This method applies for benefits in 1973 or later.
The first page shows the calculation of the number of years of coverage for special minimum purposes. Earnings in each year after 1950 and before 1979 are compared to one-quarter of the wage base for that year. Earnings after 1978 and before 1991 are compared to one-quarter of what the wage base would have been for that year had there not been ad hoc changes in the wage base in 1979-81 (the old-law base). Earnings after 1990 are compared to 15 percent of the old-law wage base. Each year for which earnings are at least equal to the required amount counts as a year of coverage. In addition, earnings prior to 1951 contribute toward years of coverage, on the basis of 1 year of coverage for each $900 of cumulative earnings, up to a maximum of 14 years of coverage for pre-1951 earnings.
The second page shows the derivation of the PIA and MFB from the number of years of coverage. The amount of PIA per year of coverage equals $11.50 for benefits in 1979 or later, before application of any automatic benefit increases. For months prior to 1979, the amount per year of coverage was $8.50 (prior to March 1974) or $9.00 (from March 1974 through December 1978). To compute the PIA, the amount per year is multiplied by the number of years greater than 10 but less than or equal to 30 (producing a maximum of 20 countable years). The MFB, before application of any automatic benefit increases, is 150% of the PIA.
For benefits in June 1979 or later, automatic benefit increases are applied beginning with the one for June 1979 and continuing through the month of benefit. After each increase in PIA and MFB, the result is rounded up (for the June 1981 increase or earlier) or down (for the June 1982 increase or later) to a multiple of a dime.
For more information on the special minimum, see the OASDI Digest.