[Congressional Record (Bound Edition), Volume 151 (2005), Part 15]
[House]
[Pages 20828-20835]
[From the U.S. Government Publishing Office, www.gpo.gov]




 PROVIDING FOR CONCURRENCE BY HOUSE WITH AMENDMENT IN SENATE AMENDMENT 
         TO H.R. 3768, KATRINA EMERGENCY TAX RELIEF ACT OF 2005

  Mr. McCRERY. Mr. Speaker, I move to suspend the rules and agree to 
the resolution (H. Res. 454) providing for the concurrence by the House 
with an amendment in the amendment of the Senate to H.R. 3768.
  The Clerk read as follows:

                              H. Res. 454

       Resolved, That, upon the adoption of this resolution, the 
     House shall be considered to have taken from the Speaker's 
     table the bill H.R. 3768, with the Senate amendment thereto, 
     and to have concurred in the Senate amendment to the bill 
     with the following amendment:
       In lieu of the matter proposed to be inserted by the 
     amendment of the Senate to the bill, insert the following:

     SECTION 1. SHORT TITLE, ETC.

       (a) Short Title.--This Act may be cited as the ``Katrina 
     Emergency Tax Relief Act of 2005''.
       (b) Table of Contents.--The table of contents for this Act 
     is as follows:

Sec. 1. Short title, etc.
Sec. 2. Hurricane Katrina disaster area.

TITLE I--SPECIAL RULES FOR USE OF RETIREMENT FUNDS FOR RELIEF RELATING 
                          TO HURRICANE KATRINA

Sec. 101. Tax-favored withdrawals from retirement plans for relief 
              relating to Hurricane Katrina.
Sec. 102. Recontributions of withdrawals for home purchases cancelled 
              due to Hurricane Katrina.
Sec. 103. Loans from qualified plans for relief relating to Hurricane 
              Katrina.
Sec. 104. Provisions relating to plan amendments.

                      TITLE II--EMPLOYMENT RELIEF

Sec. 201. Work opportunity tax credit for Hurricane Katrina employees.
Sec. 202. Employee retention credit for employers affected by Hurricane 
              Katrina.

                TITLE III--CHARITABLE GIVING INCENTIVES

Sec. 301. Temporary suspension of limitations on charitable 
              contributions.
Sec. 302. Additional exemption for housing Hurricane Katrina displaced 
              individuals.
Sec. 303. Increase in standard mileage rate for charitable use of 
              vehicles.
Sec. 304. Mileage reimbursements to charitable volunteers excluded from 
              gross income.
Sec. 305. Charitable deduction for contributions of food inventory.
Sec. 306. Charitable deduction for contributions of book inventories to 
              public schools.

               TITLE IV--ADDITIONAL TAX RELIEF PROVISIONS

Sec. 401. Exclusions of certain cancellations of indebtedness by reason 
              of Hurricane Katrina.
Sec. 402. Suspension of certain limitations on personal casualty 
              losses.
Sec. 403. Required exercise of authority under section 7508A for tax 
              relief relating to Hurricane Katrina.
Sec. 404. Special rules for mortgage revenue bonds.
Sec. 405. Extension of replacement period for nonrecognition of gain 
              for property located in Hurricane Katrina disaster area.
Sec. 406. Special rule for determining earned income.
Sec. 407. Secretarial authority to make adjustments regarding taxpayer 
              and dependency status.

                     TITLE V--EMERGENCY REQUIREMENT

Sec. 501. Emergency requirement.

     SEC. 2. HURRICANE KATRINA DISASTER AREA.

       For purposes of this Act--
       (1) Hurricane katrina disaster area.--The term ``Hurricane 
     Katrina disaster area'' means an area with respect to which a 
     major disaster has been declared by the President before 
     September 14, 2005, under section 401 of the Robert T. 
     Stafford Disaster Relief and Emergency Assistance Act by 
     reason of Hurricane Katrina.
       (2) Core disaster area.--The term ``core disaster area'' 
     means that portion of the Hurricane Katrina disaster area 
     determined by the President to warrant individual or 
     individual and public assistance from the Federal Government 
     under such Act.

TITLE I--SPECIAL RULES FOR USE OF RETIREMENT FUNDS FOR RELIEF RELATING 
                          TO HURRICANE KATRINA

     SEC. 101. TAX-FAVORED WITHDRAWALS FROM RETIREMENT PLANS FOR 
                   RELIEF RELATING TO HURRICANE KATRINA.

       (a) In General.--Section 72(t) of the Internal Revenue Code 
     of 1986 shall not apply to any qualified Hurricane Katrina 
     distribution.
       (b) Aggregate Dollar Limitation.--
       (1) In general.--For purposes of this section, the 
     aggregate amount of distributions received by an individual 
     which may be treated as qualified Hurricane Katrina 
     distributions for any taxable year shall not exceed the 
     excess (if any) of--
       (A) $100,000, over
       (B) the aggregate amounts treated as qualified Hurricane 
     Katrina distributions received by such individual for all 
     prior taxable years.
       (2) Treatment of plan distributions.--If a distribution to 
     an individual would (without regard to paragraph (1)) be a 
     qualified Hurricane Katrina distribution, a plan shall not be 
     treated as violating any requirement of the Internal Revenue 
     Code of 1986 merely because the plan treats such distribution 
     as a qualified Hurricane Katrina distribution, unless the 
     aggregate amount of such distributions from all plans 
     maintained by the employer (and any member of any controlled 
     group which includes the employer) to such individual exceeds 
     $100,000.
       (3) Controlled group.--For purposes of paragraph (2), the 
     term ``controlled group'' means any group treated as a single 
     employer under subsection (b), (c), (m), or (o) of section 
     414 of such Code.
       (c) Amount Distributed May Be Repaid.--
       (1) In general.--Any individual who receives a qualified 
     Hurricane Katrina distribution may, at any time during the 3-
     year period beginning on the day after the date on which such 
     distribution was received, make one or more contributions in 
     an aggregate amount not to exceed the amount of such 
     distribution to an eligible retirement plan of which such 
     individual is a beneficiary and to which a rollover 
     contribution of such distribution could be made under section 
     402(c), 403(a)(4), 403(b)(8), 408(d)(3), or 457(e)(16) of 
     such Code, as the case may be.
       (2) Treatment of repayments of distributions from eligible 
     retirement plans other than iras.--For purposes of such Code, 
     if a contribution is made pursuant to paragraph (1) with 
     respect to a qualified Hurricane Katrina distribution from an 
     eligible retirement plan other than an individual retirement 
     plan, then the taxpayer shall, to the extent of the amount of 
     the contribution, be treated as having received the qualified 
     Hurricane Katrina distribution in an eligible rollover 
     distribution (as defined in section 402(c)(4) of such Code) 
     and as having transferred the amount to the eligible 
     retirement plan in a direct trustee to trustee transfer 
     within 60 days of the distribution.
       (3) Treatment of repayments for distributions from iras.--
     For purposes of such Code, if a contribution is made pursuant 
     to paragraph (1) with respect to a qualified Hurricane 
     Katrina distribution from an individual retirement plan (as 
     defined by section 7701(a)(37) of such Code), then, to the 
     extent of the amount of the contribution, the qualified 
     Hurricane Katrina distribution shall be treated as a 
     distribution described in section 408(d)(3) of such Code and 
     as having been transferred to the eligible retirement plan in 
     a direct trustee to trustee transfer within 60 days of the 
     distribution.
       (d) Definitions.--For purposes of this section--
       (1) Qualified hurricane katrina distribution.--Except as 
     provided in subsection (b), the term ``qualified Hurricane 
     Katrina distribution'' means any distribution from an 
     eligible retirement plan made on or after August 25, 2005, 
     and before January 1, 2007, to an individual whose principal 
     place of abode on August 28, 2005, is located in the 
     Hurricane Katrina disaster area and who has sustained an 
     economic loss by reason of Hurricane Katrina.
       (2) Eligible retirement plan.--The term ``eligible 
     retirement plan'' shall have the meaning given such term by 
     section 402(c)(8)(B) of such Code.
       (e) Income Inclusion Spread Over 3 Year Period for 
     Qualified Hurricane Katrina Distributions.--
       (1) In general.--In the case of any qualified Hurricane 
     Katrina distribution, unless the taxpayer elects not to have 
     this subsection apply for any taxable year, any amount 
     required to be included in gross income for such taxable year 
     shall be so included ratably over the 3-taxable year period 
     beginning with such taxable year.
       (2) Special rule.--For purposes of paragraph (1), rules 
     similar to the rules of subparagraph (E) of section 
     408A(d)(3) of such Code shall apply.
       (f) Special Rules.--
       (1) Exemption of distributions from trustee to trustee 
     transfer and withholding rules.--For purposes of sections 
     401(a)(31), 402(f), and 3405 of such Code, qualified 
     Hurricane Katrina distributions shall not be treated as 
     eligible rollover distributions.
       (2) Qualified hurricane katrina distributions treated as 
     meeting plan distribution requirements.--For purposes of such 
     Code, a qualified Hurricane Katrina distribution shall be 
     treated as meeting the requirements of sections 
     401(k)(2)(B)(i), 403(b)(7)(A)(ii), 403(b)(11), and 
     457(d)(1)(A) of such Code.

