Social Security Tax Reduction Act of 1980

Social Security Tax Reduction Act of 1980 - Amends the Internal Revenue Code with respect to tax rates for old-age, survivors, and disability insurance: (1) on employees and employers, to increase the 1981 rate from 5.35 percent to 5.4 percent, the 1982 through 1984 rate from 5.4 percent to 5.45 percent, and the 1985 rate from 5.7 percent to 5.75 percent, but hold the 1986 through 1989 rate at the currently legislated 5.7 percent, and the post-1989 rate at 6.2 percent; (2) on the self-employed, to reduce the 1981 rate from 8.00 percent to 7.37 percent, but increase the 1982 through 1984 rate from 8.05 percent to 8.17 percent, and the 1985 rate from 8.55 percent to 8.62 percent, before holding the 1986 through 1989 rate at the currently legislated 8.55 percent, and the post-1989 rate at 9.3 percent.

Reduces the rates of tax on employees, employers, and the self-employed for hospital insurance: (1) from 1.3 percent to .73 percent for 1981 through 1984; and (2) from 1.35 percent to .78 percent for 1985.

Amends the Social Security Act to reduce the wage base for such taxes and to adjust the formulae for allocation of appropriations to the Disability and Hospital Insurance Trust Fund in order to maintain current levels. Provides for partial funding of hospital insurance program from general revenues.