II 

116TH CONGRESS 

2D SESSION S. 5031 

To amend the Internal Revenue Code of 1986 to provide for a progressive 

consumption tax and to reform the income tax, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

DECEMBER 16, 2020 

Mr. CARDIN introduced the following bill; which was read twice and referred 

to the Committee on Finance 

A BILL 

To amend the Internal Revenue Code of 1986 to provide 

for a progressive consumption tax and to reform the 

income tax, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE, ETC. 

4 (a) IN GENERAL.—This Act may be cited as the 

5 ‘‘Progressive Consumption Tax Act of 2020’’. 

6 (b) REFERENCE.—Except as otherwise expressly pro7 vided, whenever in this Act an amendment or repeal is 

8 expressed in terms of an amendment to, or repeal of, a 

9 section or other provision, the reference shall be considVerDate Sep 11 2014 00:05 Jan 07, 2021 Jkt 019200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S5031.IS S5031

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1 ered to be made to a section or other provision of the In2 ternal Revenue Code of 1986. 

3 (c) TABLE OF CONTENTS.—The table of contents of 

4 this Act is as follows: 

Sec. 1. Short title, etc. 

TITLE I—PROGRESSIVE CONSUMPTION TAX 

Sec. 101. Imposition of progressive consumption tax. 

TITLE II—INDIVIDUAL AND CORPORATE TAX REFORM 

Subtitle A—Individual Income Tax Reforms 

Sec. 201. Individual income tax rate reductions and inflation adjustments. 

Sec. 202. Family allowance amounts; repeal of personal exemption deduction. 

Sec. 203. Repeal of limitations relating to itemized deductions. 

Sec. 204. Restoration of certain deductions. 

Sec. 205. Termination of separate treatment of capital gains. 

Sec. 206. Repeals. 

Sec. 207. Establishment of progressive tax rebate. 

Sec. 208. Technical and conforming amendments. 

Subtitle B—Corporate Tax Reforms 

Sec. 211. Corporate income tax rate reduction. 

TITLE III—REFUND OF EXCESS CONSUMPTION TAX REVENUE 

Sec. 301. Refunds of excess consumption tax revenue. 

5 TITLE I—PROGRESSIVE 

6 CONSUMPTION TAX 

7 SEC. 101. IMPOSITION OF PROGRESSIVE CONSUMPTION 

8 TAX. 

9 (a) IN GENERAL.—Subtitle D is amended by insert10 ing before chapter 31 the following new chapter: 

11 ‘‘CHAPTER 30—PROGRESSIVE 

12 CONSUMPTION TAX 

‘‘SUBCHAPTER A. IMPOSITION OF TAX

‘‘SUBCHAPTER B. TAXABLE SUPPLY


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‘‘SUBCHAPTER C. CREDIT AGAINST TAX

‘‘SUBCHAPTER D. ADMINISTRATION

‘‘SUBCHAPTER E. DEFINITIONS AND SPECIAL RULES

1 ‘‘Subchapter A—Imposition of Tax 

‘‘Sec. 3901. Imposition of tax. 

‘‘Sec. 3902. Taxable amount. 

2 ‘‘SEC. 3901. IMPOSITION OF TAX. 

3 ‘‘(a) GENERAL RULE.—A tax is hereby imposed on 

4 every taxable supply. 

5 ‘‘(b) AMOUNT OF TAX.— 

6 ‘‘(1) IN GENERAL.—Except as provided in para7 graph (2), the amount of the tax shall be 10 percent 

8 of the taxable amount. 

9 ‘‘(2) SPECIAL RATE FOR EXPORTS.—The 

10 amount of the tax shall be zero with respect to the 

11 provision of any supply which is— 

12 ‘‘(A) a supply of tangible personal property 

13 that is exported from the United States within 

14 90 days after the provider gives an invoice for 

15 the supply, or 

16 ‘‘(B) a supply, other than a supply of tan17 gible personal property— 

18 ‘‘(i) which is provided to a recipient 

19 that is not in the United States when the 

20 supply is performed or otherwise done, and 


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1 ‘‘(ii) the use of which takes place out2 side of the United States. 

3 ‘‘SEC. 3902. TAXABLE AMOUNT. 

4 ‘‘(a) AMOUNT CHARGED CUSTOMER.—For purposes 

5 of this chapter, the taxable amount for any taxable supply 

6 for which money is the only consideration shall be the 

7 price charged by the provider— 

8 ‘‘(1) including all invoiced charges for transpor9 tation, and other items payable to the provider with 

10 respect to the supply, but 

11 ‘‘(2) excluding the tax imposed by section 3901 

12 with respect to the supply and excluding any State 

13 and local sales and use taxes with respect to the 

14 supply. 

15 ‘‘(b) BARTER TRANSACTIONS.—For purposes of this 

16 chapter, the taxable amount for any taxable supply which 

17 includes consideration other than money shall be the fair 

18 market value of the consideration (including all invoiced 

19 charges for transportation and other items payable to the 

20 provider) plus the amount of any money paid in consider21 ation. 

22 ‘‘(c) IMPORTS.—For purposes of this chapter, the 

23 taxable amount in the case of any import shall be— 

24 ‘‘(1) the customs value plus customs duties and 

25 any other duties which may be imposed, or 


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1 ‘‘(2) if there is no such customs value, the fair 

2 market value (determined as if the importer had sold 

3 the supply). 

4 For purposes of this subsection, the customs value of any 

5 import shall include all invoiced charges for transportation 

6 and other items payable to the importer with respect to 

7 the supply. 

8 ‘‘(d) SPECIAL RULE IN THE CASE OF SALES OF CER9 TAIN USED CONSUMER GOODS.—For purposes of this 

10 chapter, if— 

11 ‘‘(1) a person acquires any tangible personal 

12 property in a transaction which was not taxable 

13 under this chapter, and 

14 ‘‘(2) such property had been used by an ulti15 mate consumer before such acquisition, 

16 the taxable amount in the case of any sale of such property 

17 by such person (determined without regard to this sub18 section) shall be reduced by the amount paid for such 

19 property by such person. 

20 ‘‘Subchapter B—Taxable Supply 

‘‘Sec. 3911. Taxable supply. 

‘‘Sec. 3912. Supplies made in connection with the United States. 

‘‘Sec. 3913. Exempt supply. 

21 ‘‘SEC. 3911. TAXABLE SUPPLY. 

22 ‘‘(a) IN GENERAL.—For purposes of this chapter, the 

23 term ‘taxable supply’ means— 


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1 ‘‘(1) the importation of property into the 

2 United States, and 

3 ‘‘(2) any supply (other than an exempt sup4 ply)— 

5 ‘‘(A) which is provided— 

6 ‘‘(i) in the course of carrying on a 

7 trade or business, 

8 ‘‘(ii) in the case of an organization ex9 empt from tax under section 501(a), in 

10 furtherance of the activities related to the 

11 purpose or function constituting the basis 

12 of its exemption under section 501, or 

13 ‘‘(iii) in the case of a State, an Indian 

14 tribal government, a possession of the 

15 United States, or any political subdivision 

16 of any of the foregoing, or the United 

17 States or the District of Columbia, in car18 rying out any activity that is not an essen19 tial governmental function, 

20 ‘‘(B) for which consideration is provided in 

21 return, and 

22 ‘‘(C) which is made in connection with the 

23 United States. 

24 ‘‘(b) SUPPLY.—For purposes of this chapter— 


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1 ‘‘(1) IN GENERAL.—The term ‘supply’ means 

2 any supply whatsoever, including— 

3 ‘‘(A) the sale or provision (including 

4 through renting, leasing, or licensing) of prop5 erty, 

6 ‘‘(B) the performance of services, 

7 ‘‘(C) the grant, assignment, or surrender 

8 of real property, 

9 ‘‘(D) the creation, grant, transfer, assign10 ment, or surrender of any right, 

11 ‘‘(E) financial supplies, and 

12 ‘‘(F) an entry into, or release from, an ob13 ligation or agreement to perform or refrain 

14 from performing an act. 

15 ‘‘(2) SPECIAL RULE FOR SERVICES FOR EM16 PLOYER.—An employee’s services for the employee’s 

17 employer shall not be treated as a supply. 

18 ‘‘SEC. 3912. SUPPLIES MADE IN CONNECTION WITH THE 

19 UNITED STATES. 

20 ‘‘(a) TANGIBLE PROPERTY.—For purposes of this 

21 chapter— 

22 ‘‘(1) IN GENERAL.—The supply of tangible 

23 property is made in connection with the United 

24 States if— 


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1 ‘‘(A) the property is delivered or made 

2 available to the recipient in the United States, 

3 or 

4 ‘‘(B) the property is assembled in or re5 moved from any location in the United States. 

6 ‘‘(2) REAL PROPERTY.—The supply of real 

7 property is made in connection with the United 

8 States if the real property is located in the United 

9 States. 

10 ‘‘(b) SERVICES, INTANGIBLE PROPERTY, AND OTHER

11 SUPPLIES.—For purposes of this chapter, the supply of 

12 anything other than tangible property or real property is 

13 made in connection with the United States if— 

14 ‘‘(1) the supply is used, performed, or otherwise 

15 done in the United States, or 

16 ‘‘(2) the supply is provided through a trade or 

17 business in the United States. 

18 ‘‘SEC. 3913. EXEMPT SUPPLY. 

19 ‘‘(a) IN GENERAL.—An exempt supply shall not be 

20 subject to tax under this chapter. 

21 ‘‘(b) EXEMPT SUPPLY.—For purposes of this chap22 ter— 

23 ‘‘(1) IN GENERAL.—The term ‘exempt supply’ 

24 means— 


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1 ‘‘(A) the rental or leasing of residential 

2 real property, 

3 ‘‘(B) any sale of qualified residential real 

4 property, 

5 ‘‘(C) any financial supply, 

6 ‘‘(D) any nonparticipating small supplier 

7 supply, and 

8 ‘‘(E) any taxable supply (or category of 

9 such supplies) treated as an exempt supply 

10 under section 3932(b). 

11 ‘‘(2) QUALIFIED RESIDENTIAL REAL PROP12 ERTY.—For purposes of paragraph (1), the term 

13 ‘qualified residential real property’ means residential 

14 real property— 

15 ‘‘(A) which— 

16 ‘‘(i) has previously been sold as resi17 dential real property, or 

18 ‘‘(ii) has been continuously rented for 

19 5 years or more, and 

20 ‘‘(B) to which substantial renovations have 

21 not been made after the date of the enactment 

22 of this chapter. 

23 ‘‘(3) NONPARTICIPATING SMALL SUPPLIER SUP24 PLY.— 


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1 ‘‘(A) IN GENERAL.—For purposes of para2 graph (1), the term ‘nonparticipating small sup3 plier supply’ means any supply provided by a 

4 supplier during— 

5 ‘‘(i) any taxable period during which 

6 such supplier was a nonparticipating small 

7 supplier, or 

8 ‘‘(ii) the four-week period beginning 

9 on the first day after the close of the last 

10 calendar quarter in which such supplier 

11 was a nonparticipating small supplier. 

12 ‘‘(B) NONPARTICIPATING SMALL SUP13 PLIER.— 

14 ‘‘(i) IN GENERAL.—For purposes of 

15 subparagraph (A), the term ‘nonpartici16 pating small supplier’ means any person 

17 for any taxable period if— 

18 ‘‘(I) such person has aggregate 

19 taxable revenues of not more than 

20 $100,000 for the four-calendar quar21 ter period ending immediately before 

22 the taxable period, and 

23 ‘‘(II) has not made an election 

24 under clause (iii) for such taxable pe25 riod. 


