I 108th CONGRESS 2d Session H. R. 4075 IN THE HOUSE OF REPRESENTATIVES March 30, 2004 Mr. Smith of Michigan (for himself, Mr. Hostettler, and Mr. Miller of Florida) 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 increase the amount of capital losses which may offset ordinary income.

1.

Increase amount of capital losses which may offset ordinary income

(a)

In general

Paragraph (1) of section 1211(b) of the Internal Revenue Code of 1986 (relating to limitation on capital losses for taxpayers other than corporations) is amended by striking $3,000 ($1,500 and inserting $9,000 (1/2 such amount. (b)

Adjustment for Inflation

Section 1211 of such Code (relating to limitation on capital losses) is amended by adding at the end the following new subsection: (c)

Adjustment for Inflation

(1)

In general

In the case of any taxable year beginning in a calendar year after 2004, the $9,000 amount contained in subsection (b)(1) shall be increased by an amount equal to— (A)such amount, multiplied by (B)the cost-of-living adjustment determined under section 1(f)(3) for the calendar year in which the taxable year begins by substituting calendar year 2003 for calendar year 1992 in subparagraph (B) thereof. (2)

Rounding

If any increase determined under paragraph (1) is not a multiple of $1,000, such increase shall be rounded to the next highest multiple of $1,000.. (c)

Effective Date

The amendments made by this section shall apply to taxable years beginning after December 31, 2003.