I 111th CONGRESS 2d Session H. R. 6538 IN THE HOUSE OF REPRESENTATIVES December 16, 2010 Mr. Mack introduced the following bill; which was referred to the Committee on Ways and Means A BILL To prevent pending tax increases and to permanently repeal the estate tax.

1.

Short title

This Act may be cited as the Permanent Tax Relief Act of 2010.

2.

EGTRRA and JGTRRA tax relief made permanent

(a)

Economic growth and tax relief reconciliation act of 2001

Title IX of the Economic Growth and Tax Relief Reconciliation Act of 2001 is hereby repealed. (b)

Income tax rates on dividends and net capital gain

Section 303 of the Jobs and Growth Tax Relief Reconciliation Act of 2003 is hereby repealed. (c)

Effective date

The amendments made by this section shall take effect on the date of the enactment of this Act.

3.

Permanent individual AMT relief

(a)

Modification of alternative minimum tax exemption amount

(1)

In general

Paragraph (1) of section 55(d) of the Internal Revenue Code of 1986 (relating to exemption amount) is amended to read as follows: (1)

Exemption amount for taxpayers other than corporations

In the case of a taxpayer other than a corporation, the term exemption amount means— (A)the dollar amount for taxable years beginning in the calendar year as specified in the table contained in paragraph (4)(A) in the case of— (i)a joint return, or (ii)a surviving spouse, (B)the dollar amount for taxable years beginning in the calendar year as specified in the table contained in paragraph (4)(B) in the case of an individual who— (i)is not a married individual, and (ii)is not a surviving spouse, (C)50 percent of the dollar amount applicable under paragraph (1)(A) in the case of a married individual who files a separate return, and (D)$22,500 in the case of an estate or trust. For purposes of this paragraph, the term surviving spouse has the meaning given to such term by section 2(a), and marital status shall be determined under section 7703.. (2)

Specified exemption amounts

Section 55(d) of such Code is amended by adding at the end the following new paragraph: (4)

Specified exemption amounts

(A)

Taxpayers described in paragraph (1)(A)

For purposes of paragraph (1))(A)— For taxable years beginning in—The exemption amount is: 2010$72,450 2011$74,450 2012$78,250 2013$81,450 2014$85,050 2015$88,650 2016$92,650 2017$96,550 2018$100,950 2019$105,150 2020$109,950. (B)

Taxpayers described in paragraph (1)(B)

For purposes of paragraph (1))(B)— For taxable years beginning in—The exemption amount is: 2010$47,450 2011$48,450 2012$50,350 2013$51,950 2014$53,750 2015$55,550 2016$57,550 2017$59,500 2018$61,700 2019$63,800 2020$66,200. . (b)

Alternative minimum tax relief for nonrefundable credits

(1)

In general

Subsection (a) of section 26 of the Internal Revenue Code of 1986 is amended to read as follows: (a)

Limitation based on amount of tax

The aggregate amount of credits allowed by this subpart for the taxable year shall not exceed the sum of— (1)the taxpayer’s regular tax liability for the taxable year reduced by the foreign tax credit allowable under section 27(a), and (2)the tax imposed by section 55(a) for the taxable year. . (2)

Conforming amendments

(A)

Adoption credit

(i)Section 23(b) of such Code, as in effect on December 31, 2009, is amended by striking paragraph (4). (ii)Section 23(c) of such Code, as in effect on December 31, 2009, is amended by striking paragraphs (1) and (2) and inserting the following: (1)

In general

If the credit allowable under subsection (a) for any taxable year exceeds the limitation imposed by section 26(a) for such taxable year reduced by the sum of the credits allowable under this subpart (other than this section and sections 25D and 1400C), such excess shall be carried to the succeeding taxable year and added to the credit allowable under subsection (a) for such taxable year. . (iii)Section 23(c) of such Code, as in effect on December 31, 2009 amended by redesignating paragraph (3) as paragraph (2). (B)

Child tax credit

(i)Section 24(b) of such Code is amended by striking paragraph (3). (ii)Section 24(d)(1) of such Code is amended— (I)by striking section 26(a)(2) or subsection (b)(3), as the case may be, each place it appears in subparagraphs (A) and (B) and inserting section 26(a), and (II)by striking section 26(a)(2) or subsection (b)(3), as the case may be in the second last sentence and inserting section 26(a). (C)

Credit for interest on certain home mortgages

Section 25(e)(1)(C) of such Code is amended to read as follows: (C)

Applicable tax limit

For purposes of this paragraph, the term applicable tax limit means the limitation imposed by section 26(a) for the taxable year reduced by the sum of the credits allowable under this subpart (other than this section and sections 23, 25D, and 1400C). . (D)

Savers’ credit

Section 25B of such Code is amended by striking subsection (g). (E)

Residential energy efficient property

Section 25D(c) of such Code is amended to read as follows: (c)

Carryforward of unused credit

If the credit allowable under subsection (a) exceeds the limitation imposed by section 26(a) for such taxable year reduced by the sum of the credits allowable under this subpart (other than this section), such excess shall be carried to the succeeding taxable year and added to the credit allowable under subsection (a) for such succeeding taxable year. . (F)

Certain plug-in electric vehicles

Section 30(c)(2) of such Code is amended to read as follows: (2)

Personal credit

For purposes of this title, the credit allowed under subsection (a) for any taxable year (determined after application of paragraph (1)) shall be treated as a credit allowable under subpart A for such taxable year. . (G)

Alternative motor vehicle credit

Section 30B(g)(2) of such Code is amended to read as follows: (2)

Personal credit

For purposes of this title, the credit allowed under subsection (a) for any taxable year (determined after application of paragraph (1)) shall be treated as a credit allowable under subpart A for such taxable year. . (H)

New qualified plug-in electric vehicle credit

Section 30D(c)(2) of such Code is amended to read as follows: (2)

Personal credit

For purposes of this title, the credit allowed under subsection (a) for any taxable year (determined after application of paragraph (1)) shall be treated as a credit allowable under subpart A for such taxable year. . (I)

Cross references

Section 55(c)(3) of such Code is amended by striking 26(a), 30C(d)(2), and inserting 30C(d)(2). (J)

Foreign tax credit

Section 904 of such Code is amended by striking subsection (i) and by redesignating subsections (j), (k), and (l) as subsections (i), (j), and (k), respectively. (K)

First-time home buyer credit for the District of Columbia

Section 1400C(d) of such Code is amended to read as follows: (d)

Carryforward of unused credit

If the credit allowable under subsection (a) exceeds the limitation imposed by section 26(a) for such taxable year reduced by the sum of the credits allowable under subpart A of part IV of subchapter A (other than this section and section 25D), such excess shall be carried to the succeeding taxable year and added to the credit allowable under subsection (a) for such taxable year. . (c)

Effective date

The amendments made by this section shall apply to taxable years beginning after December 31, 2009.