[Congressional Record (Bound Edition), Volume 154 (2008), Part 15]
[House]
[Pages 21034-21040]
[From the U.S. Government Publishing Office, www.gpo.gov]




               ALTERNATIVE MINIMUM TAX RELIEF ACT OF 2008

  Mr. NEAL of Massachusetts. Madam Speaker, I move to suspend the rules 
and pass the bill (H.R. 7005) to amend the Internal Revenue Code of 
1986 to provide alternative minimum tax relief for individuals for 
2008.
  The Clerk read the title of the bill.
  The text of the bill is as follows:

                               H.R. 7005

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

     SECTION 1. SHORT TITLE, ETC.

       (a) In General.--This Act may be cited as the ``Alternative 
     Minimum Tax Relief Act of 2008''.
       (b) Reference.--Except as otherwise expressly provided, 
     whenever in this Act an amendment or repeal is expressed in 
     terms of an amendment to, or repeal of, a section or other 
     provision, the reference shall be considered to be made to a 
     section or other provision of the Internal Revenue Code of 
     1986.

     SEC. 2. EXTENSION OF ALTERNATIVE MINIMUM TAX RELIEF FOR 
                   NONREFUNDABLE PERSONAL CREDITS.

       (a) In General.--Paragraph (2) of section 26(a) is 
     amended--
       (1) by striking ``or 2007'' and inserting ``2007, or 
     2008'', and
       (2) by striking ``2007'' in the heading thereof and 
     inserting ``2008''.
       (b)  Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2007.

     SEC. 3. EXTENSION OF INCREASED ALTERNATIVE MINIMUM TAX 
                   EXEMPTION AMOUNT.

       (a) In General.--Paragraph (1) of section 55(d) is 
     amended--
       (1) by striking ``($66,250 in the case of taxable years 
     beginning in 2007)'' in subparagraph (A) and inserting 
     ``($69,950 in the case of taxable years beginning in 2008)'', 
     and
       (2) by striking ``($44,350 in the case of taxable years 
     beginning in 2007)'' in subparagraph (B) and inserting 
     ``($46,200 in the case of taxable years beginning in 2008)''.
       (b) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2007.

     SEC. 4. INCREASE OF AMT REFUNDABLE CREDIT AMOUNT FOR 
                   INDIVIDUALS WITH LONG-TERM UNUSED CREDITS FOR 
                   PRIOR YEAR MINIMUM TAX LIABILITY, ETC.

       (a) In General.--Paragraph (2) of section 53(e) is amended 
     to read as follows:
       ``(2) AMT refundable credit amount.--For purposes of 
     paragraph (1), the term `AMT refundable credit amount' means, 
     with respect to any taxable year, the amount (not in excess 
     of the long-term unused minimum tax credit for such taxable 
     year) equal to the greater of--
       ``(A) 50 percent of the long-term unused minimum tax credit 
     for such taxable year, or
       ``(B) the amount (if any) of the AMT refundable credit 
     amount for the taxpayer's preceding taxable year (determined 
     without regard to subsection (f)(2)).''.
       (b) Treatment of Certain Underpayments, Interest, and 
     Penalties Attributable to the Treatment of Incentive Stock 
     Options.--Section 53 is amended by adding at the end the 
     following new subsection:
       ``(f) Treatment of Certain Underpayments, Interest, and 
     Penalties Attributable to the Treatment of Incentive Stock 
     Options.--
       ``(1) Abatement.--Any underpayment of tax outstanding on 
     the date of the enactment of this subsection which is 
     attributable to the application of section 56(b)(3) for any 
     taxable year ending before January 1, 2008 (and any interest 
     or penalty with respect to such underpayment which is 
     outstanding on such date of enactment), is hereby abated. The 
     amount determined under subsection (b)(1) shall not include 
     any tax abated under the preceding sentence.
       ``(2) Increase in credit for certain interest and penalties 
     already paid.--The AMT refundable credit amount, and the 
     minimum tax credit determined under subsection (b), for the 
     taxpayer's first 2 taxable years beginning after December 31, 
     2007, shall each be increased by 50 percent of the aggregate 
     amount of the interest and penalties which were paid by the 
     taxpayer before the date of the enactment of this subsection 
     and which would (but for such payment) have been abated under 
     paragraph (1).''.
       (c) Effective Date.--
       (1) In general.--Except as provided in paragraph (2), the 
     amendment made by this section shall apply to taxable years 
     beginning after December 31, 2007.
       (2) Abatement.--Section 53(f)(1) of the Internal Revenue 
     Code of 1986, as added by subsection (b), shall take effect 
     on the date of the enactment of this Act.

  The SPEAKER pro tempore (Ms. DeGette). Pursuant to the rule, the 
gentleman from Massachusetts (Mr. Neal) and the gentleman from New

[[Page 21035]]

York (Mr. Reynolds) each will control 20 minutes.
  The Chair recognizes the gentleman from Massachusetts.


                             General Leave

  Mr. NEAL of Massachusetts. Madam Speaker, I ask unanimous consent 
that all Members have 5 legislative days to revise and extend their 
remarks and to insert extraneous material in the Record.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Massachusetts?
  There was no objection.

