[Congressional Record Volume 142, Number 100 (Tuesday, July 9, 1996)]
[Senate]
[Pages S7494-S7498]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                          AMENDMENTS SUBMITTED

                                 ______
                                 

             THE SMALL BUSINESS JOB PROTECTION ACT OF 1996

                                 ______
                                 

                  ROTH (AND OTHERS) AMENDMENT NO. 4436

  Mr. ROTH (for himself, Mr. Moynihan, Mr. Lott, and Mr. Daschle) 
proposed an amendment to the bill (H.R. 3448) to provide tax relief for 
small businesses, to protect jobs, to create opportunities, to increase 
the take-home pay of workers, and for other purposes; as follows:

       On page 243, strike lines 9 through 11, and insert:
       (b) Effective Dates.--
       (1) In general.--The amendment made by this section shall 
     apply to taxable years beginning after December 31, 1986.
       (2) Transitional rule.--If--
       (A) for purposes of applying part III of subchapter F of 
     chapter 1 of the Internal Revenue Code of 1986 to any taxable 
     year beginning before January 1, 1987, an agricultural or 
     horticultural organization did not treat any portion of 
     membership dues received by it as income derived in an 
     unrelated trade or business, and
       (B) such organization had a reasonable basis for not 
     treating such dues as income derived in an unrelated trade or 
     business,

     then, for purposes of applying such part III to any such 
     taxable year, in no event shall any portion of such dues be 
     treated as derived in an unrelated trade or business.
       (3) Reasonable basis.--For purposes of paragraph (2), an 
     organization shall be treated as having a reasonable basis 
     for not treating membership dues as income derived in an 
     unrelated trade or business if the taxpayer's treatment of 
     such dues was in reasonable reliance on any of the following:
       (A) Judicial precedent, published rulings, technical advice 
     with respect to the organization, or a letter ruling to the 
     organization.
       (B) A past Internal Revenue Service audit of the 
     organization in which there was no assessment attributable to 
     the reclassification of membership dues for purposes of the 
     tax on unrelated business income.
       (C) Long-standing recognized practice of agricultural or 
     horticultural organizations.
       On page 246, strike lines 1 through 3, and insert:
       (b) Effective Dates.--
       (1) In general.--The amendments made by this section shall 
     apply to remuneration paid--
       (A) after December 31, 1994, and
       (B) after December 31, 1984, and before January 1, 1995, 
     unless the payor treated such remuneration (when paid) as 
     being subject to tax under chapter 21 of the Internal Revenue 
     Code of 1986.
       (2) Reporting requirement.--The amendment made by 
     subsection (a)(1)(C) shall apply to remuneration paid after 
     December 31, 1996.
       On page 256, line 2, strike the quotation marks.
       On page 256, between lines 2 and 3, insert the following:
       ``(5) Preservation of prior period safe harbor.--If--

[[Page S7495]]

       ``(A) an individual would (but for the treatment referred 
     to in subparagraph (B)) be deemed not to be an employee of 
     the taxpayer under subsection (a) for any prior period, and
       ``(B) such individual is treated by the taxpayer as an 
     employee for employment tax purposes for any subsequent 
     period,

     then, for purposes of applying such taxes for such prior 
     period with respect to the taxpayer, the individual shall be 
     deemed not to be an employee.
       ``(6) Substantially similar position.--For purposes of this 
     section, the determination as to whether an individual holds 
     a position substantially similar to a position held by 
     another individual shall include consideration of the 
     relationship between the taxpayer and such individuals.''
       On page 257, between lines 5 and 6, insert the following:

     SEC. 1123. TREATMENT OF HOUSING PROVIDED TO EMPLOYEES BY 
                   ACADEMIC HEALTH CENTERS.

       (a) In General.--Paragraph (4) of section 119(d) (relating 
     to lodging furnished by certain educational institutions to 
     employees) is amended to read as follows:
       ``(4) Educational institution.--For purposes of this 
     subsection--
       ``(A) In general.--The term `educational institution' 
     means--
       ``(i) an institution described in section 170(b)(1)(A)(ii), 
     or
       ``(ii) an academic health center.
       ``(B) Academic health center.--For purposes of subparagraph 
     (A), the term `academic health center' means an entity--
       ``(i) which is described in section 170(b)(1)(A)(iii),
       ``(ii) which receives (during the calendar year in which 
     the taxable year of the taxpayer begins) payments under 
     subsection (d)(5)(B) or (h) of section 1886 of the Social 
     Security Act (relating to graduate medical education), and
       ``(iii) which has as one of its principal purposes or 
     functions the providing and teaching of basic and clinical 
     medical science and research with the entity's own faculty.''
       (b) Effective Date.--The amendment made by this section 
     shall apply to taxable years beginning after December 31, 
     1995.
       On page 268, lines 8 and 9, strike ``December 31, 1996'' 
     and insert ``December 31, 1997''.
       On page 269, strike line 10, and insert:
       ``(B) after December 31, 1997.

