Overview
Title
To amend title XVI of the Social Security Act to update eligibility for the supplemental security income program, and for other purposes.
ELI5 AI
H.R. 7138 is a bill that wants to make it easier and fairer for people to get more help from a program called Supplemental Security Income (SSI), by raising income limits, changing rules about marriage, and being kind to people who own things like retirement savings.
Summary AI
H.R. 7138 aims to amend the Social Security Act to update eligibility for the Supplemental Security Income (SSI) program. The bill proposes increasing income and resource limits while allowing certain tribal and state tax credits to be excluded from income considerations. It also seeks to eliminate penalties for disposing of resources below fair market value, remove marriage penalties, and modify rules around marital status determination. Additionally, the bill intends to eliminate dedicated accounts for past-due benefits and simplify payment processes.
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AnalysisAI
The Supplemental Security Income Restoration Act of 2024, also known as H.R. 7138, is proposed legislation that aims to amend the Social Security Act, focusing primarily on updating the eligibility criteria and benefits for the Supplemental Security Income (SSI) program. This initiative seeks to address various aspects including income and resource limits, marriage penalties, and the treatment of certain types of income and resources. Here is an overview of its key components and potential ramifications.
General Summary of the Bill
The bill proposes several significant updates to the SSI system. Among these changes are increases in income and resource exclusions, intended to relax the criteria that determine SSI eligibility. Notably, the general and earned income exclusions, as well as the resource limits for individuals and couples, are set to increase substantially, starting in 2024. Moreover, an annual inflation adjustment mechanism is proposed to reflect cost-of-living changes. Additionally, the legislation eliminates the SSI marriage penalty and revises certain rules, such as excluding retirement accounts from being counted as resources and modifying language around marital relationships to be more inclusive.
Summary of Significant Issues
One of the pressing issues concerns the substantial increase in income and resource exclusion limits without a detailed fiscal impact analysis or specified funding sources. This adjustment might raise concerns about the financial sustainability of the program. Furthermore, the repeal of penalties for disposing assets below market value could potentially lead to misuse, as individuals might underreport their assets to qualify for SSI benefits. Additionally, ambiguity in legal language and references, especially regarding tax credits and retirement accounts, could create confusion for beneficiaries unfamiliar with such technicalities.
Impact on the Public
The broader public is likely to experience a mix of advantages and challenges given these proposed changes. On the positive side, the updates provide much-needed reforms to improve accessibility to SSI benefits, potentially allowing more low-income individuals, including the elderly and disabled, to qualify for assistance. This could significantly enhance the financial well-being of these communities, offering better support than the current thresholds allow.
However, for some affected individuals, especially those at the margin of eligibility, the new variability introduced by tying benefits to annual poverty guidelines might create uncertainty about future SSI benefits, potentially affecting their financial planning and stability. Additionally, the complexity of the legal language used in the bill may make it difficult for typical SSI applicants to fully understand the revisions without additional guidance.
Impact on Specific Stakeholders
Beneficiaries: For eligible SSI recipients, these changes may lead to increased benefits and improved financial security. The removal of marriage penalties and exclusion of retirement plans could make SSI more attractive and viable for married couples and those with retirement savings. The adjustments could also simplify applications by reducing the number of financial sources that need stringent reporting.
State and Federal Agencies: Agencies responsible for administering SSI and Medicaid could face increased administrative burdens due to changes in eligibility assessments and resource tracking, particularly with the repeal of certain penalties and new exclusion rules. They may need to adapt their processes to effectively administer the changes while avoiding potential abuses.
Legal and Financial Advisors: Advisors who help individuals navigate SSI and related benefits will need to familiarize themselves with these extensive changes to provide accurate guidance. Given the intricacies of tax and social security laws, they play a critical role in interpreting how new rules apply to individuals' circumstances.
Overall, while the Supplemental Security Income Restoration Act of 2024 presents a potentially transformative leap toward modernizing social security support systems, it also brings challenges that warrant careful consideration and management to ensure its successful implementation and sustainability.
Financial Assessment
Financial References and Allocations in the Bill
The bill H.R. 7138 introduces several financial changes aimed at updating the eligibility and benefit calculations for the Supplemental Security Income (SSI) program. These amendments have significant implications for how financial resources and incomes of beneficiaries are calculated and understood under the SSI framework. The key financial adjustments can be highlighted as follows:
Increased Income and Resource Exclusions
- The bill proposes substantial increases to the general income exclusion and earned income exclusion. Specifically, the general income exclusion is updated from $240 to $1,797, while the earned income exclusion is raised from $780 to $5,839. These increased thresholds, effective from 2024, are also designed to be adjusted annually for inflation, using the Consumer Price Index for Elderly Consumers (CPI-E). This adjustment seeks to align SSI levels more closely with economic realities and cost-of-living changes over time. However, the potential for substantially increased costs associated with these changes raises concerns about funding, particularly because the bill doesn't provide an explicit allocation for these increased financial thresholds or a detailed fiscal impact analysis.
