"(5) In the case of any individual who is entitled to an old-age insurance benefit for the month in which such individual attains the age of sixty-five or any month thereafter, such benefit for such month shall, if such individual was also entitled to such benefit for any one or more months prior to the month in which such individual attained the age of sixty-five and such benefit for any such prior month was reduced under paragraph (1) or (4), be reduced as provided in such paragraph, except that there shall be subtracted, from the number specified in clause (B) of such paragraph— "(A) the number equal to the number of months for which such benefit was reduced under such paragraph, but for which such benefit was subject to deductions under paragraph (1) or (2) of section 203 (b), and except that, in the case of any such benefit reduced under paragraph (4), there also shall be subtracted from the number specified in clause (B) of paragraph (2), for the purpose of computing the amount referred to in clause (A) of paragraph (4)— "(B) the number equal to the number of months for which the wife's or husband's (as the case may be) insurance benefit was reduced under such paragraph (2), but for which such benefit was subject to deductions under paragraph (1) or (2) of section 203(b), under section 203(c), or under section 222(b), "(C) in case of a wife's insurance benefit, the number equal to the number of months occurring after the first month for which such benefit was reduced under paragraph (2) in which such individual had in her care (individually or jointly with the individual on whose wages and selfemployment income such benefit is based) a child of such individual entitled to child's insurance benefits, and "(D) the number equal to the number of months for which such wife's or husband's (as the case may be) insurance benefit was reduced under such paragraph (2); but in or after which such individual's entitlement to wife's or husband's insurance benefits was terminated because such individual's spouse ceased to be under a disability, not including in such number of months any month after such termination in which such individual was entitled to wife's or husband's insurance benefits. Such subtraction shall be made only if the total of such months specified in clauses (A), (B), (C), and (D) of the preceding sentence is not less than three. For purposes of clauses (B) and (C) of this paragraph, the wife's or husband's insurance benefit of an individual shall not be considered terminated for any reason prior to the month in which such individual attains the age of sixty-five. "(6) In the case of any individual who is entitled to a wife's or husband's insurance benefit for the month in which such individual attains the age of sixty-five or any month thereafter, such benefits for such month shall, if such individual was also entitled to such benefit for any one or more months prior to the month in which such individual attained the age of sixty-five and such benefit for any such prior month was reduced under paragraph (2) or (3), be reduced as provided in such paragraph, except that there shall be subtracted from the number specified in clause (B) of such paragraph "(A) the number equal to the number of months for which such benefit was reduced under such paragraph, but for which such benefit was subject to deductions under section 203 (b) (1) or (2), under section 203 (c), or under section 222 (b), "(B) in the case of a wife's insurance benefit, the number equal to the number of months, occurring after the first month for which such benefit was reduced under such paragraph, in which such individual had in her care (individually or jointly with the individual on whose wages and selfemployment income such benefit is based) a child of such individual entitled to child's insurance benefits, and "(C) the number equal to the number of months for which such wife's or husband's (as the case may be) insurance benefit was reduced under such paragraph, but in or after which such individual's entitlement to wife's or husband's insurance benefits was terminated because such individual's spouse ceased to be under a disability, not including in such number of months any month after such termination in which such individual was entitled to wife's or husband's insurance benefits, and except that, in the case of any such benefit reduced under paragraph (3), there also shall be subtracted from the number specified in clause (B) of paragraph (1), for the purpose of computing the amount referred to in clause (A) of paragraph (3)— "(D) the number equal to the number of months for which the oldage insurance benefit was reduced under such paragraph (1) but for which such benefit was subject to deductions under paragraph (1) or (2) of section 203 (b). Such subtraction