[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5281 Introduced in House (IH)]

103d CONGRESS
  2d Session
                                H. R. 5281

 To amend the Internal Revenue Code of 1986 to provide a tax credit to 
       all families with young children, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            October 7, 1994

 Mr. Smith of Michigan (for himself, Mr. McCollum, Mr. Petri, and Mr. 
   Solomon) 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 provide a tax credit to 
       all families with young children, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. TAX CREDIT FOR ALL FAMILIES WITH YOUNG CHILDREN.

    (a) General Rule.--Paragraph (1) of section 21(a) of the Internal 
Revenue Code of 1986 is amended to read as follows:
            ``(1) In general.--In the case of an individual who 
        maintains a household which includes as a member 1 or more 
        qualifying individuals, there shall be allowed as a credit 
        against the tax imposed by this chapter for the taxable year an 
        amount equal to the sum of--
                    ``(A) the applicable percentage of $2,400 for each 
                young qualifying individual, and
                    ``(B) the applicable percentage of the employment-
                related expenses paid by such individual during the 
                taxable year with respect to disabled qualifying 
                individuals.''
    (b) Conforming Amendments.--
            (1) Paragraph (1) of section 21(b) of such Code is amended 
        by striking ``13'' and inserting ``5''.
            (2) Paragraph (2) of section 21(b) of such Code is 
        amended--
                    (A) by striking ``qualifying individuals'' in 
                subparagraph (A) and inserting ``disabled qualifying 
                individuals'',
                    (B) by striking ``qualifying individual'' each 
                place it appears in subparagraph (A) and inserting 
                ``disabled qualifying individual'', and
                    (C) by amending subparagraph (B) to read as 
                follows:
                    ``(B) Exception.--Employment-related expenses 
                described in subparagraph (A) which are incurred for 
                services outside the taxpayer's household shall be 
                taken into account only if incurred for the care of a 
                disabled qualifying individual who regularly spends at 
                least 8 hours each day in the taxpayer's household.''
            (3) Subsection (b) of section 21 of such Code is amended by 
        adding at the end the following new paragraphs:
            ``(3) Young qualifying individual.--The term `young 
        qualifying individual' means any qualifying individual 
        described in subparagraph (A) of paragraph (1).
            ``(4) Disabled qualifying individual.--The term `disabled 
        qualifying individual' means any disqualifying individual 
        described in subparagraph (B) or (C) of paragraph (1).''
            (4) Subsection (c) of section 21 of such Code is amended to 
        read as follows:
    ``(c) Limitation on Credit.--The amount of the credit determined 
under subsection (a) for any taxable year shall not exceed--
            ``(1) the applicable percentage of $2,400, or
            ``(2) if there are 2 or more qualifying individuals with 
        respect to the taxpayer for such taxable year, the applicable 
        percentage of $4,800.
The amount determined under paragraph (1) or (2) (whichever is 
applicable) shall be reduced by the applicable percentage of the 
aggregate amount excludable from gross income under section 129 for the 
taxable year.''
            (5) Subparagraph (B) of section 21(e)(5) of such Code is 
        amended by striking ``13'' and inserting ``5''.
            (6) The section heading for section 21 of such Code is 
        amended to read as follows:

``SEC. 21. CREDIT FOR HOUSEHOLDS WITH YOUNG CHILDREN AND FOR 
              EMPLOYMENT-RELATED EXPENSES FOR DISABLED DEPENDENTS.''

            (7) The table of sections for subpart A of part IV of 
        subchapter A of chapter 1 of such Code is amended by striking 
        the item related to section 21 and inserting:

``Sec. 21. Credit for households with young children and for 
                            employment-related expenses for disabled 
                            dependents.''
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 1993.
                                 <all>