     Notwithstanding the preceding sentence, in the case of a 
     taxpayer making an election under subsection (c)(4) for its 
     first taxable year beginning after June 30, 1996, and before 
     July 1, 1997, this section shall apply to amounts paid or 
     incurred during such first taxable year and the first 6 
     months of the succeeding taxable year.''
       On page 272, line 22, strike ``June 30, 1997'' and insert 
     ``December 31, 1997''.
       On page 273, between lines 6 and 7, insert:
       (3) Estimated tax.--The amendments made by this section 
     shall not be taken into account under section 6654 or 6655 of 
     the Internal Revenue Code of 1986 (relating to failure to pay 
     estimated tax) in determining the amount of any installment 
     required to be paid before October 1, 1996.
       On page 274, line 11, strike ``June 30, 1997'' and insert 
     ``December 31, 1997''.
       On page 276, line 20, strike ``June 30, 1997'' and insert 
     ``December 31, 1997''.
       On page 277, line 6, strike ``January 1, 1998'' and insert 
     ``January 1, 1999''.
       On page 277, line 16, strike ``(a) In General.--''.
       On page 277, lines 23 and 24, strike ``after June 30, 1996, 
     and before July 1, 1997'' and insert ``beginning on the date 
     which is 7 days after the date of the enactment of the Small 
     Business Job Protection Act of 1996 and ending on December 
     31, 1997''.
       On page 277, strike lines 25 and 26, and insert the 
     following:

     SEC. 1208. EXTENSION OF TRANSITION RULE FOR CERTAIN PUBLICLY 
                   TRADED PARTNERSHIPS.

       (a) In General.--Subparagraph (B) of section 10211(c)(1) of 
     the Revenue Act of 1987 (Public Law 100-203) is amended by 
     striking ``December 31, 1997'' and inserting ``December 31, 
     1999''.
       (b) Conforming Amendment.--Subparagraph (C)(i) of section 
     10211(c)(2) of the Revenue Act of 1987, as added by section 
     2004(f)(2) of the Technical and Miscellaneous Revenue Act of 
     1988, is amended by striking ``December 31, 1997'' and 
     inserting ``December 31, 1999''.
       (c) Effective Date.--The amendments made by this section 
     shall take effect as if included in the provisions of section 
     10211 of the Revenue Act of 1987.
       On page 303, strike lines 1 through 23, and insert the 
     following:
       ``(e) Special Rules Applicable to S Corporations.--If an 
     organization described in section 1361(c)(7) holds stock in 
     an S corporation--
       ``(1) such interest shall be treated as an interest in an 
     unrelated trade or business; and
       ``(2) notwithstanding any other provision of this part, all 
     items of income, loss, deduction, or credit taken into 
     account under section 1366(a) and any gain or loss on the 
     disposition of the stock in the S corporation shall be taken 
     into account in computing the unrelated business taxable 
     income of such organization.''
       On page 383, strike lines 3 through 15, and insert the 
     following:

     SEC. 1451. MISSING PARTICIPANTS.

       (a) In General.--Section 4050 of the Employee Retirement 
     Income Security Act of 1974 (29 U.S.C. 1350) is amended by 
     redesignating subsection (c) as subsection (e) and by 
     inserting after subsection (b) the following new subsections:
       ``(c) Multiemployer Plans.--The corporation shall prescribe 
     rules similar to the rules in subsection (a) for 
     multiemployer plans covered by this title that terminate 
     under section 4041A.
       ``(d) Plans Not Otherwise Subject to Title.--
       ``(1) Transfer to corporation.--The plan administrator of a 
     plan described in paragraph (4) may elect to transfer a 
     missing participant's benefits to the corporation upon 
     termination of the plan.
       ``(2) Information to the corporation.--To the extent 
     provided in regulations, the plan administrator of a plan 
     that makes the election described in paragraph (1) shall, 
     upon termination of the plan, provide the corporation 
     information with respect to benefits of a missing 
     participant.
       ``(3) Payment by the corporation.--If benefits of a missing 
     participant were transferred to the corporation under 
     paragraph (1), the corporation shall, upon location of the 
     participant or beneficiary, pay to the participant or 
     beneficiary the amount transferred (or the appropriate 
     survivor benefit) either--
       ``(A) in a single sum (plus interest), or
       ``(B) in such other form as is specified in regulations of 
     the corporation.
       ``(4) Plans described.--A plan is described in this 
     paragraph if--
       ``(A) the plan is a pension plan (within the meaning of 
     section 3(2))--
       ``(i) to which the provisions of this section do not apply 
     (without regard to this subsection), and
       ``(ii) which is not a plan described in paragraphs (2) 
     through (11) of section 4021(b), and
       ``(B) at the time the assets are to be distributed upon 
     termination, the plan--
       ``(i) has missing participants, and
       ``(ii) has not provided for the transfer of assets to pay 
     the benefits of all missing participants to another pension 
     plan (within the meaning of section 3(2)).
       ``(5) Certain provisions not to apply.--Subsections (a)(1) 
     and (a)(3) shall not apply to a plan described in paragraph 
     (4).''
       (b) Conforming Amendments.--
       (1) Section 206(f) of the Employee Retirement Income 
     Security Act of 1974 (29 U.S.C. 1056(f)) is amended--
       (A) by striking ``title IV'' and inserting ``section 
     4050'', and
       (B) by striking ``the plan shall provide that''.
       (2) Section 401(a)(34) (relating to benefits of missing 
     participants on plan termination) is amended by striking 
     ``title IV'' and inserting ``section 4050''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to distributions made after final regulations 
     implementing subsections (c) and (d) of section 4050 of the 
     Employee Retirement Income Security Act of 1974 (as added by 
     subsection (a)), respectively, are prescribed.
       On page 393, after line 24, add the following:

     SEC. 1459. ALTERNATIVE NONDISCRIMINATION RULES FOR CERTAIN 
                   PLANS THAT PROVIDE FOR EARLY PARTICIPATION.

       (a) Cash or Deferred Arrangements.--Paragraph (3) of 
     section 401(k) (relating to application of participation and 
     discrimination standards), as amended by section 1433(d)(1) 
     of this Act, is amended by adding at the end the following 
     new subparagraph:
       ``(F) Special rule for early participation.--If an employer 
     elects to apply section 410(b)(4)(B) in determining whether a 
     cash or deferred arrangement meets the requirements of 
     subparagraph (A)(i), the employer may, in determining whether 
     the arrangement meets the requirements of subparagraph 
     (A)(ii), exclude from consideration all eligible employees 
     (other than highly compensated employees) who have not met 
     the minimum age and service requirements of section 
     410(a)(1)(A).''
       (b) Matching Contributions.--Paragraph (5) of section 
     401(m) (relating to employees taken into consideration) is 
     amended by adding at the end the following new subparagraph:
       ``(C) Special rule for early participation.--If an employer 
     elects to apply section 410(b)(4)(B) in determining whether a 
     plan meets the requirements of section 410(b), the employer 
     may, in determining whether the plan meets the requirements 
     of paragraph (2), exclude from consideration all eligible 
     employees (other than highly compensated employees) who have 
     not met the minimum age and service requirements of section 
     410(a)(1)(A).''
       (c) Effective Date.--The amendments made by this section 
     shall apply to plan years beginning after December 31, 1998.

     SEC. 1460. MODIFICATIONS OF JOINT AND SURVIVOR ANNUITY 
                   REQUIREMENTS.

       (a) Amendments to Internal Revenue Code.--Section 417(b) is 
     amended--
       (1) by striking ``For'' and inserting:
       ``(1) In general.--'',
       (2) by redesignating paragraphs (1) and (2) as 
     subparagraphs (A) and (B), respectively, and
       (3) by adding at the end the following new paragraph:
       ``(2) Election of 66\2/3\ percent survivor annuity.--
       ``(A) In general.--In the case of any plan with respect to 
     which the survivor annuity under a qualified joint and 
     survivor annuity

[[Page S7496]]

     is not equal to 66\2/3\ percent of the amount of the annuity 
     which is payable during the joint lives of the participant 
     and the spouse, such plan shall not be treated as meeting the 
     requirements of section 401(a)(11) unless the participant may 
     elect a qualified joint and survivor annuity with a survivor 
     annuity which is equal to 66\2/3\ percent of such amount.
       ``(B) Treatment of annuity.--If a participant elects a 
     survivor annuity under subparagraph (A), such annuity shall 
     be treated as a qualified joint and survivor annuity for 
     purposes of this title (other than subsection (c)(1)(A)).''
       (b) Amendments to ERISA.--Subsection (d) of section 205 of 
     the Employee Retirement Income Security Act of 1974 (29 
     U.S.C. 1055) is amended--
       (1) by redesignating paragraphs (1) and (2) as 
     subparagraphs (A) and (B), respectively,
       (2) by inserting ``(1)'' after ``(d)'', and
       (3) by adding at the end the following new paragraph:
       ``(2)(A) In the case of any plan with respect to which the 
     survivor annuity under a qualified joint and survivor annuity 
     is not equal to 66\2/3\ percent of the amount of the annuity 
     which is payable during the joint lives of the participant 
     and the spouse, such plan shall not be treated as meeting the 
     requirements of subsection (a) unless the participant may 
     elect a qualified joint and survivor annuity with a survivor 
     annuity which is equal to 66\2/3\ percent of such amount.
       ``(B) If a participant elects a survivor annuity under 
     subparagraph (A), such annuity shall be treated as a 
     qualified joint and survivor annuity for purposes of this 
     title (other than subsection (e)(1)(A)).''
       (c) Effective Dates.--
       (1) In general.--The amendments made by this section shall 
     apply to plan years beginning after December 31, 1996.
       (2) Special rule for existing plans.--In the case of a plan 
     in existence on the date of the enactment of this Act, the 
     amendments made by this section shall apply to any plan year 
     following the first plan year with respect to which the first 
     plan amendment adopted after such date of enactment takes 
     effect.