shall be made only if the total of such months specified in clauses (A), (B), (C), and (D) of the preceding sentence is not less than three. "(7) In the case of an individual who is entitled to an old-age insurance benefit to which paragraph (5) is applicable and who, for the month in which such individual attains the age of sixty-five (but not for any prior month) or for any later month, is entitled to a wife's or husband's insurance benefit the amount of such wife's or husband's insurance benefit for any month shall be reduced by any amount equal to the amount by which the old-age insurance benefit is reduced under paragraph (5) for such month. "(8) In the case of an individual who is or was entitled to a wife's or husband's insurance benefit to which paragraph (2) was applicable and who, for the month in which such individual attains the age of sixty-five (but not for any prior month) or for any later month, is entitled to an old-age insurance benefit, the amount of such old-age insurance benefit for any month shall be reduced by an amount equal to the amount by which the wife's or husband's (as the case may be) insurance benefit is reduced under paragraph (6) for such month (or, if such individual is not entitled to a wife's or husband's insurance benefit for such month, by (i) an amount equal to the amount by which such benefit for the last month for which such individual was entitled thereto was reduced, or (ii) if smaller, an amount equal to the amount by which such benefit would have been reduced under paragraph (6) for the month in which such individual attained the age of sixty-five if entitlement to such benefit had not terminated before such month). "(9) The preceding paragraphs shall be applied to old-age insurance benefits, wife's insurance benefits, and husband's insurance benefits after reduction under section 203 (a) and application of section 215 (g). If the amount of any reduction computed under paragraph (1), under paragraph (2), under clause (A) or clause (B) of paragraph (3), or under clause (A) or clause (B) of paragraph (4) is not a multiple of $0.10, it shall be reduced to the next lower multiple of $0.10. "Presumed Filing of Application by Individual Eligible for Old-Age and Wife's or Husband's Insurance Benefits "(r) Any individual who becomes entitled to an old-age insurance benefit for any month prior to the month in which such individual attains the age of sixtyfive and who is eligible for a wife's or husband's insurance benefit for the same month shall be deemed to have filed an application in such month for wife's or husband's (as the case may be) insurance benefits. Any individual who becomes entitled to a wife's or husband's insurance benefit for any month prior to the month in which such individual attains the age of sixty-five and who is eligible for an old-age insurance benefit for the same month shall be deemed, unless (in the case of an individual entitled to wife's insurance benefits) such individual has in such month in her care (individually or jointly with the individual on whose wages and self-employment income her wife's insurance benefits are based) a child entitled to child's insurance benefits on the basis of such wages and self-employment income, to have filed an application in such month for old-age insurance benefits. For purposes of this subsection an individual shall be deemed eligible for a benefit for a month if, upon filing application therefor in such month, such individual would have been entitled to such benefit for such month. "Disability Insurance Beneficiary "(s) (1) If any individual becomes entitled to a widow's insurance benefit, widower's insurance benefit, or parent's insurance benefit for a month before the month in which such individual attains the age of sixty-five, of becomes entitled to an old-age insurance benefit wife's insurance benefit, or husband's insurance benefit for a month before the month in which such individual attains the age of sixty-five which is reduced under the provisions of subsection (q), such individual may not thereafter become entitled to disability insurance benefits under this title. "(2) If an indivdual would, but for the provisions of subsection (k) (2) (B), be entitled for any month to a disability insurance benefit and to a wife's or husband's insurance benefit, subsection (q) shall be applicable to such wife's or husband's insurance benefit (as the case may be) for such month only to the extent it exceeds such disability insurance benefit for such month. "(3) The entitlement of any individual to disability insurance benefits shall terminate with the month before the month in which such individual becomes entitled to old-age insurance benefits." (c) So much of such section 202(b) (1) as follows clause (C) is amended by striking out "she becomes