     SEC. 102. RECONTRIBUTIONS OF WITHDRAWALS FOR HOME PURCHASES 
                   CANCELLED DUE TO HURRICANE KATRINA.

       (a) Recontributions.--
       (1) In general.--Any individual who received a qualified 
     distribution may, during

[[Page 20829]]

     the period beginning on August 25, 2005, and ending on 
     February 28, 2006, make one or more contributions in an 
     aggregate amount not to exceed the amount of such qualified 
     distribution to an eligible retirement plan (as defined in 
     section 402(c)(8)(B) of the Internal Revenue Code of 1986) of 
     which such individual is a beneficiary and to which a 
     rollover contribution of such distribution could be made 
     under section 402(c), 403(a)(4), 403(b)(8), or 408(d)(3) of 
     such Code, as the case may be.
       (2) Treatment of repayments.--Rules similar to the rules of 
     paragraphs (2) and (3) of section 101(c) of this Act shall 
     apply for purposes of this section.
       (b) Qualified Distribution Defined.--For purposes of this 
     section, the term ``qualified distribution'' means any 
     distribution--
       (1) described in section 401(k)(2)(B)(i)(IV), 
     403(b)(7)(A)(ii) (but only to the extent such distribution 
     relates to financial hardship), 403(b)(11)(B), or 72(t)(2)(F) 
     of such Code,
       (2) received after February 28, 2005, and before August 29, 
     2005, and
       (3) which was to be used to purchase or construct a 
     principal residence in the Hurricane Katrina disaster area, 
     but which was not so purchased or constructed on account of 
     Hurricane Katrina.

     SEC. 103. LOANS FROM QUALIFIED PLANS FOR RELIEF RELATING TO 
                   HURRICANE KATRINA.

       (a) Increase in Limit on Loans not Treated as 
     Distributions.--In the case of any loan from a qualified 
     employer plan (as defined under section 72(p)(4) of the 
     Internal Revenue Code of 1986) to a qualified individual made 
     after the date of enactment of this Act and before January 1, 
     2007--
       (1) clause (i) of section 72(p)(2)(A) of such Code shall be 
     applied by substituting ``$100,000'' for ``$50,000'', and
       (2) clause (ii) of such section shall be applied by 
     substituting ``the present value of the nonforfeitable 
     accrued benefit of the employee under the plan'' for ``one-
     half of the present value of the nonforfeitable accrued 
     benefit of the employee under the plan''.
       (b) Delay of Repayment.--In the case of a qualified 
     individual with an outstanding loan on or after August 25, 
     2005, from a qualified employer plan (as defined in section 
     72(p)(4) of such Code)--
       (1) if the due date pursuant to subparagraph (B) or (C) of 
     section 72(p)(2) of such Code for any repayment with respect 
     to such loan occurs during the period beginning on August 25, 
     2005, and ending on December 31, 2006, such due date shall be 
     delayed for 1 year,
       (2) any subsequent repayments with respect to any such loan 
     shall be appropriately adjusted to reflect the delay in the 
     due date under paragraph (1) and any interest accruing during 
     such delay, and
       (3) in determining the 5-year period and the term of a loan 
     under subparagraph (B) or (C) of section 72(p)(2) of such 
     Code, the period described in paragraph (1) shall be 
     disregarded.
       (c) Qualified Individual.--For purposes of this section, 
     the term ``qualified individual'' means an individual whose 
     principal place of abode on August 28, 2005, is located in 
     the Hurricane Katrina disaster area and who has sustained an 
     economic loss by reason of Hurricane Katrina.

     SEC. 104. PROVISIONS RELATING TO PLAN AMENDMENTS.

       (a) In General.--If this section applies to any amendment 
     to any plan or annuity contract, such plan or contract shall 
     be treated as being operated in accordance with the terms of 
     the plan during the period described in subsection (b)(2)(A).
       (b) Amendments to Which Section Applies.--
       (1) In general.--This section shall apply to any amendment 
     to any plan or annuity contract which is made--
       (A) pursuant to any amendment made by this title, or 
     pursuant to any regulation issued by the Secretary of the 
     Treasury or the Secretary of Labor under this title, and
       (B) on or before the last day of the first plan year 
     beginning on or after January 1, 2007, or such later date as 
     the Secretary of the Treasury may prescribe.
     In the case of a governmental plan (as defined in section 
     414(d) of the Internal Revenue Code of 1986), subparagraph 
     (B) shall be applied by substituting the date which is 2 
     years after the date otherwise applied under subparagraph 
     (B).
       (2) Conditions.--This section shall not apply to any 
     amendment unless--
       (A) during the period--
       (i) beginning on the date the legislative or regulatory 
     amendment described in paragraph (1)(A) takes effect (or in 
     the case of a plan or contract amendment not required by such 
     legislative or regulatory amendment, the effective date 
     specified by the plan), and
       (ii) ending on the date described in paragraph (1)(B) (or, 
     if earlier, the date the plan or contract amendment is 
     adopted),
     the plan or contract is operated as if such plan or contract 
     amendment were in effect; and
       (B) such plan or contract amendment applies retroactively 
     for such period.

                      TITLE II--EMPLOYMENT RELIEF

     SEC. 201. WORK OPPORTUNITY TAX CREDIT FOR HURRICANE KATRINA 
                   EMPLOYEES.

