1.This Act may be cited as
the Middle Class Tax Cut Act of
2011
.
2.Temporary
extension and expansion of employee payroll tax relief
(a)Section 601(c) of the Tax Relief,
Unemployment Insurance Reauthorization, and Job Creation Act of 2010 (26 U.S.C.
1401 note) is amended by striking year 2011
and inserting
years 2011 and 2012
.
(b)
(1)Subsection (a) of section 601 of the Tax Relief,
Unemployment Insurance Reauthorization, and Job Creation Act of 2010 (26 U.S.C.
1401 note) is amended—
(A)by inserting
(9.3 percent for calendar year 2012)
after 10.40
percent
in paragraph (1), and
(B)in paragraph
(2)—
(i)by
striking (including
and inserting (3.1 percent in the
case of calendar year 2012), including
after 4.2
percent
, and
(ii)by
striking Code)
and inserting Code
.
(2)Coordination
with individual deduction for employment taxesSubparagraph (A)
of section 601(b)(2) of such Act is amended by inserting (66.67 percent
for taxable years which begin in 2012)
after 59.6
percent
.
(c)Paragraph (2) of section 601(b) of the Tax Relief,
Unemployment Insurance Reauthorization, and Job Creation Act of 2010 (26 U.S.C.
1401 note) is amended—
(1)by inserting
of such Code
after 164(f)
,
(2)by inserting
of such Code
after 1401(a)
in subparagraph (A),
and
(3)by inserting
of such Code
after 1401(b)
in subparagraph
(B).
3.
(a)Subchapter A of
chapter 1 of the Internal Revenue Code of 1986 is amended by adding at the end
the following new part:
VIII
Sec. 59B. Surtax on millionaires.
59B.
(a)In the case of a taxpayer other than a corporation for any
taxable year beginning after 2012 and before 2022, there is hereby imposed (in
addition to any other tax imposed by this subtitle) a tax equal to 1.9 percent
of so much of the modified adjusted gross income of the taxpayer for such
taxable year as exceeds the threshold amount.
(b)For purposes of this section—
(1)The threshold amount is $1,000,000.
(2)
(A)In the case of any taxable year beginning after 2013, the
$1,000,000 amount under paragraph (1) shall be increased by an amount equal
to—
(i)such dollar
amount, multiplied by
(ii)the
cost-of-living adjustment determined under section 1(f)(3) for the calendar
year in which the taxable year begins, determined by substituting
calendar year 2011
for calendar year 1992
in
subparagraph (B) thereof.
(B)If
any amount as adjusted under paragraph (1) is not a multiple of $10,000, such
amount shall be rounded to the next highest multiple of $10,000.
(3)Married filing
separatelyIn the case of a married individual filing separately
for any taxable year, the threshold amount shall be one-half of the amount
otherwise in effect under this subsection for the taxable year.
(c)Modified
adjusted gross incomeFor purposes of this section, the term
modified adjusted gross income means adjusted gross income reduced
by any deduction (not taken into account in determining adjusted gross income)
allowed for investment interest (as defined in section 163(d)). In the case of
an estate or trust, adjusted gross income shall be determined as provided in
section 67(e).
(d)
(1)In the case of a
nonresident alien individual, only amounts taken into account in connection
with the tax imposed under section 871(b) shall be taken into account under
this section.
(2)Citizens and
residents living abroadThe dollar amount in effect under
subsection (a) shall be decreased by the excess of—
(A)the amounts
excluded from the taxpayer’s gross income under section 911, over
(B)the amounts of any deductions or exclusions
disallowed under section 911(d)(6) with respect to the amounts described in
subparagraph (A).
(3)Subsection (a) shall
not apply to a trust all the unexpired interests in which are devoted to one or
more of the purposes described in section 170(c)(2)(B).
(4)Not treated as
tax imposed by this chapter for certain purposesThe tax imposed under this section shall
not be treated as tax imposed by this chapter for purposes of determining the
amount of any credit under this chapter or for purposes of section
55.
.
(b)The table of parts
for subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended
by adding at the end the following new item:
Part VIII. Surtax on
millionaires.
.
(c)The amendment made by subsection (a) shall not be
treated as a change in a rate of tax for purposes of section 15 of the Internal
Revenue Code of 1986.
(d)The amendments made by this section shall apply to taxable
years beginning after December 31, 2012.
4.Unwarranted
unemployment compensation
(a)Subtitle E of the Internal Revenue Code of 1986 is
amended by adding at the end the following new chapter:
56Unwarranted
unemployment compensation
Sec. 5895. Unwarranted
unemployment compensation.
5895.Unwarranted
unemployment compensation
(a)There is hereby imposed on any taxpayer with adjusted gross
income (as defined in section 62) for any taxable year of at least $1,000,000
($500,000, in the case of a married individual filing a separate return), a tax
equal to 50 percent (55 percent in the case of a taxable year beginning in 2011
or 2012) of any unemployment compensation (as defined in section 85(b))
received by such taxpayer in such taxable year.
(b)Administrative
provisionsFor purposes of the deficiency procedures of subtitle
F, any tax imposed by this section shall be treated as a tax imposed by
subtitle
A.
.
(b)The table of chapters for subtitle E of the Internal
Revenue Code of 1986 is amended by adding at the end the following new
item:
Chapter 56—Unwarranted unemployment
compensation
.
