[Congressional Record Volume 166, Number 5 (Thursday, January 9, 2020)]
[Senate]
[Page S127]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. SCHUMER (for himself, Mr. Wyden, and Mr. Menendez):
  S. 3178. A bill to amend the Internal Revenue Code of 1986 to modify 
the limitation on deduction of State and local taxes, and for other 
purposes; to the Committee on Finance.
  Mr. SCHUMER. Mr. President, I ask unanimous consent that the text of 
the bill be printed in the Record.
  There being no objection, the text of the bill was ordered to be 
printed in the Record, as follows:

                                S. 3178

       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 ``Restoring Tax Fairness for 
     States and Localities Act''.

     SEC. 2. ELIMINATION FOR 2019 OF MARRIAGE PENALTY IN 
                   LIMITATION ON DEDUCTION OF STATE AND LOCAL 
                   TAXES.

       (a) In General.--Section 164(b) of the Internal Revenue 
     Code of 1986 is amended by adding at the end the following 
     new paragraph:
       ``(7) Special rule for limitation on individual deductions 
     for 2019.--In the case of a taxable year beginning after 
     December 31, 2018, and before January 1, 2020, if the 
     adjusted gross income of the taxpayer for such taxable year 
     does not exceed $100,000,000, paragraph (6) shall be applied 
     by substituting `($20,000 in the case of a joint return)' for 
     `($5,000 in the case of a married individual filing a 
     separate return)'.''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to taxable years beginning after December 31, 
     2018.

     SEC. 3. ELIMINATION FOR 2020 AND 2021 OF LIMITATION ON 
                   DEDUCTION OF STATE AND LOCAL TAXES.

       (a) In General.--Section 164(b) of the Internal Revenue 
     Code of 1986, as amended by section 2, is further amended by 
     adding at the end the following new paragraph:
       ``(8) Suspension of dollar limitation on state and local 
     taxes for 2020 and 2021.--
       ``(A) In general.--In the case of any taxable year 
     beginning in 2020 or 2021, subparagraph (B) of paragraph (6) 
     shall not apply.
       ``(B) Exception for certain high-income taxpayers.--
     Subparagraph (A) shall not apply to any taxpayer for any 
     taxable year if the adjusted gross income of such taxpayer 
     for such taxable year exceeds $100,000,000.''.
       (b) Conforming Amendments.--Section 164(b)(6) of the 
     Internal Revenue Code of 1986 is amended--
       (1) by striking ``For purposes of subparagraph (B)'' and 
     inserting ``For purposes of this section'';
       (2) by striking ``January 1, 2018'' and inserting ``January 
     1, 2022'';
       (3) by striking ``December 31, 2017, shall'' and inserting 
     ``December 31, 2021, shall''; and
       (4) by adding at the end the following: ``For purposes of 
     this section, in the case of State or local taxes with 
     respect to any real or personal property paid during a 
     taxable year beginning in 2020 or 2021, the Secretary shall 
     prescribe rules which treat all or a portion of such taxes as 
     paid in a taxable year or years other than the taxable year 
     in which actually paid as necessary or appropriate to prevent 
     the avoidance of the limitations of this subsection.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxes paid or accrued in taxable years 
     beginning after December 31, 2019.

     SEC. 4. INCREASE IN DEDUCTION FOR CERTAIN EXPENSES OF 
                   ELEMENTARY AND SECONDARY SCHOOL TEACHERS.

       (a) Increase.--Section 62(a)(2)(D) of the Internal Revenue 
     Code of 1986 is amended by striking ``$250'' and inserting 
     ``$1,000''.
       (b) Conforming Amendments.--Section 62(d)(3) of the 
     Internal Revenue Code of 1986 is amended--
       (1) by striking ``2015'' and inserting ``2019'';
       (2) by striking ``$250'' and inserting ``$1,000''; and
       (3) in subparagraph (B), by striking ``2014'' and inserting 
     ``2018''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2018.

     SEC. 5. ABOVE-THE-LINE DEDUCTION ALLOWED FOR CERTAIN EXPENSES 
                   OF FIRST RESPONDERS.