     SEC. 1461. CLARIFICATION OF APPLICATION OF ERISA TO INSURANCE 
                   COMPANY GENERAL ACCOUNTS.

       (a) In General.--Section 401 of the Employee Retirement 
     Income Security Act of 1974 (29 U.S.C. 1101) is amended by 
     adding at the end the following new subsection:
       ``(c)(1)(A) Not later than December 31, 1996, the Secretary 
     shall issue proposed regulations to provide guidance for the 
     purpose of determining, in cases where an insurer issues 1 or 
     more policies to or for the benefit of an employee benefit 
     plan (and such policies are supported by the assets of such 
     insurer's general account), which assets of the insurer 
     (other than plan assets held in its separate accounts) 
     constitute assets of the plan for purposes of this part and 
     section 4975 of the Internal Revenue Code of 1986.
       ``(B) The proposed regulations under subparagraph (A) shall 
     be subject to public notice and comment until March 31, 1997.
       ``(C) The Secretary shall issue final regulations providing 
     the guidance described in subparagraph (A) not later than 
     June 30, 1997.
       ``(2) In issuing regulations under paragraph (1), the 
     Secretary--
       ``(A) subject to subparagraph (C), may exclude any assets 
     of the insurer with respect to its operations, products, or 
     services from treatment as plan assets,
       ``(B) shall provide that assets not treated as plan assets 
     under subsection (b)(2) shall not be treated as plan assets 
     under paragraph (1), and
       ``(C) shall ensure that the regulations--
       ``(i) are administratively feasible, and
       ``(ii) are designed to protect the interests and rights of 
     the plan and of its participants and beneficiaries.
       ``(3)(A) Subject to subparagraph (B), any regulations 
     issued under paragraph (1) shall not take effect before the 
     date on which such regulations become final.
       ``(B) No person shall be subject to liability under this 
     part or section 4975 of the Internal Revenue Code of 1986 for 
     conduct which occurred before the date which is 18 months 
     following the date described in subparagraph (A) on the basis 
     of a claim that the assets of an insurer (other than plan 
     assets held in a separate account) constitute assets of the 
     plan, except--
       ``(i) as otherwise provided by the Secretary in regulations 
     intended to prevent avoidance of the regulations issued under 
     paragraph (1), or
       ``(ii) as provided in an action brought by the Secretary 
     pursuant to subsection (a) (2) or (5) of section 502 for a 
     breach of fiduciary responsibilities which would also 
     constitute a violation of Federal criminal law or constitute 
     a felony under applicable State law.
       ``(4) Nothing in this subsection shall preclude the 
     application of any Federal criminal law.
       ``(5) For purposes of this subsection, the term `policy' 
     includes a contract.''
       (b) Effective Date.--
       (1) In general.--Except as provided in paragraph (2), the 
     amendment made by this section shall take effect on January 
     1, 1975.
       (2) Civil actions.--The amendment made by this section 
     shall not apply to any civil action commenced before November 
     7, 1995.

     SEC. 1462. SPECIAL RULES FOR CHAPLAINS AND SELF-EMPLOYED 
                   MINISTERS.

       (a) In General.--Section 414(e) (defining church plan) is 
     amended by adding at the end the following new paragraph:
       ``(5) Special rules for chaplains and self-employed 
     ministers.--
       ``(A) Certain ministers may participate.--For purposes of 
     this part--
       ``(i) In general.--An employee of a church or a convention 
     or association of churches shall include a duly ordained, 
     commissioned, or licensed minister of a church who, in 
     connection with the exercise of his or her ministry--

       ``(I) is a self-employed individual (within the meaning of 
     section 401(c)(1)(B)), or
       ``(II) is employed by an organization other than an 
     organization described in section 501(c)(3).

       ``(ii) Treatment as employer and employee.--

       ``(I) Self-employed.--A minister described in clause (i)(I) 
     shall be treated as his or her own employer which is an 
     organization described in section 501(c)(3) and which is 
     exempt from tax under section 501(a).
       ``(II) Others.--A minister described in clause (i)(II) 
     shall be treated as employed by an organization described in 
     section 501(c)(3) and exempt from tax under section 501(a).