       (a) In General.--For purposes of section 51 of the Internal 
     Revenue Code of 1986, a Hurricane Katrina employee shall be 
     treated as a member of a targeted group.
       (b) Hurricane Katrina Employee.--For purposes of this 
     section, the term ``Hurricane Katrina employee'' means--
       (1) any individual who on August 28, 2005, had a principal 
     place of abode in the core disaster area and who is hired 
     during the 2-year period beginning on such date for a 
     position the principal place of employment of which is 
     located in the core disaster area, and
       (2) any individual who on such date had a principal place 
     of abode in the core disaster area, who is displaced from 
     such abode by reason of Hurricane Katrina, and who is hired 
     during the period beginning on such date and ending on 
     December 31, 2005.
       (c) Reasonable Identification Acceptable.--In lieu of the 
     certification requirement under subparagraph (A) of section 
     51(d)(12) of such Code, an individual may provide to the 
     employer reasonable evidence that the individual is a 
     Hurricane Katrina employee, and subparagraph (B) of such 
     section shall be applied as if such evidence were a 
     certification described in such subparagraph.
       (d) Special Rules for Determining Credit.--For purposes of 
     applying subpart F of part IV of subchapter A of chapter 1 of 
     such Code to wages paid or incurred to any Hurricane Katrina 
     employee--
       (1) section 51(c)(4) of such Code shall not apply, and
       (2) section 51(i)(2) of such Code shall not apply with 
     respect to the first hire of such employee as a Hurricane 
     Katrina employee, unless such employee was an employee of the 
     employer on August 28, 2005.

     SEC. 202. EMPLOYEE RETENTION CREDIT FOR EMPLOYERS AFFECTED BY 
                   HURRICANE KATRINA.

       (a) In General.--In the case of an eligible employer, there 
     shall be allowed as a credit against the tax imposed by 
     chapter 1 of the Internal Revenue Code of 1986 for the 
     taxable year an amount equal to 40 percent of the qualified 
     wages with respect to each eligible employee of such employer 
     for such taxable year. For purposes of the preceding 
     sentence, the amount of qualified wages which may be taken 
     into account with respect to any individual shall not exceed 
     $6,000.
       (b) Definitions.--For purposes of this section--
       (1) Eligible employer.--The term ``eligible employer'' 
     means any employer--
       (A) which conducted an active trade or business on August 
     28, 2005, in a core disaster area, and
       (B) with respect to whom the trade or business described in 
     subparagraph (A) is inoperable on any day after August 28, 
     2005, and before January 1, 2006, as a result of damage 
     sustained by reason of Hurricane Katrina.
       (2) Eligible employee.--The term ``eligible employee'' 
     means with respect to an eligible employer an employee whose 
     principal place of employment on August 28, 2005, with such 
     eligible employer was in a core disaster area.
       (3) Qualified wages.--The term ``qualified wages'' means 
     wages (as defined in section 51(c)(1) of such Code, but 
     without regard to section 3306(b)(2)(B) of such Code) paid or 
     incurred by an eligible employer with respect to an eligible 
     employee on any day after August 28, 2005, and before January 
     1, 2006, which occurs during the period--
       (A) beginning on the date on which the trade or business 
     described in paragraph (1) first became inoperable at the 
     principal place of employment of the employee immediately 
     before Hurricane Katrina, and
       (B) ending on the date on which such trade or business has 
     resumed significant operations at such principal place of 
     employment.
     Such term shall include wages paid without regard to whether 
     the employee performs no services, performs services at a 
     different place of employment than such principal place of 
     employment, or performs services at such principal place of 
     employment before significant operations have resumed.
       (c) Credit not Allowed for Large Businesses.--The term 
     ``eligible employer'' shall not include any trade or business 
     for any taxable year if such trade or business employed an 
     average of more than 200 employees on business days during 
     the taxable year.
       (d) Certain Rules to Apply.--For purposes of this section, 
     rules similar to the rules of sections 51(i)(1), 52, and 
     280C(a) of such Code shall apply.
       (e) Employee not Taken Into Account More Than Once.--An 
     employee shall not be treated as an eligible employee for 
     purposes of this section for any period with respect to any 
     employer if such employer is allowed a credit under section 
     51 of such Code with respect to such employee for such 
     period.
       (f) Credit to Be Part of General Business Credit.--The 
     credit allowed under this section shall be added to the 
     current year business credit under section 38(b) of such Code 
     and shall be treated as a credit allowed under subpart D of 
     part IV of subchapter A of chapter 1 of such Code.

[[Page 20830]]



                TITLE III--CHARITABLE GIVING INCENTIVES

     SEC. 301. TEMPORARY SUSPENSION OF LIMITATIONS ON CHARITABLE 
                   CONTRIBUTIONS.

       (a) In General.--Except as otherwise provided in subsection 
     (b), section 170(b) of the Internal Revenue Code of 1986 
     shall not apply to qualified contributions and such 
     contributions shall not be taken into account for purposes of 
     applying subsections (b) and (d) of section 170 of such Code 
     to other contributions.
       (b) Treatment of Excess Contributions.--For purposes of 
     section 170 of such Code--
       (1) Individuals.--In the case of an individual--
       (A) Limitation.--Any qualified contribution shall be 
     allowed only to the extent that the aggregate of such 
     contributions does not exceed the excess of the taxpayer's 
     contribution base (as defined in subparagraph (F) of section 
     170(b)(1) of such Code) over the amount of all other 
     charitable contributions allowed under such section 
     170(b)(1).
       (B) Carryover.--If the aggregate amount of qualified 
     contributions made in the contribution year (within the 
     meaning of section 170(d)(1) of such Code) exceeds the 
     limitation of subparagraph (A), such excess shall be added to 
     the excess described in the portion of subparagraph (A) of 
     such section which precedes clause (i) thereof for purposes 
     of applying such section.
       (2) Corporations.--In the case of a corporation--
       (A) Limitation.--Any qualified contribution shall be 
     allowed only to the extent that the aggregate of such 
     contributions does not exceed the excess of the taxpayer's 
     taxable income (as determined under paragraph (2) of section 
     170(b) of such Code) over the amount of all other charitable 
     contributions allowed under such paragraph.
       (B) Carryover.--Rules similar to the rules of paragraph 
     (1)(B) shall apply for purposes of this paragraph.
       (c) Exception to Overall Limitation on Itemized 
     Deductions.--So much of any deduction allowed under section 
     170 of such Code as does not exceed the qualified 
     contributions paid during the taxable year shall not be 
     treated as an itemized deduction for purposes of section 68 
     of such Code.
       (d) Qualified Contributions.--
       (1) In general.--For purposes of this section, the term 
     ``qualified contribution'' means any charitable contribution 
     (as defined in section 170(c) of such Code)--
       (A) paid during the period beginning on August 28, 2005, 
     and ending on December 31, 2005, in cash to an organization 
     described in section 170(b)(1)(A) of such Code (other than an 
     organization described in section 509(a)(3) of such Code),
       (B) in the case of a contribution paid by a corporation, 
     such contribution is for relief efforts related to Hurricane 
     Katrina, and
       (C) with respect to which the taxpayer has elected the 
     application of this section.
       (2) Exception.--Such term shall not include a contribution 
     if the contribution is for establishment of a new, or 
     maintenance in an existing, segregated fund or account with 
     respect to which the donor (or any person appointed or 
     designated by such donor) has, or reasonably expects to have, 
     advisory privileges with respect to distributions or 
     investments by reason of the donor's status as a donor.
       (3) Application of election to partnerships and s 
     corporations.--In the case of a partnership or S corporation, 
     the election under paragraph (1)(C) shall be made separately 
     by each partner or shareholder.

     SEC. 302. ADDITIONAL EXEMPTION FOR HOUSING HURRICANE KATRINA 
                   DISPLACED INDIVIDUALS.