       (a) In General.--Section 62(a)(2) of the Internal Revenue 
     Code of 1986 is amended by adding at the end the following 
     new subparagraph:
       ``(F) Certain expenses of first responders.--The deductions 
     allowed by section 162 which consist of expenses, not in 
     excess of $1,000, paid or incurred by a first responder--
       ``(i) as tuition or fees for the participation of the first 
     responder in professional development courses related to 
     service as a first responder; or
       ``(ii) for uniforms used by the first responder in service 
     as a first responder.''.
       (b) First Responder Defined.--Section 62(d) of the Internal 
     Revenue Code of 1986 is amended by adding at the end the 
     following new paragraph:
       ``(4) First responder.--For purposes of subsection 
     (a)(2)(F), the term `first responder' means, with respect to 
     any taxable year, any individual who is employed as a law 
     enforcement officer, firefighter, paramedic, or emergency 
     medical technician for at least 1,000 hours during such 
     taxable year.''.
       (c) Inflation Adjustment.--Section 62(d)(3) of the Internal 
     Revenue Code of 1986, as amended by section 4, is further 
     amended by striking ``the $1,000 amount in subsection 
     (a)(2)(D)'' and inserting ``the $1,000 amount in each of 
     subparagraphs (D) and (F) of subsection (a)(2)''.
       (d) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2019.

     SEC. 6. INCREASE OF TOP MARGINAL INDIVIDUAL INCOME TAX RATE 
                   UNDER TEMPORARY RULES.

       (a) In General.--The tables contained in subparagraphs (A), 
     (B), (C), (D), and (E) of section 1(j)(2) of the Internal 
     Revenue Code of 1986 are each amended by striking ``37%'' and 
     inserting ``39.6%'' and--
       (1) in subparagraph (A)--
       (A) by striking ``$600,000'' each place such term appears 
     and inserting ``$479,000''; and
       (B) by striking ``$161,379'' and inserting ``$119,029'';
       (2) in subparagraph (B)--
       (A) by striking ``$500,000'' each place such term appears 
     and inserting ``$452,400''; and
       (B) by striking ``$149,298'' and inserting ``$132,638'';
       (3) in subparagraph (C)--
       (A) by striking ``$500,000'' each place such term appears 
     and inserting ``$425,800''; and
       (B) by striking ``$150,689.50'' and inserting 
     ``$124,719.50''; and
       (4) in subparagraph (D)--
       (A) by striking ``$300,000'' each place such term appears 
     and inserting ``$239,500''; and
       (B) by striking ``$80,689.50'' and inserting 
     ``$59,514.50''.
       (b) Conforming Amendments.--
       (1) Section 1(j)(4)(B)(iii) of the Internal Revenue Code of 
     1986 is amended--
       (A) in the matter preceding subclause (I), by striking ``37 
     percent'' and inserting ``39.6 percent'';
       (B) in subclause (II), by striking ``37-percent bracket'' 
     and inserting ``39.6-percent bracket''; and
       (C) in the heading, by striking ``37-percent bracket'' and 
     inserting ``39.6-percent bracket''.
       (2) Section 1(j)(4)(C) of such Code is amended--
       (A) in clause (i)(II), by striking ``paragraph 
     (5)(B)(i)(IV)'' and inserting ``paragraph (5)(B)(iv)''; and
       (B) by amending clause (ii) to read as follows:
       ``(ii) the amount which would (without regard to this 
     paragraph) be taxed at a rate below 39.6 percent shall not be 
     more than the sum of--

       ``(I) the earned taxable income of such child, plus
       ``(II) the maximum dollar amount for the 35-percent rate 
     bracket for estates and trusts.''.

       (3) The heading of section 1(j)(5) of such Code is amended 
     to read as follows: ``Application of zero percent capital 
     gain rate brackets''.
       (4) Subparagraphs (A) and (B) of section 1(j)(5) of such 
     Code are amended to read as follows:
       ``(A) In general.--Subsection (h)(1)(B)(i) shall be applied 
     by substituting `below the maximum zero rate amount' for 
     `which would (without regard to this paragraph) be taxed at a 
     rate below 25 percent'.
       ``(B) Maximum zero rate amount defined.--For purposes of 
     subparagraph (A), the term `maximum zero rate amount' means--
       ``(i) in the case of a joint return or surviving spouse, 
     $77,200;
       ``(ii) in the case of an individual who is a head of 
     household (as defined in section 2(b)), $51,700;
       ``(iii) in the case of any other individual (other than an 
     estate or trust), an amount equal to \1/2\ of the amount in 
     effect for the taxable year under clause (i); and
       ``(iv) in the case of an estate or trust, $2,600.''.
       (5) Section 1(j)(5)(C) of such Code is amended by striking 
     ``clauses (i) and (ii) of''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2019.
       (d) Section 15 Not To Apply.--Section 15 of the Internal 
     Revenue Code of 1986 shall not apply to any change in a rate 
     of tax by reason of any amendment made by this section.
                                 ______