(b) Average monthly wage.

(1) For the purposes of column III of the table appearing in subsection (a) of this section, an individual's "average monthly wage" shall be the quotient obtained by dividing

(A) the total of his wages paid in and selfemployment income credited to his "benefit computation years" (determined under paragraph (2)), by

(B) the number of months in such years. (2) (A) The number of an individual's "benefit computation years" shall be equal to the number of

elapsed years (determined under paragraph (3) of this subsection), reduced by five; except that the number of an individual's benefit computation years shall in no case be less than two.

(B) An individual's "benefit computation years" shall be those computation base years, equal in number to the number determined under subparagraph (A), for which the total of his wages and self-employment income is the largest.

(C) For purposes of subparagraph (B), "computation base years" include only calendar years in

the period after 1950 and prior to the earlier of the following years

(i) the year in which occurred (whether by reason of section 402 (j) (1) of this title or otherwise) the first month for which the individual was entitled to old-age insurance benefits, or

(ii) the year succeeding the year in which he died.

Any calendar year all of which is included in a period of disability shall not be included as a computation base year.

(3) For purposes of paragraph (2), the number of an individual's elapsed years is the number of calendar years after 1950 (or, if later, the year in which he attained age 21) and before

(A) in the case of a woman, the year in which she died or, if it occurred earlier but after 1960, the year in which she attained age 62,

(B) in the case of a man who has died, the year in which he died or, if it occurred earlier but after 1960, the year in which he attained age 65, or

(C) in the case of a man who has not died, the year occurring after 1960 in which he attained (or would attain) age 65.

For purposes of the preceding sentence, any calendar year any part of which was included in a period of disability shall not be included in such number of calendar years.

(4) The provisions of this subsection shall be applicable only in the case of an individual

(A) who becomes entitled, after December 1969, to benefits under section 402(a) or section 423 of this title; or

(B) who dies after December 1969 without being entitled to benefits under section 402 (a) or section 423 of this title; or

(C) whose primary insurance amount is required to be recomputed under subsection (f) (2) of this section.

(c) Primary insurance amount under 1967 Act.

(1) For the purposes of column II of the table appearing in subsection (a) of this section, an individual's primary insurance amount shall be computed on the basis of the law in effect prior to December 30, 1969.

(2) The provisions of this subsection shall be applicable only in the case of an individual who became entitled to benefits under section 402(a) of this title or section 423 of this title before January 1970, or who died before such month.

(d) Primary insurance benefit under 1939 Act.

(1) For purposes of column I of the table appearing in subsection (a) of this section, an individual's primary insurance benefit shall be computed as follows:

(A) The individual's average monthly wage shall be determined as provided in subsection (b) (but without regard to paragraph (4) thereof) of this section, except that for purposes of paragraph (2) (C) and (3) of such subsection, 1936 shall be used instead of 1950.

(B) For purposes of subparagraphs (B) and (C) of subsection (b) (2) of this section, an individual whose total wages prior to 1951 (as defined in subparagraph (C) of this subsection) —

(1) do not exceed $27,000 shall be deemed to have been paid such wages in equal parts in nine calendar years after 1936 and prior to 1951;

(li) exceed $27,000 and are less than $42,000 shall be deemed to have been paid (I) $3,000 in each of such number of calendar years after 1936 and prior to 1951 as is equal to the integer derived by dividing such total wages by $3,000, and (II) the excess of such total wages over the product of $3,000 times such integer, in an additional calendar year in such period; or

(ii) are at least $42,000 shall be deemed to have been paid $3,000 in each of the fourteen calendar years after 1936 and prior to 1951. (C) For the purposes of subparagraph (B), "total wages prior to 1951" with respect to an individual means the sum of (i) remuneration credited to such individual prior to 1951 on the records of the Secretary, (ii) wages deemed paid prior to 1951 to such individual under section 417 of this title, and (iii) compensation under the Railroad Retirement Act of 1937 prior to 1951 creditable to him pursuant to this title.

(D) The individual's primary insurance benefit shall be 45.6 per centum of the first $50 of his average monthly wage as computed under this subsection, plus 11.4 per centum of the next $200 of such average monthly wage.