                              {time}  1600

  Mr. NEAL of Massachusetts. Madam Speaker, I yield myself such time as 
I may consume.
  The provisions of H.R. 7005, the Alternative Minimum Tax Relief Act 
of 2008, as scheduled for floor action today, provides alternative 
minimum tax relief.
  Ways and Means Committee Chairman Rangel and the ranking member, Mr. 
McCrery, have asked the nonpartisan Joint Committee on Taxation to make 
available to the public a technical explanation of the bill. The 
technical explanation expresses the committee's understanding and 
legislative intent behind this important legislation. It is available 
on the joint committee's Web site at www.jct.gov.
  I want to thank Mr. Rangel for his diligent work on a flurry of last 
minute bills here. There is some urgency to the bill we are debating 
today. I also want to acknowledge, to his everlasting relief, that this 
is the last time Mr. Reynolds will have a chance to speak on the issue 
of the alternative minimum tax.
  If we do not pass this legislation today, 25 million families will 
pay higher taxes this year. That is right, this tax relief is for this 
year. I might add to this conversation that one of the nice things 
about this bill, despite how tumultuous these days have been for 
Members of Congress and for the American citizens watching what has 
happened to their 401(k) plans, this legislation actually provides 
middle class tax relief. The current patch expired at the end of the 
last year, and it is urgent that we pass this relief now.
  Of those 25 million families facing higher taxes, 84 percent of them 
earn less than $200,000. In my constituency alone, families paying 
alternative minimum tax will rise from 8,000 to 69,000 if we do not 
enact this patch, and only 500 of those unlucky 69,000 people earn more 
than half a million dollars annually. Clearly, the alternative minimum 
tax is not the millionaire's tax it was designed to be.
  For the last decade I have sought to repeal or radically reform the 
AMT because of the unfairness it wreaks on our progressive tax system. 
The AMT patch we are considering today costs more than $60 billion, and 
a reminder to all, next year, $70 billion. But unlike the version we 
considered earlier this year, we should acknowledge, this one is not 
offset. Despite partisan efforts in outreach to the other side on the 
issue of fiscal responsibility, we have, unfortunately, been unable to 
find common ground. We have run up against the reality of the closing 
days of Congress, and this legislation simply must be accomplished.
  Again, I want to congratulate Chairman Rangel on crafting a 
responsible bill and one which picks up on the good work of our 
colleagues, Mr. Van Hollen of Maryland and Mr. Johnson of Texas, on the 
issue of incentive stock options. For a decade, Mr. Johnson and I have 
tried to find relief for those taxpayers unfortunately caught with a 
massive AMT bill on phantom stock gains, and today's bill provides 
relief by abating penalties and interest on underpayments and by 
allowing quicker recovery of AMT credits.
  The bill we are considering today is a true hold-harmless patch 
because it not only extends but increases the AMT exemption level. It 
also extends protection from AMT for taxpayers with personal, 
nonrefundable credits, such as education credits and the dependent care 
credits. Otherwise, taxpayers might lose these essential credits to 
AMT.
  I urge adoption of this bill, Madam Speaker.
  Madam Speaker, I reserve the balance of my time.
  Mr. REYNOLDS. Madam Speaker, I yield myself such time as I may 
consume.
  Madam Speaker, I thank the chairman of the Select Revenue Measures 
Subcommittee of Ways and Means. Mr. Neal has been a true leader in the 
goal of trying to get permanent repeal of AMT, and while it is 
something that we share, we have not yet reached a solution.
  So I find myself rising today on behalf of middle class families all 
across America in strong support of this bill. As my colleagues well 
know, I have fought year in and year out for the AMT patch, and I am 
disappointed that Congress has not addressed a permanent solution. 
Absent a long-term proposal, I think we have no choice but to once 
again pass a temporary 1-year fix.
  Without patch legislation, more than 25 million families will be hit 
by this stealth tax. This includes more than 21 million taxpayers who 
didn't owe AMT in 2007. If Congress does not act, each American 
affected by AMT will, on average, face a tax increase of almost $2,500. 
We delayed action for so long last year that 13.5 million taxpayers 
were forced to delay filing their returns. Because we did not act 
earlier this year, millions more have been hanging in the balance.
  We have an opportunity to end the uncertainty of the middle class 
that they have been facing all year long. Each Member of this House has 
the opportunity to live up to their responsibility and truly help the 
middle class trapped in this stealth tax that was so unintended for the 
middle class.
  Yesterday the other body passed their bipartisan tax extenders 
package. The Senate majority leader was as candid as I have ever heard 
him when he bluntly told the House, ``Don't send us back something 
else. We can't get it passed.'' He went on to make it clear that if we 
do, the important extenders we have all been working so hard to 
accomplish will die and we will have ``snatched defeat from the jaws of 
victory.''
  In these difficult and uncertain economic times, we have an 
obligation to pass a bill that can be signed into law as quickly as 
possible to protect middle class Americans. While I believe our time 
today would be better spent moving a comprehensive tax extenders 
package, I am nonetheless pleased to see the majority put up a clean 
AMT bill before this House.
  I thank Chairman Rangel for his leadership on this legislation and 
Chairman Neal for his additional leadership as the Chair of the 
Subcommittee of Select Revenues.
  Madam Speaker, I reserve the balance of my time.
  Mr. NEAL of Massachusetts. Madam Speaker, I yield 2 minutes to the 
gentleman from Wisconsin (Mr. Kind).
  Mr. KIND. Madam Speaker, I thank the Chair of the subcommittee, and I 
too want to commend the Chair and ranking member of the committee for 
bringing this important AMT fix before the Congress today.
  Madam Speaker, I couldn't agree with my friend from New York more. 
These 1-year fixes of the alternative minimum tax are just not 
sustainable. It is not fair, because it doesn't build in predictability 
and certainty with the Tax Code. That is why I commend the gentleman 
from Massachusetts, given the groundwork he has so far laid in trying 
to find a permanent fix to the AMT dilemma we face in the Nation.
  Obviously, none of us in this Chamber or in this Congress would want 
to see millions of working families wake up on Tax Day realizing that 
because of bracket creep and the inability to index the AMT, that they 
are going to be facing a higher tax liability. Given the doldrums that 
the economy is facing right now, working class families especially 
can't afford to take an additional tax hit.
  But at some point in this Chamber and in this Congress and in this 
country, we have to start paying for things again. That is why one of 
the first things that we did as a new majority last year was 
reinstitute pay-as-you-go budgeting rules. Not because we thought it 
was going to be easy or simple or fun, but because we thought it

