Determination of wages and self-employment income above contribution and benefit base after 2025

(a) Determination of wages above contribution and benefit base after 2025 (1) Amendments to the Internal Revenue Code of 1986 Section 3121 of the Internal Revenue Code of 1986 is amended— (A) in subsection (a)(1), by inserting the applicable percentage (determined under subsection (c)(1)) of before that part of the remuneration, and (B) in subsection (c), by striking (c) Included and excluded service.— For purposes of this chapter, if and inserting the following: (c) Special rules for wages and employment (1) Applicable percentage of remuneration in determining wages For purposes of paragraph (1) of subsection (a), the applicable percentage for a calendar year, in connection with any calendar year referred to in such paragraph, shall be the percentage determined in accordance with the following table: The applicable In the case of: percentage is: Calendar year 2026 86 Calendar year 2027 71 Calendar year 2028 57 Calendar year 2029 43 Calendar year 2030 29 Calendar year 2031 14 Calendar years after 2031 0. (2) Included and excluded service For purposes of this chapter, if. (2) Amendments to the Social Security Act Section 209 of the Social Security Act (42 U.S.C. 409) is amended— (A) in subsection (a)(1)— (i) in subparagraph (I)— (I) by inserting and before 2026 after 1974; and (II) by inserting and after the semicolon; and (ii) by adding at the end the following new subparagraph: (J) The applicable percentage (determined under subsection (l)) of that part of remuneration which, after remuneration (other than remuneration referred to in the succeeding subsections of this section) equal to the contribution and benefit base (determined under section 230) with respect to employment has been paid to an individual during any calendar year after 2025 with respect to which such contribution and benefit base is effective, is paid to such individual during such calendar year;; and (B) by adding at the end the following new subsection: (l) For purposes of subparagraph (J) of subsection (a)(1), the applicable percentage for a calendar year, in connection with any calendar year referred to in such subparagraph, shall be the percentage determined in accordance with the following table: The applicable In the case of: percentage is: Calendar year 2026 86 Calendar year 2027 71 Calendar year 2028 57 Calendar year 2029 43 Calendar year 2030 29 Calendar year 2031 14 Calendar years after 2031 0.. (3) Effective date The amendments made by this subsection shall apply with respect to remuneration paid in calendar years after 2025. (b) Determination of self-Employment income above contribution and benefit base after 2025 (1) Amendments to the Internal Revenue Code of 1986 Section 1402 of the Internal Revenue Code of 1986 is amended— (A) in subsection (b)(1), by inserting an amount equal to the applicable percentage (as determined under subsection (d)(2)) of before that part of the net earnings from self-employment, and (B) in subsection (d)— (i) by striking (d) Employee and wages.— The term and inserting the following: (d) Rules and definitions (1) Employee and wages The term, and (ii) by adding at the end the following: (2) Applicable percentage of net earnings from self-employment in determining self-employment income For purposes of paragraph (1) of subsection (b), the applicable percentage for a taxable year beginning in any calendar year referred to in such paragraph shall be the percentage determined in accordance with the following table: The applicable In the case of: percentage is: Calendar year 2026 86 Calendar year 2027 71 Calendar year 2028 57 Calendar year 2029 43 Calendar year 2030 29 Calendar year 2031 14 Calendar years after 2031 0.. (2) Amendments to the Social Security Act Section 211 of the Social Security Act (42 U.S.C. 411) is amended— (A) in subsection (b)— (i) in paragraph (1)(I)— (I) by striking or after the semicolon; and (II) by inserting and before 2026 after 1974; (ii) by redesignating paragraph (2) as paragraph (3); and (iii) by inserting after paragraph (1) the following new paragraph: (2) For any taxable year beginning in any calendar year after 2025, an amount equal to the applicable percentage (as determined under subsection (l)) of that part of net earnings from self-employment which is in excess of (A) an amount equal to the contribution and benefit base (determined under section 230) that is effective for such calendar year, minus (B) the amount of the wages paid to such individual during such taxable year; or; and (B) by adding at the end the following: (l) For purposes of paragraph (2) of subsection (b), the applicable percentage for a taxable year beginning in any calendar year referred to in such paragraph, shall be the percentage determined in accordance with the following table: The applicable In the case of: percentage is: Calendar year 2026 86 Calendar year 2027 71 Calendar year 2028 57 Calendar year 2029 43 Calendar year 2030 29 Calendar year 2031 14 Calendar years after 2031 0.. (3) Effective date The amendments made by this subsection shall apply with respect to taxable years beginning during or after calendar year 2026.