       (a) In General.--In the case of taxable years of a natural 
     person beginning in 2005 or 2006, for purposes of the 
     Internal Revenue Code of 1986, taxable income shall be 
     reduced by $500 for each Hurricane Katrina displaced 
     individual of the taxpayer for the taxable year.
       (b) Limitations.--
       (1) Dollar limitation.--The reduction under subsection (a) 
     shall not exceed $2,000, reduced by the amount of the 
     reduction under this section for all prior taxable years.
       (2) Individuals taken into account only once.--An 
     individual shall not be taken into account under subsection 
     (a) if such individual was taken into account under such 
     subsection by the taxpayer for any prior taxable year.
       (3) Identifying information required.--An individual shall 
     not be taken into account under subsection (a) for a taxable 
     year unless the taxpayer identification number of such 
     individual is included on the return of the taxpayer for such 
     taxable year.
       (c) Hurricane Katrina Displaced Individual.--For purposes 
     of this section, the term ``Hurricane Katrina displaced 
     individual'' means, with respect to any taxpayer for any 
     taxable year, any natural person if--
       (1) such person's principal place of abode on August 28, 
     2005, was in the Hurricane Katrina disaster area,
       (2)(A) in the case of such an abode located in the core 
     disaster area, such person is displaced from such abode, or
       (B) in the case of such an abode located outside of the 
     core disaster area, such person is displaced from such abode, 
     and
       (i) such abode was damaged by Hurricane Katrina, or
       (ii) such person was evacuated from such abode by reason of 
     Hurricane Katrina, and
       (3) such person is provided housing free of charge by the 
     taxpayer in the principal residence of the taxpayer for a 
     period of 60 consecutive days which ends in such taxable 
     year.
     Such term shall not include the spouse or any dependent of 
     the taxpayer.
       (d) Compensation for Housing.--No deduction shall be 
     allowed under this section if the taxpayer receives any rent 
     or other amount (from any source) in connection with the 
     providing of such housing.

     SEC. 303. INCREASE IN STANDARD MILEAGE RATE FOR CHARITABLE 
                   USE OF VEHICLES.

       Notwithstanding section 170(i) of the Internal Revenue Code 
     of 1986, for purposes of computing the deduction under 
     section 170 of such Code for use of a vehicle described in 
     subsection (f)(12)(E)(i) of such section for provision of 
     relief related to Hurricane Katrina during the period 
     beginning on August 25, 2005, and ending on December 31, 
     2006, the standard mileage rate shall be 70 percent of the 
     standard mileage rate in effect under section 162(a) of such 
     Code at the time of such use. Any increase under this section 
     shall be rounded to the next highest cent.

     SEC. 304. MILEAGE REIMBURSEMENTS TO CHARITABLE VOLUNTEERS 
                   EXCLUDED FROM GROSS INCOME.

       (a) In General.--For purposes of the Internal Revenue Code 
     of 1986, gross income of an individual for taxable years 
     ending on or after August 25, 2005, does not include amounts 
     received, from an organization described in section 170(c) of 
     such Code, as reimbursement of operating expenses with 
     respect to use of a passenger automobile for the benefit of 
     such organization in connection with providing relief 
     relating to Hurricane Katrina during the period beginning on 
     August 25, 2005, and ending on December 31, 2006. The 
     preceding sentence shall apply only to the extent that the 
     expenses which are reimbursed would be deductible under 
     chapter 1 of such Code if section 274(d) of such Code were 
     applied--
       (1) by using the standard business mileage rate in effect 
     under section 162(a) at the time of such use, and
       (2) as if the individual were an employee of an 
     organization not described in section 170(c) of such Code.
       (b) Application to Volunteer Services Only.--Subsection (a) 
     shall not apply with respect to any expenses relating to the 
     performance of services for compensation.
       (c) No Double Benefit.--No deduction or credit shall be 
     allowed under any other provision of such Code with respect 
     to the expenses excludable from gross income under subsection 
     (a).

     SEC. 305. CHARITABLE DEDUCTION FOR CONTRIBUTIONS OF FOOD 
                   INVENTORY.

       (a) In General.--Paragraph (3) of section 170(e) of the 
     Internal Revenue Code of 1986 (relating to special rule for 
     certain contributions of inventory and other property) is 
     amended by redesignating subparagraph (C) as subparagraph (D) 
     and by inserting after subparagraph (B) the following new 
     subparagraph:
       ``(C) Special rule for contributions of food inventory.--
       ``(i) General rule.--In the case of a charitable 
     contribution of food from any trade or business of the 
     taxpayer, this paragraph shall be applied--

       ``(I) without regard to whether the contribution is made by 
     a C corporation, and
       ``(II) only to food that is apparently wholesome food.

       ``(ii) Limitation.--In the case of a taxpayer other than a 
     C corporation, the aggregate amount of such contributions for 
     any taxable year which may be taken into account under this 
     section shall not exceed 10 percent of the taxpayer's 
     aggregate net income for such taxable year from all trades or 
     businesses from which such contributions were made for such 
     year, computed without regard to this section.
       ``(iii) Apparently wholesome food.--For purposes of this 
     subparagraph, the term `apparently wholesome food' has the 
     meaning given to such term by section 22(b)(2) of the Bill 
     Emerson Good Samaritan Food Donation Act (42 U.S.C. 
     1791(b)(2)), as in effect on the date of the enactment of 
     this subparagraph.
       ``(iv) Termination.--This subparagraph shall not apply to 
     contributions made after December 31, 2005.''.
       (b) Effective Date.--The amendment made by this section 
     shall apply to contributions made on or after August 28, 
     2005, in taxable years ending after such date.

     SEC. 306. CHARITABLE DEDUCTION FOR CONTRIBUTIONS OF BOOK 
                   INVENTORIES TO PUBLIC SCHOOLS.

       (a) In General.--Paragraph (3) of section 170(e) of the 
     Internal Revenue Code of 1986 (relating to certain 
     contributions of ordinary income and capital gain property), 
     as amended by section 305, is amended by redesignating 
     subparagraph (D) as subparagraph (E) and by inserting after 
     subparagraph (C) the following new subparagraph:
       ``(D) Special rule for contributions of book inventory to 
     public schools.--

[[Page 20831]]

       ``(i) Contributions of book inventory.--In determining 
     whether a qualified book contribution is a qualified 
     contribution, subparagraph (A) shall be applied without 
     regard to whether the donee is an organization described in 
     the matter preceding clause (i) of subparagraph (A).
       ``(ii) Qualified book contribution.--For purposes of this 
     paragraph, the term `qualified book contribution' means a 
     charitable contribution of books to a public school which is 
     an educational organization described in subsection 
     (b)(1)(A)(ii) and which provides elementary education or 
     secondary education (kindergarten through grade 12).
       ``(iii) Certification by donee.--Subparagraph (A) shall not 
     apply to any contribution unless (in addition to the 
     certifications required by subparagraph (A) (as modified by 
     this subparagraph)), the donee certifies in writing that--

       ``(I) the books are suitable, in terms of currency, 
     content, and quantity, for use in the donee's educational 
     programs, and
       ``(II) the donee will use the books in its educational 
     programs.

       ``(iv) Termination.--This subparagraph shall not apply to 
     contributions made after December 31, 2005.''.
       (b) Effective Date.--The amendments made by this section 
     shall apply to contributions made on or after August 28, 
     2005, in taxable years ending after such date.

