Provisions Affecting Level of Monthly Benefits
These provisions modify the formula used for calculating the basic Social Security monthly benefit called the Primary Insurance Amount (PIA). We provide a summary list of all options (printer-friendly PDF version) in this category. For each provision listed below, we provide an estimate of the financial effect on the OASDI program over the long-range period (the next 75 years) and for the 75th year. In addition, we provide graphs and detailed single year tables. We base all estimates on the intermediate assumptions described in the 2019 Trustees Report.
Choose the type of estimates (summary or detailed) from the list of provisions.
We group these provisions as follows:- B1: PIA bend point and factor changes, adjusting for inflation. These provisions reduce benefits for some future beneficiaries. Future PIA bend points and formula factors change so that the growth in benefits from one cohort to the next reflect some degree of inflation, rather than growth in average wages as specified in current law.
- B2: PIA bend point and factor changes, adjusting for longevity. These provisions reduce benefits for some future beneficiaries. Future PIA formula factors decrease as a result of increased longevity (people living longer).
- B3: PIA bend point and factor changes, other adjustments. These provisions specify other changes in future PIA bend points and formula factors.
- B4: Computation year changes. These provisions specify changes to the number of years used in determining benefits.
- B5: Minimum benefits. These provisions provide an increase in benefits to targeted individuals, generally those with low earnings and full work careers.
- B6: Benefit Increases for Older Beneficiaries. These provisions provide an increase in benefits for beneficiaries who have been on the rolls for at least 20 years.
- B7: Other benefit adjustments.
Number | Table and graph selection |
---|---|
B1.1 |
Price indexing of PIA factors beginning with those newly eligible for
OASDI benefits in 2026: Reduce factors so that initial benefits grow
by inflation rather than by the SSA average wage index.
Summary measures and graphs
(PDF version)
Detailed single year tables (PDF version) Memorandum containing this or a similar provision: |
B1.2 |
Progressive price indexing (30th percentile) of PIA factors beginning with
individuals newly eligible for OASDI benefits in 2026: Create a new bend
point at the 30th percentile of the AIME distribution of newly retired workers.
Maintain current-law benefits for earners at the 30th percentile and below. Reduce
the 32 and 15 percent factors above the 30th percentile such that the initial
benefit for a worker with AIME equal to the taxable maximum grows by inflation
rather than the growth in the SSA average wage index.
Summary measures and graphs
(PDF version)
Detailed single year tables (PDF version) Memorandum containing this or a similar provision: |
B1.3 |
Progressive price indexing (40th percentile) of PIA factors beginning with
individuals newly eligible for OASDI benefits in 2026: Create a new bend
point at the 40th percentile of the AIME distribution of newly retired workers.
Maintain current-law benefits for earners at the 40th percentile and below.
Reduce the 32 and 15 percent factors above the 40th percentile such that the
initial benefit for a worker with AIME equal to the taxable maximum grows by
inflation rather than the growth in the SSA average wage index.
Summary measures and graphs
(PDF version)
Detailed single year tables (PDF version) Memorandum containing this or a similar provision: |
B1.4 |
Progressive price indexing (50th percentile) of PIA factors beginning with
individuals newly eligible for OASDI benefits in 2026: Create a new bend
point at the 50th percentile of the AIME distribution of newly retired workers.
Maintain current-law benefits for earners at the 50th percentile and below. Reduce
the 32 and 15 percent factors above the 50th percentile such that the initial
benefit for a worker with AIME equal to the taxable maximum grows by inflation
rather than the growth in the SSA average wage index.
Summary measures and graphs
(PDF version)
Detailed single year tables (PDF version) Memorandum containing this or a similar provision: |
B1.5 |
Progressive price indexing (60th percentile) of PIA factors beginning with
individuals newly eligible for OASDI benefits in 2026: Create a new bend
point at the 60th percentile of the AIME distribution of newly retired workers.