[[Page 21036]]

would be necessary to restore some fiscal discipline.
  While many of us have been working on the extension of tax provisions 
and making sure AMT doesn't capture more working families, we are 
trying to do it in a fiscally responsible manner by finding appropriate 
offsets to pay for it so we are not adding to the debt burden of future 
generations. That is the great task left before us.
  It is unfinished today, because obviously this AMT fix is not paid 
for, but it is something we have to take up in the next session of 
Congress, finding a permanent fix, and getting into the Tax Code with 
major reform, which is coming up next year already.
  Again, I appreciate the leadership that the gentleman from 
Massachusetts and others on the subcommittee have shown so far on this 
issue. I encourage my colleagues to support it.
  Mr. REYNOLDS. Madam Speaker, I yield 2 minutes to the distinguished 
gentleman from Texas (Mr. Brady), a member of the Ways and Means 
Committee.
  Mr. BRADY of Texas. Mr. Reynolds, thank you for your leadership, as 
well as Mr. Neal, on trying to not only keep more middle class families 
from being hit by the alternative minimum tax, but hopefully to find a 
long-term solution where there is no AMT looming over our families.
  The truth of the matter is, this was a tax created many years ago to 
hit the very, very wealthy in America, at the time just 155 or so, who 
did not pay taxes. Unfortunately, it wasn't indexed. It is now each 
year more and more attacking middle class families who frankly are 
still struggling to make ends meet. Then after they do their regular 
taxes, they find they have a second tax that comes after them and 
catches them even if they didn't owe on the first.
  So this Congress has taken seriously the need to not allow the AMT to 
hit more families. This action today makes sure that 24 million 
American families are not hit by this second tax at an average tax rate 
increase of about $2,400. For a lot of families in America, that is 
real money in a big way.
  It is time to repeal the AMT permanently. It is time for both parties 
to work together to do that. I look forward to the day when we can bury 
it and help protect our families.
  All year long, Republicans have urged Democrats to enact a clean AMT 
patch without tax increases and to do so in a more timely manner than 
occurred in 2007.
  Last year, House Democrats' insistence on linking the 2007 patch to 
unrelated tax hikes resulted in the patch being enacted later in the 
year than ever before, causing headaches and uncertainty for taxpayers 
and the IRS alike.
  On May 21, 2008, and again on June 25, 2008, Republicans supported 
Motions to Recommit that would have provided a clean AMT patch--without 
tax hikes. Unfortunately, Democrats opposed those common-sense 
proposals, putting us on the same regrettable path as last year--toward 
another historically late AMT patch.
  Today, just days before Congress's scheduled adjournment, the 
Majority has finally acknowledged the obvious: an AMT patch that is 
offset with tax increases stands no chance of being enacted.
  Unfortunately, instead of considering the Senate's comprehensive, 
bipartisan tax package that addresses not just the AMT patch, but other 
critically important tax priorities as well, the Majority is pursuing a 
piecemeal approach that seems unlikely to advance in the Senate.
  During debate on the comprehensive Senate package on September 23rd, 
Senate Majority Leader Harry Reid made precisely this point, stating: 
``I say to my friends on the other side of the Capitol, the House: 
`Don't send us back something else. We can't get it passed.' If they 
try to mess with our package, it will come back here, it will die, and 
we will . . . have snatched defeat from the jaws of victory.''
  While it is a welcome development that Democrats have abandoned their 
efforts to patch the AMT by raising taxes, the Majority should be 
working with the Senate to ensure enactment of all our critical tax 
priorities.
  An estimated 26 million taxpayers will owe higher taxes for 2008 
because of the AMT, according to the latest Treasury Department 
estimates. This is sharply up from about 4 million people last year in 
2007 that would have been affected if Democrats had not agreed to patch 
the AMT without tax increases.
  The AMT was created in the late 1960s to ensure that fewer than 200 
high-income taxpayers couldn't avoid paying any income tax at all. The 
AMT was intended as a fail safe mechanism, NOT as a tax Increase. 
However, the tax is now hitting the middle class and hitting them hard.
  From 1992-2002, the number of filers paying AMT increased tenfold to 
1.3 million people. By 2010, nearly 1 in 3 tax filers will be subject 
to the AMT.
  Although the AMT is highly progressive, the distribution of AMT 
liability will shift toward tax units with lower incomes. In 2006, 
taxpayers with $500,000 or more in income will pay 47 percent of the 
tax. By 2010, they will pay only 16 percent.
  Over 80 percent of households with incomes between $100,000-200,000 
and almost half of those with incomes between $75,000-100,000 will pay 
the AMT by 2010 (compared to 4.8 percent and 0.7 percent in 2006).
  Simply put, Congress should act decisively to prevent $61.5+ billion 
of tax increases on the American people. Not patching the AMT means an 
average tax hike of $2,400 for over 25 million taxpayers.
  Delaying action on patching the AMT hurts taxpayers. According to 
Treasury Secretary Paulson, the failure of Congress to enact an AMT 
patch earlier in the year results in delayed tax refunds totaling 
approximately $75 billion for as many as 50 million taxpayers. Tax 
compliance is onerous enough for Americans without Congress getting 
into the mix to make it even harder!
  Mr. NEAL of Massachusetts. Madam Speaker, I yield 2 minutes to the 
gentleman from New Jersey (Mr. Pascrell), a fine member of the Ways and 
Means Committee.
  Mr. PASCRELL. Madam Speaker, the legislation we have before us today 
arises at a time when our American workers are suffering under a 
failing housing market and struggling financial market. I want to 
commend Mr. Neal and Mr. Reynolds for being advocates for this, not 
just yesterday, but through the past many years. This is an injustice 
on the middle class in America. We know it very clearly.
  I want to commend you, Mr. Neal, for trying to get this done on a 
permanent basis and paying for it. The sin of this administration is 
trying to provide tax relief for folks and not finding a way to pay for 
it. Now we see what situation we are in. Kudos to you. You stuck to 
your guns.
  The economic burden on the American worker is enormous, and it should 
compel us to take a bold and affirmative stand on serving their best 
interests today. As a proud cosponsor of H.R. 7005, the AMT Tax Relief 
Act of 2008, I want to also thank our distinguished colleague, Chairman 
Rangel, for bringing it to the floor.
  We must remind ourselves that the impact on the AMT as it currently 
stands will continue to harm the wrong taxpayer. The AMT no longer 
targets just wealthy taxpayers engaged in tax avoidance. Instead, it 
targets the unintended taxpayer, the middle class family.
  The AMT is not adjusted for inflation. In the absence of an indexing 
provision, it is largely responsible for the rising numbers of middle 
class taxpayers subject to the AMT.
  Filers in high-tax States are more likely to face the AMT to a 
surprising degree. In my State, the State of New Jersey, one of the 
three highest ranking States in terms of AMT filers, in my home State 
of New Jersey, $800 million in AMT taxes were paid last year. The three 
States of New Jersey, New York and California account for 40 percent of 
the country's 3.15 million AMT returns, just those three States. You 
tell me about justice in the tax system.
  Texas, a State with 200 percent larger population than New Jersey, 
has roughly half the number of AMT filers.
  The SPEAKER pro tempore. The time of the gentleman has expired.
  Mr. NEAL of Massachusetts. I yield 1 additional minute to the 
gentleman.
  Mr. PASCRELL. Texas, mind you, with a 200 percent larger population 
than the State of New Jersey, has roughly half the number of folks who 
file for the AMT. This is simply not an equitable tax system. It is 
very clear to all of us on Ways and Means, it is clear to the American 
people. More and more become eligible, and they have to be informed by 
those people who do their