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1 ‘‘(ii) TAXABLE REVENUE.—For pur2 poses of this paragraph, the term ‘taxable 

3 revenue’ means revenue from supplies 

4 which are taxable supplies, determined 

5 without regard to paragraph (1)(D). 

6 ‘‘(iii) ELECTION.—Under regulations 

7 prescribed by the Secretary, any person 

8 who meets the requirements of clause (i)(I) 

9 may make an election not to be treated as 

10 a nonparticipating small supplier for any 

11 taxable period. 

12 ‘‘(C) AGGREGATION RULES.—For purposes 

13 of determining aggregate taxable revenues 

14 under subparagraph (B)(i)(I), all members of 

15 the same controlled group of corporations (with16 in the meaning of section 267(f)) and all per17 sons under common control (within the mean18 ing of section 52(b) but determined by treating 

19 an interest of more than 50 percent as a con20 trolling interest) shall be treated as 1 person. 

21 ‘‘Subchapter C—Credit Against Tax 

‘‘Sec. 3916. Credit against tax. 

22 ‘‘SEC. 3916. CREDIT AGAINST TAX. 

23 ‘‘(a) GENERAL RULE.—There shall be allowed as a 

24 credit against the aggregate amount of tax imposed by 


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1 section 3901 with respect to all taxable supplies made by 

2 the taxpayer during the taxable period an amount equal 

3 to the aggregate amount of tax imposed by section 3901 

4 on creditable acquisitions of the taxpayer during such tax5 able period. 

6 ‘‘(b) CREDITABLE ACQUISITIONS.—For purposes of 

7 this chapter, the term ‘creditable acquisition’ means the 

8 acquisition or receipt of any supply which— 

9 ‘‘(1) was subject to tax under section 3901 at 

10 the time it was provided to the taxpayer, 

11 ‘‘(2) was used by the taxpayer— 

12 ‘‘(A) in the course of carrying on a trade 

13 or business, 

14 ‘‘(B) in the case of a taxpayer exempt 

15 from tax under section 501(a), in furtherance 

16 of the activities related to the purpose or func17 tion constituting the basis of the exemption 

18 under section 501, or 

19 ‘‘(C) in the case of a State, an Indian trib20 al government, a possession of the United 

21 States, or any political subdivision of any of the 

22 foregoing, or the United States or the District 

23 of Columbia, in carrying out any activity that 

24 is not an essential governmental function, and 


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1 ‘‘(3) except as provided in subsection (c), was 

2 not used by the taxpayer to make an exempt supply. 

3 ‘‘(c) CERTAIN ACQUISITIONS RELATED TO FINAN4 CIAL SUPPLIES.— 

5 ‘‘(1) ACQUISITIONS BY QUALIFIED SMALL FI6 NANCIAL SUPPLIERS.— 

7 ‘‘(A) IN GENERAL.—Solely for purposes of 

8 subsections (b)(3) and (d)(1), a financial supply 

9 which is provided by a qualified small financial 

10 supplier shall not be treated as an exempt sup11 ply. 

12 ‘‘(B) QUALIFIED SMALL FINANCIAL SUP13 PLIER.— 

14 ‘‘(i) IN GENERAL.—For purposes of 

15 this paragraph, the term ‘qualified small 

16 financial supplier’ means any person for 

17 any month if, for the 12-month period end18 ing with the month preceding such month, 

19 the amount of credits which, but for this 

20 paragraph, would be allowable to such per21 son under subsection (a) for taxable sup22 plies which are used for the purpose of 

23 making financial supplies does not exceed 

24 the lesser of— 

25 ‘‘(I) $150,000, or 


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1 ‘‘(II) 10 percent of the amount of 

2 credits allowable to such person under 

3 subsection (a) (determined without re4 gard to this paragraph) for all taxable 

5 supplies during such 12-month period. 

6 ‘‘(ii) AGGREGATION RULES.—For pur7 poses of determining the amount of credits 

8 for any period under clause (i), all mem9 bers of the same controlled group of cor10 porations (within the meaning of section 

11 267(f)) and all persons under common con12 trol (within the meaning of section 52(b) 

13 but determined by treating an interest of 

14 more than 50 percent as a controlling in15 terest) shall be treated as 1 person. 

16 ‘‘(2) PARTIALLY CREDITABLE ACQUISITIONS.— 

17 ‘‘(A) IN GENERAL.—In the case of any 

18 partially creditable acquisition by a person 

19 other than a qualified small financial supplier— 

20 ‘‘(i) subsection (b) shall be applied 

21 without regard to paragraph (3) thereof, 

22 and 

23 ‘‘(ii) only 60 percent of the amount of 

24 tax imposed by section 3901 shall be taken 

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1 mining the amount of the credit under this 

2 section. 

3 ‘‘(B) PARTIALLY CREDITABLE ACQUISI4 TION.—For purposes of this section— 

5 ‘‘(i) IN GENERAL.—The term ‘par6 tially creditable acquisition’ means the ac7 quisition of any supply described in clause 

8 (ii) if such acquisition is used to provide a 

9 financial supply. 

10 ‘‘(ii) SUPPLIES DESCRIBED.—A sup11 ply is described in this clause if such sup12 ply is a supply of— 

13 ‘‘(I) banking or cash manage14 ment services, including services re15 lated to issuing, closing, operating, 

16 and maintaining accounts, and the 

17 processing of account information and 

18 applications, 

19 ‘‘(II) payment and fund transfer 

20 services, including for the operation of 

21 a payment system and processing ac22 count transactions, 

23 ‘‘(III) securities transaction serv24 ices for the provision, acquisition, or 

25 disposal of an interest in a security, 


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1 ‘‘(IV) loan and debt collection 

2 services, including mortgage broker3 age services, services related to mort4 gage insurance and loan protection in5 surance, and loan application, man6 agement, and processing services, 

7 ‘‘(V) capital markets, financial 

8 instruments, or fund management 

9 services, 

10 ‘‘(VI) insurance services, includ11 ing brokerage services, or 

12 ‘‘(VII) such other services as the 

13 Secretary may specify in regulations. 

14 ‘‘(d) EXEMPT SUPPLIES, ETC.— 

15 ‘‘(1) IN GENERAL.—If acquisitions (other than 

16 partially creditable acquisitions) are used partly for 

17 a use which is not for an exempt supply and partly 

18 for an exempt supply, the credit shall be allowable 

19 only with respect to the acquisitions which are not 

20 used for an exempt supply. 

21 ‘‘(2) PARTIALLY CREDITABLE ACQUISITIONS.— 

22 If partially creditable acquisition is used partly to 

23 provide a supply described in subsection (c)(2)(B)(ii) 

24 and partly for another use, subsection (c)(2) shall 


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1 apply only with respect to acquisitions used to pro2 vide supplies described in subsection (c)(2)(B)(ii). 

3 ‘‘(e) EXCESS CREDIT TREATED AS OVERPAYMENT.— 

4 ‘‘(1) IN GENERAL.—If for any taxable period 

5 the amount of the credit allowable by subsection (a) 

6 exceeds the aggregate amount of the tax imposed by 

7 section 3901 for such period, such excess shall be 

8 treated as an overpayment of the tax imposed by 

9 section 3901. 

10 ‘‘(2) TIME WHEN OVERPAYMENT ARISES.—Any 

11 overpayment under paragraph (1) for any taxable 

12 period shall be treated as arising on the later of— 

13 ‘‘(A) the due date for the return for such 

14 period, or 

15 ‘‘(B) the date on which the return is filed. 

16 ‘‘Subchapter D—Administration 

‘‘Sec. 3921. Provider liable for tax. 

‘‘Sec. 3922. Tax invoices. 

‘‘Sec. 3923. Time for filing return and claiming credit; deposits of tax. 

‘‘Sec. 3924. Treatment of related businesses, etc. 

‘‘Sec. 3925. Reports. 

‘‘Sec. 3926. Regulations. 

17 ‘‘SEC. 3921. PROVIDER LIABLE FOR TAX. 

18 ‘‘(a) IN GENERAL.—Except as provided in subsection 

19 (b), the person providing the supply shall be liable for the 

20 tax imposed by section 3901. 


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1 ‘‘(b) SPECIAL RULE FOR IMPORTS.—The person re2 ceiving the supply shall be liable for the tax imposed under 

3 section 3901— 

4 ‘‘(1) in the case of any taxable supply described 

5 in section 3911(a)(1), and 

6 ‘‘(2) in the case of any taxable supply which is 

7 not a supply of tangible property and which is— 

8 ‘‘(A) performed or otherwise done outside 

9 the United States, 

10 ‘‘(B) used in the United States, and 

11 ‘‘(C) acquired for use— 

12 ‘‘(i) in carrying on a trade or business 

13 in the United States, 

14 ‘‘(ii) by an organization exempt from 

15 tax under section 501(a), in furtherance of 

16 activities related to the purpose or function 

17 constituting the basis of its exemption 

18 under section 501, or 

19 ‘‘(iii) by a State, an Indian tribal gov20 ernment, a possession of the United 

21 States, or any political subdivision of any 

22 of the foregoing, or the United States or 

23 the District of Columbia, in carrying out 

24 any activity that is not an essential govern25 mental function. 


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1 ‘‘SEC. 3922. TAX INVOICES. 

2 ‘‘(a) IN GENERAL.— 

3 ‘‘(1) SUPPLIES MADE IN CONNECTION WITH

4 THE UNITED STATES.—Except as otherwise provided 

5 in this subsection, any person providing a taxable 

6 supply shall give the recipient a tax invoice with re7 spect to such supply. 

8 ‘‘(2) CERTAIN SERVICES PERFORMED OUTSIDE

9 THE UNITED STATES.—In the case of any taxable 

10 supply described in section 3921(b)(2), paragraph 

11 (1) shall not apply and the person receiving the tax12 able supply shall generate a tax invoice with respect 

13 to such supply. 

14 ‘‘(3) IMPORTS.—In the case of any taxable sup15 ply described in section 3911(a), the Secretary, in 

16 consultation with the Commissioner of Customs and 

17 Border Protection, shall promulgate regulations gov18 erning the provision of tax invoices. 

19 ‘‘(b) CONTENT OF INVOICE.—The tax invoice re20 quired by subsection (a) with respect to any supply shall 

21 set forth— 

22 ‘‘(1) the name and, in the case of an invoice 

23 under subsection (a)(1), identification number of the 

24 provider, 

25 ‘‘(2) the name of the recipient, 

26 ‘‘(3) the date of the taxable supply, 


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1 ‘‘(4) the taxable amount with respect to the 

2 taxable supply, 

3 ‘‘(5) the amount of the tax imposed by section 

4 3901, and 

5 ‘‘(6) such other information as may be pre6 scribed by regulations. 

7 ‘‘(c) NO CREDIT WITHOUT INVOICE.— 

8 ‘‘(1) IN GENERAL.—Except as provided in para9 graph (2) or (3), a taxpayer may claim a credit with 

10 respect to a creditable acquisition only if the tax11 payer— 

12 ‘‘(A) has in the taxpayer’s possession a tax 

13 invoice which meets the requirements of this 

14 section, and 

15 ‘‘(B) is named as the recipient of the sup16 ply in such invoice. 

