September 13, 1960 Pub. Law 86-778 74 STAT. 956. 202(a) and other persons are entitled to benefits under section 202 (b), (c), or (d) on the basis of the wages and self-employment income of such individual, the excess earnings of such individual for any taxable year shall be charged in accordance with the provisions of this subsection before the excess earnings of such persons for a taxable year are charged to months in such individual's taxable year. Notwithstanding the preceding provisions of this paragraph, no part of the excess earnings of an individual shall be charged to any month (A) for which such individual was not entitled to a benefit under this title, (B) in which such individual was age seventy-two or over, (C) in which such individual, if a child entitled to child's insurance benefits, has attained the age of 18, or (D) in which such individual did not engage in selfemployment and did not render services for wages (determined as provided in paragraph (5) of this subsection) of more than $100. "(2) As used in paragraph (1), the term 'first month of such taxable year' means the earliest month in such year to which the charging of excess earnings described in such paragraph is not prohibited by the application of clauses (A), (B), (C), and (D) thereof. "(3) For purposes of paragraph (1) and subsection (h), an individual's excess earnings for a taxable year shall be his earnings for such year in excess of the product of $100 multiplied by the number of months in such year, except that of the first $300 of such excess (or all of such excess if it is less than $300), an amount equal to one-half thereof shall not be included. The excess earnings as derived under the preceding sentence, if not a multiple of $1, shall be reduced to the next lower multiple of $1. "(4) For purposes of clause (D) of paragraph (1) "(A) An individual will be presumed, with respect to any month, to have been engaged in self-employment in such month until it is shown to the satisfaction of the Secretary that such individual rendered no substantial services in such month with respect to any trade or business the net income or loss of which is includible in computing (as provided in paragraph (5) of this subsection) his net earnings or net loss from self-employment for any taxable year. The Secretary shall by regulations prescribe the methods and criteria for determining whether or not an individual has rendered substantial services with respect to any trade or business. "(B) An individual will be presumed, with respect to any month, to have rendered services for wages (determined as provided in paragraph (5) of this subsection) of more than $100 until it is shown to the satisfaction of the Secretary that such individual did not render such services in such month for more than such amount. "(5) (A) An individual's earnings for a taxable year shall be (i) the sum of his wages for services rendered in such year and his net earnings from self-employment for such year, minus (ii) any net loss from self-employment for such year. (B) In determining an individual's net earnings from selfemployment and his net loss from self-employment for purposes of subparagraph (A) of this paragraph and paragraph (4), the provisions of section 211, other than paragraphs (1), (4), and (5) Ante, pp. 937, of subsection (c), shall be applicable; and any excess of income 938,945. over deductions resulting from such a computation shall be his net earnings from self-employment and any excess of deductions over Ante, pp. 937,938. 42 USC 402. Ante, p. 955. 42 USC 403. Pub. Law 86-778 September 13, 1960 "(C) For purposes of this subsection, an individual's wages shall be computed without regard to the limitations as to amounts of remuneration specified in subsections (a), (g) (2), (g) (3), (h) (2), and (j) of section 209; and in making such computation services which do not constitute employment as defined in section 210, performed within the United States by the individual as an employee or performed outside the United States in the active military or naval service of the United States, shall be deemed to be employment as so defined if the remuneration for such services is not includible in computing his net earnings or net loss from self-employment. "(6) For purposes of this subsection, wages (determined as provided in paragraph (5) (C)) which, according to reports received by the Secretary, are paid to an individual during a taxable year shall be presumed to have been paid to him for services performed in such year until it is shown to the satisfaction of the Secretary that they were paid for services performed in another taxable year. If such reports with respect to an individual show his wages for a calendar year, such individual's taxable year shall be presumed to be a calendar year for purposes of this subsection until it is shown to the satisfaction of the Secretary that his taxable year is not a calendar year. (7) Where an individual's excess earnings are charged to a month and the excess earnings so charged are less than the total of the payments (without regard to such charging) to which all persons are entitled under section 202 for such month on the basis of his wages and self-employment income, the difference between such total and the excess so charged to such month shall be paid (if it is otherwise payable under this title) to such individual and other persons in the proportion that the benefit to which each of them is entitled (without regard to such