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Last progress March 21, 2025 (10 months ago)
Introduced on March 21, 2025 by Nicole Malliotakis
Referred to the Committee on Ways and Means, and in addition to the Committee on Appropriations, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
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.
Amends subsection (a) of section 86 of the Internal Revenue Code so that gross income for any taxpayer described in subsection (b) includes Social Security benefits equal to the lesser of: (1) 85 percent of the Social Security benefits received during the taxable year, or (2) 85 percent of the excess described in subsection (b)(1).
Defines the term “base amount” for purposes of section 86(c) as: (A) $34,000 (general rule), (B) $68,000 for a joint return, and (C) zero for a taxpayer who is married at the close of the taxable year, does not file a joint return, and does not live apart from his spouse at all times during the taxable year.
Requires inflation adjustment of the dollar amounts in the base-amount definition: for any taxable year beginning after 2025, each dollar amount in paragraph (1) shall be increased by the cost-of-living adjustment determined under section 1(f)(3), with that computation made by substituting “calendar year 2024” for “calendar year 2016.”
Specifies rounding: if any amount determined under the inflation-adjustment rule is not a multiple of $1,000, it shall be rounded to the nearest multiple of $1,000.
Appropriates from the Treasury (out of any money not otherwise appropriated) for each fiscal year an amount to each fund under the [Social Security-related funds] or the Railroad Retirement Act of 1974 equal to the reduction in transfers to such fund for that fiscal year by reason of the amendments made by this section (i.e., "held harmless" transfers).
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Last progress February 3, 2025 (11 months ago)