[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[S. 2456 Introduced in Senate (IS)]







106th CONGRESS
  2d Session
                                S. 2456

   To amend the Internal Revenue Code of 1986 to expand the adoption 
   credit to provide assistance to adoptive parents of special needs 
                   children, and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             April 25, 2000

 Ms. Landrieu introduced the following bill; which was read twice and 
                  referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL


 
   To amend the Internal Revenue Code of 1986 to expand the adoption 
   credit to provide assistance to adoptive parents of special needs 
                   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. EXPANSION OF ADOPTION CREDIT.

    (a) Special Needs Adoption.--
            (1) Credit amount.--Paragraph (1) of section 23(a) of the 
        Internal Revenue Code of 1986 (relating to allowance of credit) 
        is amended to read as follows:
            ``(1) In general.--In the case of an individual, there 
        shall be allowed as a credit against the tax imposed by this 
        chapter--
                    ``(A) in the case of a special needs adoption, 
                $10,000, or
                    ``(B) in the case of any other adoption, the amount 
                of the qualified adoption expenses paid or incurred by 
                the taxpayer.''.
            (2) Year credit allowed.--Section 23(a)(2) of such Code 
        (relating to year credit allowed) is amended by adding at the 
        end the following new flush sentence:
        ``In the case of a special needs adoption, the credit allowed 
        under paragraph (1) shall be allowed for the taxable year in 
        which the adoption becomes final.''.
            (3) Dollar limitation.--Section 23(b)(1) of such Code is 
        amended--
                    (A) by striking ``subsection (a)'' and inserting 
                ``subsection (a)(1)(B)'', and
                    (B) by striking ``($6,000, in the case of a child 
                with special needs)''.
            (4) Definition of special needs adoption.--Section 23(d) of 
        such Code (relating to definitions) is amended by adding at the 
        end the following new paragraph:
            ``(4) Special needs adoption.--The term `special needs 
        adoption' means the final adoption of an individual during the 
        taxable year who is an eligible child and who is a child with 
        special needs.''.
            (5) Definition of child with special needs.--Section 
        23(d)(3) of such Code (defining child with special needs) is 
        amended to read as follows:
            ``(3) Child with special needs.--The term `child with 
        special needs' means any child if a State has determined that 
        the child's ethnic background, age, membership in a minority or 
        sibling groups, medical condition or physical impairment, or 
        emotional handicap makes some form of adoption assistance 
        necessary.''.
    (b) Increase in Income Limitations.--Section 23(b)(2) of the 
Internal Revenue Code of 1986 (relating to income limitation) is 
amended--
            (1) in subparagraph (A)--
                    (A) by striking ``$75,000'' and inserting ``$63,550 
                ($105,950 in the case of a joint return)'', and
                    (B) by striking ``$40,000'' and inserting ``the 
                applicable amount'', and
            (2) by adding at the end the following new subparagraph:
                    ``(C) Applicable amount.--For purposes of 
                subparagraph (A), the applicable amount, with respect 
                to any taxpayer, for the taxable year shall be an 
                amount equal to the excess of--
                            ``(i) the maximum taxable income amount for 
                        the 31 percent bracket under the table 
                        contained in section 1 relating to such 
                        taxpayer and in effect for the taxable year, 
                        over
                            ``(ii) the dollar amount in effect with 
                        respect to the taxpayer for the taxable year 
                        under subparagraph (A)(i).
                    ``(D) Cost-of-living adjustment.--
                            ``(i) In general.--In the case of a taxable 
                        year beginning after 2001, each dollar amount 
                        under subparagraph (A)(i) shall be increased by 
                        an amount equal to--
                                    ``(I) such dollar amount, 
                                multiplied by
                                    ``(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 2000' for 
                                `calendar year 1992' in subparagraph 
                                (B) thereof.
                            ``(ii) Rounding rules.--If any amount after 
                        adjustment under clause (i) is not a multiple 
                        of $1,000, such amount shall be rounded to the 
                        next lower multiple of $1,000.''.
    (c) Adoption Credit Made Permanent.--Subclauses (A) and (B) of 
section 23(d)(2) of the Internal Revenue Code of 1986 (defining 
eligible child) are amended to read as follows:
                    ``(A) who has not attained age 18, or
                    ``(B) who is physically or mentally incapable of 
                caring for himself.''.
    (d) Conforming Amendments.--
            (1) Section 23(a)(2) of the Internal Revenue Code of 1986 
        is amended by striking ``(1)'' and inserting ``(1)(B)''.
            (2) Section 23(b)(3) of such Code is amended by striking 
        ``(a)'' each place it appears and inserting ``(a)(1)(B)''.
    (e) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2000.
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