[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3300 Reported in House (RH)]

<DOC>





                                                 Union Calendar No. 307
116th CONGRESS
  2d Session
                                H. R. 3300

                          [Report No. 116-384]

 To amend the Internal Revenue Code of 1986 to provide tax relief for 
             workers and families, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             June 18, 2019

   Mr. Neal introduced the following bill; which was referred to the 
                      Committee on Ways and Means

                            February 4, 2020

         Additional sponsors: Mr. San Nicolas and Mr. Norcross

                            February 4, 2020

  Reported with an amendment, committed to the Committee of the Whole 
       House on the State of the Union, and ordered to be printed
 [Strike out all after the enacting clause and insert the part printed 
                               in italic]
 [For text of introduced bill, see copy of bill as introduced on June 
                               18, 2019]





_______________________________________________________________________

                                 A BILL


 
 To amend the Internal Revenue Code of 1986 to provide tax relief for 
             workers and families, and for other purposes.


 


    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE; ETC.

    (a) Short Title.--This Act may be cited as the ``Economic Mobility 
Act of 2019''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title; etc.

                   TITLE I--EARNED INCOME TAX CREDIT

Sec. 101. Strengthening the earned income tax credit for individuals 
                            with no qualifying children.
Sec. 102. Taxpayer eligible for childless earned income credit in case 
                            of qualifying children who fail to meet 
                            certain identification requirements.
Sec. 103. Credit allowed in case of certain separated spouses.
Sec. 104. Elimination of disqualified investment income test.
Sec. 105. Application of earned income tax credit in possessions of the 
                            United States.

                       TITLE II--CHILD TAX CREDIT

Sec. 201. Child tax credit fully refundable for 2019 and 2020.
Sec. 202. Payments to possessions.

                  TITLE III--DEPENDENT CARE ASSISTANCE

Sec. 301. Refundability and enhancement of child and dependent care tax 
                            credit.
Sec. 302. Increase in exclusion for employer-provided dependent care 
                            assistance.

               TITLE IV--CERTAIN FRINGE BENEFIT EXPENSES

Sec. 401. Repeal of inclusion of certain fringe benefit expenses in 
                            unrelated business taxable income.
    (c) Amendment of 1986 Code.--Except as otherwise expressly 
provided, whenever in this Act an amendment or repeal is expressed in 
terms of an amendment to, or repeal of, a section or other provision, 
the reference shall be considered to be made to a section or other 
provision of the Internal Revenue Code of 1986.

                   TITLE I--EARNED INCOME TAX CREDIT

SEC. 101. STRENGTHENING THE EARNED INCOME TAX CREDIT FOR INDIVIDUALS 
              WITH NO QUALIFYING CHILDREN.

    (a) Special Rules for 2019 and 2020.--Section 32 is amended by 
adding at the end the following new subsection:
    ``(n) Special Rules for Individuals Without Qualifying Children.--
In the case of any taxable year beginning in 2019 or 2020--
            ``(1) Credit allowed for certain individuals over age 18.--
                    ``(A) In general.--Except in the case of a full-
                time student (or, in the case of a married individual, 
                except if both the individual and the individual's 
                spouse are full-time students), subsection 
                (c)(1)(A)(ii)(II) shall be applied by substituting `age 
                19' for `age 25'.
                    ``(B) Full-time student.--For purposes of this 
                paragraph, the term `full-time student' means, with 
                respect to a taxable year, an individual who is an 
                eligible student (as defined in section 25A(b)(3)) 
                during at least 5 calendar months during the taxable 
                year.
            ``(2) Increase in maximum age for credit.--Subsection 
        (c)(1)(A)(ii)(II) shall be applied by substituting `age 66' for 
        `age 65'.
            ``(3) Increase in credit and phaseout percentages.--The 
        table contained in subsection (b)(1) shall be applied by 
        substituting `15.3' for `7.65' each place it appears therein.
            ``(4) Increase in earned income and phaseout amounts.--
                    ``(A) In general.--The table contained in 
                subsection (b)(2)(A) shall be applied--
                            ``(i) by substituting `$9,570' for 
                        `$4,220', and
                            ``(ii) by substituting `$11,310' for 
                        `$5,280'.
                    ``(B) Coordination with inflation adjustment.--
                            ``(i) In general.--In the case of any 
                        taxable year beginning after 2019, the $9,570 
                        and $11,310 amounts in subparagraph (A) shall 
                        each 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 `2018' for `2016' in 
                                subparagraph (A)(ii) thereof.
                            ``(ii) Rounding.--If any increase under 
                        clause (i) is not a multiple of $10, such 
                        increase shall be rounded to the nearest 
                        multiple of $10.
                            ``(iii) Coordination with other inflation 
                        adjustment.--Subsection (j) shall not apply to 
                        any dollar amount specified in this 
                        paragraph.''.
    (b) Information Return Matching.--As soon as practicable, the 
Secretary of the Treasury (or the Secretary's delegate) shall develop 
and implement procedures for checking an individual's claim for a 
credit under section 32 of the Internal Revenue Code of 1986, by reason 
of subsection (n)(1) thereof, against any information return made with 
respect to such individual under section 6050S (relating to returns 
relating to higher education tuition and related expenses).
    (c) Effective Date.--The amendment made by this section shall apply 
to taxable years beginning after December 31, 2018.