Maintain current-law benefits for earners at the 60th percentile and below. Reduce
the 32 and 15 percent factors above the 60th percentile such that the initial
benefit for a worker with AIME equal to the taxable maximum grows by inflation
rather than the growth in the SSA average wage index.
Summary measures and graphs
(PDF version)
Detailed single year tables (PDF version) Memorandum containing this or a similar provision: |
B1.6 (2023) |
Progressive price indexing (30th percentile) of PIA factors beginning with
individuals newly eligible for OASI benefits in 2023: Create a new bend point
at the 30th percentile of the AIME distribution of newly retired workers. Maintain
current-law benefits for earners at the 30th percentile and below. Reduce the
32 and 15 percent factors above the 30th percentile such that the initial benefit
for a worker with AIME equal to the taxable maximum grows by inflation rather
than the growth in the SSA average wage index. Disabled workers are: (a) not
affected prior to normal retirement age; and (b) subject to a proportional reduction
in benefits, based on the worker's years of disability, upon conversion to retired-worker
beneficiary status. Young survivors (children of deceased workers and surviving
spouses with a child in care) are not affected.
Summary measures and graphs
(PDF version)
Detailed single year tables (PDF version) Memorandum containing this or a similar provision: |
B1.6 (2028) |
Progressive price indexing (30th percentile) of PIA factors beginning with
individuals newly eligible for OASI benefits in 2028: Create a new bend point
at the 30th percentile of the AIME distribution of newly retired workers. Maintain
current-law benefits for earners at the 30th percentile and below. Reduce the
32 and 15 percent factors above the 30th percentile such that the initial benefit
for a worker with AIME equal to the taxable maximum grows by inflation rather
than the growth in the SSA average wage index. Disabled workers are: (a) not
affected prior to normal retirement age; and (b) subject to a proportional reduction
in benefits, based on the worker's years of disability, upon conversion to retired-worker
beneficiary status.
Summary measures and graphs
(PDF version)
Detailed single year tables (PDF version) Memorandum containing this or a similar provision: |
B1.7 |
Progressive price indexing (40th percentile) of PIA factors for individuals
newly eligible for OASI benefits in 2027 through 2064: Create a new bend point
at the 40th percentile of the AIME distribution of newly retired workers. Maintain
current-law benefits for earners at the 40th percentile and below. Reduce the
32 and 15 percent factors above the 40th percentile such that the initial benefit
for a worker with AIME equal to the taxable maximum grows by inflation rather
than the growth in the SSA average wage index. Disabled workers are: (a) not
affected prior to normal retirement age; and (b) subject to a proportional reduction
in benefits, based on the worker's years of disability, upon conversion to retired-worker
beneficiary status. Young survivors (children of deceased workers and surviving
spouses with a child in care) are not affected.
Summary measures and graphs
(PDF version)
Detailed single year tables (PDF version) Memorandum containing this or a similar provision: |
B1.8 |
Progressive price indexing (50th percentile) of PIA factors for individuals
newly eligible for OASI benefits in 2024 through 2063: Create a new bend point
at the 50th percentile of the AIME distribution of newly retired workers. Maintain
current-law benefits for earners at the 50th percentile and below. Reduce the 32
and 15 percent factors above the 50th percentile such that the initial benefit
for a worker with AIME equal to the taxable maximum grows by inflation rather than
the growth in the SSA average wage index. Disabled workers are: (a) not affected
prior to normal retirement age; and (b) subject to a proportional reduction in
benefits, based on the worker's years of disability, upon conversion to retired-worker
beneficiary status.
Summary measures and graphs
(PDF version)
Detailed single year tables (PDF version) Memorandum containing this or a similar provision: |
B2.1 |
Beginning with those newly eligible for OASI benefits in 2029, multiply
the PIA factors by the ratio of life expectancy at 67 for 2024 to the
life expectancy at age 67 for the 4th year prior to the year of benefit
eligibility. Unisex life expectancies, based on period life tables as
computed by SSA's Office of the Chief Actuary, are used to determine the
ratio. Disabled workers are: (a) not affected prior to normal retirement
age; and (b) subject to a proportional reduction in benefits, based on
the worker's years of disability, upon conversion to retired-worker
beneficiary status.