(2) The provisions of this subsection shall be applicable only in the case of an individual

(A) with respect to whom at least one of the quarters elapsing prior to 1951 is a quarter of coverage;

(B) except as provided in paragraph (3), who attained age 22 after 1950 and with respect to whom less than six of the quarters elapsing after 1950 are quarters of coverage, or who attained such age before 1951; and

(C) (1) who becomes entitled to benefits under section 402(a) or 423 of this title after January 2, 1968, or

(ii) who dies after such date without being entitled to benefits under section 402 (a) or 423 of this title, or

(iii) whose primary insurance amount is required to be recomputed under section 415 (f) (2) of this title.

(3) The provisions of this subsection as in effect prior to January 2, 1968, shall be applicable in the case of an individual

(A) who attained age 21 after 1936 and prior to 1951, or

(B) who had a period of disability which began prior to 1951, but only if the primary insurance amount resulting therefrom is higher than the primary insurance amount resulting from the application of this section (as amended by the Social Security Amendments of 1967) and section 420 of this title.

(e) Certain wages and self-employment income not to be counted.

For the purposes of subsections (b) and (d) of this section

(1) in computing an individual's average monthly wage there shall not be counted the ex

cess over $3,600 in the case of any calendar year after 1950 and before 1955, the excess over $4,200 in the case of any calendar year after 1954 and before 1959, the excess over $4,800 in the case of any calendar year after 1958 and before 1966, the excess over $6,600 in the case of any calendar year after 1965 and before 1968, and the excess over $7,800 in the case of any calendar year after 1967 of (A) the wages paid to him in such year, plus (B) the self-employment income credited to such year (as determined under section 412 of this title); and

(2) if an individual's average monthly wage computed under subsection (b) of this section or for the purposes of subsection (d) of this section is not a multiple of $1, it shall be reduced to the next lower multiple of $1.

(f) Recomputation of benefits.

(1) After an individual's primary insurance amount has been determined under this section, there shall be no recomputation of such individual's primary insurance amount except as provided in this subsection or, in the case of a World War II veteran who died prior to July 27, 1954, as provided in section 417 (b) of this title.

(2) If an individual has wages or self-employment income for a year after 1965 for any part of which he is entitled to old-age insurance benefits, the Secretary shall, at such time or times and within such period as he may by regulations prescribe, recompute such individual's primary insurance amount with respect to each such year. Such recomputation shall be made as provided in subsection (a) (1) and (3) of this section as though the year with respect to which such recomputation is made is the last year of the period specified in subsection (b) (2) (C) of this section. A recomputation under this paragraph with repect to any year shall be effective

(A) in the case of an individual who did not die in such year, for monthly benefits beginning with benefits for January of the following year; or

(B) in the case of an individual who died in such year (including any individual whose increase in his primary insurance amount is attributable to compensation which, upon his death, is treated as remuneration for employment under section 405 (o) of this title), for monthly benefits beginning with benefits for the month in which he died.

or

(3) In the case of any individual who became entitled to old-age insurance benefits in 1952 or in a taxable year which began in 1952 (and without the application of section 402 (j) (1) of this title), who died in 1952 or in a taxable year which began in 1952 but did not become entitled to such benefits prior to 1952, and who had self-employment income for a taxable year which ended within or with 1952 or which began in 1952, then upon application filed by such individual after the close of such taxable year and prior to January 1961 or (if he died without filing such application and such death occurred prior to January 1961) by a person entitled to monthly benefits on the basis of such individual's wages and self-employment income, the Secretary shall recompute such individual's primary insurance amount. Such recomputation shall be made in the manner provided in the preceding subsections of this section

(other than subsection (b) (4) (A) of this section) for computation of such amount, except that (A) the self-employment income closing date shall be the day following the quarter with or within which such taxable year ended, and (B) the self-employment income for any subsequent taxable year shall not be taken into account. Such recomputation shall be effective (A) in the case of an application filed by such individual, for and after the first month in which he became entitled to old-age insurance benefits, and (B) in the case of an application filed by any other person, for and after the month in which such person who filed such application for recomputation became entitled to such monthly benefits. No recomputation under this paragraph pursuant to an application filed after such individual's death shall affect the amount of the lump-sum death payment under subsection (1) of section 402 of this title, and no such recomputation shall render erroneous any such payment certified by the Secretary prior to the effective date of the recomputation.

(4) Any recomputation under this subsection shall be effective only if such recomputation results in a higher primary insurance amount.

