[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5170 Introduced in House (IH)]







106th CONGRESS
  2d Session
                                H. R. 5170

   To amend the Internal Revenue Code of 1986 to reduce the marriage 
penalty by providing for adjustments to the standard deduction and the 
earned income credit and to repeal the reduction of the refundable tax 
                                credits.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                           September 13, 2000

    Ms. Millender-McDonald 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 reduce the marriage 
penalty by providing for adjustments to the standard deduction and the 
earned income credit and to repeal the reduction of the refundable tax 
                                credits.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Common Sense Marriage Tax Relief Act 
of 2000''.

SEC. 2. FINDINGS.

    The Congress finds the following:
            (1) According to a 1999 Department of the Treasury study, 
        of the 51,400,000 joint returns filed in 1999, approximately--
                    (A) 48 percent will incur a marriage tax penalty,
                    (B) 41 percent will incur a marriage tax bonus, and
                    (C) 11 percent will generally be unaffected.
            (2) The average marriage tax penalty in 1999 will reach 
        $1,141 per couple, according to the Department of the Treasury 
        study.
            (3) At least 66 provisions in the existing tax code treat 
        married couples differently from single filers, according to 
        the American Institute of Certified Public Accountants.
            (4) Married working women, on average, earn approximately 
        60 percent of their husband's salary, according to the Bureau 
        of the Census. The wage gap between women and men is 73 percent 
        for Caucasian women, 63 percent for African-American women, and 
        53 percent for Hispanic women, according to the National 
        Committee on Pay Equity.
            (5) Approximately 40 percent of married mothers in the 
        United States stay at home to raise their young children full 
        time while almost no fathers do, according to the Bureau of the 
        Census.
            (6) Although the United States tax code is neutral, it is 
        biased against secondary earners, who are overwhelmingly women.
            (7) Because of the progressive marginal rates in the tax 
        code, one spouse earning $25,000 per year would be taxed 
        entirely at the 15 percent rate; but if the other spouse also 
        earns $25,000, a portion of the other spouse's income would be 
        taxed at the 28 percent rate.
            (8) Regardless of marital status, once an individual's 
        reported income level reaches beyond the earned income tax 
        credit threshold, she or he automatically loses this benefit. 
        As a result, newly married couples struggling to escape poverty 
        suddenly lose this vital tax benefit simply because they are no 
        longer single.

SEC. 3. MARRIAGE PENALTY RELIEF.

    (a) Standard Deduction.--
            (1) In general.--Paragraph (2) of section 63(c) of the 
        Internal Revenue Code of 1986 (relating to standard deduction) 
        is amended--
                    (A) by striking ``$5,000'' in subparagraph (A) and 
                inserting ``twice the dollar amount in effect under 
                subparagraph (C) for the taxable year'',
                    (B) by adding ``or'' at the end of subparagraph 
                (B),
                    (C) by striking ``in the case of'' and all that 
                follows in subparagraph (C) and inserting ``in any 
                other case.'', and
                    (D) by striking subparagraph (D).
            (2) Increase allowed as deduction in determining minimum 
        tax.--Subparagraph (E) of section 56(b)(1) of such Code is 
        amended by adding at the end the following new sentence: ``The 
        preceding sentence shall not apply to so much of the standard 
        deduction under subparagraph (A) of section 63(c)(2) as exceeds 
        the amount which would be such deduction but for the amendment 
        made by section 2(a)(1) of the Penalty Relief From Marriage Tax 
        Act of 2000.''
            (3) Technical amendments.--
                    (A) Subparagraph (B) of section 1(f)(6) of such 
                Code is amended by striking ``(other than with'' and 
                all that follows through ``shall be applied'' and 
                inserting ``(other than with respect to sections 
                63(c)(4) and 151(d)(4)(A)) shall be applied''.
                    (B) Paragraph (4) of section 63(c) of such Code is 
                amended by adding at the end the following flush 
                sentence:
        ``The preceding sentence shall not apply to the amount referred 
        to in paragraph (2)(A).''
    (b) Earned Income Credit.--
            (1) In general.--Subsection (a) of section 32 of such Code 
        (relating to credit for earned income) is amended by adding at 
        the end the following new paragraph:
            ``(3) Reduction of marriage penalty.--
                    ``(A) In general.--In the case of a joint return, 
                the phaseout amount under this section shall be such 
                amount (determined without regard to this paragraph) 
                increased by $2,500 ($2,000 in the case of taxable 
                years beginning during 2001).
                    ``(B) Inflation adjustment.--In the case of any 
                taxable year beginning in a calendar year after 2002, 
                the $2,500 amount contained in subparagraph (A) shall 
                be increased by an amount equal to the product of--
                            ``(i) such dollar amount, and
                            ``(ii) the cost-of-living adjustment 
                        determined under section 1(f)(3) for the 
                        calendar year in which the taxable year begins, 
                        determined by substituting `calendar year 2001' 
                        for `calendar year 1992' in subparagraph (B) 
                        thereof.
                If any increase determined under the preceding sentence 
                is not a multiple of $50, such increase shall be 
                rounded to the next lowest multiple of $50.''
            (2) Repeal of reduction of refundable tax credits.--
                    (A) Subsection (d) of section 24 of such Code is 
                amended by striking paragraph (2) and redesignating 
                paragraph (3) as paragraph (2).
                    (B) Section 32 of such Code is amended by striking 
                subsection (h).
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2000.

SEC. 4. TAX REDUCTIONS CONTINGENT ON SOCIAL SECURITY AND MEDICARE 
              SOLVENCY CERTIFICATIONS.

    (a) In General.--Notwithstanding any other provision of this Act, 
no provision of this Act (or amendment made thereby) shall take effect 
until there is--
            (1) a social security certification,
            (2) a medicare certification, and
            (3) a public debt elimination certification.
    (b) Definitions.--For purposes of this subsection--
            (1) Social security solvency certification.--The term 
        ``social security solvency certification'' means a 
        certification by the Board of Trustees of the Social Security 
        Trust Funds that the Federal Old-Age and Survivors Insurance 
        Trust Fund and the Federal Disability Insurance Trust Fund are 
        in actuarial balance until the year 2050.
            (2) Medicare solvency certification.--The term ``medicare 
        solvency certification'' means a certification by the Board of 
        Trustees of the Federal Hospital Insurance Trust Fund that such 
        Trust Fund is in actuarial balance until the year 2030.
            (3) Public debt elimination certification.--There is a 
        public debt elimination certification if the Director of the 
        Office of Management and Budget certifies that, taking into 
        account the tax reductions made by this Act and other 
        legislation enacted during calendar year 2000, the national 
        debt held by the public is projected to be eliminated by the 
        year 2013.
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