SEC. 2. 2008 RECOVERY REBATES FOR CERTAIN INDIVID-
UALS RECEIVING SOCIAL SECURITY BENE-
FITS. 
(a) IN GENERAL.—Subchapter B of chapter 65 of the 
Internal Revenue Code of 1986 is amended by adding at 
the end the following new section: 
‘‘SEC. 6431. 2008 RECOVERY REBATES FOR CERTAIN INDI-
VIDUALS RECEIVING SOCIAL SECURITY BEN-
EFITS. 
‘‘(a) IN GENERAL.—In the case of an eligible indi-
vidual who is an eligible social security recipient, there 
shall be allowed as a credit against the tax imposed by 
subtitle A for the first taxable year beginning in 2008 an 
amount equal $300 ($600 in the case of a joint return). 
‘‘(b) TREATMENT OF CREDIT.—The credit allowed by 
subsection (a) shall be treated as allowed by subpart C 
of part IV of subchapter A of chapter 1. 
‘‘(c) LIMITATION BASED ON ADJUSTED GROSS IN-
COME.—The amount of the credit allowed by subsection 
(a) (determined without regard to this subsection and sub-
section (f)) shall be reduced (but not below zero) by 5 per-
cent of so much of the taxpayer’s adjusted gross income 
as exceeds $75,000 ($150,000 in the case of a joint re-
turn). 
‘‘(d) DEFINITIONS AND SPECIAL RULES.—For pur-
poses of this section— 
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‘‘(1) ELIGIBLE SOCIAL SECURITY RECIPIENT.— 
The term ‘eligible social security recipient’ means, 
with respect to any taxable year, any taxpayer 
who— 
‘‘(A) received a social security benefit (as 
defined in section 86(d)) during such taxable 
year, and 
‘‘(B) has earned income which is less than 
$3,000. 
‘‘(2) ELIGIBLE INDIVIDUAL.—The term ‘eligible 
individual’ means any individual other than— 
‘‘(A) any nonresident alien individual, 
‘‘(B) any individual with respect to whom 
a deduction under section 151 is allowable to 
another taxpayer for a taxable year beginning 
in the calendar year in which the individual’s 
taxable year begins, and 
‘‘(C) an estate or trust. 
‘‘(3) EARNED INCOME.—The term ‘earned in-
come’ has the meaning set forth in section 32(c)(2) 
except that— 
‘‘(A) 
subclause 
(II) 
of 
subparagraph 
(B)(vi) thereof shall be applied by substituting 
‘January 1, 2009’ for ‘January 1, 2008’, and 
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‘‘(B) such term shall not include net earn-
ings from self-employment which are not taken 
into account in computing taxable income. 
‘‘(e) COORDINATION WITH ADVANCE REFUNDS OF 
CREDIT.— 
‘‘(1) IN
GENERAL.—The amount of credit 
which would (but for this paragraph) be allowable 
under this section shall be reduced (but not below 
zero) by the aggregate refunds and credits made or 
allowed to the taxpayer under subsection (f). Any 
failure to so reduce the credit shall be treated as 
arising out of a mathematical or clerical error and 
assessed according to section 6213(b)(1). 
‘‘(2) JOINT RETURNS.—In the case of a refund 
or credit made or allowed under subsection (f) with 
respect to a joint return, half of such refund or cred-
it shall be treated as having been made or allowed 
to each individual filing such return. 
‘‘(f) ADVANCE REFUNDS AND CREDITS.— 
‘‘(1) IN GENERAL.—Each individual who was 
an eligible individual for such individual’s first tax-
able year beginning in 2007 shall be treated as hav-
ing made a payment against the tax imposed by 
chapter 1 for such first taxable year in an amount 
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equal to the advance refund amount for such taxable 
year. 
‘‘(2) ADVANCE
REFUND
AMOUNT.—For pur-
poses of paragraph (1), the advance refund amount 
is the amount that would have been allowed as a 
credit under this section for such first taxable year 
if this section (other than subsection (e) and this 
subsection) had applied to such taxable year. 
‘‘(3) TIMING
OF
PAYMENTS.—The Secretary 
shall, subject to the provisions of this title, refund 
or credit any overpayment attributable to this sec-
tion as rapidly as possible. No refund or credit shall 
be made or allowed under this subsection after De-
cember 31, 2008. 
‘‘(4) NO INTEREST.—No interest shall be al-
lowed on any overpayment attributable to this sec-
tion.’’. 
(b) TREATMENT OF POSSESSIONS.— 
(1) MIRROR CODE POSSESSION.—The Secretary 
of the Treasury shall make a payment to each pos-
session of the United States with a mirror code tax 
system in an amount equal to the loss to that pos-
session by reason of the amendments made by this 
section. Such amount shall be determined by the 
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Secretary of the Treasury based on information pro-
vided by the government of the respective possession. 
(2) OTHER
POSSESSIONS.—The Secretary of 
the Treasury shall make a payment to each posses-
sion of the United States which does not have a mir-
ror code tax system in an amount estimated by the 
Secretary of the Treasury as being equal to the ag-
gregate benefits that would have been provided to 
residents of such possession by reason of the amend-
ments made by this section if a mirror code tax sys-
tem had been in effect in such possession. The pre-
ceding sentence shall not apply with respect to any 
possession of the United States unless such posses-
sion has a plan, which has been approved by the 
Secretary of the Treasury, under which such posses-
sion will promptly distribute such payment to the 
residents of such possession. 
(3) DEFINITIONS AND SPECIAL RULES.— 
(A) 
POSSESSION
OF
THE
UNITED 
STATES.—For purposes of this subsection, the 
term ‘‘possession of the United States’’ includes 
the Commonwealth of Puerto Rico and the 
Commonwealth of the Northern Mariana Is-
lands. 
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(B) MIRROR CODE TAX SYSTEM.—For pur-
poses of this subsection, the term ‘‘mirror code 
tax system’’ means, with respect to any posses-
sion of the United States, the income tax sys-
tem of such possession if the income tax liabil-
ity of the residents of such possession under 
such system is determined by reference to the 
income tax laws of the United States as if such 
possession were the United States. 
(C) TREATMENT OF PAYMENTS.—For pur-
poses of section 1324(b)(2) of title 31, United 
States Code, the payments under this sub-
section shall be treated in the same manner as 
a refund due from the credit allowed under sec-
tion 6431 of the Internal Revenue Code of 1986 
(as added by this section). 
(c) CONFORMING AMENDMENTS.— 
(1) Paragraph (2) of section 1324(b) of title 
31, United States Code, is amended by inserting ‘‘or 
6431’’ after ‘‘section 35’’. 
(2) The table of contents for subchapter B of 
chapter 65 of the Internal Revenue Code of 1986 is 
amended by adding at the end the following new 
item: 
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