SEC. 102. TAXPAYER ELIGIBLE FOR CHILDLESS EARNED INCOME CREDIT IN CASE 
              OF QUALIFYING CHILDREN WHO FAIL TO MEET CERTAIN 
              IDENTIFICATION REQUIREMENTS.

    (a) In General.--Section 32(c)(1) is amended by striking 
subparagraph (F).
    (b) Effective Date.--The amendment made by this section shall apply 
to taxable years beginning after the date of the enactment of this Act.

SEC. 103. CREDIT ALLOWED IN CASE OF CERTAIN SEPARATED SPOUSES.

    (a) In General.--Section 32(d) is amended--
            (1) by striking ``Married Individuals.--In the case of'' 
        and inserting the following: ``Married Individuals.--
            ``(1) In general.--In the case of'', and
            (2) by adding at the end the following new paragraph:
            ``(2) Determination of marital status.--For purposes of 
        this section--
                    ``(A) In general.--Except as provided in 
                subparagraph (B), marital status shall be determined 
                under section 7703(a).
                    ``(B) Special rule for separated spouse.--An 
                individual shall not be treated as married if such 
                individual--
                            ``(i) is married (as determined under 
                        section 7703(a)) and does not file a joint 
                        return for the taxable year,
                            ``(ii) lives with a qualifying child of the 
                        individual for more than one-half of such 
                        taxable year, and
                            ``(iii)(I) during the last 6 months of such 
                        taxable year, does not have the same principal 
                        place of abode as the individual's spouse, or
                            ``(II) has a decree, instrument, or 
                        agreement (other than a decree of divorce) 
                        described in section 121(d)(3)(C) with respect 
                        to the individual's spouse and is not a member 
                        of the same household with the individual's 
                        spouse by the end of the taxable year.''.
    (b) Conforming Amendments.--
            (1) Section 32(c)(1)(A) of such Code is amended by striking 
        the last sentence.
            (2) Section 32(c)(1)(E)(ii) of such Code is amended by 
        striking ``(within the meaning of section 7703)''.
            (3) Section 32(d)(1) of such Code, as amended by subsection 
        (a), is amended by striking ``(within the meaning of section 
        7703)''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after the date of the enactment of 
this Act.

SEC. 104. ELIMINATION OF DISQUALIFIED INVESTMENT INCOME TEST.

    (a) In General.--Section 32 of the Internal Revenue Code of 1986 is 
amended by striking subsection (i).
    (b) Conforming Amendments.--
            (1) Section 32(j)(1) of such Code is amended by striking 
        ``subsections (b)(2) and (i)(1)'' and inserting ``subsection 
        (b)(2)''.
            (2) Section 32(j)(1)(B)(i) of such Code is amended by 
        striking ``subsections (b)(2)(A) and (i)(1)'' and inserting 
        ``subsection (b)(2)(A)''.
            (3) Section 32(j)(2) of such Code is amended--
                    (A) by striking subparagraph (B), and
                    (B) by striking ``Rounding.--'' and all that 
                follows through ``If any dollar amount'' and inserting 
                the following: ``Rounding.--If any dollar amount''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after the date of the enactment of 
this Act.

SEC. 105. APPLICATION OF EARNED INCOME TAX CREDIT IN POSSESSIONS OF THE 
              UNITED STATES.

    (a) In General.--Chapter 77 of the Internal Revenue Code of 1986 is 
amended by adding at the end the following new section:

``SEC. 7529. APPLICATION OF EARNED INCOME TAX CREDIT TO POSSESSIONS OF 
              THE UNITED STATES.

