Date: December 14, 2006
House and Senate Pass S. 4091, the Social Security Trust Funds Restoration Act of 2006
On December 9, 2006, the House passed S. 4091, the Social Security Trust Funds Restoration Act of 2006. The bill was introduced by Senator Grassley (R-IA) on December 6, 2006. The Senate passed the bill by unanimous consent on December 7, 2006. The bill will next be presented to the President for his action.
The bill contains the following provisions of interest:
Would provide an appropriation of the amount of funds needed to restore fully the Old-Age and Survivors Insurance Trust Fund and the Disability Insurance Trust Fund from the consequences of a bookkeeping error at SSA that resulted in the overpayment of amounts transferred from each Trust Fund to the Internal Revenue Service (IRS) from 1999 through 2005 as transfers of anticipated taxes on Social Security benefit payments under the voluntary withholding program authorized by section 3402(p) of the Internal Revenue Code of 1986. (This bookkeeping error did not affect the amounts of taxes that SSA withheld from payments made to Social Security beneficiaries.)
Would appropriate an amount to be determined by the Secretary of the Treasury, in consultation with the Commissioner of Social Security, equal to the difference between:
The total amount that the Social Security Trust Funds have lost (including interest that would have been earned, calculated at the statutory Social Security investment rate); and
The total amount that the IRS has already refunded to SSA under existing Internal Revenue Code authority (including interest that the IRS paid, calculated at the statutory IRS interest rate).
Would direct the Secretary of the Treasury to invest the amount appropriated to each Trust Fund in accordance with currently applicable investment policy for that Trust Fund.
Would require the Secretary of the Treasury, in cooperation with the Commissioner of Social Security, to accomplish the required restoration within 120 days after the date of enactment of the Act.
Would require the Secretary of the Treasury to notify Congress in writing of the actions taken not later than 30 days after taking the last action.