[Congressional Record Volume 145, Number 19 (Wednesday, February 3, 1999)]
[Senate]
[Pages S1152-S1153]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. CRAIG:
  S. 341. A bill to amend the Internal Revenue Code of 1986 to increase 
the amount allowable for qualified adoption expenses, to permanently 
extend the credit for adoption expenses, and to adjust the limitations 
on such credit for inflation, and for other purposes; to the Committee 
on Finance.


                         HOPE FOR CHILDREN ACT

  Mr. CRAIG. Mr. President, I rise to introduce the Hope for Children 
Act, which is also being introduced today in the House of 
Representatives by Congressman Tom Bliley of Virginia.
  I think all of us--no matter what party or philosophy--share the hope 
that every child in the world has a loving, permanent home. The Hope 
for Children Act is aimed at making that hope a reality for more 
children, by making it possible for more families to open their homes 
and hearts to a child through adoption.
  In the past few years, Congress has taken a number of steps to 
promote adoption in this country. I commend my colleagues on both sides 
of the aisle and in both chambers for their dedication to this effort. 
As an adoptive father myself, and co-chair of the bipartisan, bicameral 
Congressional Coalition on Adoption, I've been pleased to see more and 
more American families formed through adoption, and I sincerely believe 
the work of Congress has been a contributing factor.
  However, we have some unfinished business to take care of, and that's 
what I'm here to talk about today.
  Many of my colleagues will remember back in 1996, we succeeded in 
enacting a tax credit for adoption expenses. We did so, because we 
realized that adopting families face extraordinary challenges: not only 
must they forge a new family unit while navigating a labyrinth of legal 
or regulatory requirements, but they also have financial challenges 
above and beyond the usual expenses of caring for and raising children. 
The cost of adoption can easily push into the tens of thousands of 
dollars, counting legal fees, travel, medical bills and other expenses. 
All too often, it is the financial challenge that becomes an 
insurmountable obstacle to bringing a child who is alone in the world 
together with a loving family.
  We knew the adoption tax credit wouldn't eliminate the expense of 
adoption outright, but would only allow eligible adoptive families to 
keep a bit more of their own hard-earned income to devote to those 
expenses. As a result, adoptive parents may be eligible to receive a 
tax credit of $5000 to help cover out-of-pocket expenses related to 
each adoption, or a $6000 tax credit for the adoption of a ``special 
needs'' child.
  If the comments I've been hearing from families across the nation are 
any gauge, the credit has helped make adoption a reality for a lot of 
children. As more individuals explore the adoption option, they are 
finding the credit a small but significant cushion against the 
financial impact. Even so, I've received a number of constructive 
suggestions from families as to how the adoption tax credit could be 
improved, to make it more effective in promoting adoption in the United 
States.
  Furthermore, back in 1996 when we originally debated this matter, 
there were political and fiscal considerations that caused Congress to 
include a sunset provision for the adoption tax credit. Unless we act 
soon to extend this enormously helpful tool, it will expire.
  For all of those reasons, I am introducing the Hope for Children Act. 
It builds on the work done by our previous Congress, to improve and 
extend the adoption tax credit.
  Specifically, it would make the tax credit permanent, and adjust it 
for inflation. It would also exclude the credit from calculation of the 
alternative minimum tax. The full credit would be available for 
taxpayers with adjusted gross incomes under $150,000; those with 
adjusted gross incomes between $150,000 and $190,000 would be able to 
take a reduced credit. No credit would be available to those with 
adjusted gross incomes of more than $190,000.
  I should say at this point that I do not think this bill is the final 
word on the subject. I intend to work with interested groups and 
individuals on additional legislation that will promote adoption--
perhaps most important, that will do more to promote the adoption of 
children with special needs.
  There are so many children in the United States and the world who can 
only hope for the loving, permanent home that should be their 
birthright--I invite all Senators to join me in supporting the Hope for 
Children Act to help make their dreams a reality.
  Mr. President, I ask unanimous consent that a copy of the bill be 
printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                 S. 341

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Hope for Children Act''.

     SEC. 2. ADOPTION EXPENSES.

       (a) Increase in Amounts Allowed.--
       (1) Dollar amount of allowed expenses.--Paragraph (1) of 
     section 23(b) of the Internal Revenue Code of 1986 (relating 
     to dollar limitation) is amended by striking ``$5,000'' and 
     all that follows and inserting ``$10,000.''.
       (2) Phase-out limitation.--Clause (i) of section 
     23(b)(2)(A) of such Code (relating to income limitation) is 
     amended by striking ``$75,000'' and inserting ``$150,000''.
       (b) Repeal of Sunset on Children Without Special Needs.--
       (1) In general.--Paragraph (2) of section 23(d) of such 
     Code (relating to definition of eligible child) is amended to 
     read as follows:
       ``(2) Eligible child.--The term `eligible child' means any 
     individual who--
       ``(A) has not attained age 18, or
       ``(B) is physically or mentally incapable of caring for 
     himself.''.
       (2) Conforming amendment.--Subsection (d) of section 23 of 
     such Code (relating to definitions) is amended by striking 
     paragraph (3).
       (c) Adjustment of Dollar and Income Limitations For 
     Inflation.--Section 23 of such Code is amended by 
     redesignating subsection (h) as subsection (i) and by 
     inserting after subsection (g) the following new subsection:
       ``(h) Adjustments for Inflation.--In the case of a taxable 
     year beginning after December 31, 2000, each of the dollar 
     amounts in paragraphs (1) and (2)(A)(i) of subsection (b) 
     shall be increased by an amount equal to--
       ``(1) such dollar amount, multiplied by
       ``(2) 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 1999' 
     for `calendar year 1992' in subparagraph (B) thereof.''.
       (d) Limitation Based on Amount of Tax.--
       (1) In general.--Subsection (c) of section 23 of such Code 
     is amended by striking ``the limitation imposed'' and all 
     that follows through ``1400C)'' and inserting ``the 
     applicable tax limitation''.
       (2) Applicable tax limitation.--Subsection (d) of section 
     23 of such Code (as amended by subsection (b)) is further 
     amended adding at the end the following new paragraph:
       ``(3) Applicable tax limitation.--The term `applicable tax 
     limitation' means the sum of--
       ``(A) the taxpayer's regular tax liability for the taxable 
     year, reduced (but not below zero) by the sum of the credits 
     allowed by sections 21, 22, 24 (other than the amount of the 
     increase under subsection (d) thereof), 25, and 25A, and
       ``(B) the tax imposed by section 55 for such taxable 
     year.''.
       (3) Conforming amendments.--
       (A) Subsection (a) of section 26 of such Code (relating to 
     limitation based on amount of tax) is amended by inserting 
     ``(other than section 23)'' after ``allowed by this 
     subpart''.
       (B) Paragraph (1) of section 53(b) of such Code (relating 
     to minimum tax credit) is amended by inserting ``reduced by 
     the aggregate amount taken into account under section 
     23(d)(3)(B) for all such prior taxable years,'' after 
     ``1986,''.
       (e) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     1998.

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