17 ‘‘(2) EMPLOYEES OR OTHER AGENTS NAMED IN

18 INVOICES.—To the extent provided in regulations, 

19 the naming of an employee or other agent of the re20 cipient of the supply shall be treated as the naming 

21 of the recipient. 

22 ‘‘(3) WAIVER OF INVOICE REQUIREMENT IN

23 CERTAIN CASES.—To the extent provided in regula24 tions, paragraph (1) shall not apply— 


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1 ‘‘(A) where the taxpayer can demonstrate 

2 that the failure to receive or to have in the tax3 payer’s possession a tax invoice was without 

4 fault on the taxpayer’s part, or 

5 ‘‘(B) to a taxable supply (or category of 

6 supplies) where— 

7 ‘‘(i) the amount involved is de mini8 mis, or 

9 ‘‘(ii) the information required by sub10 section (b) can be reliably established by 

11 sampling or by another method and can be 

12 adequately documented. 

13 ‘‘(d) TIME FOR FURNISHING INVOICE.—Any invoice 

14 required to be furnished by subsection (a) with respect to 

15 any supply shall be furnished not later than 15 business 

16 days after the tax point for such supply. 

17 ‘‘SEC. 3923. TIME FOR FILING RETURN AND CLAIMING 

18 CREDIT; DEPOSITS OF TAX. 

19 ‘‘(a) FILING RETURN.—Before the last day of the 

20 fourth week (third week, in the case of any taxpayer to 

21 which subsection (c)(2) applies) after the close of each tax22 able period, each person liable for tax under this chapter 

23 shall file a return of the tax imposed by section 3901 on 

24 taxable supplies having a tax point within such taxable 

25 period. 


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1 ‘‘(b) CREDIT ALLOWED FOR TAXABLE PERIOD IN

2 WHICH RECIPIENT RECEIVES INVOICE.— 

3 ‘‘(1) IN GENERAL.—Except as provided in para4 graph (2), a credit allowable by section 3916 with 

5 respect to a supply may be allowed only for the first 

6 taxable period by the close of which the taxpayer— 

7 ‘‘(A) has paid or accrued amounts properly 

8 allocable to the tax imposed by section 3901 

9 with respect to such supply, and 

10 ‘‘(B) has a tax invoice (or equivalent) with 

11 respect to such supply. 

12 ‘‘(2) USE FOR LATER PERIOD.—Under regula13 tions, a credit allowable by section 3916 may be al14 lowed for a period after the period set forth in para15 graph (1). 

16 ‘‘(c) TAXABLE PERIOD.—For purposes of this chap17 ter— 

18 ‘‘(1) IN GENERAL.—Except as provided in para19 graph (2), the term ‘taxable period’ means a cal20 endar quarter. 

21 ‘‘(2) MONTHLY PERIOD FOR CERTAIN TAX22 PAYERS.— 

23 ‘‘(A) IN GENERAL.—In the case of a tax24 payer who makes taxable supplies for any 


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1 month in excess of $20,000,000, the term ‘tax2 able period’ means a calendar month. 

3 ‘‘(B) ELECTION OF 1-MONTH PERIOD.—If 

4 the taxpayer so elects, the term ‘taxable period’ 

5 means a calendar month. 

6 ‘‘(d) TAX POINT.—For purposes of this chapter— 

7 ‘‘(1) CHAPTER 1 RULES WITH RESPECT TO

8 PROVIDER GOVERN.—Except as provided in para9 graph (2), the tax point for any supply is the earlier 

10 of— 

11 ‘‘(A) the time (or times) when any income 

12 from the provision of the supply should be 

13 treated by the provider as received or accrued 

14 (or any loss should be taken into account by the 

15 seller) for purposes of chapter 1, or 

16 ‘‘(B) the time (or times) when the provider 

17 receives payment for the sale. 

18 ‘‘(2) IMPORTS.—In the case of the importing of 

19 property, the tax point is when the property is en20 tered, or withdrawn from warehouse, for consump21 tion in the United States. 

22 ‘‘(e) MONTHLY DEPOSITS REQUIRED.—To the extent 

23 provided in regulations, monthly deposits may be required 

24 of the estimated liability for any taxable period for the 

25 tax imposed by section 3901. 


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1 ‘‘SEC. 3924. TREATMENT OF RELATED BUSINESSES, ETC. 

2 ‘‘For purposes of this chapter, except as provided in 

3 sections 3913(b)(3)(C) and 3916(c)(1)(B)(ii) and in regu4 lations established by the Secretary, the taxpayer may 

5 elect— 

6 ‘‘(1) to treat as 1 person 2 or more businesses 

7 which may be treated under section 52(b) as 1 em8 ployer, and 

9 ‘‘(2) to treat as separate persons separate divi10 sions of the same business. 

11 ‘‘SEC. 3925. REPORTS. 

12 ‘‘The Secretary shall submit to Congress semi-annual 

13 reports on the implementation and administration of this 

14 chapter, including the amount of revenue collected from 

15 the tax imposed under this chapter and estimates of the 

16 revenue to be collected from such tax for future period. 

17 ‘‘SEC. 3926. REGULATIONS. 

18 ‘‘The Secretary shall prescribe such regulations as 

19 may be necessary to carry out the purposes of this chap20 ter. 

21 ‘‘Subchapter E—Definitions and Special 

22 Rules 

‘‘Sec. 3931. Definitions. 

‘‘Sec. 3932. Special rules. 

23 ‘‘SEC. 3931. DEFINITIONS. 

24 ‘‘For purposes of this chapter— 


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•S 5031 IS

1 ‘‘(1) BUSINESS.—The term ‘business’ in2 cludes— 

3 ‘‘(A) a trade, and 

4 ‘‘(B) an activity regularly carried on for 

5 profit. 

6 ‘‘(2) BUSINESS DAY.—The term ‘business day’ 

7 means any day other than Saturday and Sunday and 

8 other than a legal holiday (within the meaning of 

9 section 7503). 

10 ‘‘(3) EMPLOYEE.—The term ‘employee’ has the 

11 meaning such term has for purposes of chapter 24. 

12 ‘‘(4) FINANCIAL SUPPLIES.—The term ‘finan13 cial supplies’ means the provision, acquisition, or 

14 disposal of any of the following: a bank account, a 

15 debit or credit arrangement, a mortgage, a super16 annuation fund, an annuity, insurance, a financial 

17 guarantee, an indemnity, currency, securities, or de18 rivatives. 

19 ‘‘(5) PERSON.—The term ‘person’ includes any 

20 governmental entity. 

21 ‘‘(6) PROVIDE; PROVIDER.—The term ‘provide’, 

22 when used in reference to taxable supplies (other 

23 than in section 3911(a)(2)), includes the importation 

24 of property and the term ‘provider’ includes the im25 porter of property. 


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26 

•S 5031 IS

1 ‘‘(7) UNITED STATES.—The term ‘United 

2 States’, when used in a geographical sense, includes 

3 a Commonwealth and any possession of the United 

4 States. 

5 ‘‘SEC. 3932. SPECIAL RULES. 

6 ‘‘(a) COORDINATION WITH SUBTITLE A.—For pur7 poses of subtitle A— 

8 ‘‘(1) TREATMENT OF CREDIT.—Any credit al9 lowable to a taxpayer under section 3916 which is 

10 attributable to any supply shall be treated as a re11 duction in the amount paid or incurred by the tax12 payer for such supply. 

13 ‘‘(2) AMOUNT OF DEDUCTION FOR TAX.—The 

14 amount allowable as a deduction for the tax imposed 

15 by section 3901 shall be determined without regard 

16 to any credit allowable under section 3916. 

17 ‘‘(3) COMPUTATION OF PERCENTAGE DEPLE18 TION.—For purposes of sections 613 and 613A— 

19 ‘‘(A) gross income shall be reduced by the 

20 amount of the tax imposed by section 3901, 

21 and 

22 ‘‘(B) taxable income shall be determined 

23 without regard to any deduction allowed for 

24 such tax. 


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•S 5031 IS

1 ‘‘(b) AUTHORITY TO ZERO RATE DE MINIMIS SUP2 PLIES, ETC.—The Secretary may prescribe regulations 

3 treating as an exempt supply any taxable supply (or cat4 egory of such supplies) where— 

5 ‘‘(1) the amount involved is de minimis, or 

6 ‘‘(2) the revenue raised by taxing the supply is 

7 not sufficient to justify the administrative and other 

8 costs involved in the payment and collection of the 

9 tax.’’. 

10 (b) CLERICAL AMENDMENT.—The table of chapters 

11 for subtitle D is amended by inserting before the item re12 lating to chapter 31 the following: 

‘‘CHAPTER 30. PROGRESSIVE CONSUMPTION TAX’’. 

13 (c) EFFECTIVE DATE.—The amendments made by 

14 this section shall apply to supplies provided after Decem15 ber 31, 2021. 

16 TITLE II—INDIVIDUAL AND 

17 CORPORATE TAX REFORM 

18 Subtitle A—Individual Income Tax 

19 Reforms 

20 SEC. 201. INDIVIDUAL INCOME TAX RATE REDUCTIONS AND 

21 INFLATION ADJUSTMENTS. 

22 (a) IN GENERAL.— 

23 (1) MARRIED INDIVIDUALS FILING JOINT RE24 TURNS AND SURVIVING SPOUSES.—Subsection (a) of 


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•S 5031 IS

1 section 1 is amended by striking the table and in2 serting the following: 

‘‘If taxable income is: The tax is: 

Not over $100,000 ........................ 15 percent of taxable income. 

Over $100,000 but not over 

$500,000.

$15,000, plus 25 percent of the excess over $100,000. 

Over $500,000 ............................... $115,000, plus 28 percent of the excess over $500,000.’’. 

3 (2) HEADS OF HOUSEHOLDS.—Subsection (b) 

4 of section 1 is amended by striking the table and in5 serting the following: 

‘‘If taxable income is: The tax is: 

Not over $50,000 .......................... 15 percent of taxable income. 

Over $50,000 but not over 

$250,000.

$7,500, plus 25 percent of the excess 

over $50,000. 

Over $250,000 ............................... $57,500, plus 28 percent of the excess over $250,000.’’. 

6 (3) UNMARRIED INDIVIDUALS (OTHER THAN

7 SURVIVING SPOUSES AND HEADS OF HOUSE8 HOLDS).—Subsection (c) of section 1 is amended by 

9 striking the table and inserting the following: 

‘‘If taxable income is: The tax is: 

Not over $50,000 .......................... 15 percent of taxable income. 

Over $50,000 but not over 

$250,000.

$7,500, plus 25 percent of the excess 

over $250,000. 

Over $250,000 ............................... $57,500, plus 28 percent of the excess over $250,000.’’. 

10 (4) MARRIED INDIVIDUALS FILING SEPARATE

11 RETURNS.—Subsection (d) of section 1 is amended 

12 by striking the table and inserting the following: 

‘‘If taxable income is: The tax is: 

Not over $50,000 .......................... 15 percent of taxable income. 

Over $50,000 but not over 

$250,000.

$7,500, plus 25 percent of the excess 

over $250,000. 

Over $250,000 ............................... $57,500, plus 28 percent of the excess over $250,000.’’. 


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•S 5031 IS

1 (5) CONFORMING AMENDMENTS.—Section 1 is 

2 amended by striking subsections (i) and (j). 