    ``(a) Puerto Rico.--
            ``(1) In general.--With respect to calendar year 2020 and 
        each calendar year thereafter, the Secretary shall, except as 
        otherwise provided in this subsection, make payments to Puerto 
        Rico equal to--
                    ``(A) the specified matching amount for such 
                calendar year, plus
                    ``(B) in the case of calendar years 2020 through 
                2024, the lesser of--
                            ``(i) the expenditures made by Puerto Rico 
                        during such calendar year for education efforts 
                        with respect to individual taxpayers and tax 
                        return preparers relating to the earned income 
                        tax credit, or
                            ``(ii) $1,000,000.
            ``(2) Requirement to reform earned income tax credit.--The 
        Secretary shall not make any payments under paragraph (1) with 
        respect to any calendar year unless Puerto Rico has in effect 
        an earned income tax credit for taxable years beginning in or 
        with such calendar year which (relative to the earned income 
        tax credit which was in effect for taxable years beginning in 
        or with calendar year 2019) increases the percentage of earned 
        income which is allowed as a credit for each group of 
        individuals with respect to which such percentage is separately 
        stated or determined in a manner designed to substantially 
        increase workforce participation.
            ``(3) Specified matching amount.--For purposes of this 
        subsection--
                    ``(A) In general.--The term `specified matching 
                amount' means, with respect to any calendar year, the 
                lesser of--
                            ``(i) the excess (if any) of--
                                    ``(I) the cost to Puerto Rico of 
                                the earned income tax credit for 
                                taxable years beginning in or with such 
                                calendar year, over
                                    ``(II) the base amount for such 
                                calendar year, or
                            ``(ii) the product of 3, multiplied by the 
                        base amount for such calendar year.
                    ``(B) Base amount.--
                            ``(i) Base amount for 2020.--In the case of 
                        calendar year 2020, the term `base amount' 
                        means the greater of--
                                    ``(I) the cost to Puerto Rico of 
                                the earned income tax credit for 
                                taxable years beginning in or with 
                                calendar year 2019 (rounded to the 
                                nearest multiple of $1,000,000), or
                                    ``(II) $200,000,000.
                            ``(ii) Inflation adjustment.--In the case 
                        of any calendar year after 2020, the term `base 
                        amount' means the dollar amount determined 
                        under clause (i) 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 such calendar year, 
                                determined by substituting `calendar 
                                year 2019' for `calendar year 2016' in 
                                subparagraph (A)(ii) thereof.
                        Any amount determined under this clause shall 
                        be rounded to the nearest multiple of 
                        $1,000,000.
            ``(4) Rules related to payments and reports.--
                    ``(A) Timing of payments.--The Secretary shall make 
                payments under paragraph (1) for any calendar year--
                            ``(i) after receipt of the report described 
                        in subparagraph (B) for such calendar year, and
                            ``(ii) except as provided in clause (i), 
                        within a reasonable period of time before the 
                        due date for individual income tax returns (as 
                        determined under the laws of Puerto Rico) for 
                        taxable years which began on the first day of 
                        such calendar year.
                    ``(B) Annual reports.--With respect to calendar 
                year 2020 and each calendar year thereafter, Puerto 
                Rico shall provide to the Secretary a report which 
                shall include--
                            ``(i) an estimate of the costs described in 
                        paragraphs (1)(B)(i) and (3)(A)(i)(I) with 
                        respect to such calendar year, and
                            ``(ii) a statement of such costs with 
                        respect to the preceding calendar year.
                    ``(C) Adjustments.--
                            ``(i) In general.--In the event that any 
                        estimate of an amount is more or less than the 
                        actual amount as later determined and any 
                        payment under paragraph (1) was determined on 
                        the basis of such estimate, proper payment 
                        shall be made by, or to, the Secretary (as the 
                        case may be) as soon as practicable after the 
                        determination that such estimate was 
                        inaccurate. Proper adjustment shall be made in 
