To freeze and repeal portions of the tax cut enacted in the Economic Growth and Tax Relief Reconciliation Act of 2001 and to apply savings therefrom to a comprehensive Medicare outpatient prescription drug benefit.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Honor Thy Parents Act of 2002''.

SEC. 2. FREEZE AND REPEAL OF PORTIONS OF THE TAX CUT ENACTED IN THE 
              ECONOMIC GROWTH AND TAX RELIEF RECONCILIATION ACT OF 
              2001.

    (a) Freeze in Reductions of Top 3 Income Tax Rates for 
Individuals.--The table in paragraph (2) of section 1(i) of the 
Internal Revenue Code of 1986 (relating to reductions in rates after 
June 30, 2001) is amended to read as follows:


------------------------------------------------------------------------
                                     The corresponding percentages shall
                 ``In the case of     be substituted for  the following
                   taxable years                percentages:
                 beginning during  -------------------------------------
                  calendar year:      28%      31%      36%     39.6%
------------------------------------------------------------------------
                2001..............   27.5%    30.5%    35.5%    39.1%
                2002 and 2003.....   27.0%    30.0%    35.0%    38.6%
                2004 and 2005.....   26.0%    30.0%    35.0%    38.6%
                2006 and             25.0%    30.0%    35.0%   38.6%.''.
                 thereafter.
------------------------------------------------------------------------

    (b) Repeal of Modifications to Phaseout of Personal Exemptions and 
Overall Limitation on Itemized Deductions.--Sections 102 and 103 of the 
Economic Growth and Tax Relief Reconciliation Act of 2001 (and the 
amendments made by such sections) are hereby repealed and the Internal 
Revenue Code of 1986 shall be applied and administered as if such 
sections had never been enacted.
    (c) Repeal of Certain Estate, Gift, and Generation-Skipping 
Transfer Tax Provisions.--
            (1) In general.--The following provisions of title V of the 
        Economic Growth and Tax Relief Reconciliation Act of 2001 (and 
        the amendments made by such subtitle) are hereby repealed and 
        the Internal Revenue Code of 1986 shall be applied and 
        administered as if such provisions had never been enacted:
                    (A) Subtitle A.
                    (B) Subsections (c), (d), (e), (f)(2), and (f)(3) 
                of section 511.
                    (C) Subsections (b)(2) and (e)(2) of section 521.
                    (D) Subtitle E.
            (2) Increase in applicable exclusion amount.--Subsection 
        (c) of section 2010 of the Internal Revenue Code of 1986 
        (relating to applicable credit amount) is amended by striking 
        the table and inserting the following new table:

        ``In the case of estates of decedents
                                                         The applicable
          dying during:
                                                   exclusion amount is:
                  2002 and 2003......................       $1,000,000 
                  2004 and 2005......................       $1,500,000 
                  2006, 2007, and 2008...............       $2,000,000 
                  2009...............................       $3,500,000 
                  2010 and thereafter................    $4,000,000.''.

            (3) Conforming amendment.--Section 521(e) of the Economic 
        Growth and Tax Relief Reconciliation Act of 2001 (as amended by 
        paragraph (1)) is further amended--
                    (A) in paragraph (1) by striking ``paragraphs (2) 
                and (3)'' and inserting ``paragraph (2)'', and
                    (B) by redesignating paragraph (3) as paragraph 
                (2).

SEC. 3. TRANSFER OF SAVINGS TO MEDICARE PROGRAM TO OFFSET COSTS OF 
              PRESCRIPTION DRUG BENEFIT.

    (a) Transfer to Federal Hospital Insurance Trust Fund.--Section 
1817(a) of the Social Security Act (42 U.S.C. 1395i(a)) is amended--
            (1) by striking ``and'' at the end of paragraph (1),
            (2) by striking the period at the end of paragraph (2) and 
        inserting ``; and'', and
            (3) by inserting after paragraph (2) the following new 
        paragraph:
            ``(3) amounts estimated by the Secretary of the Treasury 
        that would have been paid from the general fund of the Treasury 
        but for the amendments and repeals made by section 2 of the 
        Honor Thy Parents Act of 2002.''.
    (b) Establishment of Separate Account for Outpatient Prescription 
Drug Benefit.--Section 1817 of such Act (42 U.S.C. 1395i) is amended by 
adding at the end the following new subsection:
    ``(l) Outpatient Prescription Drug Account.--
            ``(1) Establishment.--There is hereby established in the 
        Trust Fund an expenditure account to be known as the 
        `Outpatient Prescription Drug Account'.
            ``(2) Crediting of funds.--The Managing Trustee shall 
        credit to the Outpatient Prescription Drug Account such amounts 
        as may be deposited in the Trust Fund pursuant to subsection 
        (a)(3).
            ``(3) Use of funds.--Funds credited to the Outpatient 
        Prescription Drug Account may only be used to pay for 
        outpatient prescription drugs furnished under this title.''.

Summary: Honor Thy Parents Act of 2002 - Freezes and repeals elements of the tax cut enacted under the Economic Growth and Tax Relief Reconciliation Act of 2001 by: (1) freezing reductions of the top three income tax rates for individuals. And (2) repealing provisions of the Act that repealed the phaseout out of personal exemptions, the phaseout of the overall limitation on itemized deductions, and certain estate, gift, and generation-skipping transfer taxes. Applies the savings to the Federal Hospital Insurance Trust Fund and establishes a separate Outpatient Prescription Drug Account to be used for outpatient prescription drug benefits.