(c)Section 275(a) of the Internal Revenue Code of 1986 is
amended by inserting after paragraph (6) the following new paragraph:
(7)Tax imposed by
section
5895.
.
(d)The amendments made by this section shall apply to taxable
years beginning after December 31, 2010.
5.Ending
supplemental nutrition assistance program benefits for millionaires
(a)Section 6 of the Food
and Nutrition Act of 2008 (7 U.S.C. 2015) is amended by adding at the end the
following:
(r)Disqualification
for receipt of assets of at least $1,000,000Any household in
which a member receives income or assets with a fair market value of at least
$1,000,000 shall, immediately on the receipt of the assets, become ineligible
for further participation in the program until the date on which the household
meets the income eligibility and allowable financial resources standards under
section
5.
.
(b)Section 5(a) of the Food and Nutrition Act of 2008 (7
U.S.C. 2014(a)) is amended in the second sentence by striking sections
6(b), 6(d)(2), and 6(g)
and inserting subsections (b), (d)(2),
(g), and (r) of section 6
.
6.Subpart A of part 2 of
subtitle A of title XIII of the Housing and Community Development Act of 1992
is amended by adding after section 1326 (12 U.S.C. 4546) the following new
section:
1327.Enterprise
guarantee fees
(a)For
purposes of this section, the following definitions shall apply:
(1)The term guarantee fee—
(A)means a fee
described in subsection (b); and
(B)includes—
(i)the guaranty fee
charged by the Federal National Mortgage Association with respect to
mortgage-backed securities; and
(ii)the management
and guarantee fee charged by the Federal Home Loan Mortgage Corporation with
respect to participation certificates.
(2)The term average fees means the average
contractual fee rate of single-family guaranty arrangements by an enterprise
entered into during 2011, plus the recognition of any up-front cash payments
over an estimated average life, expressed in terms of basis points. Such
definition shall be interpreted in a manner consistent with the annual report
on guarantee fees by the Federal Housing Finance Agency.
(b)
(1)
(A)Subject to subsection (c), the Director shall require
each enterprise to charge a guarantee fee in connection with any guarantee of
the timely payment of principal and interest on securities, notes, and other
obligations based on or backed by mortgages on residential real properties
designed principally for occupancy of from 1 to 4 families, consummated after
the date of enactment of this section.
(B)The
amount of the increase required under this section shall be determined by the
Director to appropriately reflect the risk of loss, as well the cost of capital
allocated to similar assets held by other fully private regulated financial
institutions, but such amount shall be not less than an average increase of
12.5 basis points for each origination year or book year above the average fees
imposed in 2011 for such guarantees. The Director shall prohibit an enterprise
from offsetting the cost of the fee to mortgage originators, borrowers, and
investors by decreasing other charges, fees, or premiums, or in any other
manner.
(2)Authority to
limit offer of guaranteeThe Director shall prohibit an
enterprise from consummating any offer for a guarantee to a lender for
mortgage-backed securities, if—
(A)the guarantee is
inconsistent with the requirements of this section; or
(B)the risk of loss
is allowed to increase, through lowering of the underwriting standards or other
means, for the primary purpose of meeting the requirements of this
section.
(3)Amounts received from fee increases imposed under this
section shall be deposited directly into the United States Treasury, and shall
be available only to the extent provided in subsequent appropriations Acts. The
fees charged pursuant to this section shall not be considered a reimbursement
to the Federal Government for the costs or subsidy provided to an
enterprise.
(c)
(1)The Director may provide for compliance with subsection
(b) by allowing each enterprise to increase the guarantee fee charged by the
enterprise gradually over the 2-year period beginning on the date of enactment
of this section, in a manner sufficient to comply with this section. In
determining a schedule for such increases, the Director shall—
(A)provide for
uniform pricing among lenders;
(B)provide for
adjustments in pricing based on risk levels; and
(C)take into
consideration conditions in financial markets.
(2)Nothing in this subsection shall be interpreted to
undermine the minimum increase required by subsection (b).
(d)Information
collection and annual analysisThe Director shall require each
enterprise to provide to the Director, as part of its annual report submitted
to Congress—
(1)a description
of—
(A)changes made to
up-front fees and annual fees as part of the guarantee fees negotiated with
lenders;
(B)changes to the
riskiness of the new borrowers compared to previous origination years or book
years; and
(C)any adjustments
required to improve for future origination years or book years, in order to be
in complete compliance with subsection (b); and
(2)an assessment of
how the changes in the guarantee fees described in paragraph (1) met the
requirements of subsection (b).
(e)
(1)Based on the information from subsection (d) and any
other information the Director deems necessary, the Director shall require an
enterprise to make adjustments in its guarantee fee in order to be in
compliance with subsection (b).
(2)An enterprise that has been found to be out of compliance
with subsection (b) for any 2 consecutive years shall be precluded from
providing any guarantee for a period, determined by rule of the Director, but
in no case less than 1 year.
(3)Nothing in this subsection shall be interpreted as
preventing the Director from initiating and implementing an enforcement action
against an enterprise, at a time the Director deems necessary, under other
existing enforcement authority.
(f)The
provisions of this section shall expire on October 1,
2021.
.
December 6, 2011
Read the second time and placed on the
calendar