LIMIT.—No amount, other
than a prescribed contribution under part B of title
II of the Social Security Act, may be accepted as a
contribution to an individual social security retire-
ment account.
‘‘(d) 
TREATMENT
OF
ROLLOVERS.—Section
408(d)(3)(A)(i) shall apply to any amount distributed
from an individual social security retirement account only
to the extent such amount is paid into another such ac-
count for the benefit of the individual for whom the ac-
count from which such amount is transferred was main-
tained.’’
(b) CLERICAL AMENDMENT.—The table of sections
for such subpart A is amended by inserting after the item
relating to section 408 the following new item:
‘‘Sec. 408A. Individual social security retirement accounts.’’
(c) EFFECTIVE DATE.—The amendments made by
this section shall apply to taxable years beginning after
December 31, 1996.
SEC. 6. SUNSET OF PROVISIONS UPON EQUALIZATION OF
RECEIPTS AND DISBURSEMENTS OF THE
TRUST FUND.
In any case in which the authorized tax reduction (as
defined in section 3128 of the Internal Revenue Code of
1986, as amended by this Act) for any year is (or is
deemed to be) 0 percent for each calendar year of any
period of 3 consecutive calendar years commencing on or
after January 1, 1997—
(1) sections 2 and 3 and the amendments made
thereby shall cease to be effective with respect to re-
muneration paid after such period and with respect
to earnings from self-employment attributable to
taxable years beginning after such period,
(2) effective with respect to such remuneration
and such earnings, the provisions amended by sec-
tions 2 and 3 shall read as if the amendments made
by this section had not been enacted, and
(3) section 251, subsections (a) and (b) of sec-
tion 252, and section 253 of the Social Security Act
(added by this Act) shall cease to be effective with
respect to wages paid for services rendered after
such period, and self-employment income derived
after such period.
Æ
HR 2952 IH——2