[Congressional Bills 107th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2293 Introduced in House (IH)]







107th CONGRESS
  1st Session
                                H. R. 2293

   To amend the Internal Revenue Code of 1986 to provide a temporary 
   reduction in the maximum capital gains rate from 20 percent to 15 
                                percent.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             June 21, 2001

Mr. Ryan of Wisconsin 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 temporary 
   reduction in the maximum capital gains rate from 20 percent to 15 
                                percent.

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

SECTION 1. TEMPORARY REDUCTION IN CAPITAL GAINS RATE.

    (a) Reduction in Maximum Rate.--The following sections of the 
Internal Revenue Code of 1986 are each amended by striking ``20 
percent'' and inserting ``15 percent'':
            (1) Section 1(h)(1)(C).
            (2) Section 55(b)(3)(C).
            (3) Section 1445(e)(1).
            (4) The second sentence of section 7518(g)(6)(A).
            (5) The second sentence of section 607(h)(6)(A) of the 
        Merchant Marine Act, 1936.
    (b) Transition Rules for Taxable Years Which Include June 1, 
2001.--For purposes of applying section 1(h) of the Internal Revenue 
Code of 1986 in the case of a taxable year which includes June 1, 
2001--
            (1) The amount of tax determined under subparagraph (B) of 
        section 1(h)(1) of such Code shall be the sum of--
                    (A) 10 percent of the lesser of--
                            (i) the net capital gain taking into 
                        account only gain or loss properly taken into 
                        account for the portion of the taxable year on 
                        or after such date (determined without regard 
                        to collectibles gain or loss, gain described in 
                        section (1)(h)(6)(A)(i) of such Code, and 
                        section 1202 gain), or
                            (ii) the amount on which a tax is 
                        determined under such subparagraph (without 
                        regard to this subsection), plus
                    (B) 10 percent of the excess (if any) of--
                            (i) the amount on which a tax is determined 
                        under such subparagraph (without regard to this 
                        subsection), over
                            (ii) the amount on which a tax is 
                        determined under subparagraph (A).
            (2) The amount of tax determined under subparagraph (C) of 
        section (1)(h)(1) of such Code shall be the sum of--
                    (A) 15 percent of the lesser of--
                            (i) the excess (if any) of the amount of 
                        net capital gain determined under subparagraph 
                        (A)(i) of paragraph (1) of this subsection over 
                        the amount on which a tax is determined under 
                        subparagraph (A) of paragraph (1) of this 
                        subsection, or
                            (ii) the amount on which a tax is 
                        determined under such subparagraph (C) (without 
                        regard to this subsection), plus
                    (B) 20 percent of the excess (if any) of--
                            (i) the amount on which a tax is determined 
                        under such subparagraph (C) (without regard to 
                        this subsection), over
                            (ii) the amount on which a tax is 
                        determined under subparagraph (A) of this 
                        paragraph.
            (3) For purposes of applying section 55(b)(3) of such Code, 
        rules similar to the rules of paragraphs (1) and (2) of this 
        subsection shall apply.
            (4) In applying this subsection with respect to any pass-
        thru entity, the determination of when gains and loss are 
        properly taken into account shall be made at the entity level.
            (5) Terms used in this subsection which are also used in 
        section 1(h) of such Code shall have the respective meanings 
        that such terms have in such section.
    (c) Effective Dates.--
            (1) In general.--Except as provided in paragraph (2), the 
        amendments made by this section shall apply to sales or 
        exchanges made--
                    (A) on or after June 1, 2001, and
                    (B) in taxable years beginning before January 1, 
                2004.
            (2) Withholding.--The amendment made by subsection (a)(3) 
        shall apply to amounts paid after the date of the enactment of 
        this Act.
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