               TITLE IV--ADDITIONAL TAX RELIEF PROVISIONS

     SEC. 401. EXCLUSIONS OF CERTAIN CANCELLATIONS OF INDEBTEDNESS 
                   BY REASON OF HURRICANE KATRINA.

       (a) In General.--For purposes of the Internal Revenue Code 
     of 1986, gross income shall not include any amount which (but 
     for this section) would be includible in gross income by 
     reason of the discharge (in whole or in part) of indebtedness 
     of a natural person described in subsection (b) by an 
     applicable entity (as defined in section 6050P(c)(1) of such 
     Code).
       (b) Persons Described.--A natural person is described in 
     this subsection if the principal place of abode of such 
     person on August 25, 2005, was located--
       (1) in the core disaster area, or
       (2) in the Hurricane Katrina disaster area (but outside the 
     core disaster area) and such person suffered economic loss by 
     reason of Hurricane Katrina.
       (c) Exceptions.--
       (1) Business indebtedness.--Subsection (a) shall not apply 
     to any indebtedness incurred in connection with a trade or 
     business.
       (2) Real property outside core disaster area.--Subsection 
     (a) shall not apply to any discharge of indebtedness to the 
     extent that real property constituting security for such 
     indebtedness is located outside of the Hurricane Katrina 
     disaster area.
       (d) Denial of Double Benefit.--For purposes of the Internal 
     Revenue Code of 1986, the amount excluded from gross income 
     under subsection (a) shall be treated in the same manner as 
     an amount excluded under section 108(a) of such Code.
       (e) Effective Date.--This section shall apply to discharges 
     made on or after August 25, 2005, and before January 1, 2007.

     SEC. 402. SUSPENSION OF CERTAIN LIMITATIONS ON PERSONAL 
                   CASUALTY LOSSES.

       Paragraphs (1) and (2)(A) of section 165(h) of the Internal 
     Revenue Code of 1986 shall not apply to losses described in 
     section 165(c)(3) of such Code which arise in the Hurricane 
     Katrina disaster area on or after August 25, 2005, and which 
     are attributable to Hurricane Katrina. In the case of any 
     other losses, section 165(h)(2)(A) of such Code shall be 
     applied without regard to the losses referred to in the 
     preceding sentence.

     SEC. 403. REQUIRED EXERCISE OF AUTHORITY UNDER SECTION 7508A 
                   FOR TAX RELIEF RELATING TO HURRICANE KATRINA.

       (a) Authority Includes Suspension of Payment of Employment 
     and Excise Taxes.--Subparagraphs (A) and (B) of section 
     7508(a)(1) of the Internal Revenue Code of 1986 are amended 
     to read as follows:
       ``(A) Filing any return of income, estate, gift, 
     employment, or excise tax;
       ``(B) Payment of any income, estate, gift, employment, or 
     excise tax or any installment thereof or of any other 
     liability to the United States in respect thereof;''.
       (b) Application With Respect to Hurricane Katrina.--In the 
     case of any taxpayer determined by the Secretary of the 
     Treasury to be affected by the Presidentially declared 
     disaster relating to Hurricane Katrina, any relief provided 
     by the Secretary of the Treasury under section 7508A of the 
     Internal Revenue Code of 1986 shall be for a period ending 
     not earlier than February 28, 2006, and shall be treated as 
     applying to the filing of returns relating to, and the 
     payment of, employment and excise taxes.
       (c) Effective Date.--The amendment made by subsection (a) 
     shall apply for any period for performing an act which has 
     not expired before August 25, 2005.

     SEC. 404. SPECIAL RULES FOR MORTGAGE REVENUE BONDS.

       (a) In General.--In the case of financing provided with 
     respect to a qualified Hurricane Katrina recovery residence, 
     subsection (d) of section 143 of the Internal Revenue Code of 
     1986 shall be applied as if such residence were a targeted 
     area residence.
       (b) Qualified Hurricane Katrina Recovery Residence.--For 
     purposes of this section, the term ``qualified Hurricane 
     Katrina recovery residence'' means--
       (1) any residence in the core disaster area, and
       (2) any other residence if--
       (A) such other residence is located in the same State as 
     the principal residence referred to in subparagraph (B), and
       (B) the mortgagor with respect to such other residence 
     owned a principal residence on August 28, 2005, which--
       (i) was located in the Hurricane Katrina disaster area, and
       (ii) was rendered uninhabitable by reason of Hurricane 
     Katrina.
       (c) Special Rule for Home Improvement Loans.--In the case 
     of any loan with respect to a residence in the Hurricane 
     Katrina disaster area, section 143(k)(4) of such Code shall 
     be applied by substituting $150,000 for the dollar amount 
     contained therein to the extent such loan is for the repair 
     of damage by reason of Hurricane Katrina.
       (d) Application.--Subsection (a) shall not apply to 
     financing provided after December 31, 2007.

     SEC. 405. EXTENSION OF REPLACEMENT PERIOD FOR NONRECOGNITION 
                   OF GAIN FOR PROPERTY LOCATED IN HURRICANE 
                   KATRINA DISASTER AREA.

       Clause (i) of section 1033(a)(2)(B) of the Internal Revenue 
     Code of 1986 shall be applied by substituting ``5 years'' for 
     ``2 years'' with respect to property in the Hurricane Katrina 
     disaster area which is compulsorily or involuntarily 
     converted on or after August 25, 2005, by reason of Hurricane 
     Katrina, but only if substantially all of the use of the 
     replacement property is in such area.

     SEC. 406. SPECIAL RULE FOR DETERMINING EARNED INCOME.

       (a) In General.--In the case of a qualified individual, if 
     the earned income of the taxpayer for the taxable year which 
     includes August 25, 2005, is less than the earned income of 
     the taxpayer for the preceding taxable year, the credits 
     allowed under sections 24(d) and 32 of the Internal Revenue 
     Code of 1986 may, at the election of the taxpayer, be 
     determined by substituting--
       (1) such earned income for the preceding taxable year, for
       (2) such earned income for the taxable year which includes 
     August 25, 2005.
       (b) Qualified Individual.--For purposes of this section, 
     the term ``qualified individual'' means any individual whose 
     principal place of abode on August 25, 2005, was located--
       (1) in the core disaster area, or
       (2) in the Hurricane Katrina disaster area (but outside the 
     core disaster area) and such individual was displaced from 
     such principal place of abode by reason of Hurricane Katrina.
       (c) Earned Income.--For purposes of this section, the term 
     ``earned income'' has the meaning given such term under 
     section 32(c) of such Code.
       (d) Special Rules.--
       (1) Application to joint returns.--For purpose of 
     subsection (a), in the case of a joint return for a taxable 
     year which includes August 25, 2005--
       (A) such subsection shall apply if either spouse is a 
     qualified individual, and
       (B) the earned income of the taxpayer for the preceding 
     taxable year shall be the sum of the earned income of each 
     spouse for such preceding taxable year.
       (2) Uniform application of election.--Any election made 
     under subsection (a) shall apply with respect to both section 
     24(d) and section 32 of such Code.
       (3) Errors treated as mathematical error.--For purposes of 
     section 6213 of such Code, an incorrect use on a return of 
     earned income pursuant to subsection (a) shall be treated as 
     a mathematical or clerical error.
       (4) No effect on determination of gross income, etc.--
     Except as otherwise provided in this section, the Internal 
     Revenue Code of 1986 shall be applied without regard to any 
     substitution under subsection (a).

