No CRS summary available for this bill.
This section designates the Act as the “Protecting and Preserving Social Security Act” and sets forth its table of contents.
This section directs the Bureau of Labor Statistics to develop and publish a monthly Consumer Price Index for Elderly Consumers that measures changes over time in consumption expenditures typical for individuals aged 62 or older, effective for months ending on or after July 31 of the calendar year following enactment. It authorizes appropriations as necessary for this purpose.
This section revises the cost-of-living adjustment (COLA) formula in the Social Security Act to define the Consumer Price Index (CPI) as the CPI for Elderly Consumers (CPI-E, as published by the Bureau of Labor Statistics), replacing the prior use of the CPI for Urban Wage Earners and Clerical Workers (CPI-W). (As background, Title II benefits—including Old-Age, Survivors, and Disability Insurance—are increased annually by the percentage change in the CPI-W, measured from the third calendar quarter of the second preceding year to the third calendar quarter of the preceding year, if positive.) The change applies to both current law and pre-1979 law computations (via new subparagraphs (H) and (D), respectively), with a conforming amendment to subsection (i)(4); it takes effect for cost-of-living computation quarters ending on or after September 30 of the second calendar year following enactment; resulting benefit increases do not affect adjustments under other laws or count as income or resources for Supplemental Security Income (SSI) or Medicaid eligibility or benefits.
This section revises the definitions of wages under the Social Security Act (SSA §209, 42 U.S.C. 409) and Internal Revenue Code (IRC §3121) and of self-employment income under the SSA (§211, 42 U.S.C. 411) and IRC (§1402) to exclude only an applicable percentage of remuneration or net earnings above the contribution and benefit base (CBB)—previously 100% excluded—paid in calendar years after 2025 (wages) or taxable years beginning in or after 2026 (self-employment income). As background, the CBB caps annual earnings subject to Social Security payroll taxes (currently $168,600 for 2024). The applicable exclusion percentages, identical across all four provisions, are (1) 86% for 2026, (2) 71% for 2027, (3) 57% for 2028, (4) 43% for 2029, (5) 29% for 2030, (6) 14% for 2031, and (7) 0% for calendar years after 2031. (Thus, this phases in taxation of 14% to 100% of earnings above the CBB.)
This section modifies the Social Security Act's primary insurance amount (PIA) formula—the basis for old-age and disability benefits—by distinguishing basic average indexed monthly earnings (AIME, from wages up to the contribution and benefit base, or CBB) from surplus AIME (earnings above the CBB) and adding two new marginal replacement rates on surplus AIME: (1) 3% to the extent such earnings do not exceed a new bend point and (2) 0.25% of the sum of surplus AIME plus 1/12 of the CBB for the individual's last computation base year, to the extent that sum exceeds the new bend point. It establishes the initial surplus bend point at $8,933 for individuals who initially become eligible for benefits (or die before eligibility) in 2026, indexed annually thereafter by the national average wage index for the second preceding year (or the highest prior index, if higher) relative to 2024. The changes apply to individuals eligible for benefits after 2025.