Summary measures and graphs
(PDF version)
Detailed single year tables (PDF version) Memoranda containing this or a similar provision: |
B3.8 |
Beginning with those newly eligible for OASDI benefits in 2026, create a
new bend point at the 50th percentile of the AIME distribution of newly
retired workers and gradually reduce all PIA factors except for the 90
percent factor. By 2059: a) the 32 percent PIA factor below the new bend
point reduces to 30 percent; b) the 32 percent PIA factor above the new
bend point reduces to 10 percent; and c) the 15 percent PIA factor reduces
to 5 percent.
Summary measures and graphs
(PDF version)
Detailed single year tables (PDF version) Memorandum containing this or a similar provision: |
B3.9 |
Beginning with those newly eligible for OASDI benefits in 2032, gradually
reduce the 15 percent PIA factor in each year so that it reaches 10 percent
for those newly eligible in 2061 and later.
Summary measures and graphs
(PDF version)
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B3.10 |
Beginning with those newly eligible for OASDI benefits in 2026, gradually
increase the first PIA bend point in each year so that it is 15 percent higher
for those newly eligible in 2040 and later.
Summary measures and graphs
(PDF version)
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B3.11 |
Increase the first PIA factor from 90 percent to 93 percent for all
beneficiaries eligible as of January 2021 and for those newly eligible
for benefits after 2020.
Summary measures and graphs
(PDF version)
Detailed single year tables (PDF version) Memoranda containing this or a similar provision: |
B3.12 |
Use an annualized "mini-PIA" formula beginning with retired workers
newly eligible in 2026. For each indexed earnings year, compute an
individual AIME and an individual PIA. Sum these individual PIAs for
the 40 highest years of indexed earnings and divide that total amount
by 37 to get the PIA for this provision. Phase-in over five years,
meaning that in 2026, 80 percent of the benefit would be based on the
old 35-year average PIA formula and 20 percent on the new mini-PIA
formula, shifting by 20 percentage points each year until 100 percent
is based on the new mini-PIA formula for those attaining age 62 in 2030.
Disabled worker benefits are unchanged under this provision.
Summary measures and graphs
(PDF version)
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B3.13 |
For retired worker beneficiaries newly eligible in 2026 (excluding
disabled workers), add a new bend point at the wage-indexed equivalent
of the 50th percentile of the AIME distribution minus $100 (for 2015
eligibility) and change the PIA factors to 95/32/15/5. Also move the
current-law first bend point from the wage-indexed equivalent of $926
in 2019 to $1,177 in 2019. Phase this provision in over 10 years
(2026-2035). The phase-in would work on a weighted-average basis:
90% of CL formula + 10% of proposal formula for 2026, 80% of CL formula
+ 20% of proposal formula for 2027, and so on.
Summary measures and graphs
(PDF version)
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B3.14 |
Beginning with those newly eligible for OASDI benefits in 2021, reduce
the 15 percent PIA factor by 2 percentage points per year so that it
reaches 5 percent for those newly eligible in 2025 and later.
Summary measures and graphs
(PDF version)
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B3.15 |
Increase the 90 percent PIA formula factor to 91 percent for beneficiaries
newly eligible in 2024, 92 percent for those newly eligible in 2025, ...,
reaching 95 percent for those newly eligible in 2028 and later.
Summary measures and graphs
(PDF version)
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B3.16 |
For retired worker and disabled worker beneficiaries becoming initially
eligible in January 2026 or later, phase in a new benefit formula (from
2026 to 2035). Replace the existing two primary insurance amount (PIA)
bend points with three new bend points as follows: (1) 25% AWI/12 from
2 years prior to initial eligibility; (2) 100% AWI/12 from 2 years prior
to initial eligibility; and (3) 125% AWI/12 from 2 years prior to initial
eligibility. The new PIA factors are 95%, 27.5%, 5% and 2%. During the
phase in, those becoming newly eligible for benefits will receive an increasing
portion of their benefits based on the new formula, reaching 100% of the
new formula in 2035.