charging, without the application of section 202 (k) (3), and prior to the application of section 203 (a)) bears to the total of the benefits to which all of them are entitled." (f) The subsection of section 203 of such Act redesignated as subsection (h) by subsection (c) of this section is amended (1) by striking out "paragraph (4) of subsection (e)" wherever it appears and inserting in lieu thereof "paragraph (5) of subsection (f)", (2) by striking out in subparagraph (B) of paragraph (1) "paragraph (3) of subsection (g)" and inserting in lieu thereof "paragraph (3) of this subsection", (3) by striking out "(b) (1)" wherever it appears and inserting in lieu thereof "(b)", and (4) by striking out in paragraph (3) "suspend the payment" and insert in lieu thereof "suspend the total or less than the total payment". (g) The subsection of section 203 of such Act redesignated as subsection (i) by subsection (c) of this section is amended by striking out "subsection (b), (f), or (g) of this section" and inserting in lieu thereof "subsection (b), (c), (g), or (h) of this section". (h) Subsection (1) of section 203 of such Act is amended by striking out "subsection (f) or (g) (1) (A)" and inserting in lieu thereof "subsection (g) or (h) (1) (A)". (i) The last sentence of section 202 (n) (1) of such Act is amended by striking out "Section 203 (b) and (c)" and inserting in lieu thereof "Section 203 (b), (c), and (d)". (j) (1) Clause (A) of section 202 (q) (5) of such Act is amended by striking out "paragraph (1) or (2) of" and by inserting before the comma at the end thereof "or paragraph (1) of section 203 (c)". (2) Clause (B) of such section 202(q) (5) is amended by striking out "paragraph (1) or (2) of section 203(b), under section 203 (c)" September 13, 1960 Pub. Law 86-778 74 STAT 958. and inserting in lieu thereof "section 203 (b), under section 203 (c) (1), under section 203 (d) (1)". (k) (1) Clause (A) of section 202 (q) (6) of such Act is amended 42 USC 402. by striking out "section 203 (b) (1) or (2), under section 203 (c)" and inserting in lieu thereof "section 203(b), under section 203 (c) (1), under section 203 (d) (1)". (2) Clause (D) of such section 202 (q) (6) is amended by striking out "paragraph (1) or (2) of” and by inserting immediately before the period "or paragraph (1) of section 203 (c)". (1) Section 202(t) (7) of such Act is amended by striking out "Subsections (b) and (c) of section 203" and inserting in lieu thereof "Subsections (b), (c), and (d) of section 203". (m) Section 208 (a) (3) of such Act is amended by striking out "section 203 (e)" and inserting in lieu thereof "section 203 (f)". (n) Section 215 (g) of such Act is amended by striking out "203 (a)" and inserting in lieu thereof "203 (a) and deductions under section 203 (b)". (0) (1) Section 3 (e) of the Railroad Retirement Act of 1937 is 45 USC 2280. amended by striking out "subsections (f) and (g) (2) of section 203 of the Social Security Act" and inserting in lieu thereof "subsections (g) and (h) (2) of section 203 of the Social Security Act". (2) Section 5(i)(1)(ii) of the Railroad Retirement Act of 1937 45 USC 228e. is amended (A) by striking out "section 203 (e)" each place it appears and inserting in lieu thereof "section 203 (f)"; (B) by striking out "section 203 (g) (3)" and inserting in lieu thereof "section 203 (h) (3)"; and (C) by striking out "earnings" each place it appears and inserting in lieu thereof "excess earnings". (p) Section 203 (c), (d), (e), (g), and (i) of the Social Security Ante, p. 953. Act as amended by this Act shall be effective with respect to monthly benefits for months after December 1960. (q) Section 203 (b), (f), and (h) of the Social Security Act as amended by this Act shall be effective with respect to taxable years beginning after December 1960. ノ (r) Section 203 (1) of the Social Security Act as amended by this Act, to the extent that it applies to section 203 (g) of the Social Security Act as amended by this Act, shall be effective with respect to monthly benefits for months after December 1960 and, to the extent that it applies to section 203 (h) (1) (A) of the Social Security Act as amended by this Act, shall be effective with respect to taxable years beginning after December 1960. (s) The amendments made by subsections (i), (j), (k), (1), (m), Supra. (n), and (o) of this section, to the extent that they make changes in references to provisions of section 203 of the Social Security Act, shall take effect in the manner provided in subsections (p) and (q) of this section for the provisions of such section 203 to which the respective references so changed relate. (t) In any case where (1) an individual has earnings (as defined in section 203 (e) (4) of the Social Security Act as in effect prior to the enactment of this Act) in a taxable year which begins before 1961 and ends in 1961 (but not on December 31, 1961), and (2) such individual's spouse or child entitled to monthly benefits on the basis of such individual's self-employment income has excess earnings (as defined in section 203 (f)(3) of the Social Security Act as amended by this Act) in a taxable year which begins after 1960, and 1 Pub. Law 86-778 74 STAT. 959. 42 USC 402. 