entitled to an old-age or disability insurance benefit based on a primary insurance amount which is equal to or exceeds one-half of an old-age or disability insurance benefit of her husband,". (d) (1) Clause (D) of subsection (c) (1) of such section 202 is amended by striking out "or he becomes entitled to an old-age or disability insurance benefit equal to or exceeding one-half of the primary insurance amount of his wife,”. (2) Subsection (c) (3) of such section 202 is amended by striking out "Such" and inserting in lieu thereof "Except as provided in subsection (q), such". (e) Subsection 202(j) (3) of such Act is amended to read as follows: "(3) Notwithstanding the provisions of paragraph (1), an individual may, at his option, waive entitlement to old-age insurance benefits, wife's insurance benefits, or husband's insurance benefits for any one or more consecutive months which occur "(A) after the month before the month in which such individual attains retirement age, "(B) prior to the month in which such individual attains the age of sixty-five, and "(C) prior to the month in which such individual files application for such benefits; and, in such case, such individual shall not be considered as entitled to such benefits for any such month or months before he filed such application. An individual shall be deemed to have waived such entitlement for any such month for which such benefit would, under the second sentence of paragraph (1), be reduced to zero." (f) Section 3121(a) (9) of the Internal Revenue Code of 1954, is amended by striking out "65" and inserting in lieu thereof "62", and by striking out "62" and inserting in lieu thereof "60". (g) (1) The amendment made by subsection (a) shall apply only in the case of lump-sum death payments under section 202(i) of the Social Security Act with respect to deaths occurring after October 1960, and in the case of monthly benefits under title II of such Act for months after October 1960 on the basis of applications filed after the date of enactment of this Act. (2) For purposes of section 215(b) (3)(B) of the Social Security Act (but subject to paragraph (1) of this subsection)— (A)(i) a woman who attains the age of sixty prior to November 1960 and who was not eligible for old-age insurance benefits under section 202 of such Act (as in effect prior to the enactment of this Act) for any month prior to November 1960 shall be deemed to have attained the age of sixty in 1960 or, if earlier, the year in which she died; and (ii) a man who attains the age of sixty-two prior to November 1960 and who was not eligible for old-age insurance benefits under section 202 of such Act (as in effect prior to the enactment of this Act) for any month prior to November 1960 shall be deemed to have attained the age of sixty-two in 1960, or, if earlier, the year in which he died; (B) an individual shall not, by reason of the amendment made by subsection (a), be deemed to be a fully insured individual before November 1960 or the month in which he died, whichever month is the earlier; and (C) the amendment made by subsection (a) shall not be applicable in the case of any individual who was eligible for old-age insurance benefits under such section 202 for any month prior to November 1960. An individual shall, for purposes of this paragraph, be deemed eligible for old-age insurance benefits under section 202 of the Social Security Act for any month if he was or would have been, upon filing application therefor in such month, entitled to such benefits for such month. (3) For purposes of section 209 (i) of such Act, the amendment made by subsection (a) shall apply only with respect to remuneration paid after October 1960. (h) (1) The amendments made by subsections (b) through (e) shall take effect November 1, 1960, and shall be applicable with respect to monthly benefits under title II of the Social Security Act for months after October 1960. (2) The amendment made by subsection (f) shall be effective with respect to remuneration paid after October 1960. 8. AMENDMENT 6-27-60-A-INTRODUCED BY SENATOR KEATING (IDENTICAL TO THE FOLLOWING AMENDMENTS: NO. 13, 6-27-60-I, INTRODUCED BY SENATOR SCHOEPPEL; No. 16, 6-28-60-C, INTRODUCED BY SENATOR HUMPHREY; AND NO. 24, 6-29-60-X, INTRODUCED BY SENATOR HARTKE) STAFF ANALYSIS Increases the social security earnings limitation from $1,200 to $1,800 per year. basis. Cost.