Summary measures and graphs
(PDF version)
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B4.1 |
Increase the number of years used to calculate benefits for retirees
and survivors (but not for disabled workers) from 35 to 38, phased in
over the years 2020-2024.
Summary measures and graphs
(PDF version)
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B4.2 |
Increase the number of years used to calculate benefits for retirees
and survivors (but not for disabled workers) from 35 to 40, phased in
over the years 2020-2028.
Summary measures and graphs
(PDF version)
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B4.3 |
For the OASI and DI computation of the PIA, gradually reduce the maximum
number of drop-out years from 5 to 0, phased in over the years 2021-2029.
Summary measures and graphs
(PDF version)
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B4.4 |
Reduce the number of computation years (increase dropout years) for parents
having a child in care under the age of 6. The parent must have no earnings
(covered or non-covered) for the year to be eligible for the credit. Only one
parent can claim the childcare added dropout year for a given earnings year.
Each parent can earn at most 2 dropout years per child, and a maximum of 5
dropout years in total. The years designated as childcare years do not have
to be the years that could otherwise be included in the computation of the
average indexed monthly earnings (AIME). The provision would be effective for
all benefits payable for entitlement in January 2021 and later (without regard
for when the beneficiary became initially eligible).
Summary measures and graphs
(PDF version)
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B4.5 |
For retired and disabled workers, reduce the maximum number of dropout
years to 4 for workers newly eligible in 2021, to 3 for workers newly
eligible in 2022, and to 2 for workers newly eligible in 2023 and later.
Summary measures and graphs
(PDF version)
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B5.1 |
Increase the PIA to a level such that a worker with 30 years of earnings
at the minimum wage level receives an adjusted PIA equal to 120 percent
of the Federal poverty level for an aged individual. This provision takes
full effect for all newly eligible OASDI workers in 2037, and is phased
in for new eligibles in 2028 through 2036. The percentage increase in PIA
is lowered proportionately for those with fewer than 30 years of earnings,
down to no enhancement for workers with 20 or fewer years of earnings.
(Year-of-work requirements are "scaled" for disabled workers based on their
years of potential work from age 22 to benefit eligibility). The benefit
enhancement percentage is reduced proportionately for workers with higher
average indexed monthly earnings (AIME), down to no enhancement for those
with AIME at least twice that of a 35-year steady minimum wage earner.
Summary measures and graphs
(PDF version)
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B5.2 |
Beginning for those newly eligible in 2020, reconfigure the special
minimum benefit: (a) A year of coverage is defined as a year in which
4 quarters of coverage are earned. (b) At implementation, set the PIA
for 30 years of coverage equal to 125 percent of the monthly poverty
level (about $1,265 in 2018). For those with under 30 years of coverage,
the PIA per year of coverage over 10 years is $1,265/20 = $63.25. (c)
Index the initial PIA per year of coverage by wage growth for successive
cohorts.
Summary measures and graphs
(PDF version)
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B5.3 |
Beginning for those newly eligible in 2020, reconfigure the special
minimum benefit: (a) A year of coverage is defined to be either a year
in which 4 quarters of coverage are earned or a child is in care.
Childcare years are granted to parents who have a child under 5, with
a limit of 8 such years. (b) At implementation, set the PIA for 30
years of coverage equal to 125 percent of the monthly poverty level
(about $1,265 in 2018). For those with under 30 years of coverage,
the PIA per year of coverage over 10 years is $1,265/20 = $63.25.
(c) Index the initial PIA per year of coverage by wage growth for
successive cohorts.