3 (b) INFLATION ADJUSTMENTS APPLIED BASED ON

4 CPI.—Paragraph (3) of section 1(f) is amended to read 

5 as follows: 

6 ‘‘(3) COST-OF-LIVING ADJUSTMENT.—For pur7 poses of this subsection— 

8 ‘‘(A) IN GENERAL.—The cost-of-living ad9 justment for any calendar year is the percent10 age (if any) by which— 

11 ‘‘(i) the CPI for the preceding cal12 endar year, exceeds 

13 ‘‘(ii) the CPI for calendar year 2016, 

14 multiplied by the amount determined 

15 under subparagraph (B). 

16 ‘‘(B) AMOUNT DETERMINED.—The 

17 amount determined under this subparagraph is 

18 the product of— 

19 ‘‘(i) the amount obtained by divid20 ing— 

21 ‘‘(I) the C-CPI-U for calendar 

22 year 2016, by 

23 ‘‘(II) the CPI for calendar year 

24 2016, and 


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•S 5031 IS

1 ‘‘(ii) the amount obtained by divid2 ing— 

3 ‘‘(I) the CPI for calendar year 

4 2021, by 

5 ‘‘(II) the C-CPI-U for calendar 

6 year 2021. 

7 ‘‘(C) SPECIAL RULE FOR ADJUSTMENTS

8 WITH A BASE YEARS AFTER 2016.— 

9 ‘‘(i) BASE YEARS AFTER 2021.—For 

10 purposes of any provision of this title 

11 which provides for the substitution of a 

12 year after 2021 for ‘2016’ in subparagraph 

13 (A)(ii), such subparagraph shall be applied 

14 without regard to ‘, multiplied by the 

15 amount determined under subparagraph 

16 (B)’. 

17 ‘‘(ii) BASE YEARS AFTER 2016 AND

18 BEFORE 2022.—For purposes of any provi19 sion of this title which provides for the 

20 substitution of a year after 2016 and be21 fore 2021 for ‘2016’ in subparagraph 

22 (A)(ii)— 

23 ‘‘(I) subparagraph (A)(ii) shall 

24 be applied by substituting ‘C-CPI-U’ 

25 for ‘CPI’, and 


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•S 5031 IS

1 ‘‘(II) the amount determined 

2 under subparagraph (B) shall be the 

3 amount obtained by dividing— 

4 ‘‘(aa) the CPI for calendar 

5 year 2021, by 

6 ‘‘(bb) the C-CPI-U for cal7 endar year 2021.’’. 

8 (c) CONFORMING AMENDMENTS RELATED TO RATE

9 CHANGES.— 

10 (1) IN GENERAL.—Paragraph (3) of section 

11 1(f) is amended by inserting ‘‘, except as provided 

12 in paragraph (7),’’ after ‘‘for any calendar year’’. 

13 (2) UPDATED COST-OF-LIVING ADJUSTMENT

14 FOR NEW RATES.—Section 1(f) is amended by strik15 ing paragraphs (8) and inserting the following: 

16 ‘‘(8) COST-OF-LIVING ADJUSTMENT FOR YEARS

17 AFTER 2021.— 

18 ‘‘(A) CALENDAR YEAR 2022.—In pre19 scribing the tables under paragraph (1) which 

20 apply in lieu of the tables contained in sub21 sections (a), (b), (c), and (d) with respect to 

22 taxable years beginning in calendar year 2022, 

23 the Secretary shall make no adjustment to the 

24 dollar amounts in any such table. 


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•S 5031 IS

1 ‘‘(B) LATER CALENDAR YEARS.—In pre2 scribing tables under paragraph (1) which apply 

3 in lieu of the tables contained in subsections 

4 (a), (b), (c), and (d) with respect to taxable 

5 years beginning after December 31, 2022, the 

6 cost-of-living adjustment used in making ad7 justments to the dollar amounts in such tables 

8 shall be determined under paragraph (3) by 

9 substituting ‘2021’ for ‘2016’ in subparagraph 

10 (A)(ii) thereof.’’. 

11 (3) OTHER CONFORMING AMENDMENTS.— 

12 (A) Paragraph (2) of section 1(f) is 

13 amended— 

14 (i) by striking ‘‘paragraph (8)’’ in 

15 subparagraph (A) and inserting ‘‘para16 graph (7)(A)’’, and 

17 (ii) by striking ‘‘by adjusting’’ in sub18 paragraph (C) and inserting ‘‘except as 

19 provided in paragraph (7)(A), by adjust20 ing’’. 

21 (B) The heading of subsection (f) of sec22 tion 1 is amended by striking ‘‘PHASEOUT OF

23 MARRIAGE PENALTY IN 15-PERCENT BRACK24 ET; ADJUSTMENTS’’ and inserting ‘‘ADJUST25 MENTS’’. 


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•S 5031 IS

1 (d) EFFECTIVE DATE.—The amendments made by 

2 this section shall apply to taxable years beginning after 

3 December 31, 2021. 

4 SEC. 202. FAMILY ALLOWANCE AMOUNTS; REPEAL OF PER5 SONAL EXEMPTION DEDUCTION. 

6 (a) FAMILY ALLOWANCE AMOUNT.— 

7 (1) IN GENERAL.—Section 63 is amended to 

8 read as follows: 

9 ‘‘SEC. 63. TAXABLE INCOME DEFINED. 

10 ‘‘(a) IN GENERAL.—For purposes of this subtitle, the 

11 term ‘taxable income’ means adjusted gross income 

12 minus— 

13 ‘‘(1) the deductions allowed by this chapter 

14 (other than those taken into account in determining 

15 adjusted gross income), and 

16 ‘‘(2) the family allowance amount. 

17 ‘‘(b) FAMILY ALLOWANCE AMOUNT.—For purposes 

18 of this subtitle— 

19 ‘‘(1) IN GENERAL.—The family allowance 

20 amount with respect to a taxpayer shall be deter21 mined in accordance with the following table: 

‘‘If the taxpayer is: 

The family 

allowance 

amount is: 

Single or married filing separately ................................. $50,000

Married filing jointly or a surviving spouse ................... $100,000

A head of a household .................................................... $75,000. 


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•S 5031 IS

1 ‘‘(2) DEFINITIONS.—For purposes of this sub2 section— 

3 ‘‘(A) the term ‘single or married filing sep4 arately’ means a taxpayer to whom subsection 

5 (c) or (d) of section 1 applies, 

6 ‘‘(B) the term ‘married filing jointly or a 

7 surviving spouse’ means a taxpayer to whom 

8 subsection (a) of section 1 applies, and 

9 ‘‘(C) the term ‘head of a household’ means 

10 a taxpayer to whom subsection (b) of section 1 

11 applies. 

12 ‘‘(3) ADJUSTMENT FOR INFLATION.—In the 

13 case of any taxable year beginning after 2022, each 

14 of the dollar amounts in the table under paragraph 

15 (1) shall be increased by an amount equal to— 

16 ‘‘(A) such dollar amount, multiplied by 

17 ‘‘(B) the cost-of-living adjustment deter18 mined under section 1(f)(3) for the calendar 

19 year in which the taxable year begins, by sub20 stituting ‘2021’ for ‘2016’ in subparagraph 

21 (A)(ii) thereof. 

22 ‘‘(c) CROSS REFERENCES.— 

23 ‘‘(1) For deductions of estates and trusts in 

24 lieu of the family allowance amount, see section 

25 642(b). 


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•S 5031 IS

1 ‘‘(2) For calculation of family allowance relat2 ing to nonresident aliens, see section 873(b)(3). 

3 ‘‘(3) For determination of marital status, see 

4 section 7703.’’. 

5 (2) APPLICATION OF FAMILY ALLOWANCE TO

6 CERTAIN RULES.— 

7 (A) SOURCE RULES.— 

8 (i) Section 861(b) is amended by 

9 striking ‘‘the standard deduction’’ and in10 serting ‘‘the family allowance’’. 

11 (ii) Section 862(b) is amended by 

12 striking ‘‘the standard deduction’’ and in13 serting ‘‘the family allowance’’. 

14 (B) THRESHOLD FOR REQUIREMENT TO

15 MAKE RETURN.— 

16 (i) Section 6012(a)(1) is amended to 

17 read as follows: 

18 ‘‘(1)(A) Every individual— 

19 ‘‘(i) having for the taxable year gross in20 come which equals or exceeds the family allow21 ance amount applicable to the individual under 

22 section 63, or 

23 ‘‘(ii) in the case of individuals entitled to 

24 make a joint return (but only if the individual 

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•S 5031 IS

1 hold as their home at the close of the taxable 

2 year), every individual whose gross income, 

3 when combined with the gross income of the in4 dividual’s spouse, equals or exceeds the family 

5 allowance amount applicable to taxpayers who 

6 are married filing jointly under section 63. 

7 ‘‘(B) Every individual not described in subpara8 graph (A) who is taken into account as a dependent 

9 by another taxpayer under section 7706 for purposes 

10 of any provision of this title, but only if such individ11 ual’s gross income, when combined with the gross in12 come of all individuals taken into account in deter13 mining the family allowance amount under section 

14 63(b) of the taxpayer, equals or exceeds the family 

15 allowance amount applicable to the taxpayer under 

16 such section.’’. 

17 (ii) Section 6012(a)(8) is amended by 

18 striking ‘‘is not less than the sum of the 

19 exemption amount plus the basic standard 

20 deduction under section 63(c)(2)(D)’’ and 

21 inserting ‘‘equals or exceeds the family al22 lowance amount applicable to the estate 

23 under section 1398(c)(3)’’. 

24 (iii) Section 6012 is amended by 

25 striking subsection (f). 


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•S 5031 IS

1 (C) OTHER RULES.— 

2 (i) Section 1398(c) is amended— 

3 (I) by striking paragraph (3) and 

4 inserting the following: 

5 ‘‘(3) FAMILY ALLOWANCE AMOUNT.—The fam6 ily allowance amount under section 63(b) taken into 

7 account for the estate for the taxable year shall be 

8 the same as for a taxpayer who is single or married 

9 filing separately.’’, and 

10 (II) by striking ‘‘BASIC STAND11 ARD DEDUCTION’’ in the heading and 

12 inserting ‘‘FAMILY ALLOWANCE

13 AMOUNT’’. 

14 (ii) Section 6014 is amended— 

15 (I) by striking ‘‘who dos not 

16 itemize his deductions and who is not 

17 described in section 6012(a)(1)(C)(i)’’ 

18 in subsection (a) and inserting ‘‘who 

19 is not described in section 

20 6012(a)(1)(B)’’, and 

21 (II) by striking subsection (b)(4) 

22 and inserting the following: 

23 ‘‘(4) to cases where the taxpayer claims deduc24 tions in addition to the family allowance.’’. 


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•S 5031 IS

1 (b) PERMANENT REPEAL OF DEDUCTION FOR PER2 SONAL EXEMPTIONS.— 

3 (1) IN GENERAL.—Part V of subchapter B of 

4 chapter 1 is hereby repealed. 

5 (2) DEFINITION OF DEPENDENT RETAINED.— 

6 (A) IN GENERAL.—Section 152, prior to 

7 the repeal made by subsection (a), is hereby re8 designated as section 7706 and moved to the 

9 end of chapter 79. 