[[Page 21037]]

taxes, ``oh, by the way, you are susceptible to the AMT.'' ``What are 
you talking about?''
  This administration has consistently ignored the tough issues. We 
could have dealt with the AMT permanently if this administration had 
taken tax reform seriously. But they refused to sit down with this 
Congress to have these important discussions. Now we need to take a 
stand and make these significant changes. In a week we will have to 
take many stands, because we allowed things to get worse.
  I urge all my colleagues on both sides of the aisle to vote ``yes'' 
on the extension of the AMT relief for 2008.

                              {time}  1615

  Mr. REYNOLDS. Madam Speaker, it is now my pleasure to yield 2 minutes 
to the ranking member of the Rules Committee, who has long been an 
expert on trade as well as tax issues that affect this body and the 
country, the gentleman from California, David Dreier.
  Mr. DREIER. I thank my friend for yielding.
  Madam Speaker, I would like to begin by saying that I suspect that 
after many decades of stellar public service, this will be one of the 
last times that we see our good friend from Buffalo (Mr. Reynolds) who 
served ably as a member of the Rules Committee for many years and now 
as a member of the Ways and Means Committee actually manage a measure 
on the floor. I would like to thank him for his wonderful public 
service and to say that we are very pleased to be here with this very 
important measure.
  I don't want to be the skunk at a picnic, but I have to point to a 
couple of very, very important issues. I listened to my good friend 
from New Jersey (Mr. Pascrell) talk about the fact that Mr. Neal has 
moved forward with a measure that is paid for. The fact of the matter 
is we are waiving PAYGO on this provision which will allow us to deal 
with this patch for the AMT relief.
  We all know back in 1969, 155 millionaires were the target of the 
alternative minimum tax, as was pointed out by my friend from Houston 
(Mr. Brady). The fact is, the indexation has created a situation 
whereby millions and millions and millions of Americans are now saddled 
with this responsibility.
  Madam Speaker, what we heard time and time again was that in this new 
Congress, we were going to have everything paid for. I find it 
interestingly ironic that here, as we deal with the alternative minimum 
tax, this measure, we have suspended the rules and waived PAYGO on 
this. Yet we did not choose to do that when we dealt with the very 
important issue that the American people wanted us to try to address, 
and that is to bring gasoline prices down with a responsible energy 
bill.
  We chose to waive it for the farm bill. Unfortunately, again, on the 
gas issue, we didn't waive it there, and we are waiving it again here.
  I would also like to point to the fact that my good friend from New 
Jersey talked about the fact that his State, I guess, has the third 
highest number of people impacted by the alternative minimum tax. The 
issue of repealing the alternative minimum tax is a high priority for 
many of us. I believe that it should be completely eliminated.
  The SPEAKER pro tempore. The time of the gentleman has expired.
  Mr. REYNOLDS. I yield the gentleman 1 additional minute.
  Mr. DREIER. I thank my friend.
  Let me say that I believe it's important for us to remember that a 
very short 8 years ago, in 1999, the House and the Senate passed a 
repeal of the alternative minimum tax. Unfortunately, President Clinton 
at that time chose to veto that measure.
  We can get into the issue of paid for or not paid for, but it's 
interesting that the measure we are considering today is basically 
under the same structure that we in 1999 passed the repeal of the 
alternative minimum tax out under and President Clinton chose to veto 
it at that point.
  Mr. PASCRELL. Will my friend yield?
  Mr. DREIER. I would be happy to yield to my friend from New Jersey.
  Mr. PASCRELL. The problem is back in 1998 there were just a few 
people that were eligible. It didn't make it less onerous, but there 
were many less people that were subject to the AMT tax. That was the 
difference. You know what the situation is today, my friend from 
California.
  Mr. DREIER. If I could reclaim my time, Madam Speaker, let me just 
say I concur. But if we had, in fact, in 1999, when President Clinton 
chose to veto that bill 8 years ago, if we had had that passed, we 
wouldn't be here dealing with this issue as we are today. I just wanted 
to make that clear for the record.
  Thanks again, and congratulations to my friend from Buffalo.
  Mr. NEAL of Massachusetts. Madam Speaker, I appreciate my friend, Mr. 
Dreier's, comments, about the alternative minimum tax and how we are 
going to proceed today, but, let me be blunt, over my objections for 
the last 8 years, what we talked about today is simply this for the 
American people that might be viewing this discussion, we are going to 
borrow the money. I object to it, but I have tried time and again to 
find concurrence on the other side with a common way forward and have 
been unsuccessful.
  Madam Speaker, I would like to yield 2 minutes to the gentlelady from 
Nevada, a very valued member of the Ways and Means Committee, Ms. 
Berkley.
  Ms. BERKLEY. I thank the gentleman for yielding.
  Madam Speaker, I rise in support of the AMT Relief Act. While I 
strongly believe the alternative minimum tax should be eliminated, this 
bill will provide a necessary, temporary solution to protect the more 
than 25 million Americans who would otherwise be hit by the AMT this 
year.
  If this legislation is not enacted, more than 138,000 Nevada 
taxpayers will see their tax bill increased by the AMT. This includes 
more than 32,000 hardworking Las Vegas families who were never intended 
to be affected by this tax.
  I am also pleased that the bill contains language to help those who 
face gargantuan alternative minimum tax liabilities on stock option 
income that they never actually received. I have several constituents 
in my district affected by this so-called ISO AMT, including one 
citizen who received a $1.2 million tax bill on a $30,000 stock option 
gain. This provision will help make these individuals whole.
  With the current economic downturn, the rising cost of food and gas, 
increased unemployment and people losing their homes due to mortgage 
foreclosure, the last thing Las Vegas needs is a tax increase on 
thousands of middle class families.
  I urge my colleagues to support this legislation.
  Mr. REYNOLDS. Madam Speaker, today is solution day. There have been 
times where I have come to the floor and indicated I was sad over the 
circumstances we were in. Today I am not sad. We are moving the result 
of legislation I have introduced since probably 2005, a 1-year patch 
that protects anyone else from getting trapped in the middle class of 
AMT and make sure that we do this patch.
  I don't believe, and most of the Members on my side of the aisle 
don't believe you need to raise taxes in order to pay for a tax cut on 
middle class Americans here.
  But I am bringing concern, not sadness, but concern, because Chairman 
Rangel and Chairman Neal have moved this legislation to the floor and 
that we, I hope, will pass this legislation, as we have in the past, 
with very strong bipartisan measure. But I don't take lightly a message 
from the leader of the other body on the closing days of this session 
that we make sure that we don't fall through the cracks, our version 
versus the Senate--the other body--version that could cause this to 
fall through the cracks and 25 million middle class Americans are 
trapped.
  So while we are looking to move this in the spirit of strong 
bipartisan support, it's indicative that the leadership of this body 
make sure that they full well know how we can get the mechanics with 
the other body to make this law as the President gets it to his desk.

[[Page 21038]]

