[Congressional Bills 109th Congress]
[From the U.S. Government Publishing Office]
[S. 1770 Introduced in Senate (IS)]








109th CONGRESS
  1st Session
                                S. 1770

   To amend the Internal Revenue Code of 1986 to provide for advance 
 payment of the earned income tax credit and the child tax credit for 
 2005 in order to provide needed funds to victims of Hurricane Katrina 
                   and to stimulate local economies.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                           September 26, 2005

 Mr. Obama (for himself, Mrs. Murray, Mr. Corzine, Mr. Kerry, and Mr. 
Levin) 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 provide for advance 
 payment of the earned income tax credit and the child tax credit for 
 2005 in order to provide needed funds to victims of Hurricane Katrina 
                   and to stimulate local economies.

    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 ``Hurricane Katrina Fast-Track Refunds 
for Working Families Act of 2005''.

SEC. 2. FINDINGS.

            (1) An estimated 1.3 million households were affected by 
        Hurricane Katrina, many of which were working families left 
        with no material belongings and minimal assets following the 
        storm.
            (2) It will be difficult for these working families to 
        immediately find new employment opportunities and to restore 
        lost wages, thus depleting their resources for food, housing, 
        clothing, and other necessities.
            (3) These working families can be expected to spend their 
        fast-tracked tax refunds on immediate necessities which will 
        stimulate local economic activity.
            (4) These families have worked hard, earned their Child Tax 
        Credit and Earned Income Tax Credit refunds and should receive 
        them now rather than later.

SEC. 3. ADVANCE PAYMENT OF EARNED INCOME TAX CREDIT AND CHILD TAX 
              CREDIT FOR 2005 FOR VICTIMS OF HURRICANE KATRINA.

    (a) In General.--Subchapter B of chapter 61 of the Internal Revenue 
Code of 1986 (relating to rules of special application) is amended by 
adding at the end the following new section:

``SEC. 6430. ADVANCE PAYMENT OF EARNED INCOME TAX CREDIT AND CHILD TAX 
              CREDIT FOR 2005 FOR VICTIMS OF HURRICANE KATRINA.

    ``(a) In General.--Each eligible taxpayer shall be treated as 
having made a payment against the tax imposed by chapter 1 for the 
taxpayer's last taxable year ending in 2004 in an amount equal to--
            ``(1) the child tax credit refund amount (if any) for such 
        taxable year, and
            ``(2) the earned income credit refund amount (if any) for 
        such taxable year.
    ``(b) Definitions.--For purposes of this section--
            ``(1) Eligible taxpayer.--The term `eligible taxpayer' 
        means any taxpayer--
                    ``(A) who was allowed a credit under section 24 
                (relating to child tax credit) or section 32 (relating 
                to earned income credit) for the taxpayer's last 
                taxable year ending in 2004, and
                    ``(B) whose address on such taxpayer's return for 
                such last taxable year was within an area determined by 
                the President to warrant individual or individual and 
                public assistance from the Federal Government under the 
                Robert T. Stafford Disaster Relief and Emergency 
                Assistance Act by reason of Hurricane Katrina.
            ``(2) Child tax credit refund amount.--The child tax credit 
        refund amount is the amount of the credit which would have been 
        allowed under section 24 for such last taxable year if only 
        qualifying children (as defined in section 24(c)) of the 
        taxpayer for such year who had not attained age 17 as of 
        December 31, 2005, were taken into account.
            ``(3) Earned income credit refund amount.--The earned 
        income credit refund amount is the amount of the credit which 
        would have been allowed under section 32 for such last taxable 
        year if--
                    ``(A) the amount in section 32(b)(2)(B) were 
                $2,000, and
                    ``(B) an individual is treated as meeting the age 
                requirements under section 32 only if such requirements 
                are met as of December 31, 2005.
    ``(c) Timing of Payments.--In the case of any overpayment 
attributable to this section, the Secretary shall, subject to the 
provisions of this title, refund or credit such overpayment as rapidly 
as possible and shall ensure that adequate systems and delivery 
mechanisms are in place for the prompt delivery of refunds to eligible 
recepients.
    ``(d) Coordination With Credits.--
            ``(1) In general.--The amount of credit which would (but 
        for this subsection and section 26) be allowed under sections 
        24 and 32, as the case may be, for the taxpayer's first taxable 
        year beginning in 2005 shall be reduced (but not below zero) by 
        so much of the payment made to the taxpayer under this section 
        as is attributable to such section 24 or 32. Any failure to so 
        reduce the credit shall be treated as arising out of a 
        mathematical or clerical error and assessed according to 
        section 6213(b)(1).
            ``(2) Joint returns.--In the case of a payment under this 
        section with respect to a joint return, half of such payment 
        shall be treated as having been made to each individual filing 
        such return.
    ``(e) No Interest.--No interest shall be allowed on any overpayment 
attributable to this section.''.
    (b) Clerical Amendment.--The table of sections for such subchapter 
B is amended by adding at the end the following new item:

``Sec. 6430. Advance payment of earned income tax credit and child tax 
                            credit for 2005 for victims of Hurricane 
                            Katrina.''.
    (c) Effective Date.--The amendments made by this section shall take 
effect on the date of the enactment of this Act.
                                 <all>