What This Bill Does
This bill makes changes to Social Security benefits and creates a new combined trust fund. It increases benefit amounts, adjusts how cost-of-living increases are calculated, and adds new taxes on wages and investments to pay for these changes.
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Who It Affects
- Social Security beneficiaries (people receiving retirement, disability and survivor benefits)
- Employees and employers (through new payroll taxes)
- Self-employed people (through new self-employment taxes)
- People with investment income
- Children of deceased or disabled workers who are full-time students
- Railroad employees
- The Social Security Administration
- The Treasury Department
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Key Provisions
- Social Security benefits increase by a higher percentage for all beneficiaries, with adjustments to benefit calculations that apply starting January 1, 2024 (Sec. 2)
- Cost-of-living increases for Social Security benefits now use the Consumer Price Index for Elderly Consumers instead of the regular Consumer Price Index (Sec. 3)
- Lifetime low earners who worked more than 10 years receive a guaranteed minimum benefit amount that increases based on years of work, ranging from 6.25 percent to 125 percent of the poverty guideline (Sec. 4)
- Children who are full-time students can now receive benefits until age 22 instead of age 19, and this applies to children of workers who are disabled or deceased as well as retired workers (Sec. 5)
- Employers and employees pay Social Security taxes on wages between the current contribution and benefit base and $250,000 annually (Sec. 6)
- Self-employed people pay Social Security taxes on net self-employment earnings between the contribution and benefit base and $250,000 annually (Sec. 7)
- An investment income tax increases from 3.8 percent to 16.2 percent, and this tax now applies to a broader range of investment and business income with 62 percent of the revenue directed to Social Security (Sec. 8)
- Two separate Social Security trust funds combine into one unified Social Security Trust Fund (Sec. 9)
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What Changes
If this becomes law, Social Security benefit amounts will increase immediately. The way the government calculates yearly benefit increases will change. People who worked minimum-wage jobs their entire lives will receive higher guaranteed minimums. Children in school can stay on parents' benefits until age 22 instead of age 19. Workers earning over $250,000 yearly will pay additional Social Security payroll taxes on income above the current wage cap. People with significant investment income will pay higher taxes, with part of that money going to Social Security. The two separate trust funds that currently manage Social Security will merge into a single trust fund.
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Important Definitions
- "Full-time student at an educational institution" means a person attending a primary school, secondary school, or college as a full-time student, as determined by the Social Security Commissioner, but does not include people who are paid by employers to attend school or people confined in jail or prison (Sec. 5)
- "Year of work" means any year during which someone earned 4 quarters of Social Security coverage based on their wages and self-employment income (Sec. 4)
- "Consumer Price Index for Elderly Consumers" is the index published by the Bureau of Labor Statistics that measures price changes for items purchased by people age 62 and older (Sec. 3)
- "Contribution and benefit base" is the maximum income subject to Social Security tax in a given year, as determined under Social Security law (Sec. 6)
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Effective Date
Most changes take effect January 1, 2024. The investment tax increase and trust fund consolidation take effect January 1 of the first calendar year beginning after the bill is enacted. The cost-of-living calculation change takes effect starting September 30 of the second calendar year after the bill is enacted.
I
118TH CONGRESS
1ST SESSION H. R. 1046
To enhance Social Security benefits and ensure the long-term solvency of
the Social Security program.
IN THE HOUSE OF REPRESENTATIVES
FEBRUARY 14, 2023
Ms. SCHAKOWSKY (for herself, Ms. HOYLE of Oregon, Mr. COHEN, Mr.
PAYNE, Mr. LARSEN of Washington, Ms. MOORE of Wisconsin, Ms.
BUSH, Mr. LYNCH, Ms. TLAIB, Ms. PINGREE, Mrs. NAPOLITANO, Ms.
NORTON, Mr. RASKIN, Ms. ADAMS, Mr. BOWMAN, Mr. NADLER, Mr.
POCAN, Mr. GRIJALVA, Ms. JAYAPAL, Ms. LEE of California, Ms. JACK-
SON LEE, Mr. GARCI´A of Illinois, Ms. OCASIO-CORTEZ, Mr. CARTER of
Louisiana, Mr. KHANNA, Mr. CASAR, and Mr. MCGOVERN) introduced
the following bill; which was referred to the Committee on Ways and
Means, and in addition to the Committees on Education and the Work-
force, and Transportation and Infrastructure, for a period to be subse-
quently determined by the Speaker, in each case for consideration of such
provisions as fall within the jurisdiction of the committee concerned
A BILL
To enhance Social Security benefits and ensure the long-
term solvency of the Social Security program.