Summary measures and graphs
(PDF version)
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B5.4 |
Beginning for those newly eligible in 2026, reconfigure the special minimum
benefit: (a) A year of coverage is defined as a year in which 4 quarters of
coverage are earned. (b) At implementation, set the PIA for 30 years of coverage
equal to 125 percent of the monthly poverty level (about $1,265 in 2018). For
those with under 30 years of coverage, the PIA per year of coverage over 10
years is $1,265/20 = $63.25. (c) From 2018 to the year of implementation, 2026,
index the PIA per year of coverage using the chain-CPI index. Then, for later
years, index the PIA per year of coverage by wage growth for successive cohorts.
(d) Scale work requirements for disabled workers, based on the number of years
of non-disabled potential work.
Summary measures and graphs
(PDF version)
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B5.5 |
Beginning for those newly eligible in 2021, reconfigure the special minimum
benefit: (a) A year of coverage is defined as a year in which either 20 percent
of the "old law maximum" is earned or a child is in care. Childcare years are
granted to parents who have a child under 6, with a limit of 8 such years.
(b) At implementation, set the PIA for 30 years of coverage equal to 133 percent
of the Census monthly poverty level (about $1,335 in 2018). For those with under
30 years of coverage, the PIA per year of coverage over 19 years is $1,335/11
= $121.40. (c) Index the initial PIA per year of coverage by wage growth for
successive cohorts. (d) Scale work requirements for disabled workers, based on
the number of years of non-disabled potential work.
Summary measures and graphs
(PDF version)
Detailed single year tables (PDF version) Memorandum containing this or a similar provision: |
B5.6 |
Beginning for those newly eligible in 2020, reconfigure the special
minimum benefit: (a) A year of coverage is defined to be either a year
in which 4 quarters of coverage are earned or a child is in care. Childcare
years are granted to parents who have a child under 6, with a limit
of 5 such years. (b) At implementation, set the PIA for 30 years of
coverage equal to 100 percent of the monthly poverty level (about $1,041
in 2019). For those with under 30 years of coverage, the PIA per year
of coverage over 10 years is $1,041/20 = $52.05. (c) From 2019 to the
year of implementation, 2020, index the PIA per year of coverage using
the CPI index. Then, for later years, index the PIA per year of coverage
by wage growth for successive cohorts. (d) Scale work requirements for
disabled workers, based on the number of years of non-disabled potential
work.
Summary measures and graphs
(PDF version)
Detailed single year tables (PDF version) Memorandum containing this or a similar provision: |
B5.7 |
Beginning for those newly eligible in 2022, reconfigure the special
minimum benefit: (a) The number of years of work (YOWs) is determined
as total quarters of coverage divided by 4, ignoring any fraction.
Childcare years are granted to parents who have a child under 6, with
a limit of 5 such years. (b) At implementation, set the PIA for 30+
YOWs equal to 100 percent of the monthly HHS poverty level for the
year prior to eligibility. For workers between 11 and 29 YOWs, reduce
the special minimum by 3 1/3 percentage points per YOW so that at 29
YOWs the minimum would be 96 2/3% of poverty, ..., down to 11 YOWs at
36 2/3% of poverty. No minimum for 10 or fewer YOWs.
Summary measures and graphs
(PDF version)
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B5.8 |
Beginning in 2024, create a Basic Minimum Benefit (BMB) within Social
Security (i.e., the cost of the BMB would be charged as a cost to the
OASI Trust Fund), with the following specifications: (1) Eligibility
for the BMB would be limited to OASI beneficiaries who have attained
normal retirement age (NRA) or above. OASI beneficiaries under NRA would
not be eligible for the BMB. (2) The BMB would be calculated on a household
basis and split equally between members of the household. In the case
of a married couple, both spouses would need to claim any Social Security
benefits for which they are eligible before they could receive the BMB.
