H.R. 904 — No Tax on Social Security

This section repeals the inclusion of Social Security and Tier 1 railroad retirement benefits in gross income (i.e., terminates IRC §86) for taxable years beginning after the date of enactment. (As background, current law requires up to 50% of such benefits to be included in gross income for recipients with provisional income between $25,000 and $34,000 ($32,000 and $44,000 for joint filers) and up to 85% for those with higher provisional income; thus, the repeal eliminates taxation of such benefits entirely.) It also appropriates to each Social Security trust fund (including the Federal Hospital Insurance Trust Fund) and Railroad Retirement Act fund, for each fiscal year, an amount equal to the reduction in transfers to that fund resulting from the repeal.