       ``(B) Special rules for applying section 403(b) to self-
     employed ministers.--In the case of a minister described in 
     subparagraph (A)(i)(I)--
       ``(i) the minister's includible compensation under section 
     403(b)(3) shall be determined by reference to the minister's 
     earned income (within the meaning of section 401(c)(2)) from 
     such ministry rather than the amount of compensation which is 
     received from an employer, and
       ``(ii) the years (and portions of years) in which such 
     minister was a self-employed individual (within the meaning 
     of section 401(c)(1)(B)) with respect to such ministry shall 
     be included for purposes of section 403(b)(4).
       ``(C) Effect on non-denominational plans.--If a duly 
     ordained, commissioned, or licensed minister of a church in 
     the exercise of his or her ministry participates in a church 
     plan (within the meaning of this section) and is employed by 
     an employer not eligible to participate in such church plan, 
     then such minister shall not be treated as an employee of 
     such employer for purposes of applying sections 401(a)(3), 
     401(a)(4), and 401(a)(5), as in effect on September 1, 1974, 
     and sections 401(a)(4), 401(a)(5), 401(a)(26), 401(k)(3), 
     401(m), 403(b)(1)(D) (including section 403(b)(12)), and 410 
     to any stock bonus, pension, profit-sharing, or annuity plan 
     (including an annuity described in section 403(b) or a 
     retirement income account described in section 403(b)(9)).''
       (b) Contributions by Certain Ministers to Retirement Income 
     Accounts.--Section 404(a) (relating to deduction for 
     contributions of an employer to an employees' trust or 
     annuity plan and compensation under a deferred-payment plan) 
     is amended by adding at the end the following new paragraph:
       ``(10) Contributions by certain ministers to retirement 
     income accounts.--In the case of contributions made by a 
     minister described in section 414(e)(5) to a retirement 
     income account described in section 403(b)(9) and not by a 
     person other than such minister, such contributions--
       ``(A) shall be treated as made to a trust which is exempt 
     from tax under section 501(a) and which is part of a plan 
     which is described in section 401(a), and
       ``(B) shall be deductible under this subsection to the 
     extent such contributions do not exceed the limit on elective 
     deferrals under section 402(g), the exclusion allowance under 
     section 403(b)(2), or the limit on annual additions under 
     section 415.

     For purposes of this paragraph, all plans in which the 
     minister is a participant shall be treated as one plan.''
       (c) Effective Date.--The amendments made by this section 
     shall apply to years beginning after December 31, 1996.

     SEC. 1463. DEFINITION OF HIGHLY COMPENSATED EMPLOYEE FOR PRE-
                   ERISA CHURCH PLANS.

       (a) In General.--Section 414(q) (defining highly 
     compensated employee), as amended by section 1431(c)1(A) of 
     this Act, is amended by adding at the end the following new 
     paragraph:
       ``(7) Certain employees not considered highly compensated 
     and excluded employees under pre-erisa church plans.--In the 
     case of a church plan (as defined in subsection (e)), no 
     employee shall be considered an officer, a person whose 
     principal duties consist in supervising the work of other 
     employees, or a highly compensated employee for any year 
     unless such employee is a highly compensated employee under 
     paragraph (1) for such year.''
       (b) Safeharbor Authority.--The Secretary of the Treasury 
     may design nondiscrimination and coverage safe harbors for 
     church plans.
       (c) Effective Date.--The amendments made by subsection (a) 
     shall apply to years beginning after December 31, 1996.

     SEC. 1464. RULE RELATING TO INVESTMENT IN CONTRACT NOT TO 
                   APPLY TO FOREIGN MISSIONARIES.

       (a) In General.--The last sentence of section 72(f) is 
     amended by inserting ``, or to the extent such credits are 
     attributable to services performed as a foreign missionary 
     (within the meaning of section 403(b)(2)(D)(iii))'' before 
     the end period.
       (b) Effective Date.--The amendment made by this section 
     shall apply to taxable years beginning after December 31, 
     1996.

[[Page S7497]]

     SEC. 1465. INCREASE IN GUARANTEED AMOUNT OF MULTIEMPLOYER 
                   PLAN BENEFITS.

       (a) In General.--Section 4022A(c) of the Employee 
     Retirement Income Security Act of 1974 is amended by adding 
     at the end the following new paragraph:
       ``(7)(A) In the case of a multiemployer plan which first 
     receives financial assistance (within the meaning of section 
     4261) during the applicable period--
       ``(i) paragraph (1) shall be applied with respect to the 
     guarantee of benefits under such plan by substituting `$11' 
     for `$5' each place it appears and by substituting `$33' for 
     `$15', and
       ``(ii) paragraphs (2), (5), and (6) shall not apply with 
     respect to such plan.
       ``(B) For purposes of subparagraph (A), the applicable 
     period is the period--
       ``(i) beginning on the date of the enactment of this 
     paragraph, and
       ``(ii) ending on the last day of the first fiscal year for 
     which the surplus in the corporation's multiemployer 
     insurance program is less than 50 percent of such surplus for 
     the fiscal year ending September 30, 1995.
       ``(C) For purposes of subparagraph (B), the surplus for any 
     fiscal year shall be the surplus reflected in the Statement 
     of Financial Condition for the fiscal year contained in the 
     corporation's annual report, except that the assumptions used 
     in computing such surplus shall be the same as those used for 
     the fiscal year ending September 30, 1995.''
       (b) Effective Date.--The amendments made by this section 
     shall take effect on the date of the enactment of this Act.

     SEC. 1466. WAIVER OF EXCISE TAX ON FAILURE TO PAY LIQUIDITY 
                   SHORTFALL.