10 (B) IDENTIFYING INFORMATION REQUIRED

11 TO TREAT INDIVIDUAL AS DEPENDENT.—Sec12 tion 7706, as redesignated by subparagraph 

13 (A), is amended by adding at the end the fol14 lowing new subsection: 

15 ‘‘(g) IDENTIFYING INFORMATION REQUIRED.—No 

16 individual shall be treated as a dependent of the taxpayer 

17 under this section for a taxable year unless the taxpayer 

18 includes the TIN of such individual on the return of tax 

19 for the taxable year.’’. 

20 (3) APPLICATION OF REPEAL TO CERTAIN

21 RULES.— 

22 (A) DETERMINATION OF DEPENDENT.— 

23 Section 7706, as redesignated by subparagraph 

24 (A), is amended— 

25 (i) in subsection (d)— 


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•S 5031 IS

1 (I) by striking ‘‘the exemption 

2 amount (as defined in section 

3 151(d))’’ in subparagraph (1)(B) and 

4 inserting ‘‘$4,150’’, and 

5 (II) by adding at the end the fol6 lowing new paragraph: 

7 ‘‘(6) INFLATION ADJUSTMENT.—In the case of 

8 any taxable year beginning in a calendar year begin9 ning after 2018, the $4,150 amount in paragraph 

10 (1)(B) shall be increased by an amount equal to— 

11 ‘‘(A) such dollar amount, multiplied by 

12 ‘‘(B) the cost-of-living adjustment deter13 mined under section 1(c)(2)(A) for the calendar 

14 year in which such taxable year begins, deter15 mined by substituting ‘calendar year 2017’ for 

16 ‘calendar year 2016’ in clause (ii) thereof.’’, 

17 and 

18 (ii) in subsection (f)(6)(B)(i), by 

19 striking ‘‘the deduction under section 

20 151(c)’’ and inserting ‘‘the family allow21 ance amount under section 63(b)’’. 

22 (B) NET OPERATING LOSS.—Section 

23 172(d)(3) is amended to read as follows: 

24 ‘‘(3) FAMILY ALLOWANCE AMOUNT.—Taxable 

25 income under section 63 shall be determined without 


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•S 5031 IS

1 regard to paragraph (2) of section 63(a), relating to 

2 the family allowance amount. No deduction in lieu of 

3 such family allowance amount shall be allowed.’’. 

4 (C) SHORT TAXABLE YEARS.— 

5 (i) Section 443(c) is amended— 

6 (I) by striking ‘‘the exemptions 

7 allowed as a deduction under section 

8 151 (and any deduction in lieu there9 of) shall be reduced to amounts which 

10 bear the same ratio to the full exemp11 tions’’ and inserting ‘‘the family al12 lowance amount under section 63 

13 (and any deduction in lieu thereof) 

14 shall be reduced to an amount which 

15 bears the same ratio to the full family 

16 allowance amount’’, and 

17 (II) by striking ‘‘DEDUCTION

18 FOR PERSONAL EXEMPTIONS’’ in the 

19 heading and inserting ‘‘FAMILY AL20 LOWANCE AMOUNT’’. 

21 (ii) Section 441(f)(2)(B)(iii) is amend22 ed by striking ‘‘of the deductions for per23 sonal exemptions as described in section 

24 443(c)’’ and inserting ‘‘of the family allow25 ance amount’’. 


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•S 5031 IS

1 (D) APPLICATION TO TRUSTS AND ES2 TATES.— 

3 (i) Section 642(b)(2)(C) is amended— 

4 (I) by striking ‘‘the exemption 

5 amount under section 151(d)’’ in 

6 clause (i) and inserting ‘‘the dollar 

7 amount in effect under section 

8 7706(d)(1)(B)’’, and 

9 (II) by striking clause (iii). 

10 (ii) Section 642(b)(3) is amended— 

11 (I) by striking ‘‘the deductions 

12 allowed under section 151 (relating to 

13 deduction for personal exemption)’’ 

14 and inserting ‘‘the family allowance 

15 amount’’, and 

16 (II) by striking ‘‘PERSONAL EX17 EMPTION’’ in the heading and insert18 ing ‘‘FAMILY ALLOWANCE AMOUNT’’. 

19 (E) PARTNERSHIP COMPUTATIONS.—Sec20 tion 703(a) is amended— 

21 (i) by striking ‘‘and’’ at the end of 

22 paragraph (1), 

23 (ii) by striking subparagraph (A) of 

24 paragraph (2) and by redesignating sub25 paragraphs (B), (C), (D), (E), and (F) of 


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•S 5031 IS

1 such paragraph as subparagraphs (A), (B), 

2 (C), (D), and (E), 

3 (iii) by striking the period at the end 

4 of paragraph (2)(F) and inserting ‘‘, and’’, 

5 and 

6 (iv) by adding at the end the following 

7 new paragraph: 

8 ‘‘(3) taxable income under section 63 shall be 

9 determined without regard to the family allowance 

10 amount.’’. 

11 (F) NONRESIDENT ALIENS.— 

12 (i) Section 873(b) is amended— 

13 (I) by striking ‘‘deductions’’ in 

14 the matter preceding paragraph (1), 

15 and 

16 (II) by striking paragraph (3) 

17 and inserting the following: 

18 ‘‘(3) FAMILY ALLOWANCE AMOUNT.—The fam19 ily allowance amount under section 63(a)(2), except 

20 that the taxpayer shall be treated for purposes of 

21 section 63(b) as single or married filing separately 

22 unless the taxpayer is a resident of a contiguous 

23 country or is a national of the United States.’’. 

24 (ii)(I) The heading of section 873 is 

25 amended by striking ‘‘DEDUCTIONS’’ and 


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•S 5031 IS

1 inserting ‘‘DEDUCTIONS AND ALLOW2 ANCES’’. 

3 (II) The item relating to section 873 

4 in the table of sections for subpart A of 

5 part II of subchapter N of chapter 1 is 

6 amended to read as follows: 

‘‘Sec. 873. Deductions and allowances.’’. 

7 (iii) Section 874(b) is amended by 

8 striking ‘‘deduction for exemptions under 

9 section 151’’ and inserting ‘‘the family al10 lowance amount under section 63’’. 

11 (iv) Section 891 is amended by strik12 ing ‘‘deductions allowable under section 

13 151 and under’’ and inserting ‘‘the family 

14 allowance amount under section 63(a)(2) 

15 and the deductions allowable under’’. 

16 (G) FOREIGN TAX CREDIT.—Section 

17 904(b)(1) is amended to read as follows: 

18 ‘‘(1) FAMILY ALLOWANCE AND DEDUCTIONS.— 

19 For purposes of subsection (a), the taxable income 

20 in the case of an individual, estate, or trust shall be 

21 computed without regard to the family allowance 

22 amount under section 63(a)(2) or any deduction in 

23 lieu of such amount under section 642(b)(3).’’. 

24 (H) TREATMENT OF POSSESSIONS.— 


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•S 5031 IS

1 (i) Section 931(b)(1) is amended by 

2 striking ‘‘the deduction under section 151, 

3 relating to personal exemptions’’ and in4 serting ‘‘the family allowance amount 

5 under section 63(c)’’. 

6 (ii) Section 933 is amended— 

7 (I) by striking ‘‘the deduction 

8 under section 151, relating to per9 sonal exemptions’’ in paragraph (1) 

10 and inserting ‘‘the family allowance 

11 amount under section 63(c)’’, and 

12 (II) by striking ‘‘the deduction 

13 for personal exemptions under section 

14 151’’ in paragraph (2) and inserting 

15 ‘‘the family allowance amount under 

16 section 63(c)’’. 

17 (I) CAPITAL LOSSES.—Section 

18 1212(b)(2)(B)(ii) is amended to read as follows: 

19 ‘‘(ii) in the case of an estate or trust, 

20 the deduction allowed for such year under 

21 section 642(b).’’. 

22 (J) NET EARNINGS FROM SELF-EMPLOY23 MENT.—Section 1402(a) is amended by striking 

24 paragraph (7). 

25 (K) PAYROLL WITHHOLDING.— 


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•S 5031 IS

1 (i) IN GENERAL.—Paragraph (1) of 

2 section 3402(f) is amended by striking 

3 subparagraph (A) and all that follows and 

4 inserting the following: 

5 ‘‘(A) the family allowance amount; and 

6 ‘‘(B) any additional amounts to which the 

7 employee elects to take into account under sub8 section (m), but only if the employee’s spouse 

9 does not have in effect a withholding allowance 

10 certificate claiming such allowance.’’. 

11 (ii) FAMILY ALLOWANCE EXEMPTION

12 AMOUNT.—Subsection (f) of section 3402 

13 is amended— 

14 (I) by redesignating paragraphs 

15 (2), (3), (4), (5), (6), and (7) as para16 graphs (3), (4), (5), (6), (7), and (8), 

17 respectively, 

18 (II) by striking ‘‘paragraph 

19 (2)(C)’’ in paragraph (3)(B)(iii) and 

20 inserting ‘‘paragraph (3)(C)’’, and 

21 (III) by inserting after paragraph 

22 (1) the following new paragraph: 

23 ‘‘(2) FAMILY ALLOWANCE EXEMPTION

24 AMOUNT.—For purposes of this section— 


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•S 5031 IS

1 ‘‘(A) IN GENERAL.—Except as provided in 

2 subparagraphs (B) and (C), the term ‘family al3 lowance exemption amount’ means the family 

4 allowance amount with respect to the taxpayer 

5 under section 63(b) for the taxable year in 

6 which the payroll period begins, prorated to the 

7 payroll period. 

8 ‘‘(B) MARRIED EMPLOYEES.—If the em9 ployee is married filing jointly and the employ10 ee’s spouse is an employee receiving wages, the 

11 employee and the employee’s spouse may divide 

12 the family allowance amount determined under 

13 section 63(b) in the proportion of their choice 

14 for purposes of this paragraph, but the sum of 

15 the family allowance exemption amounts 

16 claimed by the employee and the employee’s 

17 spouse shall not exceed such family allowance 

18 amount. 

19 ‘‘(C) EMPLOYEES WITH MORE THAN 1 EM20 PLOYER.—In the case of an employee that has 

21 withholding exemption certificates in effect with 

22 respect to more than 1 employer, the employee 

23 may divide the family allowance amount (or the 

24 employee’s share of such amount after the ap25 plication of subparagraph (B), if applicable) deVerDate Sep 11 2014 00:05 Jan 07, 2021 Jkt 019200 PO 00000 Frm 00046 Fmt 6652 Sfmt 6201 E:\BILLS\S5031.IS S5031

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•S 5031 IS

1 termined under section 63(b) among employers 

2 in the proportion of the employee’s choice for 

3 purposes of this paragraph, but the sum of the 

4 family allowance exemption amounts claimed by 

5 the employee with respect to all employers shall 

6 not exceed such family allowance amount (or 

7 the employee’s share of such amount after the 

8 application of subparagraph (B), if applica9 ble).’’. 

10 (iii) CONFORMING AMENDMENTS.— 

11 (I) Paragraph (7) of section 

12 3402(f), as redesignated by subpara13 graph (B)(i) of this paragraph, is 

14 amended by striking ‘‘shall be entitled 

15 to only one withholding exemption’’ 

16 and inserting ‘‘shall be treated as sin17 gle or married filing separately for 

18 purposes of determining the family al19 lowance exemption amount’’. 

20 (II) Paragraph (8) of section 

21 3402(f), as redesignated by subpara22 graph (B)(i) of this paragraph, is 

23 amended by inserting ‘‘, except as 

24 provided in paragraph (2)(C)’’ after 

25 ‘‘with respect to one employer’’. 


