Social Security Related Legislation in 1993

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The first session of the 103rd Congress convened on January 5, 1993, and adjourned on November 24, 1993 (Senate) and November 26, 1993 (House). During this session, some 140 bills of interest to the Social Security Administration (SSA) were introduced and 4 were enacted. This note describes the Social Security-related legislation that was enacted during that session.

THE OMNIBUS BUDGET RECONCILIATION ACT OF 1993) H.R 2264), P.L. 103-66 (signed August 10, 1993)

TAX PROVISIONS

Taxation of Social Security and Railroad Retirement Tier I benefits.--The legislation increases the percentage of Social Security and Railroad Retirement Tier I benefits that may be subject to income taxes from 50 percent to 85 percent for single taxpayers with incomes over $34,000 and for married taxpayers filing jointly with incomes over $44,000. It retains the present law, under which no more than 50 percent of benefits may be subject to income taxes for single taxpayers with incomes from $25,000 to $34,000 and for married taxpayers filing jointly with incomes from $32,000 to $44,000. Income for benefit taxation purposes would continue to be the sum of the taxpayer's adjusted gross income, any tax-exempt interest income, and 50 percent of the taxpayer's Social Security or Tier I benefits.

Revenues from the additional taxation of benefits will be credited to the Medicare Hospital Insurance (HI) Trust Fund. The provision is effective for taxable years beginning after 1993.

Availability and use of death information.--The legislation prohibits disclosure of Federal tax return information to any State that does not have in effect a contract with the Secretary of Health and Human Services under which the State provides death certificate information, without restriction on redisclosure, for the purpose of ensuring that Federal benefits or other payments are not erroneously paid to deceased beneficiaries. The provision is effective 1 year after the date of enactment.

Repeal of Hospital Insurance contribution and benefit base.--The legislation repeals the limitation on the amount of earnings subject to the HI tax beginning with calendar year 1994.

Credit for employer tax on tips.--The legislation provides a business tax credit for food and beverage establishments equal to the amount of the employer's Social Security tax attributable to covered tips in excess of the tips needed to bring the employee's wages up to the minimum wage.

The provision affects neither the amount of tips covered and taxable for Social Security purposes nor the amount of Social Security taxes credited to the Social Security trust funds. The provision applies to taxes paid after December 31, 1993.

Employer-provided educational assistance.--The legislation extends the exclusion for income tax and Social Security purposes of amounts paid, or expenses incurred, by an employer under a qualified educational assistance program. The exclusion applies retroactively to expenses incurred after June 30, 1992 (the date the former exclusion expired), and extends through December 31, 1994.

SUPPLEMENTAL SECURITY INCOME PROVISIONS

Fees for Federal administration of State supplementary payments.--The legislation requires States to pay fees for Federal administration of their supplementary Supplemental Security Income (SSI) payments. The fees are $1.67 for each monthly supplementary payment in fiscal year (FY) 1994, $3.33 in FY 1995, and $5.00 in FY 1996. Fees for subsequent years will be $5.00 or another amount determined by the Secretary to be appropriate. The Secretary may charge States additional fees for services they request that are beyond the level customarily provided in administering State supplementary payments.

The provision is effective with respect to federally administered State supplementary payments for months after September 1993.

Exclusion from income and resources of State relocation assistance. …