(5) In the case of a man who became entitled to old-age insurance benefits and died before the month in which he attained age 65, the Secretary shall recompute his primary insurance amount as provided in subsection (a) of this section as though he became entitled to old-age insurance benefits in the month in which he died; except that (i) his computation base years referred to in subsection (b) (2) of this section shall include the year in which he died, and (ii) his elapsed years referred to in subsection (b) (3) of this section shall not include the year in which he died or any year thereafter. Such recomputation of such primary insurance amount shall be effective for and after the month in which he died.

(6) Any recomputation under this subsection shall be effective only if such recomputation results in a higher primary insurance amount.

(7) (A) In the case of a man who attains age 65 and who became entitled to old-age insurance benefits before the month in which he attains such age, his primary insurance amount shall be recomputed as provided in subsection (a) of this section as though he became entitled to old-age insurance benefits in the month in which he attained age 65, except that his computation base years referred to in subsection (b) (2) of this section shall include the year in which he attained age 65. Such recomputation shall be effective for and after the month in which he attained age 65.

(B) In the case of a man who became entitled to old-age insurance benefits and died before the month in which he attained age 65, the Secretary shall, if any person is entitled to monthly insurance benefits or a lump-sum death payment on the basis of the wages and self-employment income of the decedent, recompute his primary insurance amount as provided in subsection (a) of this section as though he became entitled to old-age insurance benefits in the month in which he died; except that

(i) his computation base years referred to in subsection (b) (2) of this section shall include the year in which he died, and (ii) his elapsed years referred to in subsection (b) (3) of this section shall not include the year in which he died or any year thereafter. In the case of monthly insurance benefits, such recomputation of a man's primary insurance amount shall be effective for and after the month in which he died.

(g) Rounding of benefits.

The amount of any primary insurance amount and the amount of any monthly benefit computed under section 402 or 423 of this title which (after reduction under section 403 (a) of this title and deductions under section 403(b) of this title) is not a multiple of $0.10 shall be raised to the next higher multiple of $0.10.

(h) Election of benefits by Public Health Service Reserve Officers.

(1) Notwithstanding the provisions of subchapter III of chapter 83 of Title 5, remuneration paid for service to which the provisions of section 410 (7) (1) of this title are applicable and which is performed by an individual as a commissioned officer of the Reserve Corps of the Public Health Service prior to July 1, 1960, shall not be included in computing entitlement to or the amount of any monthly benefit under this subchapter, on the basis of his wages and self-employment income, for any month after June 1960 and prior to the first month with respect to which the Civil Service Commission certifies to the Secretary that, by reason of a waiver filed as provided in paragraph (2), no further annuity will be paid to him, his wife, and his children, or, if he has died, to his widow and children, under subchapter III of chapter 83 of Title 5 on the basis of such service.

(2) In the case of a monthly benefit for a month prior to that in which the individual, on whose wages and self-employment income such benefit is based, dies, the waiver must be filed by such individual; and such waiver shall be irrevocable and shall constitute a waiver on behalf of himself, his wife, and his children. If such individual did not file such a waiver before he died, then in the case of a benefit for the month in which he died or any month thereafter, such waiver must be filed by his widow, if any, and by or on behalf of all his children, if any; and such waivers shall be irrevocable. Such a waiver by a child shall be filed by his legal guardian or guardians, or, in the absence thereof, by the person (or persons) who has the child in his care. (Aug. 14, 1935, ch. 531, title II, § 215, as added Aug. 28, 1950, ch. 809, title I, § 104(a), 64 Stat. 492, and amended July 18, 1952, ch. 945, §§ 2(a), (b) (1), 3(c), 6 (a), (b), 66 Stat. 767, 768, 770, 771, 776; 1953 Reorg. Plan No. 1, §§ 5, 8, eff. Apr. 11, 1953, 18 F. R. 2053, 67 Stat. 631; Sept. 1, 1954, ch. 1206, title I, §§ 102 (a)-(d), (e) (1)–(4), 104(d), 106(c), 68 Stat. 1062, 1078, 1079; Aug. 1, 1956, ch. 836, title I, §§ 103(c) (4), (5), 109(a), 115(a)-(c), 70 Stat. 818, 830, 832; Aug. 28, 1958, Pub. L. 85-840, title I, §§ 101(a)-(d), 102(d), title II, § 205 (m), 72 Stat. 1013, 1020, 1025; Apr. 8, 1960, Pub. L. 86415, 7, 74 Stat. 35; Sept. 13, 1960, Pub. L. 86-778, title I, § 103 (j) (2) (C), title II, § 211(n), title III, §§ 303 (a)-(e), 304(a), 74 Stat. 937, 958, 960, 966;