  So the caution is we are not quite there yet because we have taken 
action today. While I like the version of the bill, we have taken our 
legislative prerogative and advanced it to have just this free-standing 
AMT bill.
  I support however we get the law signed, but I bring the caution that 
leadership in this House will have to work very closely with the Senate 
leadership of the other body to match a solution that's law so we don't 
put our 25 million Americans in the same harm's way of inaction that we 
have seen in other years past.
  Madam Speaker, I reserve the balance of my time.
  Mr. NEAL of Massachusetts. Madam Speaker, I want to agree with some 
of what Mr. Reynolds said, but I also want to remind the American 
citizenry today, we have now borrowed hundreds of billions of dollars 
to fix the alternative minimum tax, only to discover that a temporary 
patch is hardly a fix.
  Think of what we might have done had we adhered to some fiscal 
rectitude and actually paid for this legislation as opposed to 
borrowing the money.
  The reality is, in a legislative body, that there are some days that 
you can't get the votes to do what you would like, and this is one of 
those days.
  But be mindful as we proceed to the next session of the Congress that 
the request for fixing the alternative minimum tax, or patching the 
alternative minimum tax, you will be out $70 billion, the following 
year $80 billion, maybe more. Then when you calculate the interest that 
attends to the issue, we quickly find that we will be at $500 billion 
to have temporarily patched alternative minimum tax, when we have 
offered a remedy here to do away with it?
  We can argue about percentage of GDP that results in taxation to 
administer the Federal Government. I have heard that argument. The 
difficulty with that argument is that it doesn't take into 
consideration the reality of what we might have done in the intervening 
time to address the issue.
  We have put very thoughtful pieces of legislation to permanently 
repeal it, to put it behind us once and for all, alternative minimum 
tax, only to discover that we have had difficulty securing the 
necessary cooperation to get it done. So, I will be standing here next 
year, talking about alternative minimum tax, asking for a permanent 
repeal. I hope, in the atmosphere of tax reform, that we might 
accomplish that task.
  Madam Speaker, I would like to yield 2 minutes to the gentleman from 
New York, a classmate of mine from 1988, my friend, Mr. Engel.
  Mr. ENGEL. I thank my friend from Massachusetts for yielding, and 
it's hard to believe that it has been 20 years. We are classmates, and 
I am very proud of the work that Mr. Neal is doing on the Ways and 
Means Committee.
  Madam Speaker, I rise to strongly support the bill, but I want to 
express the frustration that so many people here have expressed that we 
are not permanently repealing the AMT. Every year, it seems, we come 
and we talk about a fix, which we are doing now, which needs to be 
done, but we point fingers at each other, we play the blame game and 
somehow or other a total repeal and a redoing of the AMT doesn't 
happen.
  If you come from a high-tax State like mine, like New York, which 
also happens to be a very high cost-of-living State, people are making 
more money because it costs more money to live in a high cost-of-living 
State.
  Yet many of these middle class families find that they are being hit 
with the AMT. Even if we pass this today, as I am sure we will, those 
families will continue to be hit with the AMT, even though they are 
middle class, and, as all my colleagues have mentioned, the AMT was 
never supposed to affect them.
  We need to put our heads together and come up with a plan to have 
alternative means of raising revenue and not have the AMT that affects 
so many middle class families. We are talking about a $700 billion 
bailout for Wall Street, and yet we never seem to have the money to 
bail out the middle class.
  We need to do that. We need to do it, and we need to do it now. We 
need a permanent fix, not patchwork every year. PAYGO, I am certainly 
for it, but the main thing is, middle class families should not be 
harmed by the AMT. And in a State like New York where there is a high 
taxation and high cost of living, we have a double whammy.
  I thank my friend, I support the bill, and I hope that next year we 
will come back for a permanent fix and finally repeal the onerous AMT.
  Mr. REYNOLDS. Madam Speaker, if I might inquire to the chairman if he 
has any other speakers, I am prepared to close.
  Mr. NEAL of Massachusetts. I would be prepared to close upon 
listening to the eloquence of the gentleman from New York.
  Mr. REYNOLDS. Madam Speaker, it's interesting in the debate, and many 
of us who spoke today and so many others that have come forward in 
years past have presented the history or the finger pointing or the 
direction of how we got to where we are.
  The important thing is that we know that we must produce a result, 
even if it's a 1-year patch. It has been admirable, as Chairman Rangel 
took over Ways and Means, a goal he had was to rid the AMT tax from the 
books. We need to work in a bipartisan fashion, I suspect, to reach 
that permanent goal.
  But as we banter some on PAYGO or pay not, or whether they are in or 
they are not, it reminds me to think as a Member who will not be going 
home to campaign, maybe I should spend a little time to see how many 
times we have waived PAYGO on this bill after we beat up the fact that 
we should do it, it's the right thing, it must happen. And then at the 
end of the day, we take the Republican version of not raising taxes. 
Quite frankly, I don't think we are borrowing money for the bill, we 
are just not raising taxes in order to prevent a tax increase, 
particularly one to the middle class which both parties so dearly want 
to preserve.

                              {time}  1630

  So as we look to the reality of this year, I remind my colleagues, we 
have caution to get this bill matched with the other body so that we 
make law in order to send it to the President's desk to protect our 
middle class taxpayers.
  Last year 352 bipartisan Members of the House voted for the AMT 
extension that was not offset by devastating tax increases, just like 
this bill coming before us today.
  I urge my colleagues to do the same today by supporting this bill so 
it may be included in a comprehensive tax extenders package equal to 
the Senate version, or that the other body relinquishes their very 
clear, strong warning from their leader. Ignoring the other body's 
warning will not get this across the finish line. So I urge adoption of 
the resolution, and I thank Chairman Rangel and Chairman Neal for their 
efforts and work to get this before us today as we are in the final 
days of this legislative session.
  Madam Speaker, I yield back the balance of my time.
  Mr. NEAL of Massachusetts. Madam Speaker, let me, as I close, 
acknowledge the work of Chairman Rangel. He has given me considerable 
latitude not only on this issue but on a range of other issues within 
the jurisdiction of the committee. We have come up with some pretty 
good pieces of legislation during the last couple of years.
  What is striking about this debate is we find ourselves in the same 
predicament where we will once again convene next year to discuss it. 
Mr. Rangel's legislation that I helped to author actually repealed the 
alternative minimum tax and did it in a responsible manner. The fact 
that we are here today because we couldn't find enough numbers in the 
House to move forward on the proposal, I think, demonstrates the 
frustration that we all feel with what has now become a very onerous 
position for the Congress to entertain.
  But I do want to thank my friend, Tom Reynolds. And he is my friend. 
We probably on tax policy disagree on where the sun rises and the sun 
sets, but it is an example of a friendship that has been able to 
supersede any of those differences because after the debate of this 
House is over, socially he