     SEC. 407. SECRETARIAL AUTHORITY TO MAKE ADJUSTMENTS REGARDING 
                   TAXPAYER AND DEPENDENCY STATUS.

       With respect to taxable years beginning in 2005 or 2006, 
     the Secretary of the Treasury or the Secretary's delegate may 
     make such adjustments in the application of the internal 
     revenue laws as may be necessary to ensure that taxpayers do 
     not lose any deduction or credit or experience a change of 
     filing status by reason of temporary relocations by reason of 
     Hurricane Katrina. Any adjustments made under the preceding 
     sentence shall ensure that an individual is not taken into 
     account by more than one taxpayer with respect to the same 
     tax benefit.

                     TITLE V--EMERGENCY REQUIREMENT

     SEC. 501. EMERGENCY REQUIREMENT.

       Any provision of this Act causing an effect on receipts, 
     budget authority, or outlays is designated as an emergency 
     requirement pursuant to section 402 of H. Con. Res. 95 (109th 
     Congress).

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
Louisiana (Mr. McCrery) and the gentleman from New York (Mr. Rangel) 
each will control 20 minutes.
  The Chair recognizes the gentleman from Louisiana (Mr. McCrery).

[[Page 20832]]




                             General Leave

  Mr. McCRERY. Mr. Speaker, I ask unanimous consent that all Members 
may have 5 legislative days in which to revise and extend their remarks 
and to include extraneous material on the subject matter of the 
resolution under consideration, H. Res. 454.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Louisiana?
  There was no objection.
  Mr. McCRERY. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, the bill before us today is a bicameral, bipartisan 
compromise on the bill that we passed through this House last week 
dealing with tax relief primarily for individuals who were affected by 
Hurricane Katrina. The Senate, as you know, Mr. Speaker, passed a 
slightly different bill, and in the time since the passage in the House 
and the Senate, we have gotten together with our colleagues from the 
other body and worked out those differences, and today we have on the 
floor a bill that, when it passes the House today, should immediately 
pass the Senate thereafter and be sent to the President for his 
signature.
  I am pleased to say that the level of cooperation across the aisle 
and across the Capitol with respect to taking care of the needs of 
individuals who were affected by Hurricane Katrina continues in a 
manner that does us all proud.
  So the bill today on the floor, Mr. Speaker, as I said, primarily 
provides for individual tax relief. There are several provisions which 
provide tax relief to businesses in the affected areas, but of course 
those businesses, we hope, will be employing and paying residents of 
the affected areas. So at least indirectly, even those provisions 
promote the welfare of those individuals who were affected by Hurricane 
Katrina.
  Just to enumerate some of the provisions in this bill that will help 
individuals over these troubled times for them, any loss of tax 
benefits that would occur under current law, due to the relocation of 
that individual or family, would not take place because this House will 
pass this bill. In other words, this bill will hold harmless those 
families and individuals who might have lost some tax benefit due to a 
temporary relocation that was necessary due to the storm. Any debt that 
is forgiven to these individuals, those individuals will not be taxed 
on that debt. The debt forgiveness will not be counted as income to 
those individuals, as it would be under current law.
  Also, anybody that provides housing assistance to dislocated persons 
will, under this bill, be given a tax deduction of $500 per person they 
are housing, up to a maximum of $2,000 tax deduction. And, of course, 
that is meant to help with the burden of bringing people into one's 
home and thereby encouraging people to house dislocated persons from 
that affected area.
  Also, under current law, there is a deduction for personal casualty 
losses, but there is a limit on that deduction. This bill would waive 
that limit and allow individuals to fully deduct their loss.
  This bill would allow affected individuals to withdraw from their 
IRAs and pensions. For those individuals, the 10 percent penalty or 10 
percent tax for early withdrawal of those funds, up to a maximum of 
$100,000, those affected people could withdraw from those vehicles and 
put that money into their home, helping them with repairs and so forth, 
and that would be a big help to those individuals. There are provisions 
that would allow those folks to repay their IRA over time and avoid any 
tax on those withdrawals as well.
  Several of these provisions, as I said, help businesses, help 
employers; and, of course, we are trying to encourage employers in 
these affected areas to bring workers back and to create jobs so that 
people can come back and have an income. One thing that we will extend 
to employers in this area is the work opportunity tax credit. The 
credit will give a 40 percent credit for the first $6,000 of wages paid 
to an employee in the first year, so up to $2,400 tax credit for hiring 
somebody in these affected areas.
  There is also an employee retention tax credit, which is very 
important. As you know, Mr. Speaker, many of the businesses in these 
affected areas are basically out of business now. Their businesses were 
destroyed, so they have no ongoing business at this time. Yet many of 
those employers have the wherewithal to continue paying their employees 
until their business can get back up and running. And while we 
certainly congratulate those employers, we know they cannot do that, 
many of them cannot do that for long. Because we want to encourage them 
to continue paying their employees even though their business is not up 
and going, we have an employee retention tax credit available to those 
employers who wish to continue paying their employees.
  With respect to replacing damaged property, under current law, if it 
is business property, the insurance proceeds are not taxable if they 
replace that business property within 2 years. And for individuals 
replacing individual property, they have 4 years to replace that 
property. This bill will make the time period 5 years for either 
businesses or individuals.
  Also, another help to businesses and employers in this bill is an 
extension of the deadline for paying excise and employment taxes. That 
is going to be a problem for some of those businesses, particularly 
small businesses who were destroyed by the storm.
  Also, on the business side, Mr. Speaker, we encourage cash donations 
by corporations by removing the limit on those corporate donations, as 
well as we provide the same charitable donation the deduction for 
charitable donation of food inventory to S corporations, partnerships, 
and sole proprietors that is now available under the law to C 
corporations.
  So, in sum, Mr. Speaker, this bill provides a number of tax benefits 
to both individuals and businesses to help them get over these very 
difficult times that they are experiencing because of their losses due 
to Hurricane Katrina, and also starts us on the way to rebuilding a 
business infrastructure, a jobs infrastructure, in these affected areas 
which will be so critical to the overall recovery of the area.
  Mr. Speaker, I reserve the balance of my time.
  Mr. RANGEL. Mr. Speaker, I yield myself such time as I may consume.
  First, let me thank the leadership on the other side of the aisle for 
the cooperation that they have given. I have worked very closely with 
the chairman, the gentleman from California (Mr. Thomas), and I am so 
pleased the gentleman from Louisiana (Mr. McCrery) and the gentleman 
from Louisiana (Mr. Jefferson), who come from the affected areas, have 
been able to work together to assist the Congress, and especially those 
of us on the committee, to see how fast we could get some type of 
assistance to the victims of this horrendous disaster.
  As the gentleman from Louisiana (Mr. McCrery) stated, this is a 
temporary provision that is not meant to indicate that the Congress has 
completed its work on this task. As a matter of fact, it is hardly even 
a beginning, but that is what we thought we could do.
  The good that has come out of this is a sense of bipartisanship, that 
Katrina was not a Republican or a Democratic disaster, it was one that 
struck America. And I think the President of the United States has 
definitely set the tone as to what most all Americans, and certainly 
people from all over the world realize, that this is not just building 
or rebuilding a city, it is not just restoring a culture, but it 
certainly is making the people there whole. So as we pass this bill on 
the consent calendar, I hope that the tone that has been set on the 
other side of the aisle can continue to be a bipartisan and bicameral 
effort in order to do the best we can in terms of restoring the dignity 
and the culture of this great city.
  To do this, some of us are working very closely with the people that 
come from this area, hoping that we can get an authority on the 
empowerment zone concept that goes far beyond the limitations that we 
have on the tax-writing committee. We hope that we can get the local 
officials, the State officials, as well as the business people, to come 
up with a comprehensive plan that would allow all of us, no matter what

[[Page 20833]]

committees that we sit on, to be a part of this great American recovery 
effort.