42 USC 408. Ante, p. 949. Ante, p. 953. September 13, 1960 (3) one or more months in the taxable year specified in paragraph (2) are included in the taxable year specified in paragraph (1), then, if a deduction is imposed against the benefits payable to such individual with respect to a month described in paragraph (3), such spouse or child, as the case may be, shall not, for purposes of subsections (b) and (f) of section 203 of the Social Security Act as amended by this Act, be entitled to a payment for such month. TITLE III-BENEFIT AMOUNTS INCREASE IN INSURANCE BENEFITS OF CHILDREN OF DECEASED WORKERS SEC. 301. (a) The second sentence of section 202(d) (2) of the Social Security Act is amended to read as follows: "Such child's insurance benefit for each month shall, if such individual has died in or prior to such month, be equal to three-fourths of the primary insurance amount of such individual." (b) The amendment made by this section shall apply only with respect to monthly benefits under section 202 of the Social Security Act for months after the second month following the month in which this Act is enacted. (c) Where (1) one or more persons were entitled (without the application of section 202 (j) (1) of the Social Security Act) to monthly benefits under section 202 of such Act for the second month following the month in which this Act is enacted on the basis of the wages and self-employment income of a deceased individual (but not including any person who became so entitled by reason of section 208 of this Act); and (2) no person, other than (i) those persons referred to in paragraph (1) of this subsection (ii) those persons who are entitled to benefits under section 202 (d), (e), (f), or (g) of the Social Security Act but would not be so entitled except for the enactment of section 208 of this Act, is entitled to benefits under such section 202 on the basis of such individual's wages and selfemployment income for any subsequent month or for any month after the second month following the month in which this Act is enacted and prior to such subsequent month; and (3) the total of the benefits to which all persons referred to in paragraph (1) of this subsection are entitled under section 202 of the Social Security Act on the basis of such individual's wages and self-employment income for such subsequent month exceeds the maximum of benefits payable, as provided in section 203 (a) of such Act, on the basis of such wages and self-employment in come, then the amount of the benefit to which each such person referred to in paragraph (1) of this subsection is entitled for such subsequent month shall be determined (4) in case such person is entitled to benefits under section 202 (e), (f), (g), or (h), as though this section and section 208 had not been enacted, or (5) in case such person is entitled to benefits under section 202(d), as though (i) no person is entitled to benefits under section 202 (e), (f), (g), or (h) for such subsequent month, and (ii) the maximum of benefits payable, as described in paragraph (3), is such maximum less the amount of each person's benefit for such month determined pursuant to paragraph (4). September 13, 1960 Pub. Law 86-778 MAXIMUM FAMILY BENEFIT IN CERTAIN CASES 74 STAT. 960. SEC. 302. (a) Section 203 (a) (3) of the Social Security Act is amended (1) by striking out "and is not less than $68, then such total of benefits shall not be reduced to less than the smaller of" and inserting in lieu thereof ", then such total of benefits shall not be reduced to less than $99.10 if such primary insurance amount is $66, to less than $102.40 if such primary insurance amount is $67, to less than $106.50 if such primary insurance amount is $68, or, if such primary insurance amount is higher than $68, to less than the smaller of"; and (2) by striking out "the last figure in column V of the table appearing in section 215 (a)" and inserting in lieu thereof "the amount determined under this subsection without regard to this paragraph, or $206.60, whichever is larger". (b) The amendments made by subsection (a) shall apply only in the case of monthly benefits under section 202 or section 223 of the Social Security Act for months after the month following the month in which this Act is enacted, and then only (1) if the insured individual on the basis of whose wages and self-employment income such monthly benefits are payable became entitled (without the application of section 202(j) (1) or section 223 (b) of such Act) to benefits under section 202(a) or section 223 of such Act after the month following the month in which this Act is enacted, or (2) if such insured individual died before becoming so entitled and no person was entitled (without the application of section 202 (j) (1) or section 223 (b) of such Act) on the basis of such wages and self-employment income to monthly benefits under title II of the Social Security Act for the month following the month in which this Act is enacted or any prior month. COMPUTATIONS AND RECOMPUTATIONS OF PRIMARY INSURANCE AMOUNTS SEC. 303. (a) Section 215 (b) of the Social Security Act is amended to read as follows: "(b) (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 self-employment 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 the purposes of subparagraph (B), 'computation base years' include only calendar years occurring "(i) after December 31, 1950, and "(ii) prior to the year in which the individual became entitled to old-age insurance benefits or died, whichever first occurred; except that the year in which the individual became entitled to oldage insurance benefits or died, as the case may be, shall be included as a computation base year if the Secretary determines, on the basis of 42 USC 403. 42 USC 402, 423. Post, p. 967. 42 USC 415. |