[[Page 21039]]

has been a good pal for a long time. And I have the impression that he 
is not going to miss debating alternative minimum tax when he is back 
in New York. His position has been steadfast in this arena on the issue 
of AMT, and we have really worked hand in glove with one minor 
difference: I think rather than borrow the money, I think we should pay 
for it. And at the same time, I must tell you, he has been a good and 
humorous friend along the way, and we will miss his presence in the 
House and on the Ways and Means Committee.
  Madam Speaker, I urge adoption of the resolution.
  Mr. BLUMENAUER. Madam Speaker, the alternative minimum tax was 
introduced to the tax code in 1969 to capture a small number of 
millionaires who had escaped tax liability. Since that laudable 
beginning, however, the tax has morphed from a millionaire's tax to a 
middle class tax.
  In fact, a failure to pass an alternative minimum tax patch this year 
will result in millions of additional families being subject to that 
tax. In my district alone, H.R. 7005 will prevent over 40,000 
additional taxpayers from facing the AMT.
  Nationally, the alternative minimum tax would, but for this bill, 
affect over 50 percent of taxpayers with incomes between $50,000 and 
$100,000 this year. This is a tax on nearly every middle class family--
and it falls hardest on those raising a family. A 1-year patch is 
necessary to protect those families.
  It is for those reasons that I reluctantly voted in favor of this 
legislation. However, a piecemeal, year-by-year approach that places 
the burden on our children's credit cards is insufficient for a 
challenge of this magnitude. When Congress returns to this issue, I am 
looking forward to permanently reforming the alternative minimum tax in 
a way that does not add to our national deficit.
  Mr. LEVIN. Madam Speaker, I rise in support of the Alternative 
Minimum Tax Relief Act.
  I do so because this legislation is necessary to protect 25 million 
middle class families from a tax that was never intended to apply to 
them, including more than 53,000 families in my district.
  But the bill before us will also increase the Federal deficit by more 
than $64 billion.
  Earlier this year, we passed an AMT patch in a fiscally responsible 
manner. We paid for it by closing loopholes and improving the fairness 
of our tax code.
  The minority argued that we should just borrow more money, ignoring 
the ballooning deficit and mounting debt, and the Bush administration's 
reckless fiscal policies. At no time did we hear the minority oppose 
our offsets on the merits. At no time did they argue we should not 
close these loopholes.
  They just engaged in absurd ideological arguments and claimed that 
closing a loophole is a tax increase.
  Today we will take this action to protect 25 million taxpayers 
because it's the necessary thing to do.
  Mr. DINGELL. Madam Speaker, I rise today in support of H.R. 7005, 
legislation that will provide critical tax relief to 25 million middle 
class families and provide a solution to the looming Alternative 
Minimum Tax crisis. Had Congress failed to act, tens of thousands of my 
constituents in Michigan's 15th Congressional District would have been 
required to pay the AMT when filing their 2008 tax return. At a time 
when middle class families are already finding their budgets stretched 
thin because of rising costs for things like gasoline, groceries, and 
health care expenses, imposing an increased tax burden would be 
unconscionable.
  The Democratic majority has shown a continuing commitment to 
responsible fiscal policies, and made numerous efforts to offset the 
cost of the AMT fix by closing tax loopholes that allow corporate CEOs 
to receive deferred compensation from offshore companies. 
Unfortunately, President Bush and the Republican minority have opposed 
our efforts to find a way to pay for the AMT fix, and have chosen to 
pass the cost of this bill onto our children and grandchildren rather 
than require the wealthiest Americans to pay their fair share of taxes.
  This is especially disappointing because the expansion of the AMT was 
an accounting gimmick designed to make the Bush tax cuts for the 
wealthy more affordable. Since the enactment of those tax cuts, the 
President has committed us to a war that costs hundreds of billions of 
dollars every year and the budget deficit has exploded. Despite 
inheriting balanced budgets, President Bush's irresponsible fiscal 
policies have caused the national debt to rise to nearly $9 trillion; 
three times the size of our debt when President Clinton left office. 
Clearly, it is time for a change. I look forward to working with a new 
President next year to find a way to enact a permanent AMT fix, and 