       (a) In General.--Section 4971(f) (relating to failure to 
     pay liquidity shortfall) is amended by adding at the end the 
     following new paragraph:
       ``(4) Waiver by secretary.--If the taxpayer establishes to 
     the satisfaction of the Secretary that--
       ``(A) the liquidity shortfall described in paragraph (1) 
     was due to reasonable cause and not willful neglect, and
       ``(B) reasonable steps have been taken to remedy such 
     liquidity shortfall,
     the Secretary may waive all or part of the tax imposed by 
     this subsection.''
       (b) Effective Date.--The amendment made by this section 
     shall take effect as if included in the amendment made by 
     clause (ii) of section 751(a)(9)(B) of the Retirement 
     Protection Act of 1994 (108 Stat. 5020).
       On page 394, line 1, strike ``1459'' and insert ``1467''.
       On page 417, lines 5 and 6, strike ``after June 30 in 
     calendar year 1996, and in calendar years after 1996'' and 
     insert ``in calendar years after 1995''.
       On page 417, line 11, strike ``take effect on July 1, 
     1996'' and insert ``apply with respect to sales occurring 
     after the date which is 7 days after the date of the 
     enactment of this Act''.
       On page 421, line 7, strike ``December 31, 1996'' and 
     insert ``April 15, 1997''.
       On page 421, lines 11 and 12, strike ``December 31, 1996'' 
     and insert ``April 15, 1997''.
       On page 421, line 21, strike ``December 31, 1996'' and 
     insert ``April 15, 1997''.
       On page 422, line 2, strike ``January 1, 1997'' and insert 
     ``April 16, 1997''.
       On page 422, line 7, strike ``January 1, 1997'' and insert 
     ``April 16, 1997''.
       On page 422, lines 18 and 19, strike ``December 31, 1996'' 
     and insert ``April 15, 1997''.
       On page 427, line 23, strike ``amendment'' and insert 
     ``amendments''.
       On page 438, between lines 19 and 20, insert the following:

     SEC. 1612. ELECTION TO CEASE STATUS AS QUALIFIED SCHOLARSHIP 
                   FUNDING CORPORATION.

       (a) In General.--Subsection (d) of section 150 (relating to 
     definitions and special rules) is amended by adding at the 
     end the following new paragraph:
       ``(3) Election to cease status as qualified scholarship 
     funding corporation.--
       ``(A) In general.--Any qualified scholarship funding bond, 
     and qualified student loan bond, outstanding on the date of 
     the issuer's election under this paragraph (and any bond (or 
     series of bonds) issued to refund such a bond) shall not fail 
     to be a tax-exempt bond solely because the issuer ceases to 
     be described in subparagraphs (A) and (B) of paragraph (2) if 
     the issuer meets the requirements of subparagraphs (B) and 
     (C) of this paragraph.
       ``(B) Assets and liabilities of issuer transferred to 
     taxable subsidiary.--The requirements of this subparagraph 
     are met by an issuer if--
       ``(i) all of the student loan notes of the issuer and other 
     assets pledged to secure the repayment of qualified 
     scholarship funding bond indebtedness of the issuer are 
     transferred to another corporation within a reasonable period 
     after the election is made under this paragraph;
       ``(ii) such transferee corporation assumes or otherwise 
     provides for the payment of all of the qualified scholarship 
     funding bond indebtedness of the issuer within a reasonable 
     period after the election is made under this paragraph;
       ``(iii) to the extent permitted by law, such transferee 
     corporation assumes all of the responsibilities, and succeeds 
     to all of the rights, of the issuer under the issuer's 
     agreements with the Secretary of Education in respect of 
     student loans;
       ``(iv) immediately after such transfer, the issuer, 
     together with any other issuer which has made an election 
     under this paragraph in respect of such transferee, hold all 
     of the senior stock in such transferee corporation; and
       ``(v) such transferee corporation is not exempt from tax 
     under this chapter.
       ``(C) Issuer to operate as independent organization 
     described in section 501(c)(3).--The requirements of this 
     subparagraph are met by an issuer if, within a reasonable 
     period after the transfer referred to in subparagraph (B)--
       ``(i) the issuer is described in section 501(c)(3) and 
     exempt from tax under section 501(a);
       ``(ii) the issuer no longer is described in subparagraphs 
     (A) and (B) of paragraph (2); and
       ``(iii) at least 80 percent of the members of the board of 
     directors of the issuer are independent members.
       ``(D) Senior stock.--For purposes of this paragraph, the 
     term `senior stock' means stock--
       ``(i) which participates pro rata and fully in the equity 
     value of the corporation with all other common stock of the 
     corporation but which has the right to payment of liquidation 
     proceeds prior to payment of liquidation proceeds in respect 
     of other common stock of the corporation;
       ``(ii) which has a fixed right upon liquidation and upon 
     redemption to an amount equal to the greater of--