Updated Benefit Amounts and Marriage Penalty Repeal
- For individual beneficiaries, the SSI benefit rate is specified at $1,752 for the years up to 2024. Afterward, benefits will be calculated based on the annual poverty guideline as published by the Department of Health and Human Services. For individuals with an eligible spouse, the benefits rate prior to 2024 is fixed at $2,628. Moving forward, the benefits for couples will be twice that of single individuals as defined in the revised guidelines. The variability introduced by tying benefits to fluctuating poverty guidelines could create uncertainty for beneficiaries, as these rates can change annually.
Exclusion of Retirement Accounts
- Section 5 specifies that qualified retirement plans and deferred compensation plans will be excluded from being counted as resources. This change could meaningfully impact individuals' eligibility for SSI, potentially permitting more beneficiaries to qualify due to excluding significant forms of retirement savings from consideration.
Repeal of Penalty for Disposal of Resources
- In Section 6, the bill removes penalties associated with disposing of resources for below market value. While intended to simplify the resource reporting process, this amendment might open avenues for abuse, where individuals could deliberately undervalue or dispose of resources to qualify for benefits. The financial implications of this could challenge the integrity of resource assessment and oversight.
Each of these changes could bring about additional financial burdens on the SSI program, and it's essential for lawmakers to consider the long-term fiscal implications. The potential for cost increases without specific funding mechanisms or clearer fiscal plans is a critical consideration which should be addressed to ensure the sustainability and effectiveness of the SSI program adjustments.
Issues
The change in eligibility for the supplemental security income program (Section 2) includes significant increases in the income and resource exclusions. While this could provide more aid to individuals, the increased financial thresholds might raise concerns about the potential for substantially increased costs without an explicit plan for funding or a detailed fiscal impact analysis.
The update in supplemental security income benefit amounts and the repeal of the marriage penalty (Section 3) could introduce variability in benefits, as benefit rates after 2024 are tied to the annual poverty guideline, which is subject to change. While this change might address fairness in benefits distribution, the variability could lead to uncertainty for beneficiaries.
In Section 6, the repeal of the penalty for disposal of resources for less than fair market value raises issues of potential abuse if individuals dispose of assets below market value to qualify for benefits. This change could have implications for the integrity of resource assessments in eligibility determinations.
The exclusion of retirement accounts from resources (Section 5) could significantly impact eligibility calculations for supplemental security income. However, referencing complex sections of the Internal Revenue Code might lead to confusion and unintentional exclusion errors, especially for individuals unfamiliar with these references.
Section 11's extension of the exclusion period for certain payments from countable resources from '9 months' to '21 months' lacks context and justification within the bill text. It is unclear what the rationale is behind extending the exclusion period or its potential implications on beneficiaries.
The amendments concerning the treatment of state tax credits (Section 7) lack clarity, especially concerning the definition of state earned income and child tax credits. Without adequate definitions and context, beneficiaries may face confusion about how these credits factor into their eligibility or benefit calculations.
The modification of rules to determine marital relationships (Section 12) replaces gender-specific terms with gender-neutral terms, but it could cause confusion if inconsistencies arise elsewhere in federal or state laws. This change could have broader implications for the interpretation of marital relationships in legal contexts beyond social security.
The complexity and legal language used across various sections, such as Sections 4 and 9, might make the bill difficult for the general public to interpret, potentially limiting accessibility and understanding for stakeholders without specialized legal or policy background.
Sections
Sections are presented as they are annotated in the original legislative text. Any missing headers, numbers, or non-consecutive order is due to the original text.
1. Short title; table of contents Read Opens in new tab
Summary AI
The Supplemental Security Income Restoration Act of 2024 introduces changes to the supplemental security income program, including updates to eligibility and benefit amounts, and removes penalties related to marriage and retirement accounts. It also revises how certain state tax credits, tribal welfare payments, and past-due benefits are treated, while extending exclusions on some resources and adjusting rules around marital relationships.
2. Update in eligibility for the supplemental security income program Read Opens in new tab
Summary AI
The bill updates the supplemental security income program by increasing the general and earned income exclusions and the resource limits for individuals and couples starting in 2024, with adjustments for inflation in subsequent years based on the Consumer Price Index for Elderly Consumers.
Money References
- (a) Update in general income exclusion.—Section 1612(b)(2)(A) of the Social Security Act (42 U.S.C. 1382a(b)(2)(A)) is amended by striking “$240” and inserting “$1,797 (increased as described in section 1617(d) for each calendar year after 2024)”.
- (b) Update in earned income exclusion.—Section 1612(b)(4) of such Act (42 U.S.C. 1382a(b)(4)) is amended by striking “$780” each place it appears and inserting “$5,839 (increased as described in section 1617(d) for each calendar year after 20224”.
