[Congressional Bills 107th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3685 Introduced in House (IH)]







107th CONGRESS
  2d Session
                                H. R. 3685

To amend the Internal Revenue Code of 1986 to allow a refundable credit 
     against income tax for educational expenses incurred for each 
    qualifying child of the taxpayer in attending public or private 
                    elementary or secondary school.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            February 5, 2002

   Mr. Smith of New Jersey 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 allow a refundable credit 
     against income tax for educational expenses incurred for each 
    qualifying child of the taxpayer in attending public or private 
                    elementary or secondary school.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Education, Achievement, and 
Opportunity Act''.

SEC. 2. CREDIT FOR ELEMENTARY AND SECONDARY EDUCATION EXPENSES.

    (a) In General.--Subpart C of part IV of subchapter A of chapter 1 
of the Internal Revenue Code of 1986 (relating to refundable credits) 
is amended by redesignating section 35 as section 36 and by inserting 
after section 34 the following new section:

``SEC. 35. ELEMENTARY AND SECONDARY EDUCATION EXPENSES.

    ``(a) Allowance of Credit.--
            ``(1) In general.--In the case of an individual, there 
        shall be allowed as a credit against the tax imposed by this 
        subtitle for the taxable year the amount of the qualified 
        education expenses paid by the taxpayer during the taxable year 
        for each qualifying child of the taxpayer.
            ``(2) Amount per child.--The amount of credit allowable 
        under paragraph (1) for any taxable year with respect to the 
        qualified education expenses of each qualifying child of the 
        taxpayer shall not exceed--
                    ``(A) $2,500 for a child enrolled in an elementary 
                school for any portion of the taxable year, and
                    ``(B) $3,500 for a child enrolled in a secondary 
                school for any portion of the taxable year.
        In any taxable year in which a child meets the requirements of 
        both subparagraphs (A) and (B), the amount of credit allowable 
        shall not exceed the sum of the amounts in such subparagraphs.
    ``(b) Limitation Based on Adjusted Gross Income.--The amount of the 
credit allowable under subsection (a) (after the application of 
subsection (a)(2)) shall be reduced (but not below zero) by $50 for 
each $1,000 (or fraction thereof) by which the taxpayer's modified 
adjusted gross income exceeds the threshold amount. For purposes of 
this subsection--
            ``(1) Threshold amount.--The term `threshold amount' 
        means--
                    ``(A) $150,000 in the case of a joint return, and
                    ``(B) $75,000 in any other case.
            ``(2) Modified adjusted gross income.--The term `modified 
        adjusted gross income' means adjusted gross income increased by 
        any amount excluded from gross income under section 911, 931, 
        or 933.
            ``(3) Marital status.--Marital status shall be determined 
        under section 7703.
    ``(c) Special Rule Related to Home Schooling.--In the case of 
education furnished to a child in a home, the credit under subsection 
(a) is allowable for a taxable year only if the child takes any 
applicable student achievement exam that all children enrolled in the 
nearest public school would ordinarily be required to take during the 
academic year beginning during the taxable year.
    ``(d) Definitions.--For purposes of this section--
            ``(1) Qualifying child.--The term `qualifying child' has 
        the meaning provided by section 24(c).
            ``(2) Qualified education expenses.--
                    ``(A) In general.--The term `qualified education 
                expenses' means amounts paid for--
                            ``(i) tuition and fees required for the 
                        enrollment or attendance of a student at a 
                        qualified educational institution,
                            ``(ii) computers, educational software, 
                        computer support services, and books required 
                        for courses of instruction at a qualified 
                        educational institution,
                            ``(iii) academic tutoring (by a person 
                        other than the taxpayer),
                            ``(iv) special needs services for 
                        qualifying children with disabilities (within 
                        the meaning of the Americans With Disabilities 
                        Act of 1990),
                            ``(v) fees for transportation services to 
                        and from a private school, if the 
                        transportation is provided by the school and 
                        the school charges a fee for the 
                        transportation, and
                            ``(vi) academic testing services.
                    ``(B) Amounts excluded.--The term does not include 
                special school fees for nonacademic purposes, including 
                fees for student activities, athletics, insurance, 
                school uniforms, and nonacademic after-school 
                activities.
            ``(3) Qualified educational institution.--The term 
        `qualified educational institution' means--
                    ``(A) an elementary or secondary school (as defined 
                in section 14101 of the Elementary and Secondary 
                Education Act of 1965 (20 U.S.C. 8801)), or
                    ``(B) any private, parochial, religious, or home 
                school organized for the purpose of providing 
                elementary or secondary education, or both.''.
    (b) Technical Amendments.--
            (1) Paragraph (2) of section 1324(b) of title 31, United 
        States Code, is amended by striking ``or'' after ``1978,'' and 
        by inserting before the period ``, or enacted by the Education, 
        Achievement, and Opportunity Act''.
            (2) The table of sections for subpart C of part IV of 
        subchapter A of chapter 1 of such Code is amended by striking 
        the last item and inserting the following new items:

                              ``Sec. 35. Elementary and secondary 
                                        education expenses.
                              ``Sec. 36. Overpayments of tax.''
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after the date of the enactment of 
this Act.
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