       ``(I) the fair market value of such stock on the date of 
     liquidation or redemption (whichever is applicable); or
       ``(II) the fair market value of all assets transferred in 
     exchange for such stock and reduced by the amount of all 
     liabilities of the corporation which has made an election 
     under this paragraph assumed by the transferee corporation in 
     such transfer;

       ``(iii) the holder of which has the right to require the 
     transferee corporation to redeem on a date that is not later 
     than 10 years after the date on which an election under this 
     paragraph was made and pursuant to such election such stock 
     was issued; and
       ``(iv) in respect of which, during the time such stock is 
     outstanding, there is not outstanding any equity interest in 
     the corporation having any liquidation, redemption or 
     dividend rights in the corporation which are superior to 
     those of such stock.
       ``(E) Independent member.--The term `independent member' 
     means a member of the board of directors of the issuer who 
     (except for services as a member of such board) receives no 
     compensation directly or indirectly--
       ``(i) for services performed in connection with such 
     transferee corporation, or
       ``(ii) for services as a member of the board of directors 
     or as an officer of such transferee corporation.

     For purposes of clause (ii), the term `officer' includes any 
     individual having powers or responsibilities similar to those 
     of officers.
       ``(F) Coordination with certain private foundation taxes.--
     For purposes of sections 4942 (relating to the excise tax on 
     a failure to distribute income) and 4943 (relating to the 
     excise tax on excess business holdings), the transferee 
     corporation referred to in subparagraph (B) shall be treated 
     as a functionally related business (within the meaning of 
     section 4942(j)(4)) with respect to the issuer during the 
     period commencing with the date on which an election is made 
     under this paragraph and ending on the date that is the 
     earlier of--
       ``(i) the last day of the last taxable year for which more 
     than 50 percent of the gross income of such transferee 
     corporation is derived from, or more than 50 percent of the 
     assets (by value) of such transferee corporation consists of, 
     student loan notes incurred under the Higher Education Act of 
     1965; or
       ``(ii) the last day of the taxable year of the issuer 
     during which occurs the date which is 10 years after the date 
     on which the election under this paragraph is made.
       ``(G) Election.--An election under this paragraph may be 
     revoked only with the consent of the Secretary.''
       (b) Effective Date.--The amendment made by this section 
     shall take effect on the date of the enactment of this Act.

     SEC. 1613. CERTAIN TAX BENEFITS DENIED TO INDIVIDUALS FAILING 
                   TO PROVIDE TAXPAYER IDENTIFICATION NUMBERS.

       (a) Personal Exemption.--
       (1) In general.--Section 151 (relating to allowance of 
     deductions for personal exemptions) is amended by adding at 
     the end the following new subsection:
       ``(e) Identifying Information Required.--No exemption shall 
     be allowed under this section with respect to any individual 
     unless the TIN of such individual is included on the return 
     claiming the exemption.''
       (2) Conforming amendments.--
       (A) Subsection (e) of section 6109 is repealed.
       (B) Section 6724(d)(3) is amended by adding ``and'' at the 
     end of subparagraph (C), by striking subparagraph (D), and by 
     redesignating subparagraph (E) as subparagraph (D).
       (b) Dependent Care Credit.--Subsection (e) of section 21 
     (relating to expenses for household and dependent care 
     services necessary for gainful employment) is amended by 
     adding at the end the following new paragraph:
       ``(10) Identifying information required with respect to 
     qualifying individuals.--No credit shall be allowed under 
     this section

[[Page S7498]]