                              {time}  1245

  We also have to make certain that the people that are providing the 
assistance down there are held accountable and that every effort is 
made to make certain that, one, the people who were forced to leave the 
area have an opportunity to return; and to some extent our tax policy 
will reflect what we can do to provide incentives for them to come back 
home. It is also important that we take into consideration the 
environmental conditions that exist there to make certain that it is 
not contaminated when the people come back.
  We would also like to see an independent commission that goes far 
beyond what has been suggested by the Speaker to make certain that as 
we move forward that we do not make the same mistakes that were made in 
the past, and where there have been mistakes, we do not give medals of 
honor to those people who made them, but rather work to correct them 
and make certain we have competent bipartisan workers doing the 
Nation's business to rebuild the area that has been affected.
  Some Members on this side will share their experiences with 9/11, 
some of the things that did and did not happen; and I would hope that 
we would be able to share those views today and as we move forward to 
make certain that when we do have a plan, there are jobs there and we 
deal with housing, schools, and deal with all of these things with the 
same vigor as the President had indicated that we would do.
  Again, I would like to thank the gentleman from California (Chairman 
Thomas), the gentleman from Louisiana (Mr. McCrery), and the members of 
the Committee on Ways and Means for the speed with which we reacted to 
this. I hope it has set a tone, if not for the entire Congress as we 
relate to other things, at least to begin with Hurricane Katrina and 
see what we can do to set an example for the other committees in 
working together.
  Mr. Speaker, I reserve the balance of my time.
  Mr. McCRERY. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I rise just to thank the gentleman from New York (Mr. 
Rangel), the distinguished ranking member of the Committee on Ways and 
Means, for his work in putting together not only this bill but also in 
gathering ideas from his experiences with New York following 9/11 and 
also ideas that he has gathered from Members on his side of the aisle 
with how we best deal with the tragedy that has occurred and the 
rebuilding efforts that necessarily have to follow, not only in terms 
of the jurisdiction of our committee, but other areas that this 
Congress must address to adequately ensure the recovery of the 
devastated areas along the gulf coast. I thank the gentleman for his 
help.
  Mr. Speaker, I reserve the balance of my time.
  Mr. RANGEL. Mr. Speaker, I yield 2 minutes to the gentlewoman from 
New York (Mrs. Maloney), who has done a great deal of work on 9/11; and 
she would like to share some of her views with us today.
  Mrs. MALONEY. Mr. Speaker, I thank the gentleman from New York (Mr. 
Rangel) for his leadership. This country is united and determined to 
help the victims of Hurricane Katrina. By passing this important bill, 
we can quickly move refunds into the hands of families and businesses 
that have worked hard and paid their taxes.
  I do want to provide and share with my colleagues a report that the 
New York delegation, under the leadership of the gentleman from New 
York (Mr. Rangel) and others, developed for our gulf coast colleagues 
that outlines the experiences that we had, the challenges that we had 
in the recovery process in our efforts to help New Yorkers.
  I thank this body for their swift and committed help in helping New 
Yorkers. But despite the efforts of our entire delegation to get a 
report about what exactly happened in the seven tax benefit programs 
that came into New York, we asked for a GAO report, again under the 
leadership of the gentleman from New York (Mr. Rangel) and others, and 
they have told us that they do not track this information and do not 
have any information on whether the tax benefits were used, who they 
went to, or if anyone even benefited from them.
  I share that experience with my colleagues so they might want to add 
to the legislation, if it is not already in it, that there be a mandate 
that the impact of what we are trying to do to help people in fact is 
tracked when we are spending, or may spend, billions of dollars. The 
taxpayers, the victims, and this body deserve an accurate tracking of 
what exactly happened and if our intentions to help people really was 
realized in dollars in their pockets and dollars in economic 
development. I want to share with my colleagues from the gulf region 
this report.
  Our recovery in New York is still ongoing 4 years afterwards. I hope 
we are not here 4 years from now waving a similar report from 
Louisiana, Mississippi and Alabama trying to find out what happened 
with the efforts that I truly support today to help families and 
victims of Hurricane Katrina, and I strongly support this legislation.
  Mr. Speaker, anyone interested in viewing the reports mentioned in my 
speech please visit my website at www.house.gov/maloney.
  Mr. RANGEL. Mr. Speaker, I yield 2 minutes to the gentleman from Ohio 
(Mr. Kucinich).
  Mr. KUCINICH. Mr. Speaker, I will vote for this bill; but I have to 
hand it to this administration, they want to lower your taxes so 
earnestly that they will even lower your wages to do it.
  Through an executive order, the President lowered the wages workers 
will be paid to rebuild the hurricane-affected region. He suspended the 
Davis-Bacon Act, a 74-year-old law which requires that companies 
receiving Federal contracts pay the average wage to employees hired to 
perform those Federal contracts. With smaller incomes, workers will pay 
less.
  But corporate income, unlike worker incomes, will rise. The corporate 
contractors will be able to keep more of the contract for themselves 
through a combination of setting lower wages for workers and receiving 
tax exemptions under the provisions of H.R. 3768. Suspension of the 
Davis-Bacon Act will give contractors unprecedented power to set wages. 
That is because the hurricane destroyed the labor market in the region. 
Nearly everyone is out of work; nearly everyone needs a job. After 
losing everything, how many people will be able to hold out for higher 
wages? Not many.
  Thus, labor market forces will not determine wages. Instead, 
hurricane victims and workers who may be brought into the region are at 
the mercy of Halliburton and Fluor corporations, just to name a couple 
contractors who have won or will win construction contracts in 
hurricane reconstruction and which will dictate wage levels.
  The bottom line is this: hurricane tax relief means one thing if you 
are a hurricane victim and another if you a corporate contractor 
receiving Federal funds to rebuild the hurricane-affected region. Tax 
relief for hurricane victims will primarily take the form of paying 
less taxes on smaller wages. But tax relief means something very 
different to the corporate contractors. They will be paying less taxes 
on increased income.
  Mr. RANGEL. Mr. Speaker, I yield 2\1/2\ minutes to the gentlewoman 
from Ohio (Mrs. Jones), an outstanding member of the Committee on Ways 
and Means.
  Mrs. JONES of Ohio. Mr. Speaker, I would like to compliment both the 
gentleman from New York (Mr. Rangel) and the gentleman from Louisiana 
(Mr. McCrery) on the work they have done on this legislation.
  I introduced a piece of legislation. This bill's number is H.R. 3768, 
mine is H.R. 3769. I hope as we go through the process you would take a 
look at the legislation that I have. The legislation I have has two of 
the same provisions, the temporary housing tax credit as well as the 
work opportunity tax credit for Hurricane Katrina victims.
  But I would ask Members to consider expanding the low-income tax 
credit to assist Katrina victims in obtaining affordable housing. This 
legislation