- (c) Update in resource limit for individuals and couples.—Section 1611(a)(3) of such Act (42 U.S.C. 1382(a)(3)) is amended— (1) in subparagraph (A), by striking “$2,250” and all that follows through the end of the subparagraph and inserting “$20,000 in calendar year 2024, and shall be increased as described in section 1617(d) for each subsequent calendar year.”; and (2) in subparagraph (B), by striking “$1,500” and all that follows through the end of the subparagraph and inserting “$10,000 in calendar year 2024, and shall be increased as described in section 1617(d) for each subsequent calendar year.”. (d) Inflation adjustment.—Section 1617 of such Act (42 U.S.C. 1382f) is amended— (1) in the section heading, by inserting “; inflation adjustment” after “benefits”; and (2) by adding at the end the following: “(d) In the case of any calendar year after 2024, each of the amounts specified in sections 1611(a)(3), 1612(b)(2)(A), and 1612(b)(4) shall be increased by multiplying each such amount by the quotient (not less than 1) obtained by dividing— “(1) the average of the Consumer Price Index for Elderly Consumers (CPI–E, as published by the Bureau of Labor Statistics of the Department of Labor) for the 12-month period ending with September of the preceding calendar year, by “(2) such average for the 12-month period ending with September 2024.”. ---
3. Update in supplemental security income benefit amounts and repeal of marriage penalty Read Opens in new tab
Summary AI
The bill updates the amounts for supplemental security income (SSI) benefits: for individuals without an eligible spouse, the benefit is $1,752 until 2024 and after that, based on the annual poverty guideline; for those with an eligible spouse, the benefit is $2,628 until 2024 and double the individual rate after that. Additionally, it eliminates the marriage penalty and adjusts related cost-of-living provisions, with changes effective for calendar years after 2021.
Money References
- (a) In general.—Section 1611(b) of the Social Security Act (42 U.S.C. 1382(b)) is amended to read as follows: “(b)(1) The benefit under this title for an individual who does not have an eligible spouse shall be payable— “(A) for calendar years 1974 through 2024, at the rate of $1,752 (or, if greater, the amount determined under section 1617), and “(B) for calendar years after 2024, at the rate equal to the annual poverty guideline for the calendar year preceding such calendar year (as updated annually in the Federal Register by the Department of Health and Human Services under the authority of section 673(2) of the Omnibus Budget Reconciliation Act of 1981) as applicable to a single individual, reduced by the amount of income, not excluded pursuant to section 1612(b), of such individual. “(2) The benefit under this title for an individual who has an eligible spouse shall be payable— “(A) for calendar years 1974 through 2024, at the rate of $2,628 (or, if greater, the amount determined under section 1617), and “(B) for calendar years after 2024, at the rate equal to twice the rate described in paragraph (1)(B), reduced by the amount of income, not excluded pursuant to section 1612(b), of such individual and spouse.”.
4. Support and maintenance furnished in kind not included as income Read Opens in new tab
Summary AI
The updated section of the law clarifies that support or maintenance given in kind, such as goods or services, is not considered income for certain benefits. It also includes changes in how income is determined for some aliens when supported by sponsors, and removes or rephrases certain clauses to align with these adjustments.
5. Exclusion of retirement accounts from resources Read Opens in new tab
Summary AI
The section amends the Social Security Act to remove qualified retirement and eligible deferred compensation plans from being considered as resources when determining benefits.
6. Repeal of penalty for disposal of resources for less than fair market value Read Opens in new tab
Summary AI
The text describes changes to the law requiring the Social Security Commissioner to inform applicants and their spouses about Medicaid rules affecting eligibility when they sell resources for less than their market value. It also mandates that any information collected be shared with state agencies that manage Medicaid programs.
7. Clarifying the treatment of certain state tax credits Read Opens in new tab
Summary AI
The section amends the Social Security Act to specify that if a person receives a refund on their state income taxes because of either a state earned income tax credit or a state child tax credit, this refund is not considered as income for specific purposes.
8. Treatment of tribal general welfare payments Read Opens in new tab
Summary AI
This section of the bill amends parts of the Social Security Act to exclude the value of Indian general welfare benefits from being counted as income, ensuring these benefits do not affect an individual's (or their spouse's) eligibility for social security assistance.
9. Elimination of dedicated accounts for certain past-due benefits Read Opens in new tab
Summary AI
The proposed changes eliminate specific accounts used for certain overdue Social Security benefits, adjusting how these transfers are treated in terms of income and resources when determining eligibility for various benefits programs. Additionally, these changes ensure transferred amounts from such accounts will not affect eligibility or assistance levels for federal, state, or local benefits programs.
10. Elimination of installment payment requirement Read Opens in new tab
Summary AI
The bill proposes removing the requirement for installment payments as stated in Section 1631(a), paragraph (10) of the Social Security Act.
11. Extension of period of exclusion of certain payments from countable resources Read Opens in new tab
Summary AI
The section modifies the Social Security Act, specifically extending the time period from 9 months to 21 months during which certain payments are excluded from being considered as part of a person's countable resources.
12. Modification of rules to determine marital relationships Read Opens in new tab
Summary AI
The section amends the Social Security Act to modernize language by replacing terms related to marital status. Instead of using "husband and wife," the text now refers to "married individuals" or "spouse" to ensure inclusivity and consistency throughout the act.
13. Effective date Read Opens in new tab
Summary AI
The changes made by this law will begin to apply 6 months after it is officially passed.