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•S 5031 IS

1 (III) Paragraph (3) of section 

2 3402(m) is amended by striking ‘‘de3 ductions (including the additional 

4 standard deduction under section 

5 63(c)(3) for the aged and blind)’’ and 

6 inserting ‘‘deductions’’. 

7 (IV) Paragraph (2) of section 

8 3402(r) is amended striking ‘‘the sum 

9 of’’ and all that follows and inserting 

10 ‘‘the family allowance amount deter11 mined under section 63(b) for a tax12 payer who is single or married filing 

13 separately.’’. 

14 (V) Section 6040(4) is amended 

15 by striking ‘‘section 3402(f)(2), (3), 

16 (4), and (5)’’ and inserting ‘‘para17 graphs (3), (4), (5), and (6) of section 

18 3402(f)’’. 

19 (L) JOINT RETURNS.—Section 

20 6013(b)(3)(A) is amended by striking ‘‘has the 

21 meaning given to such term’’ and all that fol22 lows and inserting ‘‘means the family allowance 

23 amount applicable to a taxpayer who is single 

24 or married filing separately under section 

25 63(b).’’. 


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•S 5031 IS

1 (M) AMOUNTS SUBJECT TO LEVY.— 

2 (i) Section 6334(d)(2)(A) is amended 

3 to read as follows: 

4 ‘‘(A) 50 percent of the family allowance 

5 amount determined under section 63(b) with re6 spect to the taxpayer for the taxable year in 

7 which such levy occurs, divided by’’. 

8 (ii) Section 6334(d) is amended by 

9 striking paragraph (4). 

10 (c) OTHER CONFORMING AMENDMENTS.— 

11 (1) Section 1(f)(7) is amended— 

12 (A) by striking ‘‘section 63(c)(4), section 

13 68(b)(2) or section 151(d)(4)’’ in subparagraph 

14 (A) and inserting ‘‘subsection (g)(4)(B), section 

15 63(b)(3), section 68(b)(2), or section 

16 7706(d)(6)’’, and 

17 (B) by striking ‘‘sections 63(c)(4) and sec18 tion 151(d)(4)(A)’’ in subparagraph (B) and in19 serting ‘‘sections 63(b)(3) and 7706(d)(6)’’. 

20 (2) Section 1(g)(4) is amended— 

21 (A) by striking subparagraph (A)(ii)(I) 

22 and inserting the following: 

23 ‘‘(I) $500, plus’’, and 

24 (B) by redesignating subparagraphs (B) 

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•S 5031 IS

1 tively, and inserting after subparagraph (A) the 

2 following new subparagraph: 

3 ‘‘(B) ADJUSTMENT FOR INFLATION.—In 

4 the case of any taxable year beginning in a cal5 endar year after 1988, the $500 amount in sub6 paragraph (A)(ii)(I) shall be increased by an 

7 amount equal to— 

8 ‘‘(i) such dollar amount, multiplied by 

9 ‘‘(ii) the cost-of-living adjustment de10 termined under subsection (f)(3) for the 

11 calendar year in which the taxable year be12 gins, by substituting ‘1987’ for ‘2016’ in 

13 subparagraph (A)(ii) thereof.’’. 

14 (3) Section 1(g)(5)(A) is amended by striking 

15 ‘‘section 152(e)’’ and inserting ‘‘section 7706(e)’’. 

16 (4) Section 2(a)(1)(B) is amended— 

17 (A) by striking ‘‘section 152’’ and insert18 ing ‘‘section 7706’’, and 

19 (B) by striking ‘‘with respect to whom the 

20 taxpayer is entitled to a deduction for the tax21 able year under section 151’’ and inserting 

22 ‘‘whose TIN is included on the taxpayer’s re23 turn of tax for the taxable year’’. 

24 (5) Section 2(b)(1)(A)(i) is amended— 


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•S 5031 IS

1 (A) in the matter preceding subclause 

2 (I)— 

3 (i) by striking ‘‘section 152(c)’’ and 

4 inserting ‘‘section 7706(c)’’, and 

5 (ii) by striking ‘‘section 152(e)’’ and 

6 inserting ‘‘section 7706(e)’’, and 

7 (B) in subclause (II), by striking ‘‘section 

8 152(b)(2) or 152(b)(3)’’ and inserting ‘‘section 

9 7706(b)(2) or 7706(b)(3)’’. 

10 (6) Section 2(b)(1)(A)(ii) is amended by strik11 ing ‘‘if the taxpayer is entitled to a deduction for the 

12 taxable year for such person under section 151’’ and 

13 inserting ‘‘if the taxpayer included such person’s 

14 TIN on the return of tax for the taxable year’’. 

15 (7) Section 2(b)(1)(B) is amended by striking 

16 ‘‘if the taxpayer is entitled to a deduction for the 

17 taxable year for such father or mother under section 

18 151’’ and inserting ‘‘if such father or mother is a 

19 dependent of the taxpayer and the taxpayer included 

20 such father or mother’s TIN on the return of tax for 

21 the taxable year’’. 

22 (8) Section 2(b)(3)(B) is amended— 

23 (A) by striking ‘‘section 152(d)(2)’’ in 

24 clause (i) and inserting ‘‘section 7706(d)(2)’’, 

25 and 


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•S 5031 IS

1 (B) by striking ‘‘section 152(d)’’ in clause 

2 (ii) and inserting ‘‘section 7706(d)’’. 

3 (9) Section 36B(b)(2)(A) is amended by strik4 ing ‘‘section 152’’ and inserting ‘‘section 7706’’. 

5 (10) Section 36B(b)(3)(B) is amended by strik6 ing ‘‘unless a deduction is allowed under section 151 

7 for the taxable year with respect to a dependent’’ in 

8 the flush matter at the end and inserting ‘‘unless 

9 the taxpayer has a dependent for the taxable year 

10 (and the taxpayer included such dependent’s TIN on 

11 the return of tax for the taxable year)’’. 

12 (11) Section 36B(c)(1)(D) is amended by strik13 ing ‘‘with respect to whom a deduction under section 

14 151 is allowable to another taxpayer’’ and inserting 

15 ‘‘who is a dependent of another taxpayer’’. 

16 (12) Section 36B(d)(1) is amended by striking 

17 ‘‘equal to the number of individuals for whom the 

18 taxpayer is allowed a deduction under section 151 

19 (relating to allowance of deduction for personal ex20 emptions) for the taxable year’’ and inserting ‘‘the 

21 sum of 1 (2 in the case of a joint return) plus the 

22 number of individuals who are dependents of the 

23 taxpayer for the taxable year’’. 

24 (13) Section 36B(e)(1) is amended by striking 

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•S 5031 IS

1 lowed a deduction under section 151 (relating to al2 lowance of deduction for personal exemptions) for 

3 the taxable year (including the taxpayer or his 

4 spouse)’’ and inserting ‘‘1 or more of the taxpayer, 

5 the taxpayer’s spouse, or any dependent of the tax6 payer’’. 

7 (14) Section 42(i)(3)(D)(ii)(I) is amended by 

8 striking ‘‘section 152’’ and inserting ‘‘section 7706’’. 

9 (15) Section 45R(e)(1)(A)(iv) is amended— 

10 (A) by striking ‘‘section 152(d)(2)’’ and in11 serting ‘‘section 7706(d)(2)’’, and 

12 (B) by striking ‘‘section 152(d)(2)(H)’’ 

13 and inserting ‘‘section 7706(d)(2)(H)’’. 

14 (16) Section 51(i)(1) is amended— 

15 (A) by striking ‘‘section 152(d)(2)’’ in sub16 paragraphs (A) and (B) and inserting ‘‘section 

17 7706(d)(2)’’, and 

18 (B) by striking ‘‘section 152(d)(2)(H)’’ in 

19 subparagraph (C) and inserting ‘‘section 

20 7706(d)(2)(H)’’. 

21 (17) Section 72(t)(2)(D)(i)(III) is amended by 

22 striking ‘‘section 152’’ and inserting ‘‘section 7706’’. 

23 (18) Section 72(t)(7)(A)(iii) is amended by 

24 striking ‘‘section 152(f)(1)’’ and inserting ‘‘section 

25 7706(f)(1)’’. 


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•S 5031 IS

1 (19) Section 105(b) is amended— 

2 (A) by striking ‘‘as defined in section 152’’ 

3 and inserting ‘‘as defined in section 7706’’, 

4 (B) by striking ‘‘section 152(f)(1)’’ and in5 serting ‘‘section 7706(f)(1)’’, and 

6 (C) by striking ‘‘section 152(e)’’ and in7 serting ‘‘section 7706(e)’’. 

8 (20) Section 105(c)(1) is amended by striking 

9 ‘‘section 152’’ and inserting ‘‘section 7706’’. 

10 (21) Section 125(e)(1)(D) is amended by strik11 ing ‘‘section 152’’ and inserting ‘‘section 7706’’. 

12 (22) Section 129(c)(1) is amended to read as 

13 follows: 

14 ‘‘(1) who is a dependent of such employee or of 

15 such employee’s spouse, or’’. 

16 (23) Section 129(c)(2) is amended by striking 

17 ‘‘section 152(f)(1)’’ and inserting ‘‘section 

18 7706(f)(1)’’. 

19 (24) Section 132(h)(2)(B) is amended— 

20 (A) by striking ‘‘section 152(f)(1)’’ and in21 serting ‘‘section 7706(f)(1)’’, and 

22 (B) by striking ‘‘section 152(e)’’ and in23 serting ‘‘section 7706(e)’’. 

24 (25) Section 139D(c)(5) is amended by striking 

25 ‘‘section 152’’ and inserting ‘‘section 7706’’. 


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•S 5031 IS

1 (26) Section 139E(c)(2) is amended by striking 

2 ‘‘section 152’’ and inserting ‘‘section 7706’’. 

3 (27) Section 162(l)(1)(D) is amended by strik4 ing ‘‘section 152(f)(1)’’ and inserting ‘‘section 

5 7706(f)(1)’’. 

6 (28) Section 170(g)(1) is amended by striking 

7 ‘‘section 152’’ and inserting ‘‘section 7706’’. 

8 (29) Section 170(g)(3) is amended by striking 

9 ‘‘section 152(d)(2)’’ and inserting ‘‘section 

10 7706(d)(2)’’. 

11 (30) Section 213(a) is amended by striking 

12 ‘‘section 152’’ and inserting ‘‘section 7706’’. 

13 (31) Section 213(d)(5) is amended by striking 

14 ‘‘section 152(e)’’ and inserting ‘‘section 7706(e)’’. 

15 (32) Section 213(d)(11) is amended by striking 

16 ‘‘section 152(d)(2)’’ in the matter following subpara17 graph (B) and inserting ‘‘section 7706(d)(2)’’. 

18 (33) Section 220(b)(6) is amended by striking 

19 ‘‘with respect to whom a deduction under section 

20 151 is allowable to’’ and inserting ‘‘who is a depend21 ent of’’. 

22 (34) Section 220(d)(2)(A) is amended by strik23 ing ‘‘section 152’’ and inserting ‘‘section 7706’’. 

24 (35) Section 223(b)(6) is amended by striking 

25 ‘‘with respect to whom a deduction under section 


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•S 5031 IS

1 151 is allowable to’’ and inserting ‘‘who is a depend2 ent of’’. 