[[Page 20834]]

would make the following changes to low-income housing tax credit. It 
will double the housing tax credit authority for Louisiana, 
Mississippi, and Alabama for 2006 and 2007 to $3.70 times State 
population. The current cap is $1.85.
  It would extend difficult development area designation to Federal 
disaster areas in Louisiana, Mississippi, Alabama, and Florida through 
2007. The difficult development areas are currently those areas with 
high construction land and utility costs because of their location. In 
DDAs, the tax credit is based on 130 percent of the project's total 
cost instead of the normal 100 percent, providing an incentive to 
developers to invest in these most-distressed areas.
  This legislation will make affordable housing projects in Federal 
disaster areas in Louisiana, Mississippi, Alabama, and Florida eligible 
for the DDA designation and the basis boost, increasing investment and 
economic development in the region.
  It would also waive the national pool ``full subscription'' 
requirement for Louisiana, Mississippi, Alabama, and Florida through 
2007. Currently, the low-income housing tax credit not used by States 
is added to a national pool. The tax credit in that national pool is 
then distributed to those States that apply for the excess credits. 
However, to be eligible for those credits, a State must have used all 
of its previously allocated tax credits, or full subscription.
  This legislation waives the requirement for Louisiana, Alabama, 
Mississippi, and Florida. I would hope that you would take a look at 
this piece of legislation because I think it will also help Katrina 
victims.
  Last, I would ask you to consider giving them a home buyer tax credit 
that would encourage people from these States to go back to the States 
where they lived and they would get a $5,000 tax credit to rebuild a 
new home in those communities. I support this legislation. I would 
encourage you to consider the two areas that I mentioned.
  Mr. McCRERY. Mr. Speaker, I yield myself such time as I may consume.
  I want to congratulate the gentlewoman from Ohio, a distinguished 
member of the Committee on Ways and Means for coming up with some good 
ideas to assist in getting people back home and into housing. Her ideas 
are on a list that we are examining. I am very attracted to the 
substance of her ideas on this matter.
  I cannot guarantee that it is going to be in future legislation; but 
it is something that I am looking at very closely, as are others on the 
committee, including the gentleman from New York (Mr. Rangel), I am 
sure. I think we will be able to get together on some of the 
gentlewoman's comments. I thank the gentlewoman for her assistance in 
helping us put together even more legislation following today's bill to 
help those folks get back home.
  Mr. RANGEL. Mr. Speaker, I yield 2\1/2\ minutes to the gentleman from 
Illinois (Mr. Emanuel).
  Mr. EMANUEL. Mr. Speaker, I want to commend the gentleman from 
California (Chairman Thomas); the ranking member, the gentleman from 
New York (Mr. Rangel); and the gentleman from Louisiana (Mr. McCrery) 
for working on a bipartisan basis to bring this legislation to the 
floor. It will go a long ways towards helping the 1.3 million families 
devastated by Hurricane Katrina.
  I am especially pleased that this bill prevents the loss of tax 
benefits, like the earned income tax credit and the child credit, by 
reason of job loss or relocation due to Hurricane Katrina. I believe, 
as I have talked on the floor, that we can do more in this area.
  I hope in the future tax bills that we look at, we will consider 
legislation introduced by the gentleman from Georgia (Mr. Lewis), the 
gentleman from Mississippi (Mr. Taylor), and the gentleman from 
Louisiana (Mr. Melacon), and I to immediately fast track the earned 
income tax credit and the child tax credit refunds earned by working 
families so they receive them now rather than later.
  Many constituents of the gentleman from Mississippi (Mr. Taylor) and 
the gentleman from Louisiana (Mr. Melacon) have lost their belongings 
and their homes. Others have been left destitute with nothing more than 
the clothes on their backs. The Federal Government can respond as they 
have in past instances, advancing the refunds that Hurricane Katrina 
victims have earned. By taking these steps, we can fast track the 
refunds to families that have worked, paid taxes and earned them, all 
the while stimulating local economies. It is a win-win for those 
families and communities in America.
  I would like to draw attention to the Congressional Research Service 
that on Monday issued a report entitled ``Tax Policy Options After 
Hurricane Katrina.'' The study says that measures directed at the 
earned income tax credit and refundable child credits are the best ways 
to stimulate the local economy.
  I understand that the gentleman from California (Chairman Thomas) and 
the gentleman from Louisiana (Mr. McCrery) plan to introduce a third 
Hurricane Katrina tax bill in the coming weeks. I hope that they look 
at this report just issued on Monday by the Congressional Research 
Service that this would be the best way to help families and local 
communities through fast-tracking the earned income tax credits and the 
refundable child credit.
  Mr. RANGEL. Mr. Speaker, I yield 3 minutes to the gentlewoman from 
Texas (Ms. Jackson-Lee).

                              {time}  1300

  Ms. JACKSON-LEE of Texas. Mr. Speaker, I thank the esteemed ranking 
member for yielding me this time, and I thank the sponsor of this 
legislation and the bipartisan effort that has been offered here today.
  Mr. Speaker, as the Members well know, Hurricane Rita is fast 
approaching the gulf coast again. My own community of Galveston, 
Houston, and other surrounding areas that many of us represent is about 
to face the unknown, and it is important for the face of Congress today 
to be bipartisan.
  I want to congratulate the gentleman from New York (Mr. Rangel), the 
gentleman from Louisiana (Mr. McCrery), and all of the supporters, the 
gentleman from Louisiana (Mr. Jefferson), all who have lived this in a 
very unique and special way.
  But as we move toward this legislation, might I reinforce some 
concepts that are so very important, particularly if the New Orleans 
region is hit again and the tragedy of the levees again spills water 
into that region, we want to go forward in the reconstruction in a 
bipartisan way. We want Members and local leaders to be consulted. We 
also want regional development authorities to be developed. And, 
particularly, as I was asked today, we want an inspector general or a 
recovery czar to make sure that, as we give tax relief, that we also 
give dollars for reconstruction. These dollars will be used effectively 
and invested not only in the large corporations, the standard bearers 
of Rebuild America that have gone on to Iraq and other places, but let 
us put those dollars that will help rebuild small businesses in the 
hands of small businesses, minority-owned businesses and women-owned 
businesses. Let us make sure that the relief that has been given 
impacts individuals in their properties that still exist in New 
Orleans, for example, although under water. The physical structure of 
the house may be leveled, but they will need to have the tax benefits 
so that they can make sure that they are able to rebuild.
  This legislation, for example, exempts income from forgiveness of 
debt from tax. It prevents loss of tax benefits such as the earned 
income tax credit, waives the 10 percent penalty on early distributions 
from retirement plans, provides the work opportunity tax credit, and 
many others. It also deals with the charitable incentives that will 
allow people to give.
  But I think the main point is we are still facing the forward road. 
It is time to work together for the rebuilding of the region and to 
prepare us for whatever the results are of Hurricane Rita.
  May God bless those in Houston and the surrounding areas and those 
who will be facing this horrible storm. May they know that we are 
focused on their work and on their future. May God

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bless them, and our prayers are with them.
  Mr. RANGEL. Mr. Speaker, I yield back the balance of my time.
  Mr. McCRERY. Mr. Speaker, I yield back the balance of my time.
  The SPEAKER pro tempore (Mr. Shimkus). The question is on the motion 
offered by the gentleman from Louisiana (Mr. McCrery) that the House 
suspend the rules and agree to the resolution, H. Res. 454.
  The question was taken.
  The SPEAKER pro tempore. In the opinion of the Chair, two-thirds of 
those present have voted in the affirmative.
  Mr. RANGEL. Mr. Speaker, on that I demand the yeas and nays.
  The yeas and nays were ordered.
  The SPEAKER pro tempore. Pursuant to clause 8 of rule XX and the 
Chair's prior announcement, further proceedings on this motion will be 
postponed.

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