Raises the income thresholds used to decide how much of a person’s Social Security benefits are taxed and standardizes the inclusion rule at 85% for those who are subject to taxation. New base amounts are set at $34,000 for single filers, $68,000 for joint filers, and $0 for certain married‑filing‑separately filers, with the thresholds indexed for inflation after 2025. It also provides funds to keep the Social Security and railroad retirement trust funds whole if tax transfers fall.

To pay for the change, beginning in fiscal year 2027 the government must rescind an amount from non‑security discretionary spending each year equal to the total cost of the policy, as determined by the Treasury Secretary. OMB must publish an annual report on these rescissions starting January 1, 2028.