June 30, 1961, Pub. L. 87-64, title I, §§ 101(a), 102(d), 75 Stat. 131, 135; July 30, 1965, Pub. L. 89-97, title III, §§ 301 (a), (b), 302(a)–(d), 303 (e), 304(k), 320 (a) (4), 79 Stat. 361, 363-365, 367, 370, 393; Jan. 2, 1968, Pub. L. 90-248, title I, §§ 101 (a), (c), (d), 108 (a) (4), 155(a)(1)–(6), title IV, § 403(b), 81 Stat. 824, 827, 834, 864, 865, 931; Dec. 30, 1969, Pub. L. 91172, title X, § 1002 (a), (c), (d), 83 Stat. 737, 740.) REFERENCES IN TEXT

The Railroad Retirement Act of 1937, referred to in subsec. (d) (1) (C), is classified to section 228a et seq. of Title 45, Railroads.

For amendment of this section by the Social Security Amendments of 1967, referred to in subsec. (d) (3) (B), see 1968 Amendment notes set out under this section.

AMENDMENTS

1969 Subsec. (a). Pub. L. 91-172, § 1002 (a), revised the benefits table to increase: the primary insurance amount limits to $64.00-$250.70 for people whose average monthly wage is $76.00 or less for the minimum, and $650.00 for the maximum, the primary insurance amounts of retired workers on the benefit rolls from $48.00 or less to $55.40 at the minimum, and from $168.00 to $218.00 at the maximum, and the family benefits limits to $96.00-434.40 from $82.50-434.40.

Subsec. (b) (4). Pub. L. 91-172, § 1002(c), substituted references to December 1969 for references to January 1968.

Subsec. (c). Pub. L. 91-172, § 1002 (d), substituted "December 30, 1969" for "January 2, 1968" in subpar. (1), and "January 1970" for "February 1968" in subpar. (2). 1968-Subsec. (a). Pub. L. 90-248, § 101(a), revised the benefits table to increase: the primary insurance amount limits to $55.00-$218.00 for people whose average monthly wage is $74.00 or less for the minimum and $650.00 for the maximum, the primary insurance amounts of retired workers on the benefit rolls from $48.00 or less to $55.00 at the minimum and from $168.00 to $189.90 at the maximum, and the family benefit limits to $82.50-8434.40 from $66.00 $368.00.

Subsec. (b) (4). Pub. L. 90-248, § 101 (c) (1), substituted "January 1968" for "December 1965" in subpar. (A) and (B), deleted", as amended by the Social Security Amendments of 1965;" from end of subpar. (C), and struck out the exception provision that the subsection would not apply to any individual described therein for purposes of monthly benefits for months before January 1966.

Subsec. (b) (5). Pub. L. 90-248, § 101(c)(2), repealed par. (5) which preserved the method in effect before the enactment of the 1965 amendments of computing average monthly earnings for people who become entitled to benefits or a recomputation of benefits before 1966.

Subsec. (c). Pub. L. 90-248, § 101(d), substituted "1965 Act" for "1958 Act, as modified" in subsection catchline and "on the basis of the law in effect prior to the enactment of the Social Security Amendments of 1967" for "as provided in, and subject to the limitations specified in, (A) this section as in effect prior to July 30, 1965 and (B) the applicable provisions of the Social Security Amendments of 1960" in par. (1) and "the month of February 1968, or who died before such month" for "July 30, 1965 or who died before such date" in par. (2).

Subsec. (d) (1). Pub. L. 90-248, § 155(a) (1), substituted "(d) (1) For purposes of column I of the table appearing in subsection (a) of this section, an individual's primary insurance benefit shall be computed as follows:

"(A) The individual's average monthly wage shall be determined as provided in subsection (b) (but without regard to paragraph (4) thereof) of this section, except that for purposes of paragraph (2) (C) and (3) of such subsection, 1936 shall be used instead of 1950.

"(B) For purposes of subparagraphs (B) and (C) of subsection (b) (2) of this section, an individual whose total wages prior to 1951 (as defined in subparagraph (C) of this subsection)

"(1) do not exceed $27,000 shall be deemed to have been paid such wages in equal parts in nine calendar years after 1936 and prior to 1951;