                        the amount of any subsequent payments made 
                        under paragraph (1) to the extent that proper 
                        payment is not made under the preceding 
                        sentence before such subsequent payments.
                            ``(ii) Additional reports.--The Secretary 
                        may require such additional periodic reports of 
                        the information described in subparagraph (B) 
                        as the Secretary determines appropriate to 
                        facilitate timely adjustments under clause (i).
                    ``(D) Determination of cost of earned income tax 
                credit.--For purposes of this subsection, the cost to 
                Puerto Rico of the earned income tax credit shall be 
                determined by the Secretary on the basis of the laws of 
                Puerto Rico and shall include reductions in revenues 
                received by Puerto Rico by reason of such credit and 
                refunds attributable to such credit, but shall not 
                include any administrative costs with respect to such 
                credit.
                    ``(E) Prevention of manipulation of base amount.--
                No payments shall be made under paragraph (1) if the 
                earned income tax credit as in effect in Puerto Rico 
                for taxable years beginning in or with calendar year 
                2019 is modified after the date of the enactment of 
                this subsection.
    ``(b) Possessions With Mirror Code Tax Systems.--
            ``(1) In general.--With respect to calendar year 2020 and 
        each calendar year thereafter, the Secretary shall, except as 
        otherwise provided in this subsection, make payments to the 
        Virgin Islands, Guam, and the Commonwealth of the Northern 
        Mariana Islands equal to--
                    ``(A) 75 percent of the cost to such possession of 
                the earned income tax credit for taxable years 
                beginning in or with such calendar year, plus
                    ``(B) in the case of calendar years 2020 through 
                2024, the lesser of--
                            ``(i) the expenditures made by such 
                        possession during such calendar year for 
                        education efforts with respect to individual 
                        taxpayers and tax return preparers relating to 
                        such earned income tax credit, or
                            ``(ii) $50,000.
            ``(2) Application of certain rules.--Rules similar to the 
        rules of subparagraphs (A), (B), (C), and (D) of subsection 
        (a)(4) shall apply for purposes of this subsection.
    ``(c) American Samoa.--
            ``(1) In general.--With respect to calendar year 2020 and 
        each calendar year thereafter, the Secretary shall, except as 
        otherwise provided in this subsection, make payments to 
        American Samoa equal to--
                    ``(A) the lesser of--
                            ``(i) 75 percent of the cost to American 
                        Samoa of the earned income tax credit for 
                        taxable years beginning in or with such 
                        calendar year, or
                            ``(ii) $12,000,000, plus
                    ``(B) in the case of calendar years 2020 through 
                2024, the lesser of--
                            ``(i) the expenditures made by American 
                        Samoa during such calendar year for education 
                        efforts with respect to individual taxpayers 
                        and tax return preparers relating to such 
                        earned income tax credit, or
                            ``(ii) $50,000.
            ``(2) Requirement to enact and maintain an earned income 
        tax credit.--The Secretary shall not make any payments under 
        paragraph (1) with respect to any calendar year unless American 
        Samoa has in effect an earned income tax credit for taxable 
        years beginning in or with such calendar year which allows a 
        refundable tax credit to individuals on the basis of the 
        taxpayer's earned income which is designed to substantially 
        increase workforce participation.
            ``(3) Inflation adjustment.--In the case of any calendar 
        year after 2020, the $12,000,000 amount in paragraph (1)(A)(ii) 
        shall be increased by an amount equal to--
                    ``(A) such dollar amount, multiplied by--
                    ``(B) the cost-of-living adjustment determined 
                under section 1(f)(3) for such calendar year, 
                determined by substituting `calendar year 2019' for 
                `calendar year 2016' in subparagraph (A)(ii) thereof.
        Any increase determined under this clause shall be rounded to 
        the nearest multiple of $100,000.
            ``(4) Application of certain rules.--Rules similar to the 
        rules of subparagraphs (A), (B), (C), and (D) of subsection 
        (a)(4) shall apply for purposes of this subsection.
    ``(d) Treatment of Payments.--For purposes of section 1324 of title 
31, United States Code, the payments under this section shall be 
treated in the same manner as a refund due from a credit provision 
referred to in subsection (b)(2) of such section.''.
    (b) Clerical Amendment.--The table of sections for chapter 77 of 
such Code is amended by adding at the end the following new item:

``Sec. 7529. Application of earned income tax credit to possessions of 
                            the United States.''.

                       TITLE II--CHILD TAX CREDIT

SEC. 201. CHILD TAX CREDIT FULLY REFUNDABLE FOR 2019 AND 2020.

    (a) In General.--Section 24(h) is amended by adding at the end the 
following new paragraph:
            ``(8) Credit fully refundable for 2019 and 2020.--In the 
        case of an individual other than a nonresident alien, for any 
        taxable year beginning in 2019 or 2020--
                    ``(A) paragraph (5) of this subsection shall not 
                apply, and
                    ``(B) the increase determined under the first 
                sentence of subsection (d)(1) shall be the amount 
                determined under subparagraph (A) of such subsection 
                (determined without regard to paragraph (4) of this 
                subsection).''.
    (b) Effective Date.--The amendment made by this section shall apply 
to taxable years beginning after December 31, 2018.

SEC. 202. PAYMENTS TO POSSESSIONS.

    (a) Mirror Code Possession.--The Secretary of the Treasury shall 
pay to each possession of the United States with a mirror code tax 
system amounts equal to the loss to that possession by reason of the 
application of section 24 of the Internal Revenue Code of 1986 with 
respect to taxable years beginning after 2018. Such amounts shall be 
determined by the Secretary of the Treasury based on information 
provided by the government of the respective possession.
    (b) Other Possessions.--The Secretary of the Treasury shall pay to 
each possession of the United States which does not have a mirror code 
tax system amounts estimated by the Secretary of the Treasury as being 
equal to the aggregate benefits that would have been provided to 
residents of such possession by reason of the application of section 24 
of such Code for taxable years beginning after 2018 if the provisions 
of such section had been in effect in such possession. The preceding 
sentence shall not apply with respect to any possession of the United 
States unless such possession has a plan, which has been approved by 
the Secretary of the Treasury, under which such possession will 
promptly distribute such payments to the residents of such possession 
in a manner which replicates to the greatest degree practicable the 
benefits that would have been so provided to each such resident.
    (c) Coordination With Credit Allowed Against United States Income 
Taxes.--
            (1) In general.--No credit shall be allowed against United 
        States income taxes for any taxable year under section 24 of 
        the Internal Revenue Code of 1986 to any person--
                    (A) to whom a credit is allowed against taxes 
                imposed by a possession with a mirror code tax system 
                by reason of the application of section 24 of such Code 
                in such possession for such taxable year, or
                    (B) who is eligible for a payment under a plan 
                described in subsection (b) with respect to such 
                taxable year.
            (2) Restriction on refundable credit.--In the case of any 
        person to whom a credit would be allowed against taxes imposed 
        by a possession which does not have a mirror code tax system if 
        the provisions of such section 24 had been in effect in such 
        possession for the taxable year (and who is not described in 
        paragraph (1)(B)), section 24(h)(8) of such Code (as added by 
        this Act) shall not apply to such person for such taxable year.
    (d) Definitions and Special Rules.--
            (1) Possession of the united states.--For purposes of this 
        section, the term ``possession of the United States'' includes 
        the Commonwealth of Puerto Rico and the Commonwealth of the 
        Northern Mariana Islands.
            (2) Mirror code tax system.--For purposes of this section, 
        the term ``mirror code tax system'' means, with respect to any 
        possession of the United States, the income tax system of such 
        possession if the income tax liability of the residents of such 
        possession under such system is determined by reference to the 
        income tax laws of the United States as if such possession were 
        the United States.
            (3) Treatment of payments.--For purposes of section 
        1324(b)(2) of title 31, United States Code, the payments under 
        this section shall be treated in the same manner as a refund 
        due from the credit allowed under section 24 of the Internal 
        Revenue Code of 1986.

SEC. 203. INCREASED CHILD TAX CREDIT FOR CHILDREN WHO HAVE NOT ATTAINED 
              AGE 4.

    (a) In General.--Section 24(h)(2) is amended to read to as follows:
            ``(2) Credit amount.--
                    ``(A) In general.--Except as provided in 
                subparagraph (B), subsection (a) shall be applied by 
                substituting `$2,000' for `$1,000'.
                    ``(B) Taxable years beginning in 2019 and 2020.--In 
                the case of any taxable year beginning in 2019 or 2020, 
                subsection (a) shall be applied by substituting `$2,000 
                ($3,000 in the case of a qualifying child who has not 
                attained age 4 as of the close of the calendar year in 
                which the taxable year of the taxpayer begins)' for 
                `$1,000'.''.
    (b) Effective Date.--The amendment made by this section shall apply 
to taxable years beginning after December 31, 2018.

                  TITLE III--DEPENDENT CARE ASSISTANCE

SEC. 301. REFUNDABILITY AND ENHANCEMENT OF CHILD AND DEPENDENT CARE TAX 
              CREDIT.