     with respect to any qualifying individual unless the TIN of 
     such individual is included on the return claiming the 
     credit.''
       (c) Extension of Procedures Applicable to Mathematical or 
     Clerical Errors.--Section 6213(g)(2) (relating to the 
     definition of mathematical or clerical errors) is amended by 
     striking ``and' at the end of subparagraph (D), by striking 
     the period at the end of subparagraph (E) and inserting ``, 
     and'', and by inserting at the end the following new 
     subparagraph:
       ``(F) an omission of a correct TIN required under section 
     21 (relating to expenses for household and dependent care 
     services necessary for gainful employment) or section 151 
     (relating to allowance of deductions for personal 
     exemptions).''
       (d) Effective Date.--
       (1) In general.--The amendments made by this section shall 
     apply with respect to returns the due date for which (without 
     regard to extensions) is on or after the 30th day after the 
     date of the enactment of this Act.
       (2) Special rule for 1995 and 1996.--In the case of returns 
     for taxable years beginning in 1995 or 1996, a taxpayer shall 
     not be required by the amendments made by this section to 
     provide a taxpayer identification number for a child who is 
     born after October 31, 1995, in the case of a taxable year 
     beginning in 1995 or November 30, 1996, in the case of a 
     taxable year beginning in 1996.
       On page 486, between lines 21 and 22, insert:
       (d) Comparable Estate and Gift Tax Treatment.--
       (1) Estate tax.--
       (A) In general.--Subsection (a) of section 2107 is amended 
     to read as follows:
       ``(a) Treatment of Expatriates.--
       ``(1) Rate of tax.--A tax computed in accordance with the 
     table contained in section 2001 is hereby imposed on the 
     transfer of the taxable estate, determined as provided in 
     section 2106, of every decedent nonresident who is an 
     expatriate if the expatriation date of the decedent is within 
     the 10-year period ending with the date of death, unless such 
     expatriation did not have for 1 of its principal purposes the 
     avoidance of taxes under this subtitle or subtitle A.
       ``(2) Certain individuals treated as having tax avoidance 
     purpose.--For purposes of paragraph (1), an individual shall 
     be treated as having a principal purpose to avoid such taxes 
     if such individual is a covered expatriate.
       ``(3) Definitions.--For purposes of this subsection, the 
     terms `expatriate', `expatriation date', and `covered 
     expatriate' have the meanings given such terms by section 
     877A.''
       (B) Credit for foreign death taxes.--Subsection (c) of 
     section 2107 is amended by redesignating paragraph (2) as 
     paragraph (3) and by inserting after paragraph (1) the 
     following new paragraph:
       ``(2) Credit for foreign death taxes.--
       ``(A) In general.--The tax imposed by subsection (a) shall 
     be credited with the amount of any estate, inheritance, 
     legacy, or succession taxes actually paid to any foreign 
     country in respect of any property which is included in the 
     gross estate solely by reason of subsection (b).
       ``(B) Limitations on credit.--The credit allowed by 
     subparagraph (A) for such taxes paid to a foreign country 
     shall not exceed the lesser of--
       ``(i) the amount which bears the same ratio to the amount 
     of such taxes actually paid to such foreign country in 
     respect of property included in the gross estate as the value 
     of the property included in the gross estate solely by reason 
     of subsection (b) bears to the value of all property 
     subjected to such taxes by such foreign country, or
       ``(ii) such property's proportionate share of the excess 
     of--

       ``(I) the tax imposed by subsection (a), over
       ``(II) the tax which would be imposed by section 2101 but 
     for this section.

     The amount applicable under clause (i) or (ii) shall be 
     reduced by the amount of any credit allowed under section 
     877A(i).
       ``(C) Proportionate share.--For purposes of subparagraph 
     (B), a property's proportionate share is the percentage of 
     the value of the property which is included in the gross 
     estate solely by reason of subsection (b) bears to the total 
     value of the gross estate.''
       (C) Expansion of inclusion in gross estate of stock of 
     foreign corporations.--Paragraph (2) of section 2107(b) is 
     amended by striking ``more than 50 percent of'' and all that 
     follows and inserting ``more than 50 percent of--
       ``(A) the total combined voting power of all classes of 
     stock entitled to vote of such corporation, or
       ``(B) the total value of the stock of such corporation,''.
       (2) Gift tax.--
       (A) In general.--Paragraph (3) of section 2501(a) is 
     amended to read as follows:
       ``(3) Exception.--
       ``(A) Certain individuals.--Paragraph (2) shall not apply 
     in the case of a donor who is an expatriate if the 
     expatriation date of the donor is within the 10-year period 
     ending with the date of transfer, unless such expatriation 
     did not have for 1 of its principal purposes the avoidance of 
     taxes under this subtitle or subtitle A.
       ``(B) Certain individuals treated as having tax avoidance 
     purpose.--For purposes of subparagraph (A), an individual 
     shall be treated as having a principal purpose to avoid such 
     taxes if such individual is a covered expatriate.
       ``(C) Credit for foreign gift taxes.--The tax imposed by 
     this section solely by reason of this paragraph shall be 
     credited with the amount of any gift tax actually paid to any 
     foreign country in respect of any gift which is taxable under 
     this section solely by reason of this paragraph. The amount 
     of such credit shall be reduced by the amount of the credit 
     allowed under section 877A(i).
       ``(D) Definitions.--For purposes of this paragraph, the 
     term `expatriate', `expatriation date', and `covered 
     expatriate' have the meanings given such terms by section 
     877A.''
       On page 486, line 22, strike ``(d)'' and insert ``(e)''.
       On page 487, line 19, strike ``(e)'' and insert ``(f)''.
       On page 487, line 23, strike ``(f)'' and insert ``(g)''.
       On page 488, line 21, strike ``(d)(1)'' and insert 
     ``(e)(1)''.
       On page 501, strike lines 16 through 25, and redesignate 
     the subsequent paragraphs accordingly.
       On page 512, strike lines 1 through 11, and insert:
       ``(i) Effective Date.--Except as otherwise expressly 
     provided, any amendment made by this section shall take 
     effect as if included in the provision of the Revenue 
     Reconciliation Act of 1990 to which such amendment relates.
       On page 521, line 6, strike ``(1)'' and insert ``(1) In 
     general.--''.
       On page 521, line 13, strike ``(2)'' and insert ``(2) 
     Effective date.--''.
       On page 571, line 5, strike ``contribution to'' and insert 
     ``distribution from''.

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