3 (36) Section 223(d)(2)(A) is amended by strik4 ing ‘‘section 152’’ and inserting ‘‘section 7706’’. 

5 (37) Section 401(h) is amended by striking 

6 ‘‘section 152(f)(1)’’ in the last sentence and insert7 ing ‘‘section 7706(f)(1)’’. 

8 (38) Section 402(l)(4)(D) is amended by strik9 ing ‘‘section 152’’ and inserting ‘‘section 7706’’. 

10 (39) Section 409A(a)(2)(B)(ii)(I) is amended 

11 by striking ‘‘section 152(a)’’ and inserting ‘‘section 

12 7706(a)’’. 

13 (40) Section 501(c)(9) is amended by striking 

14 ‘‘section 152(f)(1)’’ and inserting ‘‘section 

15 7706(f)(1)’’. 

16 (41) Section 529(e)(2)(B) is amended by strik17 ing ‘‘section 152(d)(2)’’ and inserting ‘‘section 

18 7706(d)(2)’’. 

19 (42) Section 529A(e)(4) is amended— 

20 (A) by striking ‘‘section 152(d)(2)(B)’’ and 

21 inserting ‘‘section 7706(d)(2)(B)’’, and 

22 (B) by striking ‘‘section 152(f)(1)(B)’’ and 

23 inserting ‘‘section 7706(f)(1)(B)’’. 

24 (43) Section 643(a)(2) is amended— 


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•S 5031 IS

1 (A) by striking ‘‘(relating to deduction for 

2 personal exemptions)’’ and inserting ‘‘(relating 

3 to basic deduction)’’, and 

4 (B) by striking ‘‘DEDUCTION FOR PER5 SONAL EXEMPTION’’ in the heading thereof and 

6 inserting ‘‘BASIC DEDUCTION’’. 

7 (44) Section 1361(c)(1)(C) is amended by strik8 ing ‘‘section 152(f)(1)(C)’’ and inserting ‘‘section 

9 7706(f)(1)(C)’’. 

10 (45) Section 2032A(c)(7)(D) is amended by 

11 striking ‘‘section 152(f)(2)’’ and inserting ‘‘section 

12 7706(f)(2)’’. 

13 (46) Section 5000A(b)(3)(A) is amended by 

14 striking ‘‘section 152’’ and inserting ‘‘section 7706’’. 

15 (47) Section 5000A(c)(4)(A) is amended by 

16 striking ‘‘the number of individuals for whom the 

17 taxpayer is allowed a deduction under section 151 

18 (relating to allowance of deduction for personal ex19 emptions) for the taxable year’’ and inserting ‘‘the 

20 sum of 1 (2 in the case of a joint return) plus the 

21 number of the taxpayer’s dependents for the taxable 

22 year’’. 

23 (48) Section 6103(l)(21)(A)(iii) is amended by 

24 striking ‘‘for whom a deduction is allowed under sec25 tion 151’’ and inserting ‘‘who is taken into account 


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•S 5031 IS

1 as a dependent under section 7706 for purposes of 

2 any provision of this title’’. 

3 (49) Section 6213(g)(2)(H) is amended by 

4 striking ‘‘section 21 (relating to expenses for house5 hold and dependent care services necessary for gain6 ful employment) or section 151 (relating to allow7 ance of deductions for personal exemptions)’’ and in8 serting ‘‘subsection (a)(1)(B), (b)(1)(A)(ii), or 

9 (b)(1)(B) of section 2 or section 36B(b)(3)(B)’’. 

10 (50) Section 7702B(f)(2)(C)(iii) is amended by 

11 striking ‘‘section 152(d)(2)’’ and inserting ‘‘section 

12 7706(d)(2)’’. 

13 (51) Section 7703(a) is amended by striking 

14 ‘‘part V of subchapter B of chapter 1 and’’. 

15 (52) Section 7703(b)(1) is amended by striking 

16 ‘‘section 152(f)(1))’’ and all that follows and insert17 ing ‘‘section 7706(f)(1)) who is a dependent of such 

18 individual for the taxable year (or would be but for 

19 section 7706(e)),’’. 

20 (53) Section 7706(a), as redesignated by this 

21 section, is amended by striking ‘‘this subtitle’’ and 

22 inserting ‘‘subtitle A’’. 

23 (54) Section 7706(e)(3), as redesignated by this 

24 section, is amended by inserting ‘‘(as in effect before 

25 its repeal)’’ after ‘‘section 151’’. 


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•S 5031 IS

1 (55) The table of parts for subchapter B of 

2 chapter 1 is amended by striking the item relating 

3 to part V. 

4 (56) The table of sections for chapter 79 is 

5 amended by adding at the end the following new 

6 item: 

‘‘Sec. 7706. Dependent defined.’’. 

7 (d) EFFECTIVE DATE.—The amendments made by 

8 this section shall apply to taxable years beginning after 

9 December 31, 2021. 

10 SEC. 203. REPEAL OF LIMITATIONS RELATING TO ITEMIZED 

11 DEDUCTIONS. 

12 (a) IN GENERAL.—Sections 67 and 68 are repealed. 

13 (b) CONFORMING AMENDMENTS.— 

14 (1) Section 162(o) is amended by striking para15 graph (2) and redesignating paragraph (3) as para16 graph (2). 

17 (2) Section 164(b)(5)(H)(ii) is amended— 

18 (A) by striking the comma at the end of 

19 subclause (I) and inserting ‘‘, and’’, 

20 (B) by striking ‘‘, and’’ at the end of sub21 clause (II) and inserting a period, and 

22 (C) by striking subclause (III). 

23 (3) Section 302(b)(5) is amended by inserting 

24 ‘‘, as in effect on December 31, 2021’’ after 

25 ‘‘67(c)(2)(B)’’. 


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•S 5031 IS

1 (4) Section 562(c) is amended by inserting ‘‘, 

2 as in effect on December 31, 2021’’ after 

3 ‘‘67(c)(2)(B)’’. 

4 (5) Section 642(b)(2)(C)(i)(II) is amended by 

5 inserting ‘‘, and as in effect on December 31, 2021’’ 

6 after ‘‘642(b)’’. 

7 (6) Section 6654(d)(1)(C)(iii) is amended by in8 serting ‘‘, as in effect on December 31, 2021’’ before 

9 the period. 

10 (c) EFFECTIVE DATE.—The repeal and the amend11 ments made by this section shall apply to taxable years 

12 beginning after December 31, 2021. 

13 SEC. 204. RESTORATION OF CERTAIN DEDUCTIONS. 

14 (a) DEDUCTION FOR QUALIFIED RESIDENCE INTER15 EST.—Section 163(h)(3) is amended by striking subpara16 graph (F). 

17 (b) DEDUCTION FOR STATE AND LOCAL TAXES.— 

18 Section 164(b) is amended by striking paragraph (6). 

19 (c) DEDUCTION FOR PERSONAL CASUALTY

20 LOSSES.—Section 165(h) is amended by striking para21 graph (5). 

22 (d) EFFECTIVE DATE.—The amendments made by 

23 this section shall apply to taxable years beginning after 

24 December 31, 2021. 


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•S 5031 IS

1 SEC. 205. TERMINATION OF SEPARATE TREATMENT OF 

2 CAPITAL GAINS. 

3 Subsection (h) of section 1 is amended by adding at 

4 the end the following new paragraph: 

5 ‘‘(12) TERMINATION.—This subsection shall not 

6 apply to any taxable year beginning after December 

7 31, 2021.’’. 

8 SEC. 206. REPEALS. 

9 (a) IN GENERAL.—The following provisions of the In10 ternal Revenue Code of 1986 are repealed: 

11 (1) Subpart A of part IV of subchapter A of 

12 chapter 1 (relating to nonrefundable personal cred13 its). 

14 (2) Subpart B of part IV of subchapter A of 

15 chapter 1 (relating to other credits), other than sec16 tion 27 (relating to taxes of foreign countries and 

17 possessions of the United States; possession tax 

18 credit). 

19 (3) Sections 34, 35, and 36. 

20 (4) Part VI of subchapter A of chapter 1 (relat21 ing to alternative minimum tax). 

22 (5) Section 199A (relating to deduction for 

23 qualified business income). 

24 (6) Section 217 (relating to moving expenses). 

25 (7) Section 221 (relating to interest on edu26 cation loans). 


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•S 5031 IS

1 (8) Section 222 (relating to qualified tuition 

2 and related expenses). 

3 (9) Chapter 2A (relating to unearned income 

4 medicare contribution). 

5 (b) EFFECTIVE DATE.—The repeals made by sub6 section (a) shall take effect for taxable years beginning 

7 after December 31, 2021. 

8 SEC. 207. ESTABLISHMENT OF PROGRESSIVE TAX REBATE. 

9 (a) IN GENERAL.—Section 32 is amended to read as 

10 follows: 

11 ‘‘SEC. 32. PROGRESSIVE TAX REBATE. 

12 ‘‘(a) ALLOWANCE OF CREDIT.—In the case of an eli13 gible taxpayer, there shall be allowed as a credit against 

14 the tax imposed by this subtitle for the taxable year an 

15 amount equal to the sum of— 

16 ‘‘(1) the earned income amount (as determined 

17 under subsection (b)), 

18 ‘‘(2) the child benefit amount (as determined 

19 under subsection (c)), plus 

20 ‘‘(3) the additional child benefit amount (as de21 termined under subsection (d)). 

22 ‘‘(b) EARNED INCOME AMOUNT.— 

23 ‘‘(1) SINGLE WORKERS.—In the case of an eli24 gible taxpayer (other than a head of a household as 

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1 turn for the taxable year under section 6013, the 

2 earned income amount shall be equal to— 

3 ‘‘(A) in the case of a taxpayer whose 

4 earned income for the taxable year does not ex5 ceed $6,100, 25.1 percent of such earned in6 come, 

7 ‘‘(B) in the case of a taxpayer whose 

8 earned income for the taxable year exceeds 

9 $6,100 but does not exceed $9,000, $1,530 plus 

10 17.1 percent of such earned income in excess of 

11 $6,100, 

12 ‘‘(C) in the case of a taxpayer whose 

13 earned income (or, if greater, adjusted gross in14 come) for the taxable year exceeds $9,000, but 

15 does not exceed $49,494, $2,025 minus 5 per16 cent of such earned income or adjusted gross 

17 income in excess of $9,000, or 

18 ‘‘(D) in the case of a taxpayer whose 

19 earned income (or, if greater, adjusted gross in20 come) for the taxable year exceeds $49,494, $0. 

21 ‘‘(2) HEAD OF HOUSEHOLD.—In the case of an 

22 eligible taxpayer who is a head of a household (as 

23 defined in section 2(b)), the earned income amount 

24 shall be equal to— 


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•S 5031 IS

1 ‘‘(A) in the case of a taxpayer whose 

2 earned income for the taxable year does not ex3 ceed $9,150, 25.1 percent of such earned in4 come, 

5 ‘‘(B) in the case of a taxpayer whose 

6 earned income for the taxable year exceeds 

7 $9,150 but does not exceed $13,500, $2,294 

8 plus 17.1 percent of such earned income in ex9 cess of $9,150, 

10 ‘‘(C) in the case of a taxpayer whose 

11 earned income (or, if greater, adjusted gross in12 come) for the taxable year exceeds $13,500, but 

13 does not exceed $74,241, $3,037 minus 5 per14 cent of such earned income or adjusted gross 

15 income in excess of $13,500, or 

16 ‘‘(D) in the case of a taxpayer whose 

17 earned income (or, if greater, adjusted gross in18 come) for the taxable year exceeds $74,241, $0. 