-$616 million per year, or 0.19 percent of payroll, on a level premium Financing. No tax increase provided to cover added cost to program. VIEWS OF DEPARTMENT OF HEALTH, EDUCATION, AND WELFARE ON FOLLOWING AMENDMENTS: No. 8, 6-27–60–A; No. 9, 6-27-60-B ; No. 10, 6-27-60-E; No. 13, 6-27-60-I; No. 16, 6-28-60-C; No. 21, 6-29-60-AA; No. 22, 6-29–60-BB; No. 24, 6-29-60-X; No. 25, 629–60-Y; No. 26, 6-29-60-Z The Department of Health, Education, and Welfare believes that the retirement test in the old-age and survivors insurance program is necessary in order to assure that the funds of the program will be employed for socially useful purposes. As indicated in our report of February 11, 1960, on S. 343, S. 453, and S. 1168, elimination of the test would substantially increase the cost of the program and the additional cost would be incurred chiefly as a result of paying full benefits to people who are fully employed at relatively high earnings. If the retirement test were abolished, the cost of the old-age and survivors insurance program would be increased (on an intermediate-cost basis) by about 1 percent of payroll. The Department is therefore strongly in favor of retaining the retirement test in the old-age and survivors insurance program. Moreover, as stated in our report of July 29, 1959, on S. 108, S. 248, S. 432, S. 565, S. 638, S. 679, and S. 1288, we believe that the present exemption of $1,200 is preferable to the higher exemption proposed by the various amendments to H.R. 12580 here reported on. An increase in the amount of earnings exempt under the earnings test would not help the great majority of old-age and survivors insurance beneficiaries, who are either unable to work or cannot find jobs. Moreover, it would not contribute at all to a solution to the basic problems involved in the retirement test. Yet, if the exempt amount were raised, the cost of the old-age and survivors insurance program would be significantly increased. For example, the estimated level-premium cost of increasing the exempt amount to $1,800, without other change in the present law, would be 0.19 percent of payroll on an intermediate-cost basis. The increase in cost would of course be even higher if the exempt amount were raised to a higher amount than $1,800, as proposed in some of the amendments here commented on. The Department of Health, Education, and Welfare recommends against enactment of the proposed amendments. TEXT OF AMENDMENT 6-27-60-A Intended to be proposed by Mr. KEATING to the bill (H.R. 12580), viz: On page 80, between lines 3 and 4, insert the following new section: SEC. 211. (a) (1) Paragraphs (1) and (2) of subsection (e) of section 203 of the Social Security Act are amended by striking out "$1,200" wherever it appears therein and inserting in lieu thereof "$1,800", and (2) such paragraphs and paragraph (1) of subsection (g) of such section are amended by striking out "$100 times" wherever it appears therein and inserting in lieu thereof "$150 times". (b) The amendments made by subsection (a) shall be effective, in the case of any individual, with respect to taxable years of such individual ending after 1960. 9. AMENDMENT 6-27-60-B-INTRODUCED BY SENATOR KEATING (IDENTICAL TO NO. 22, 6-29-60-BB. INTRODUCED BY SENATOR HARTKE) STAFF ANALYSIS Eliminates the social security earnings limitation (now $1,200 per year). TEXT OF AMENDMENT 6-27-60-B Intended to be proposed by Mr. KEATING to the bill (H.R. 12580), viz: On page 27, line 17, strike out “(A)”. On page 27, line 22, strike out "(B)" and insert in lieu thereof “(2)”. On page 42, line 13, strike out "subsection (a)" and insert in lieu thereof "subsections (a) and (b)". On page 80, between lines 3 and 4, insert the following new section: "ELIMINATION OF DEDUCTIONS FROM BENEFITS ON ACCOUNT OF WORK "SEC. 211. (a) Subsections (c), (e), (g), (j), and (k) of section 203 of the Social Security Act are repealed. "(b) Subsection (b) of such section 203 is amended by (1) striking out 'Work or' in the heading, and (2) striking out paragraphs (1) and (2) thereof. "(c) (1) The first sentence of subsection (d) of such section 203 is amended by striking out 'subsections (b) and (e)' and inserting in lieu thereof 'subsection (b)'. 66 "(2) The second sentence of such subsection (d) is repealed. "(d) Subsection (f) of such section 203 (as amended by section 209 (a) of this Act) is amended by striking out '(other than an event specified in subsection (b) (1))'. "(e) Paragraph (1) of subsection (h) of such section 203 is amended by striking out', (f), or (g)' and inserting in lieu thereof‘, or (f)'. "(f) Subsection (1) of such section 203 is amended by striking out ‘or (g)'. 66 ‘(g) Paragraph (1) of subsection (n) of section 202 of the Social Security Act is amended by striking out 'section 203 (b) and (c)' and inserting in lieu thereof 'section 203 (b)'. "(h) Paragraph (7) of subsection (t) of section 202 of the Social Security Act is amended by striking out 'subsections (b) and (c)' and inserting in lieu thereof 'subsection (b)'. “(i) The amendments made by this section shall apply only with respect to monthly benefits payable under title II of the Social Security Act for months beginning after the month in which this Act is enacted." |