[Congressional Bills 103th Congress]
[From the U.S. Government Publishing Office]
[H.R. 579 Introduced in House (IH)]

103d CONGRESS
  1st Session
                                H. R. 579

    To amend the Internal Revenue Code of 1986 to provide that the 
  disallowance of deductions for personal interest shall not apply to 
            interest on loans used to buy highway vehicles.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            January 26, 1993

   Mr. Carr 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 that the 
  disallowance of deductions for personal interest shall not apply to 
            interest on loans used to buy highway vehicles.

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

SECTION 1. DEDUCTION FOR INTEREST ON LOANS FOR CERTAIN HIGHWAY 
              VEHICLES.

    (a) In General.--Paragraph (2) of section 163(h) of the Internal 
Revenue Code of 1986 (relating to disallowance of deduction for 
personal interest) is amended by striking ``and'' at the end of 
subparagraph (D), by redesignating subparagraph (E) as subparagraph 
(F), and by inserting after subparagraph (D) the following new 
subparagraph:
                    ``(E) any qualified vehicle interest (as defined in 
                paragraph (5)), and''.
    (b) Qualified Vehicle Interest.--Section 163(h) of such Code is 
amended by redesignating paragraph (5) as paragraph (6) and by 
inserting after paragraph (4) the following new paragraph:
            ``(5) Qualified vehicle interest defined.--
                    ``(A) In general.--For purposes of paragraph 
                (2)(E), the term `qualified vehicle interest' means any 
                interest on indebtedness secured by qualified vehicle 
                which is incurred in acquiring such vehicle.
                    ``(B) Qualified vehicle.--
                            ``(i) In general.--For purposes of this 
                        paragraph, the term `qualified vehicle' means 
                        any 4-wheeled vehicle propelled by fuel if--
                                    ``(I) such vehicle is manufactured 
                                primarily for use on public streets, 
                                roads, and highways (except any vehicle 
                                operated exclusively on a rail or 
                                rails),
                                    ``(II) such vehicle is of a model 
                                year not earlier than the second model 
                                year preceding the model year during 
                                which the vehicle is purchased by the 
                                taxpayer, and
                                    ``(III) such vehicle is designated 
                                by the taxpayer for purposes of this 
                                paragraph.
                            ``(ii) Limitation on number of vehicles 
                        which may be designated.--A vehicle may be 
                        designated under clause (i)(III) only if such a 
                        designation by the taxpayer is not in effect 
                        with respect to--
                                    ``(I) any other vehicle, or
                                    ``(II) in the case of a joint 
                                return, more than 1 other vehicle.
                    ``(C) Reduction of interest deduction for vehicles 
                costing more than $20,000.--If the purchase price of 
                the designated vehicle exceeds $20,000, the amount 
                which would (but for this subparagraph) be treated as 
                qualified vehicle interest for any taxable year with 
                respect to indebtedness secured by such vehicle shall 
                be reduced by the amount which bears the same ratio to 
                such interest for such year as such excess bears to the 
                purchase price of the vehicle.''
    (c) Effective Date.--The amendments made by this section shall 
apply to vehicles purchased after January 26, 1993.

                                 <all>