Be it enacted by the Senate and House of Representa-
1
tives of the United States of America in Congress assembled,
2
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
3
(a) SHORT TITLE.—This Act may be cited as the
4
‘‘Social Security Expansion Act’’.
5
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(b) TABLE OF CONTENTS.—The table of contents of
1
this Act is as follows:
2
Sec. 1. Short title; table of contents.
Sec. 2. Across-the-board benefit increase.
Sec. 3. Computation of cost-of-living increases.
Sec. 4. Increase in minimum benefit for lifetime low earners based on years in
the workforce.
Sec. 5. Extended benefit eligibility for children who are full-time students.
Sec. 6. Payroll tax on remuneration up to contribution and benefit base and
more than $250,000.
Sec. 7. Tax on net earnings from self-employment up to contribution and ben-
efit base and more than $250,000.
Sec. 8. Tax on investment gain.
Sec. 9. Social Security Trust Fund established.
SEC. 2. ACROSS-THE-BOARD BENEFIT INCREASE.
3
(a) INCREASE OF FIRST BEND POINT PERCENT-
4
AGE.—Section 215(a)(1)(A)(i) of the Social Security Act
5
(42 U.S.C. 415(a)(1)(A)(i)) is amended by striking ‘‘90
6
percent’’ and inserting ‘‘95 percent’’.
7
(b) ADJUSTMENT TO BEND POINT AMOUNT.—
8
(1) IN GENERAL.—Section 215(a)(1)(B) of the
9
Social Security Act (42 U.S.C. 415(a)(1)(B)) is
10
amended—
11
(A) by redesignating clause (iii) as clause
12
(iv); and
13
(B) by inserting after clause (ii) the fol-
14
lowing new clause:
15
‘‘(iii) For an individual who is eligible for an
16
old-age or disability insurance benefit (or who dies
17
before becoming eligible for such a benefit) in any
18
calendar year after 2023, the amount determined for
19
the individual under clause (ii) of this subparagraph
20
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•HR 1046 IH
for purposes of subparagraph (A)(i)(I) shall be in-
1
creased by 22 percent.’’.
2
(2) CONFORMING AMENDMENT.—Clause (iv) of
3
section 215(a)(1)(B) of the Social Security Act (42
4
U.S.C. 415(a)(1)(B)), as redesignated by paragraph
5
(1), is amended by inserting ‘‘(after the application
6
of clause (iii), when applicable)’’ after ‘‘clause (ii)’’.
7
(c) EFFECTIVE DATE.—
8
(1) IN GENERAL.—The amendments made by
9
this section shall take effect on January 1, 2024,
10
and shall apply with respect to monthly insurance
11
benefits payable under title II of the Social Security
12
Act (42 U.S.C. 401 et seq.) for months in calendar
13
years beginning on or after such date.
14
(2) RECOMPUTATION OF PRIMARY INSURANCE
15
AMOUNTS.—
16
(A) IN
GENERAL.—Notwithstanding sec-
17
tion 215(f) of the Social Security Act (42
18
U.S.C. 415(f)), the Commissioner of Social Se-
19
curity
shall
recompute
primary
insurance
20
amounts to the extent necessary to carry out
21
the amendments to this section.
22
(B) RULE
OF
APPLICATION.—In recom-
23
puting the primary insurance amount of an in-
24
dividual who initially became eligible for old-age
25
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•HR 1046 IH
or disability insurance benefits before January
1
1, 2024, the Commissioner of Social Security
2
shall apply the increase described in clause (iii)
3
of section 215(a)(1)(B) of the Social Security
4
Act (as added by subsection (b)(1)(B)) to the
5
amount determined under clause (ii) of such
6
section 215(a)(1)(B) for the calendar year in
7
which the individual initially became eligible for
8
such benefits.
9
SEC. 3. COMPUTATION OF COST-OF-LIVING INCREASES.
