As per "42 USC § 401 - Trust Funds":

(h) Benefit payments

Benefit payments required to be made under section 423 of this title, and benefit payments required to be made under subsection (b), (c), or (d) of section 402 of this title to individuals entitled to benefits on the basis of the wages and self-employment income of an individual entitled to disability insurance benefits, shall be made only from the Federal Disability Insurance Trust Fund. All other benefit payments required to be made under this subchapter (other than section 426 of this title) shall be made only from the Federal Old-Age and Survivors Insurance Trust Fund. (hat tip: Sean Cheshire's answer)

However, it looks like these rules were violated in 2011/2012. As per Wikipedia:

During 2011 and 2012, for example, FICA tax revenue was insufficient to maintain Social Security's solvency without transfers from general revenues. These transfers added to the general budget deficit like general program spending.

How was the legality of such a move resolved when this seemingly violated 42 USC § 401?

  • The former is about "can they simply refuse to use FICA for funding alltogether". This is specifically about what reasoning was used to claim H.R.2419 was legal - meaning it's quite possible that a temporary patch like H.R.2419 has some legal basis but slashing FICA to 0% permanent does not.
    – user4012
    Feb 15, 2013 at 14:56
  • The transfers were to the trust fund not used to pay SSI Disbursments directly. The US Federal government has borrowed the money in the SSI Trust fund to fund other spending for years. It is just repaying some of that debt. Feb 15, 2013 at 15:01

1 Answer 1


This is the text of SEC. 12601. HR 2419 of the 110th Congress (the section the question asks about:

To ensure that the assets of the trust funds established under section 201 of the Social Security Act (42 U.S.C. 401) are not reduced as a result of the enactment of this Act, the Secretary of the Treasury shall transfer annually from the general revenues of the Federal Government to those trust funds the following amounts:

  1. For fiscal year 2009, $86,000,000.
  2. For fiscal year 2010, $90,000,000.
  3. For fiscal year 2011, $88,000,000.
  4. For fiscal year 2012, $88,000,000.
  5. For fiscal year 2013, $5,000,000.
  6. For fiscal year 2014, $5,000,000.
  7. For fiscal year 2015, $4,000,000.
  8. For each fiscal year after fiscal year 2015, $2,000,000.

The bill simply transfers funds from the General Revenues account to the social security Trust fund. Congress has for the last several decades used excess funds(read funds that were not needed to meet obligations of the SSA) to pay for spending. Now that the money they have borrowed from the SS Trust is needed congress needs to return the borrowed funds to the trust. This law makes provisions to do that.

There is no requirement that any law be justified legally before being passed. It is worth noting that the President vetoed 2419 but that the veto was overridden by congress in 2007. In order for the law to be invalidated it would need to be challenged in court.

  • Sorry, I'm not seeing from the quoted portion that the "transferred general revenues" are coming out of the amount considered a loaned from trust fund to the government? Meaning, is there something in the law that says "well, after this is done, government will owe $86Mil less to trust Fund than it did in 2008"?
    – user4012
    Feb 15, 2013 at 21:45
  • @DVK - No there is nothing in any of the laws that drew from the SS Trust fund that required the money actually be repaid either... Other than the promise of the politicians in office when that happened that it would be repaid in the future. But there is a SS General ledger that tracks how much money the trust fund should have in it. It is at 2.7 trillion right now... I will try to find that I read it earlier today. It should be noted that that "Debt" does not count as debt that is applied to the debt ceiling. Feb 15, 2013 at 21:46
  • OK, I guess what I'm asking about is whether those $86Mil in 2009 were entered as a liability into the general ledger (assuming they came out of the IOUs that were the assets)?
    – user4012
    Feb 15, 2013 at 21:50
  • @DVK - SS trust fund has money come in every year in the form of payroll taxes. It had a shortfall in 2009 of 86 million dollars, that is it paid out more in benefits than it took in in taxes. The general revenue fund kicked in the remainder of the needed capitol to cover the needs of the trust fund. The US keeps minimal operating capitol in its accounts. There is no extra capitol in the SS Trust fund to cover the shortfalls that have occurred since 2003ish. Feb 15, 2013 at 21:58
  • MAybe you should ask a question about how the SS Trust fund works, and where the 2.7 trillion dollar balance is. Feb 15, 2013 at 21:59

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