H.R. 1161House117th Congress (2021-2023)In Committee

Fairness in Social Security Act of 2021

AI-Generated Summary

Updated February 7, 2026 at 10:53 PM UTC

The Fairness in Social Security Act of 2021 changes the tax code so that the portion of a lump‑sum Social Security benefit that relates to months before the taxable year is not counted when determining a household’s modified adjusted gross income. It affects taxpayers who receive lump‑sum Social Security payments and lets them choose whether to apply the exclusion. The rule applies to tax years beginning after December 31, 2013, and provides a one‑year window for refunds or credits related to the change.

Key Provisions

Adds a new subparagraph to §36B(d)(2) excluding from modified adjusted gross income the part of a lump‑sum Social Security benefit attributable to months ending before the start of the taxable year.
Defines a lump‑sum Social Security benefit as any payment covering more than one month of benefits.
Allows a taxpayer to elect to have the exclusion not apply for a taxable year.
Sets the amendment’s effective date to tax years beginning after December 31, 2013, and waives the statute of limitations for related refunds or credits for one year after enactment.

Legislative Activity

Stay on top of the latest movement without scrolling through every action

2 earlier actions

HouseIntro Referral Latest Action

Referred to the House Committee on Ways and Means.

Ways and Means Committee

February 18, 2021

View full timeline

HouseIntro Referral

Introduced in House

February 18, 2021

HouseCommittee

Referred to the Subcommittee on Social Security.

Social Security Subcommittee

February 18, 2021

HouseIntro Referral

Referred to the House Committee on Ways and Means.

Ways and Means Committee

February 18, 2021

Bill Text

Latest available legislative text

Reading Mode

Raw Text PDF XML

Introduced in HouseIssued February 18, 2021

117th CONGRESS

1st Session

H. R. 1161

IN THE HOUSE OF REPRESENTATIVES

February 18, 2021

Mr. Neguse introduced the following bill; which was referred to the Committee on Ways and Means

A BILL

To amend the Internal Revenue Code of 1986 to exclude the portion of a lump-sum social security benefit payment that relates to periods prior to the taxable year from the determination of household income.

Short title

This Act may be cited as the Fairness in Social Security Act of 2021.

Treatment of lump-sum social security benefits in determining household income

(a)

In general

Section 36B(d)(2) of the Internal Revenue Code of 1986 is amended by adding at the end the following new subparagraph:

(C)

Exclusion of portion of lump-sum social security benefits

(i)

In general

The term modified adjusted gross income shall not include so much of any lump-sum social security benefit payment as is attributable to months ending before the beginning of the taxable year.

(ii)

Lump-sum social security benefit payment

For purposes of this subparagraph, the term lump-sum social security benefit payment means any payment of social security benefits (as defined in section 86(d)(1)) which constitutes more than 1 month of such benefits.

(iii)

Election to include excludable amount

A taxpayer may elect (at such time and in such manner as the Secretary may provide) to have this subparagraph not apply for any taxable year.

(b)

Effective date

The amendment made by this section shall apply to taxable years beginning after December 31, 2013.

(c)

Waiver of statute of limitation on credit or refund

If the period of limitation on a credit or refund resulting from the amendment made by subsection (a) expires before the end of the 1-year period beginning on the date of the enactment of this Act, refund or credit of such overpayment (to the extent attributable to such amendment) may, nevertheless, be made or allowed if claim therefor is filed before the close of such 1-year period.