    (a) In General.--Section 21 is amended by adding at the end the 
following new subsection:
    ``(g) Special Rules for 2019 and 2020.--In the case of any taxable 
year beginning in 2019 or 2020--
            ``(1) Credit made refundable.--In the case of an individual 
        other than a nonresident alien, the credit allowed under 
        subsection (a) shall be treated as a credit allowed under 
        subpart C (and not allowed under this subpart).
            ``(2) Increase in applicable percentage.--Subsection (a)(2) 
        shall be applied--
                    ``(A) by substituting `50 percent' for `35 percent 
                ', and
                    ``(B) by substituting `$120,000' for `$15,000'.
            ``(3) Increase in dollar limit on amount creditable.--
        Subsection (c) shall be applied--
                    ``(A) by substituting `$6,000' for `$3,000' in 
                paragraph (1) thereof, and
                    ``(B) by substituting `twice the amount in effect 
                under paragraph (1)' for `$6,000' in paragraph (2) 
                thereof.
            ``(4) Inflation adjustment of dollar amounts.--In the case 
        of any taxable year beginning after 2019, the $120,000 amount 
        in paragraph (2)(B) and the $6,000 amount in paragraph (3)(A) 
        shall each be increased by an amount equal to--
                    ``(A) such dollar 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, determined by substituting 
                `2018' for `2016' in subparagraph (A)(ii) thereof.
        If any increase determined under this paragraph is not a 
        multiple of $100, such increase shall be rounded to the next 
        lowest multiple of $100.
            ``(5) Income limitation.--
                    ``(A) In general.--Paragraphs (1) through (4) of 
                this subsection shall not apply to any taxpayer for any 
                taxable year if the modified adjusted gross income of 
                such taxpayer for such taxable year exceeds $1,000,000.
                    ``(B) Modified adjusted gross income.--For purposes 
                of this paragraph, the term `modified adjusted gross 
                income' means adjusted gross income determined without 
                regard to sections 911, 931, and 933.''.
    (b) Conforming Amendment.--Section 1324(b)(2) of title 31, United 
States Code, is amended by inserting ``21 (by reason of subsection (g) 
thereof),'' before ``25A''.
    (c) Coordination With Possession Tax Systems.--Section 21(g)(1) of 
the Internal Revenue Code of 1986 (as added by this section) shall not 
apply to any person--
            (1) to whom a credit is allowed against taxes imposed by a 
        possession with a mirror code tax system by reason of the 
        application of section 21 of such Code in such possession for 
        such taxable year, or
            (2) to whom a credit would be allowed against taxes imposed 
        by a possession which does not have a mirror code tax system if 
        the provisions of section 21 of such Code had been in effect in 
        such possession for such taxable year.
    (d) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2018.

SEC. 302. INCREASE IN EXCLUSION FOR EMPLOYER-PROVIDED DEPENDENT CARE 
              ASSISTANCE.

    (a) In General.--Section 129(a)(2) is amended by adding at the end 
the following new subparagraph:
                    ``(D) Special rule for 2020 and 2021.--In the case 
                of any taxable year beginning in 2020 or 2021--
                            ``(i) In general.--Subparagraph (A) shall 
                        be applied be substituting `$10,500 (half such 
                        dollar amount' for `$5,000 ($2,500'.
                            ``(ii) Inflation adjustment.--In the case 
                        of any taxable year beginning after 2020, the 
                        $10,500 amount in clause (i) 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 `2019' for `2016' in 
                                subparagraph (A)(ii) thereof.
                        Any increase determined under the preceding 
                        sentence which is not a multiple of $50, shall 
                        be rounded to the nearest multiple of $50.''.
    (b) Effective Date.--The amendment made by this section shall apply 
to taxable years beginning after December 31, 2019.

               TITLE IV--CERTAIN FRINGE BENEFIT EXPENSES

SEC. 401. REPEAL OF INCLUSION OF CERTAIN FRINGE BENEFIT EXPENSES IN 
              UNRELATED BUSINESS TAXABLE INCOME.

    (a) In General.--Section 512(a) is amended by striking paragraph 
(7).
    (b) Effective Date.--The amendment made by this section shall take 
effect as if included in the amendments made by section 13703 of Public 
Law 115-97.
                                                 Union Calendar No. 307

116th CONGRESS

  2d Session

                               H. R. 3300

                          [Report No. 116-384]

_______________________________________________________________________

                                 A BILL

 To amend the Internal Revenue Code of 1986 to provide tax relief for 
             workers and families, and for other purposes.

_______________________________________________________________________

                            February 4, 2020

  Reported with an amendment, committed to the Committee of the Whole 
       House on the State of the Union, and ordered to be printed