If both spouses have claimed and one is NRA or above and the other has
not yet attained NRA, only the half of the BMB for the spouse over NRA
would be payable. (3) The BMB amount for single beneficiaries would be
equal to either: 1) the BMB base ($604 in 2015) - 0.70 * current monthly
OASI benefit (not including any BMB), if positive; or 2) zero. (4) The
BMB amount for married beneficiaries would be equal to either: 1) the BMB
base ($906 in 2015) - 0.70 * total household monthly OASI benefits (not
including any BMB), if positive; or 2) zero. (5) The BMB bases for singles
and couples would be updated annually for changes in the average wage index
(AWI). (6) Single filers with Adjusted Gross Income (AGI) over $30,000 and
joint filers with AGI (including taxable SS benefits) over $45,000 would be
subject to clawback of the BMB through the income tax system. Any BMB would
be reduced by one dollar for every dollar of income above the thresholds.
(Thresholds, in 2015 dollars, would be indexed to chained CPI-U.) Clawbacks
would be credited back to the OASI Trust Fund.
Summary measures and graphs
(PDF version)
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B5.9 |
Beginning for those newly eligible in 2021, reconfigure the special minimum
benefit: (a) A year of coverage is defined as a year in which 4 quarters of
coverage are earned. (b) At implementation, set the PIA for 40 years of coverage
equal to 125 percent of the monthly Aged Federal poverty level (about $1,254
in 2018). For those with 20 or fewer years of coverage, phase up linearly from
0 percent of the poverty level for 10 years of coverage to 100 percent of the
poverty level. For those having between 20 and 40 years of coverage, phase up
linearly from 100 percent of the poverty level at 20 years of coverage to 125%
of the poverty level for 40 or more years of coverage. (c) For newly eligible
workers in 2021 and 2022, index the applicable poverty level using the CPI index,
to the year prior to eligibility. Then, for newly eligible workers in 2023 and
later, index the PIA per year of coverage by wage growth for successive cohorts.
(d) Disabled workers have a somewhat similar minimum benefit, with work requirements
scaled based on the number of years of non-disabled potential work.
Summary measures and graphs
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B5.10 |
Reconfigure the special minimum benefit, phased in for retired and
disabled workers newly eligible from 2026 through 2035: (a) A year
of work (YOW) coverage is equal to earnings at or above $10,875 in
2019 (reflecting a full-time worker earning the federal minimum wage),
adjusted thereafter for wage growth. (b) At implementation, set the
minimum PIA at zero percent of AWI for those with 10 or fewer YOWs to
15 percent of AWI for those with 15 YOWs, increasing linearly so that
it reaches 19 percent for 19 YOWs. Then the minimum PIA would jump
up to 25 percent of AWI for those with 20 YOWs, increasing linearly
so that it equals 35 percent of AWI for those with 35 or more YOWs.
(c) Use the AWI for two years prior to the year of initial eligibility
in the minimum PIA calculation with COLA increase after the year of
initial eligibility. (d) Scale the YOW requirements for disabled workers,
based on the number of years of non-disabled potential work.
Summary measures and graphs
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B5.11 |
Beginning for those newly eligible in 2020, reconfigure the special minimum
benefit: (a) The number of years of work (YOWs) is determined as total quarters
of coverage divided by 4, ignoring any fraction. Childcare years are granted
to parents who have a child under 6, with a limit of 5 such years. (b) For
beneficiaries becoming newly eligible in 2020, set the initial special minimum
benefit for 30+ YOWs equal to 100 percent of the monthly HHS poverty level for
2019. For beneficiaries becoming newly eligible after 2020, the initial special
minimum benefit is indexed by the AWI. For workers between 11 and 29 YOWs, reduce
the special minimum by 3 1/3 percentage points per YOW so that at 29 YOWs the
minimum would be 96 2/3% of poverty, ..., down to 11 YOWs at 36 2/3% of poverty.
No minimum for 10 or fewer YOWs.
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B6.1 |
Provide a 5 percent increase to the monthly benefit amount (MBA) of any
beneficiary who is 85 or older at the beginning of 2020 or who reaches
their 85th birthday after the beginning of 2020.