rewrite our tax laws and put an end to irresponsible Bush fiscal 
policies.
  Mr. SHAYS. Madam Speaker, I rise in strong support of the passage of 
the Alternative Minimum Tax patch we are considering today that will 
prevent the AMT from affecting an additional 20 million taxpayers in 
2009. I am pleased that we are considering this legislation now, which 
should give taxpayers and the Internal Revenue Service plenty of time 
to prepare for this important tax change.
  According to a 2007 study by the Tax Foundation, Connecticut's Fourth 
Congressional District, which I represent, is the seventh most affected 
district by the AMT. Over 10 percent of our residents' tax returns are 
subject to the AMT, and the average tax liability of those affected by 
it is $5,235 per return.
  I would prefer us to be considering an AMT bill today that is offset 
by a combination of spending cuts and temporary revenue increases, but 
I am pleased that we are not considering legislation that pays for a 1-
year fix in the process with a permanent revenue increase.
  Finally, I urge Congress to take up legislation soon that would fully 
repeal the AMT permanently. While the revenue loss will need to be made 
up in other ways, it was never the intent for the AMT to affect 41 
million taxpayers, which it could by 2013 if it is not changed.
  I thank the Ways and Means Committee for bringing this legislation to 
the floor and urge its adoption.
  Mr. ETHERIDGE. Madam Speaker, I rise in support of H.R. 7005, the 
Alternative Minimum Tax Relief Act of 2008.
  H.R. 7005 is critical to easing the burden on middle-class taxpayers. 
The Alternative Minimum Tax, AMT, was originally intended to ensure 
that the Nation's wealthiest taxpayers were not able to avoid paying 
taxes altogether. However, it was not indexed for inflation, and today 
millions of middle income Americans who pay their taxes as required 
would see a huge tax increase because of the AMT. In my district alone, 
over 30,000 people would be affected by the AMT this year. H.R. 7005 
provides 1 year of AMT relief to protect ordinary taxpayers who are 
threatened by this extra tax by increasing the amount of income exempt 
from the Alternative Minimum Tax. In addition, this bill would protect 
individuals who exercised incentive stock options from being required 
to pay tax on gains that never materialized. This legislation will 
protect over 25 million middle-class families from paying the AMT.
  I would have preferred that this bill was fully paid for. I supported 
H.R. 6275, the 1-year AMT patch legislation that the House passed in 
June of this year. This bill was fully offset and did not add to the 
deficit. Unfortunately, the Administration and Senate Republicans have 
continued to ignore fiscal responsibility and have threatened to veto 
any AMT bill that includes offsets. However, H.R. 7005 is a crucial 
part of providing tax relief to millions of middle-income Americans and 
strengthening our lagging economy.
  I support H.R. 7005, the Alternative Minimum Tax Relief Act of 2008, 
and I urge my colleagues to join me in voting for its passage.
  Ms. HERSETH SANDLIN. Madam Speaker, I regret that due to unforeseen 
circumstances I was unable to participate in one vote on the floor of 
the House of Representatives on September 24, 2008.
  The vote was on H.R. 7005, to amend the Internal Revenue Code of 1986 
to provide alternative minimum tax, AMT, relief for individuals for 
2008. Had I been present, I would have voted ``no'' on that question. 
AMT relief is certainly necessary, and providing it for more than 25 
million families in 2008 is projected to cost more than $60 billion 
over 10 years. In addition, because the AMT fix in this bill is not 
paid for under pay-as-you-go rules, the fix can be expected to add tens 
of billions more in interest costs. In contrast, the fiscally 
responsible version of AMT relief that the House passed earlier this 
year with my support would have been revenue neutral, including through 
the elimination of a tax subsidy that continues to be provided to major 
oil companies during this time of record profits for the industry. I 
cannot support H.R. 7005, which would add many tens of billions more to 
the out-of-control national debt that is approaching $10 trillion, when 
a fiscally responsible and fair alternative is available.
  Mr. VAN HOLLEN. Madam Speaker, I rise in support of the AMT Relief 
Act of 2008 and urge my colleagues to do the same.
  While I would prefer to eliminate the AMT entirely--and pay for it 
when we do--the fact of the matter is that failing to act on this 
legislation would subject over twenty-five million families--including 
nearly 335,000 in my congressional district--to an additional tax 
burden

