109 HR 4066 IH: Evacuees Tax Relief Act of 2005 U.S. House of Representatives 2005-10-17 text/xml EN Pursuant to Title 17 Section 105 of the United States Code, this file is not subject to copyright protection and is in the public domain.

I 109th CONGRESS 1st Session H. R. 4066 IN THE HOUSE OF REPRESENTATIVES October 17, 2005 Mr. Paul 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 individuals either a credit against income tax or a deduction for expenses paid or incurred by reason of a voluntary or mandatory evacuation.

1.

Short title

This Act may be cited as the Evacuees Tax Relief Act of 2005.

2.

Evacuation expenses

(a)

Credit for evacuation expenses

Subpart A of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 (relating to nonrefundable personal credits) is amended by inserting after section 25D the following new section:

25E.

Evacuation expenses

(a)

Allowance of credit

In the case of an individual, there shall be allowed as a credit against the tax imposed by this subtitle for the taxable year an amount equal to the qualified evacuation expenses paid or incurred by the individual during the taxable year. (b)

Dollar limitation

With respect to an individual, the aggregate amount of qualified evacuation expenses which may be taken into account under subsection (a) for all taxable years during the credit allowance period shall not exceed $5,000. (c)

Qualified evacuation expenses

For purposes of this section— (1)

In general

The term qualified evacuation expenses means, with respect to any taxable year during the credit allowance period, the sum of all expenses paid or incurred by the individual during such taxable year by reason of a qualified evacuation. Such expenses shall include travel and lodging expenses as do not exceed $1,000, lost wages, and any property damage not compensated for by insurance or otherwise. (2)

Qualified evacuation

With respect to an individual, the term qualified evacuation means a voluntary or mandatory evacuation ordered by reason of a qualified disaster (as defined in section 139(c)) of an area in which such individual resides on the date of such disaster. (3)

Credit allowance period

With respect to a qualified evacuation, the term credit allowance period means the taxable year or years during which the evacuation occurred and each of the 3 succeeding taxable years. (d)

Portion of credit refundable

(1)

In general

The aggregate credits allowed to an individual under subpart C shall be increased by the lesser of— (A)the credit which would be allowed under this section without regard to this subsection, or (B)the amount by which the aggregate amount of credits allowed by this subpart (determined without regard to this subsection) would increase if the limitation imposed by section 26(a) were increased by the individual’s social security taxes for the taxable year. The amount of the credit allowed under this subsection shall not be treated as a credit allowed under this subpart and shall reduce the amount of credit otherwise allowable under subsection (a). (2)

Social security taxes

For purposes of paragraph (1)— (A)

In general

The term social security taxes means, with respect to any taxpayer for any taxable year— (i)the amount of the taxes imposed by section 3101 and 3201(a) on amounts received by the taxpayer during the calendar year in which the taxable year begins, (ii)50 percent of the taxes imposed by section 1401 on the self-employment income of the taxpayer for the taxable year, and (iii)50 percent of the taxes imposed by section 3211(a)(1) on amounts received by the taxpayer during the calendar year in which the taxable year begins. (B)

Coordination with special refund of social security taxes

The term social security taxes shall not include any taxes to the extent the taxpayer is entitled to a special refund of such taxes under section 6413(c). (C)

Special rule

Any amounts paid pursuant to an agreement under section 3121(l) (relating to agreements entered into by American employers with respect to foreign affiliates) which are equivalent to the taxes referred to in subparagraph (A)(i) shall be treated as taxes referred to in such paragraph. (e)

Denial of double benefit

No credit shall be allowed under subsection (a) for any expense for which a deduction or credit is allowed under any other provision of this chapter. (f)

Election not to have section apply

An individual may elect not to have this section apply with respect to the qualified evacuation expenses of the individual for any taxable year.

. (b)

Deduction for evacuation expenses

(1)

In general

Part VII of subchapter B of chapter 1 of the Internal Revenue Code of 1986 (relating to additional itemized deductions for individuals) is amended by redesignating section 224 as section 225 and by inserting after section 223 the following new section:

224.

Deduction for evacuation expenses

(a)

Allowance of deduction

In the case of an individual, there shall be allowed as a deduction an amount equal to the qualified evacuation expenses paid or incurred by the individual during the taxable year. (b)

Dollar limitation

With respect to an individual, the aggregate amount of qualified evacuation expenses which may be taken into account under subsection (a) for all taxable years during the deduction allowance period shall not exceed $5,000. (c)

Qualified evacuation expenses

For purposes of this section— (1)

In general

The term qualified evacuation expenses means, with respect to any taxable year during the deduction allowance period, the sum of all expenses paid or incurred by the individual during such taxable year by reason of a qualified evacuation. Such expenses shall include travel and lodging expenses as do not exceed $1,000, lost wages, and any property damage not compensated for by insurance or otherwise. (2)

Qualified evacuation

With respect to an individual, the term qualified evacuation means a voluntary or mandatory evacuation ordered by reason of a qualified disaster (as defined in section 139(c)) of an area in which such individual resides on the date of such disaster. (3)

Deduction allowance period

With respect to a qualified evacuation, the term deduction allowance period means the taxable year or years during which the evacuation occurred and each of the 3 succeeding taxable years. (d)

Denial of double benefit

No deduction shall be allowed under subsection (a) for any expense for which a deduction or credit is allowed under any other provision of this chapter. (e)

Election not to have section apply

An individual may elect not to have this section apply with respect to the qualified evacuation expenses of the individual for any taxable year.

. (2)

Deduction allowed whether or not individual itemizes other deductions

Subsection (a) of section 62 of such Code is amended by redesignating paragraph (19) (relating to health savings accounts) as paragraph (20) and inserting at the end the following new paragraph: (21)

Deduction for evacuation expenses

The deduction allowed by section 224.. (c)

Clerical amendments

(1)The table of sections for subpart A of part IV of subchapter A of chapter 1 of such Code is amended by inserting after the item relating to section 25D the following new item: Sec. 25E. Evacuation expenses. (2)The table of sections for part VII of subchapter B of chapter 1 of such Code is amended by striking the last item and inserting the following new items: Sec. 224. Deduction for evacuation expenses Sec. 225. Cross reference. (d)

Effective date

The amendments made by this section shall apply to taxable years ending after August 27, 2005.