10
(a) IN GENERAL.—Section 215(i)(1) of the Social Se-
11
curity Act (42 U.S.C. 415(i)(1)) is amended by adding
12
at the end the following new subparagraph:
13
‘‘(H) the term ‘Consumer Price Index’ means
14
the Consumer Price Index for Elderly Consumers
15
(CPI–E, as published by the Bureau of Labor Sta-
16
tistics of the Department of Labor).’’.
17
(b) APPLICATION TO PRE-1979 LAW.—
18
(1) IN GENERAL.—Section 215(i)(1) of the So-
19
cial Security Act as in effect in December 1978, and
20
as applied in certain cases under the provisions of
21
such Act as in effect after December 1978, is
22
amended by adding at the end the following new
23
subparagraph:
24
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•HR 1046 IH
‘‘(D) the term ‘Consumer Price Index’ means
1
the Consumer Price Index for Elderly Consumers
2
(CPI–E, as published by the Bureau of Labor Sta-
3
tistics of the Department of Labor).’’.
4
(2) CONFORMING CHANGE.—Section 215(i)(4)
5
of the Social Security Act (42 U.S.C. 415(i)(4)) is
6
amended—
7
(A) by striking ‘‘and by section 9001’’ and
8
inserting ‘‘, section 9001’’; and
9
(B) by inserting ‘‘and section 3 of the So-
10
cial Security Expansion Act,’’ after ‘‘1986,’’.
11
(c) NO EFFECT ON ADJUSTMENTS UNDER OTHER
12
LAWS.—Section 215(i) of the Social Security Act (42
13
U.S.C. 415(i)) is amended by adding at the end the fol-
14
lowing:
15
‘‘(6) Any provision of law (other than in this title,
16
title VIII, or title XVI) which provides for adjustment of
17
an amount based on a change in benefit amounts resulting
18
from a determination made under this subsection shall be
19
applied and administered without regard to the amend-
20
ments made by section 3 of the Social Security Expansion
21
Act, and, for purposes of making such an adjustment
22
under such a provision, this subsection as in effect on the
23
day before the date of enactment of such Act shall con-
24
tinue to apply.’’.
25
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•HR 1046 IH
(d) PUBLICATION OF CONSUMER PRICE INDEX FOR
1
ELDERLY CONSUMERS.—The Bureau of Labor Statistics
2
of the Department of Labor shall prepare and publish the
3
index authorized by section 191 of the Older Americans
4
Amendments Act of 1987 (29 U.S.C. 2 note) for each cal-
5
endar month, beginning with July of the calendar year fol-
6
lowing the calendar year in which this Act is enacted, and
7
such index shall be known as the ‘‘Consumer Price Index
8
for Elderly Consumers’’.
9
(e) EFFECTIVE DATE.—The amendments made by
10
subsection (a) shall apply to determinations made with re-
11
spect to cost-of-living computation quarters (as defined in
12
section 215(i)(1)(B) of the Social Security Act (42 U.S.C.
13
415(i)(1)(B))) ending on or after September 30 of the sec-
14
ond calendar year following the calendar year in which this
15
Act is enacted.
16
SEC. 4. INCREASE IN MINIMUM BENEFIT FOR LIFETIME
17
LOW EARNERS BASED ON YEARS IN THE
18
WORKFORCE.
19
(a) IN GENERAL.—Section 215(a)(1) of the Social
20
Security Act (42 U.S.C. 415(a)(1)) is amended—
21
(1) by redesignating subparagraph (D) as sub-
22
paragraph (E); and
23
(2) by inserting after subparagraph (C) the fol-
24
lowing new subparagraph:
25
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•HR 1046 IH
‘‘(D)(i) Effective with respect to the benefits of indi-
1
viduals who become eligible for old-age insurance benefits
2
or disability insurance benefits (or die before becoming so
3
eligible) after 2023, no primary insurance amount com-
4
puted under subparagraph (A) may be less than the great-
5
er of—
6
‘‘(I) the minimum monthly amount computed
7
under subparagraph (C); or
8
‘‘(II) in the case of an individual who has more
9
than 10 years of work (as defined in clause (iv)(I)),
10
the alternative minimum amount determined under
11
clause (ii).
12
‘‘(ii)(I) The alternative minimum amount determined
13
under this clause is the applicable percentage of 1⁄12 of
14
the annual dollar amount determined under clause (iii) for
15
the year in which the amount is determined.