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B6.2 |
Provide the same dollar amount increase to the monthly benefit amount
(MBA) of any beneficiary who is 85 or older at the beginning of 2020
or who reaches their 85th birthday after the beginning of 2020. The
dollar amount of increase equals 5 percent of the average retired-worker
MBA in the prior year.
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B6.3 |
Provide an increase in the benefit level of any beneficiary who is 85
or older at the beginning of 2021 or who reaches their 85th birthday
after the beginning of 2021. Increase the beneficiary's PIA based on
an amount equal to the average retired-worker PIA at the end of 2020,
or at the end of the year age 80 if later. Increase the beneficiary's
PIA by 5 percent of this amount for those older than 85 at the beginning
of 2021 and by 5 percent of this amount at age 85 for others, phased in
at 1 percent per year for ages 81-85.
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B6.4 |
Starting in 2020, provide a 5 percent uniform benefit increase 24
years after initial benefit eligibility. Phase in the benefit increase
at 1 percent per year from the 20th through 24th years after eligibility.
For disabled workers, the eligibility age is the initial entitlement
year to the benefit. The benefit increase is equal to 5 percent of
the PIA of a worker assumed to have career-average earnings equal
to SSA's average wage index. Auxiliary beneficiaries receive benefit
enhancement based on the PIA of the governing worker.
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B6.5 |
Starting in 2022, provide a 5 percent uniform PIA increase 20 years
after benefit eligibility. Phase in the PIA increase at 1 percent per
year from the 16th through 20th years after eligibility. The full PIA
increase is equal to 5 percent of the PIA of a worker assumed to have
career-average earnings equal to the SSA average wage index. Auxiliary
beneficiaries receive benefit enhancement based on the PIA of the governing
worker.
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B6.6 |
Starting in 2026, provide a uniform PIA increase in the 24th year of
benefit eligibility. Phase in the PIA increase at 0.5 percent per year
from the 15th through the 24th years of eligibility. The full PIA increase
is equal to 5 percent of the average retired worker PIA in December
of the 14th year of benefit eligibility. A similar additional PIA increase
applies in the 43rd year of benefit eligibility (age 104), phased in
from the 34rd through the 43nd years of eligibility. For those past the
15th year of eligibility in 2026 (over age 76 for retirees), phase in
the PIA enhancement over 10 years starting in 2026. Auxiliary beneficiaries
receive benefit enhancement based on the PIA of the governing worker.
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B6.7 |
Starting in January 2026, provide an addition to monthly benefits
for all beneficiaries who have been eligible for at least 20 years,
with the following specifications: (1) Augment benefits (not the
PIA) for those of qualifying age and eligibility duration with a MAGI
below about $27,000 if single and $54,000 if married. MAGI is set
to equal the IRMAA definition (AGI plus tax-exempt interest income).
Index these thresholds after 2026 by the increase in the C-CPI-U;
(2) The full additional amount is applicable for those born 1959 and
later, once 24 years elapse from initial eligibility. The basic additional
amount is calculated as 5 percent of the PIA for a hypothetical worker
with earnings equal to the AWI each year; (3) For those born prior to
1960, the full additional amount is multiplied by the number of years
they have been affected by the C-CPI-U, divided by 24; (4) Beneficiaries
will receive 20 percent of their additional amount in their 20th year
after initial eligibility, 40 percent in their 21st year after initial
eligibility,..., and 100 percent of their additional amount in their
24th and later years after benefit eligibility; (5) Retired and disabled
worker beneficiaries, dually entitled spouse beneficiaries, and all
survivor beneficiaries received their addition as described above. Spousal
beneficiaries (aged or with child in care) and child beneficiaries of
a living retired or disabled worker receive 50 percent of the additional
amount described above. Other beneficiary types (such as parents of
deceased workers) will receive the percentage of the flat benefit that
equals the percentage of the insured worker's PIA that they receive;
(6) The AWI used is for the second year prior to the beneficiary's
initial eligibility year, with applicable COLAs applied up to the age
when the addition is received; and (7) The additional amount is added
to the monthly benefit after reductions for early claiming or increases
for delayed claiming have been applied.
