text: SECTION 1. SHORT TITLE.
  
      This Act may be cited as the ``Senior Citizens' Freedom to Work 
  Act''.
  
  SEC. 2. ADJUSTMENTS IN MONTHLY EXEMPT AMOUNT FOR PURPOSES OF THE SOCIAL 
                SECURITY EARNINGS TEST.
  
      (a) Increase in Monthly Exempt Amount for Individuals Who Have 
  Attained Retirement Age.--
              (1) In general.--Section 203(f)(8)(D) of the Social 
          Security Act (42 U.S.C. 403(f)(8)(D)) is amended to read as 
          follows:
              ``(D)(i) Notwithstanding any other provision of this 
          subsection, the exempt amount which is applicable to an 
          individual who has attained retirement age (as defined in 
          section 216(l)) before the close of the taxable year involved 
          shall be--
                      ``(I) $1,208.33\1/3\ for each month of any taxable 
                  year ending after 1995 and before 1997,
                      ``(II) $1,416.66\2/3\ for each month of any taxable 
                  year ending after 1996 and before 1998,
                      ``(III) $1,666.66\2/3\ for each month of any 
                  taxable year ending after 1997 and before 1999,
                      ``(IV) $1,875.00 for each month of any taxable year 
                  ending after 1998 and before 2000,
                      ``(V) $2,083.33\1/3\ for each month of any taxable 
                  year ending after 1999 and before 2001,
                      ``(VI) $2,291.66\2/3\ for each month of any taxable 
                  year ending after 2000 and before 2002, and
                      ``(VII) $2,500.00 for each month of any taxable 
                  year ending after 2001 and before 2003.''.
              (2) Increased amounts subject to present law cost-of-living 
          adjustment after 2002.--Section 203(f)(8)(D) of such Act (42 
          U.S.C. 403(f)(8)(D)), as amended by paragraph (1), is amended 
          by adding at the end the following new clause:
              ``(ii) For purposes of this paragraph, the increase in the 
          exempt amount provided under clause (i)(VII) shall be deemed to 
          have resulted from a determination which shall be deemed to 
          have been made under subparagraph (A) in 2001.''.
              (3) Conforming amendment.--The second sentence of section 
          223(d)(4)(A) of such Act (42 U.S.C. 423(d)(4)(A)) is amended by 
          striking ``the exempt amount under section 203(f)(8) which is 
          applicable to individuals described in subparagraph (D) 
  thereof'' and inserting the following: ``an amount equal to the exempt 
  amount which would have been applicable under section 203(f)(8), to 
  individuals described in subparagraph (D) thereof, if the amendments 
  made to such section by the Senior Citizens' Freedom to Work Act had 
  not been enacted''.
              (4) Effective date of subsection.--The amendments made by 
          this subsection shall apply with respect to taxable years 
          beginning after 1995.
      (b) Compensation of Trust Fund for Increased Outlays.--
              (1) In general.--Section 201(d) of the Social Security Act 
          (42 U.S.C. 401(d)) is amended--
                      (A) by inserting ``(1)'' after ``(d)'';
                      (B) in the fifth sentence, by striking ``shall bear 
                  interest'' and inserting ``shall (subject to paragraph 
                  (2)) bear interest''; and
                      (C) by adding at the end the following new 
                  paragraph:
      ``(2) In the case of the Federal Old-Age and Survivors Insurance 
  Trust Fund, the Managing Trustee shall increase the rate of interest 
  (otherwise specified in the fifth sentence of paragraph (1)) which is 
  to be borne by obligations referred to in the fourth sentence of 
  paragraph (1) issued after September 30, 1995, and before October 1, 
  2002, by .25 percent point for each fiscal year beginning after 
  September 30, 1995, and before October 1, 2002. For purposes of this 
  paragraph, any obligation in which any portion of such Trust Fund is 
  invested which was issued before October 1, 1995, shall be deemed to 
  have matured on September 30, 1995, and to have been reissued on 
  October 1, 1995, with the same maturation date and same rate of 
  interest (subject to the increase provided under this paragraph).''.
              (2) Effective date of subsection.--The amendments made by 
          this subsection shall apply with respect to obligations issued 
          after December 31, 1995.
      (c) Additional Offsets.--
              (1) In general.--Notwithstanding any other provision of 
          law, each nonexempt account within the discretionary spending 
          category for each of the fiscal years 1996 through 2002 shall 
          be reduced, if necessary, by the uniform percentage necessary 
          to offset the Federal Old-Age and Survivors Insurance Trust 
          Fund shortfall resulting from the amendments made to section 
          203(f)(8) of the Social Security Act by the Senior Citizens' 
          Freedom to Work Act.
              (2) Effective date.--The reductions required by this 
          subsection shall be implemented pursuant to a Presidential 
          order as provided for a sequester to eliminate a budget-year 
          breach under section 251 of the Balanced Budget and Deficit 
          Control Act of 1985. The reductions required by this subsection 
          shall be in addition to any reductions required by section 251 
          of the Balanced Budget and Deficit Control Act of 1985.
      (d) Report by GAO.--Not later than the date which is 2 years after 
  the date of the enactment of this Act, the Comptroller General of the 
  United States shall report to the Congress regarding an analysis of the 
  dynamic effect of the reform of the social security earnings limit 
  under section 203(f)(8) of the Social Security Act, as provided by 
  subsection (a) of this section, and a calculation of the reform's true 
  effect on the Federal budget.
target: Senior Citizens' Freedom to Work Act - Amends title II (Old Age, Survivors and Disability Insurance) (OASDI) of the Social Security Act to increase the monthly exempt amount, under the earnings test, for individuals who have attained retirement age.  Sets forth the schedule of monthly adjustments increasing from $1,208 for taxable year 1996 to $2,500 for taxable year 2002. 
  Subjects such increased amounts to current law cost-of-living adjustments after 2002. 
  Requires the Managing Trustee of the Federal Old-Age and Survivors Insurance Trust Fund to increase by a specified percentage per year the rate of interest borne by public-debt obligations issued for purchase by the OASDI trust funds between September 30, 1995, and October 1, 2002. 
  Provides that each nonexempt account within the discretionary spending category for each of FY 1996 through 2002 shall be reduced, if necessary, by the uniform percentage necessary to offset the Federal Old-Age and Survivors Insurance Trust Fund shortfall resulting from the amendments of this Act increasing the monthly exempt amount. 
  Directs the Comptroller General to analyze and report to the Congress on the dynamic effect of the revision of the social security earnings limit made by this Act and a calculation of its true effect on the Federal budget.
feat_title: Senior Citizens' Freedom to Work Act