16
‘‘(II) For purposes of subclause (I), the applicable
17
percentage is the percentage specified in connection with
18
the number of years of work, as set forth in the following
19
table:
20
‘‘If the number of years
The applicable
of work is:
percentage is:
11 ......................................................................................
6.25 percent
12 ......................................................................................
12.50 percent
13 ......................................................................................
18.75 percent
14 ......................................................................................
25.00 percent
15 ......................................................................................
31.25 percent
16 ......................................................................................
37.50 percent
17 ......................................................................................
43.75 percent
18 ......................................................................................
50.00 percent
19 ......................................................................................
56.25 percent
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•HR 1046 IH
‘‘If the number of years
The applicable
of work is:
percentage is:
20 ......................................................................................
62.50 percent
21 ......................................................................................
68.75 percent
22 ......................................................................................
75.00 percent
23 ......................................................................................
81.25 percent
24 ......................................................................................
87.50 percent
25 ......................................................................................
93.75 percent
26 ......................................................................................
100.00 percent
27 ......................................................................................
106.25 percent
28 ......................................................................................
112.50 percent
29 ......................................................................................
118.75 percent
30 or more ........................................................................
125.00 percent.
‘‘(iii) The annual dollar amount determined under
1
this clause is—
2
‘‘(I) for calendar year 2024, the poverty guide-
3
line for 2023; and
4
‘‘(II) for any calendar year after 2024, the an-
5
nual dollar amount for 2023 multiplied by the ratio
6
of—
7
‘‘(aa) the national average wage index (as
8
defined in section 209(k)(1)) for the second cal-
9
endar year preceding the calendar year for
10
which the determination is made, to
11
‘‘(bb) the national average wage index (as
12
so defined) for 2022.
13
‘‘(iv) For purposes of this subparagraph—
14
‘‘(I) the term ‘year of work’ means, with re-
15
spect to an individual, a year to which 4 quarters of
16
coverage have been credited based on such individ-
17
ual’s wages and self-employment income; and
18
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•HR 1046 IH
‘‘(II) the term ‘poverty guideline for 2023’
1
means the annual poverty guideline for 2023 (as up-
2
dated annually in the Federal Register by the De-
3
partment of Health and Human Services under the
4
authority of section 673(2) of the Omnibus Budget
5
Reconciliation Act of 1981) as applicable to a single
6
individual.’’.
7
(b)
RECOMPUTATION.—Notwithstanding
section
8
215(f)(1) of the Social Security Act, the Commissioner of
9
Social Security shall recompute primary insurance
10
amounts originally computed for months prior to Novem-
11
ber 2018, to the extent necessary to carry out the amend-
12
ments made by this section.
13
(c) CONFORMING AMENDMENT.—Section 209(k)(1)
14
of such Act (42 U.S.C. 409(k)(1)) is amended by inserting
15
‘‘215(a)(1)(E),’’ after ‘‘215(a)(1)(D),’’.
16
SEC. 5. EXTENDED BENEFIT ELIGIBILITY FOR CHILDREN
17
WHO ARE FULL-TIME STUDENTS.
18
(a) IN GENERAL.—
19
(1) IN GENERAL.—Section 202(d) of the Social
20
Security Act (42 U.S.C. 402(d)) is amended—
21
(A) in paragraph (1)—
22
(i) in subparagraph (B)—
23
(I) by striking ‘‘or (ii)’’ and in-
24
serting ‘‘(ii)’’; and
25
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•HR 1046 IH
(II) by inserting ‘‘or (iii) was the
1
child of an individual entitled to dis-
2
ability insurance benefits or of an in-
3
dividual who dies a fully or currently
4
insured individual and was a full-time
5
student at an educational institution
6
and had not attained the age of 22,’’
7
after ‘‘22,’’;
8
(ii) in subparagraph (E)—
9
(I) by striking ‘‘and (ii)’’ and in-
10
serting ‘‘(ii)’’; and
11
(II) by inserting ‘‘and (iii) is not
12
a full-time student at an educational
13
institution during any part of such
14
month (in the case of a child who is
15
the child of an individual entitled to
16
disability insurance benefits or of an
17
individual who dies a fully or cur-
18
rently insured individual)’’ before the
19
comma at the end;
20
(iii) in subparagraph
[Text truncated for display. Full text available on Congress.gov.]