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B6.8 |
Starting in 2021, provide an additional monthly benefit equal to 1/12th
of 2 percent of the AWI for the second prior year. This additional benefit
would be available to those meeting any of the following four requirements:
(a) Social Security beneficiaries who have attained age 82; (b) Social
Security beneficiaries who have attained NRA and have both AIME at or below
the first PIA bend point ($926 for 2019 initial eligibility) and at least
11 "years of coverage" as used for Windfall Elimination Provision purposes
(earnings above $24,675 for 2019); (c) Individuals who have received Social
Security benefits and/or SSI payments for at least 240 distinct months after
attaining age 19; or (d) SSI recipients who have attained the Social Security
NRA. This additional benefit would be paid out of the applicable Social Security
OASI or DI Trust Fund for any month in which the individual is in receipt
of a Social Security benefit; it would be paid out of the General Fund of
the Treasury for any month in which the individual is in receipt of an SSI
monthly payment but not a Social Security monthly benefit.
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B7.2 |
Reduce benefits by 5 percent for those newly eligible for benefits in
2020 and later.
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B7.3 |
Give credit to parents with a child under 6 for earnings for up to five
years. The earnings credited for a childcare year equal one half of the
SSA average wage index (about $27,038 in 2019). The credits are available
for all past years to newly eligible retired-worker and disabled-worker
beneficiaries starting in 2020. The 5 years are chosen to yield the largest
increase in AIME.
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B7.5 |
Increase benefits by 5 percent for all beneficiaries as of the beginning
of 2020 and for those newly eligible for benefits after the beginning of 2020.
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B7.7 |
Reduce individual Social Security benefits if modified adjusted gross
income, or MAGI (AGI less taxable Social Security benefits plus nontaxable
interest income) is above $60,000 for single taxpayers or $120,000 for
taxpayers filing jointly. This provision is effective for individuals
newly eligible for benefits in 2024 or later. The percentage reduction
increases linearly up to 50 percent for single/joint filers with MAGI
of $180,000/$360,000 or above. Index the MAGI thresholds for years after
2024, based on changes in the SSA average wage index.
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B7.8 |
Replace the Windfall Elimination Provision (WEP) and Government Pension
Offset (GPO) with a revised reduction for most OASI benefits based on all
earnings, beginning with beneficiaries newly eligible in 2026.
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B7.9 |
Beginning for newly eligible retired workers and spouses in 2026, all
claimants who are married would receive a specified joint-and-survivor
annuity benefit (i.e., surviving spouses would receive 75 percent of
the decedents' benefits, in addition to their own) that would be payable
if both were still alive. Initial benefits would be actuarially adjusted
to keep the expected value of benefits equivalent to what would otherwise
be current law.
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B7.10 |
Replace the current-law WEP with a new calculation for most OASI and DI
benefits based on covered and non-covered earnings, phased in for beneficiaries
becoming newly eligible in 2026 through 2035. For this new approach, compute
a PIA based on all past earnings (covered and non-covered), and multiply
by the "non-covered earnings ratio." This ratio is equal to the current-law
concept of the average indexed monthly earnings computed without non-covered
earnings divided by a modified average indexed monthly earnings that includes
both covered and non-covered earnings in our records.
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B7.11 |
Beginning in January 2022, eliminate the retirement earnings test for all
beneficiaries under normal retirement age, including retired workers, aged
spouses, aged widow(er)s, young spouses with a child in care, young surviving
spouses with a child in care, and children.
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B7.12 |
Provide an option to split the 8-percent delayed retirement credit
(DRC) to offer a lump sum benefit at initial entitlement equal to
2 percent of the 8 percent DRC earned, and a 6 percent DRC on subsequent
monthly benefits, effective for workers newly entitled to retired
worker benefits in 2022 and later. Widows are held harmless from
the lump-sum decision.
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