Marriage Tax Relief Reconciliation Act of 2000

Summary: (Sec. 2) Amends the Internal Revenue Code to provide that the basic standard deduction for a married couple filing jointly shall be twice the basic standard deduction for an unmarried individual, beginning in 2001.
(Sec. 3) Provides that the 15 and 28 percent regular income tax bracket for a married couple filing jointly shall be twice the size of the corresponding bracket for an unmarried individual. Sets forth a graduated phase-in beginning in 2002 and fully effective in 2007.
(Sec. 4) Increases the beginning point of the phase-out range of the earned income credit for married couples filing jointly by $2,500, beginning in 2001.
(Sec. 5) Revises provisions concerning the allowance of nonrefundable personal tax credits to provide that the aggregate amount of such credits shall not exceed the sum of: (1) the taxpayer's regular tax liability for the taxable year reduced by the foreign tax credit; and (2) the alternative minimum tax.
(Sec. 6) Sets forth "Budget Act" compliance provisions (sunset provisions).

SECTION 1. SHORT TITLE, ETC.

    (a) Short Title.--This Act may be cited as the ``Marriage Tax 
Relief Reconciliation Act of 2000''.
    (b) Section 15 Not To Apply.--No amendment made by this Act shall 
be treated as a change in a rate of tax for purposes of section 15 of 
the Internal Revenue Code of 1986.

SEC. 2. ELIMINATION OF MARRIAGE PENALTY IN STANDARD DEDUCTION.

    (a) In General.--Paragraph (2) of section 63(c) of the Internal 
Revenue Code of 1986 (relating to standard deduction) is amended--
            (1) by striking ``$5,000'' in subparagraph (A) and 
        inserting ``200 percent of the dollar amount in effect under 
        subparagraph (C) for the taxable year'';
            (2) by adding ``or'' at the end of subparagraph (B);
            (3) by striking ``in the case of'' and all that follows in 
        subparagraph (C) and inserting ``in any other case.''; and
            (4) by striking subparagraph (D).
    (b) Technical Amendments.--
            (1) Subparagraph (B) of section 1(f)(6) of such Code is 
        amended by striking ``(other than with'' and all that follows 
        through ``shall be applied'' and inserting ``(other than with 
        respect to sections 63(c)(4) and 151(d)(4)(A)) shall be 
        applied''.
            (2) Paragraph (4) of section 63(c) of such Code is amended 
        by adding at the end the following flush sentence:
        ``The preceding sentence shall not apply to the amount referred 
        to in paragraph (2)(A).''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2000.

SEC. 3. PHASEOUT OF MARRIAGE PENALTY IN 15-PERCENT AND 28-PERCENT RATE 
              BRACKETS.

    (a) In General.--Subsection (f) of section 1 of the Internal 
Revenue Code of 1986 (relating to adjustments in tax tables so that 
inflation will not result in tax increases) is amended by adding at the 
end the following new paragraph:
            ``(8) Phaseout of marriage penalty in 15-percent and 28-
        percent rate brackets.--
                    ``(A) In general.--With respect to taxable years 
                beginning after December 31, 2001, in prescribing the 
                tables under paragraph (1)--
                            ``(i) the maximum taxable income amount in 
                        the 15-percent rate bracket, the minimum and 
                        maximum taxable income amounts in the 28-
                        percent rate bracket, and the minimum taxable 
                        income amount in the 31-percent rate bracket in 
                        the table contained in subsection (a) shall be 
                        the applicable percentage of the comparable 
                        taxable income amounts in the table contained 
                        in subsection (c) (after any other adjustment 
                        under this subsection), and
                            ``(ii) the comparable taxable income 
                        amounts in the table contained in subsection 
                        (d) shall be \1/2\ of the amounts determined 
                        under clause (i).
                    ``(B) Applicable percentage.--For purposes of 
                subparagraph (A), the applicable percentage shall be 
                determined in accordance with the following table:

                ``For taxable years beginning
                                                         The applicable
                  in calendar year--
                                                        percentage is--
                    2002...................................      170.3 
                    2003...................................      173.8 
                    2004...................................      180.0 
                    2005...................................      183.2 
                    2006...................................      185.0 
                    2007 and thereafter....................      200.0.
                    ``(C) Rounding.--If any amount determined under 
                subparagraph (A)(i) is not a multiple of $50, such 
                amount shall be rounded to the next lowest multiple of 
                $50.''.
    (b) Technical Amendments.--
            (1) Subparagraph (A) of section 1(f)(2) of such Code is 
        amended by inserting ``except as provided in paragraph (8),'' 
        before ``by increasing''.
            (2) The heading for subsection (f) of section 1 of such 
        Code is amended by inserting ``Phaseout of Marriage Penalty in 
        15-Percent and 28-Percent Rate Brackets;'' before 
        ``Adjustments''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2001.

SEC. 4. MARRIAGE PENALTY RELIEF FOR EARNED INCOME CREDIT.

    (a) In General.--Paragraph (2) of section 32(b) of the Internal 
Revenue Code of 1986 (relating to percentages and amounts) is amended--
            (1) by striking ``Amounts.--The earned'' and inserting 
        ``Amounts.--
                    ``(A) In general.--Subject to subparagraph (B), the 
                earned''; and
            (2) by adding at the end the following new subparagraph:
                    ``(B) Joint returns.--In the case of a joint 
                return, the phaseout amount determined under 
                subparagraph (A) shall be increased by $2,500.''.
    (b) Inflation Adjustment.--Paragraph (1)(B) of section 32(j) of 
such Code (relating to inflation adjustments) is amended to read as 
follows:
                    ``(B) the cost-of-living adjustment determined 
                under section 1(f)(3) for the calendar year in which 
                the taxable year begins, determined--
                            ``(i) in the case of amounts in subsections 
                        (b)(2)(A) and (i)(1), by substituting `calendar 
                        year 1995' for `calendar year 1992' in 
                        subparagraph (B) thereof, and
                            ``(ii) in the case of the $2,500 amount in 
                        subsection (b)(2)(B), by substituting `calendar 
                        year 2000' for `calendar year 1992' in 
                        subparagraph (B) of such section 1.''.
    (c) Rounding.--Section 32(j)(2)(A) of such Code (relating to 
rounding) is amended by striking ``subsection (b)(2)'' and inserting 
``subsection (b)(2)(A) (after being increased under subparagraph (B) 
thereof)''.
    (d) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2000.

SEC. 5. PRESERVE FAMILY TAX CREDITS FROM THE ALTERNATIVE MINIMUM TAX.

    (a) In General.--Subsection (a) of section 26 of the Internal 
Revenue Code of 1986 (relating to limitation based on tax liability; 
definition of tax liability) is amended to read as follows:
    ``(a) Limitation Based on Amount of Tax.--The aggregate amount of 
credits allowed by this subpart for the taxable year shall not exceed 
the sum of--
            ``(1) the taxpayer's regular tax liability for the taxable 
        year reduced by the foreign tax credit allowable under section 
        27(a), and
            ``(2) the tax imposed for the taxable year by section 
        55(a).''.
    (b) Conforming Amendments.--
            (1) Subsection (d) of section 24 of such Code is amended by 
        striking paragraph (2) and by redesignating paragraph (3) as 
        paragraph (2).
            (2) Section 32 of such Code is amended by striking 
        subsection (h).
            (3) Section 904 of such Code is amended by striking 
        subsection (h) and by redesignating subsections (i), (j), and 
        (k) as subsections (h), (i), and (j), respectively.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2001.

SEC. 6. COMPLIANCE WITH BUDGET ACT.

    (a) In General.--Except as provided in subsection (b), all 
amendments made by this Act which are in effect on September 30, 2005, 
shall cease to apply as of the close of September 30, 2005.
    (b) Sunset for Certain Provisions Absent Subsequent Legislation.--
The amendments made by sections 2, 3, 4, and 5 of this Act shall not 
apply to any taxable year beginning after December 31, 2004.