[[Page 21040]]

they were never intended to bear. Moreover, having recently visited 
with IRS Commissioner Shulman, there is no question that the IRS is 
better able to do its job and the taxpayers are best served when 
Congress completes its tax-related work in a timely fashion.
  I am especially pleased that H.R. 7005 also includes legislation I 
introduced on a bipartisan basis with Congressmen Richard Neal (D-MA), 
Sam Johnson (R-TX) and Jim Ramstad (R-MN) to correct the equally 
unintended and all too frequently devastating treatment of incentive 
stock options under the Alternative Minimum tax. The AMT Credit 
Fairness and Relief Act will end the ISO AMT crisis once and for all by 
allowing affected taxpayers to claim the entirety of their unused 
credits over the next two years and abating all penalties and interest 
arising from this particularly egregious part of the code.
  Madam Speaker, the AMT Relief Act of 2008 is vital middle class tax 
relief designed to correct several widely acknowledged defects in our 
tax law. I look forward to its passage and encourage its prompt 
consideration in the Senate so that it can be signed by the President 
without delay.
  Mr. POMEROY. Madam Speaker, I rise today to support this relief from 
the Alternative Minimum Tax, AMT. If Congress does not pass this 
legislation, over 25 million middle-class tax payers would find 
themselves subject to this tax.
  It is important that we provide this relief to millions of American 
families who want a better life for their families. The current 
structure of the AMT leaves middle-class households vulnerable to a 
significant unexpected tax bill while many very wealthy households pay 
no AMT. In these economic times, enacting AMT relief can put more money 
in their pockets rather than subject them to taxes that were not 
intended to apply to middle-class families.
  I have long supported and advocated for responsible reform of the 
Alternative Minimum Tax, which would be offset by other changes that 
target loopholes and abuses in the tax code. A responsible paid-for fix 
would also protect future generations of Americans from tax increases 
by not adding to our national debt. The Federal Government deficit will 
reach over $400 billion this fiscal year and it is projected to reach 
$500 billion in the next fiscal year.
  Today, we see the consequences of excessive debt in our economy. I am 
greatly concerned with the legacy of debt that we are leaving to our 
children as our national debt reaches over $10 trillion. That amount 
translates to a debt of over $30,000 for each of our children. We must 
pay interest on the debt and each day the average interest payment adds 
more than $1 billion to the tab we leave behind.
  While I believe that huge, persistent debt has a significant cost for 
the economy, I also practically realize that both the President and my 
colleagues across the aisle refuse to pay for this package of tax 
relief. They rejected the fiscally responsible bill, H.R. 6275, that I 
voted for in the Ways and Means Committee and on this floor when the 
House approved the bill on June 25, 2008. The other legislative body 
has only passed an AMT patch without an offset, rejecting paying for 
this tax relief just last week once again.
  Weighing the economic stress middle-class families face today, I will 
cast my vote for the Alternative Minimum Tax Relief Act today so that 
this tax does not fall on families struggling to meet increasing prices 
with wages that have not kept pace with inflation over the last 8 
years. I do so in the hope that Congress will work next year with a new 
administration to advance commonsense tax reform that includes paid for 
AMT relief. We must reverse years of failed Republican policies that 
have mortgaged our grandchildren's future with debt.
  Mr. NEAL of Massachusetts. I yield back the balance of my time.
  The SPEAKER pro tempore. The question is on the motion offered by the 
gentleman from Massachusetts (Mr. Neal) that the House suspend the 
rules and pass the bill, H.R. 7005.
  The question was taken.
  The SPEAKER pro tempore. In the opinion of the Chair, two-thirds 
being in the affirmative, the ayes have it.
  Mr. NEAL of Massachusetts. Madam 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.

                          ____________________