19 ‘‘(3) MARRIED FILING JOINTLY.—In the case of 

20 an eligible taxpayer filing a joint return under sec21 tion 6013, the earned income amount shall be deter22 mined pursuant to paragraph (1), except that the 

23 dollar amounts in effect under such paragraph shall 

24 be multiplied by 2. 

25 ‘‘(c) CHILD BENEFIT AMOUNT.— 


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1 ‘‘(1) IN GENERAL.—In the case of an eligible 

2 taxpayer with a qualifying child, the child benefit 

3 amount shall be equal to 15 percent of the earned 

4 income of such taxpayer for the taxable year. 

5 ‘‘(2) LIMITATIONS.— 

6 ‘‘(A) LIMITATION BASED ON NUMBER OF

7 CHILDREN.—The child benefit amount deter8 mined under paragraph (1) shall not exceed an 

9 amount equal to the product of— 

10 ‘‘(i) the number of qualifying children 

11 of the taxpayer, multiplied by 

12 ‘‘(ii) $1,590. 

13 ‘‘(B) REDUCTION BASED ON EARNINGS OR

14 ADJUSTED GROSS INCOME.—The child benefit 

15 amount determined under this subsection (as 

16 determined after application of subparagraph 

17 (A)) shall be reduced (but not below zero) by an 

18 amount equal to 5 percent of the earned income 

19 (or, if greater, the adjusted gross income) of 

20 the taxpayer for the taxable year in excess of 

21 $75,000 ($110,000 in the case of a joint re22 turn). 

23 ‘‘(d) ADDITIONAL CHILD BENEFIT AMOUNT.— 


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1 ‘‘(1) IN GENERAL.—In the case of an eligible 

2 taxpayer with a qualifying child, the additional child 

3 benefit amount shall be equal to— 

4 ‘‘(A) in the case of a taxpayer whose 

5 earned income for the taxable year does not ex6 ceed $20,000, the applicable percentage of such 

7 earned income, 

8 ‘‘(B) in the case of a taxpayer whose 

9 earned income exceeds $20,000 but does not ex10 ceed $25,000, the applicable percentage of 

11 $20,000, 

12 ‘‘(C) in the case of a taxpayer whose 

13 earned income (or, if greater, adjusted gross in14 come) exceeds $25,000 but does not exceed the 

15 applicable amount, an amount equal to— 

16 ‘‘(i) the applicable percentage of 

17 $20,000, minus 

18 ‘‘(ii) 15 percent of such earned in19 come or adjusted gross income in excess of 

20 $25,000, or 

21 ‘‘(D) in the case of a taxpayer whose 

22 earned income (or, if greater, adjusted gross in23 come) exceeds the applicable amount, $0. 

24 ‘‘(2) APPLICABLE PERCENTAGE.—For purposes 

25 of paragraph (1), the applicable percentage is— 


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•S 5031 IS

1 ‘‘(A) in the case of a taxpayer with 1 

2 qualifying child, 11 percent, 

3 ‘‘(B) in the case of a taxpayer with 2 

4 qualifying children, 17 percent, and 

5 ‘‘(C) in the case of a taxpayer with 3 or 

6 more qualifying children, 19 percent. 

7 ‘‘(3) APPLICABLE AMOUNT.—For purposes of 

8 paragraph (1), the applicable amount is— 

9 ‘‘(A) in the case of a taxpayer with 1 

10 qualifying child, $39,667, 

11 ‘‘(B) in the case of a taxpayer with 2 

12 qualifying children, $47,667, and 

13 ‘‘(C) in the case of a taxpayer with 3 or 

14 more qualifying children, $50,333. 

15 ‘‘(e) ELIGIBLE TAXPAYER.— 

16 ‘‘(1) IN GENERAL.—The term ‘eligible taxpayer’ 

17 means an individual— 

18 ‘‘(A) whose principal place of abode is in 

19 the United States for more than one-half of 

20 such taxable year, and 

21 ‘‘(B) is not a dependent (as defined under 

22 section 152) to another taxpayer for any tax23 able year beginning in the same calendar year 

24 as such taxable year. 


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1 ‘‘(2) QUALIFYING CHILD INELIGIBLE.—If an 

2 individual is the qualifying child of a taxpayer for 

3 any taxable year of such taxpayer beginning in a cal4 endar year, such individual shall not be treated as 

5 an eligible taxpayer for any taxable year of such in6 dividual beginning in such calendar year. 

7 ‘‘(3) EXCEPTION FOR TAXPAYER CLAIMING

8 BENEFITS UNDER SECTION 911.—The term ‘eligible 

9 taxpayer’ does not include any taxpayer who claims 

10 the benefits of section 911 for the taxable year. 

11 ‘‘(4) LIMITATION ON ELIGIBILITY OF NON12 RESIDENT ALIENS.—The term ‘eligible taxpayer’ 

13 shall not include any individual who is a nonresident 

14 alien individual for any portion of the taxable year 

15 unless such individual is treated for such taxable 

16 year as a resident of the United States for purposes 

17 of this chapter by reason of an election under sub18 section (g) or (h) of section 6013. 

19 ‘‘(5) IDENTIFICATION NUMBER REQUIRE20 MENT.—No credit shall be allowed under this section 

21 to an eligible taxpayer who does not include on the 

22 return of tax for the taxable year— 

23 ‘‘(A) such individual’s taxpayer identifica24 tion number, and 


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•S 5031 IS

1 ‘‘(B) if the individual is married (within 

2 the meaning of section 7703), the taxpayer 

3 identification number of such individual’s 

4 spouse. 

5 ‘‘(6) TAXPAYERS WHO DO NOT INCLUDE TIN, 

6 ETC., OF ANY QUALIFYING CHILD.—No credit shall 

7 be allowed under this section to any eligible taxpayer 

8 who has one or more qualifying children if no quali9 fying child of such taxpayer is taken into account 

10 under subsection (c) or (d) by reason of subsection 

11 (f)(4). 

12 ‘‘(7) TREATMENT OF MILITARY PERSONNEL

13 STATIONED OUTSIDE OF THE UNITED STATES.—For 

14 purposes of paragraph (1)(A) and subsection (f)(3), 

15 the principal place of abode of a member of the 

16 Armed Forces of the United States shall be treated 

17 as in the United States during any period during 

18 which such member is stationed outside the United 

19 States while serving on extended active duty with 

20 the Armed Forces of the United States. For pur21 poses of the preceding sentence, the term ‘extended 

22 active duty’ means any period of active duty pursu23 ant to a call or order to such duty for a period in 

24 excess of 90 days or for an indefinite period. 

25 ‘‘(8) JOINT RETURN.— 


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1 ‘‘(A) MARRIED INDIVIDUALS.—In the case 

2 of an individual who is married (within the 

3 meaning of section 7703), this section shall 

4 apply only if a joint return is filed for the tax5 able year under section 6013. 

6 ‘‘(B) OTHER.—In the case of taxpayer fil7 ing a joint return under section 6013, such tax8 payer shall not be treated as an eligible tax9 payer for purposes of this section unless either 

10 the taxpayer or the taxpayer’s spouse satisfies 

11 each of the requirements under this subsection. 

12 ‘‘(f) QUALIFYING CHILD.— 

13 ‘‘(1) IN GENERAL.—The term ‘qualifying child’ 

14 means a qualifying child of the taxpayer (as defined 

15 in section 152(c), determined without regard to 

16 paragraph (1)(D) thereof and section 152(e)). 

17 ‘‘(2) MARRIED INDIVIDUAL.—The term ‘quali18 fying child’ shall not include an individual who is 

19 married as of the close of the eligible taxpayer’s tax20 able year unless the individual qualifies as a depend21 ent (as defined under section 152) of the taxpayer 

22 for such taxable year. 

23 ‘‘(3) PLACE OF ABODE.—For purposes of para24 graph (1), the requirements of section 152(c)(1)(B) 


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•S 5031 IS

1 shall be met only if the principal place of abode is 

2 in the United States. 

3 ‘‘(4) IDENTIFICATION REQUIREMENTS.— 

4 ‘‘(A) IN GENERAL.—A qualifying child 

5 shall not be taken into account under sub6 section (c) or (d) unless the taxpayer includes 

7 the name, age, and TIN of the qualifying child 

8 on the return of tax for the taxable year. 

9 ‘‘(B) OTHER METHODS.—The Secretary 

10 may prescribe other methods for providing the 

11 information described in subparagraph (A). 

12 ‘‘(g) EARNED INCOME.— 

13 ‘‘(1) IN GENERAL.—The term ‘earned income’ 

14 means— 

15 ‘‘(A) wages, salaries, tips, and other em16 ployee compensation, but only if such amounts 

17 are includible in gross income for the taxable 

18 year, plus 

19 ‘‘(B) the amount of the taxpayer’s net 

20 earnings from self-employment for the taxable 

21 year (within the meaning of section 1402(a)), 

22 but such net earnings shall be determined with 

23 regard to the deduction allowed to the taxpayer 

24 by section 164(f). 


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1 ‘‘(2) SPECIAL RULES.—For purposes of para2 graph (1)— 

3 ‘‘(A) no amount received as a pension or 

4 annuity shall be taken into account, 

5 ‘‘(B) no amount to which section 871(a) 

6 applies (relating to income of nonresident alien 

7 individuals not connected with United States 

8 business) shall be taken into account, 

9 ‘‘(C) no amount received for services pro10 vided by an individual while the individual is an 

11 inmate at a penal institution shall be taken into 

12 account, 

13 ‘‘(D) no amount described in paragraph 

14 (1) received for service performed in work ac15 tivities as defined in paragraph (4) or (7) of 

16 section 407(d) of the Social Security Act to 

17 which the taxpayer is assigned under any State 

18 program under part A of title IV of such Act 

19 shall be taken into account, but only to the ex20 tent such amount is subsidized under such 

21 State program, and 

22 ‘‘(E) a taxpayer may elect to treat 

23 amounts excluded from gross income by reason 

24 of section 112 as earned income. 


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1 ‘‘(h) TAXABLE YEAR MUST BE FULL TAXABLE

2 YEAR.—Except in the case of a taxable year closed by rea3 son of the death of the eligible taxpayer, no credit shall 

4 be allowable under this section in the case of a taxable 

5 year covering a period of less than 12 months. 

6 ‘‘(i) COORDINATION WITH CERTAIN MEANS-TESTED

7 PROGRAMS.—For purposes of— 

8 ‘‘(1) the United States Housing Act of 1937, 

9 ‘‘(2) title V of the Housing Act of 1949, 

10 ‘‘(3) section 101 of the Housing and Urban De11 velopment Act of 1965, 

12 ‘‘(4) sections 221(d)(3), 235, and 236 of the 

13 National Housing Act, and 

14 ‘‘(5) the Food and Nutrition Act of 2008, 

15 any refund made to a taxpayer by reason of this section 

16 shall not be treated as income (and shall not be taken into 

17 account in determining resources for the month of its re18 ceipt and the following month). 

19 ‘‘(j) AMOUNT OF CREDIT TO BE DETERMINED

20 UNDER TABLES.—The amount of the credit allowed by 

21 this section shall be determined under tables prescribed 

22 by the Secretary. 

23 ‘‘(k) DENIAL OF CREDIT FOR INDIVIDUALS HAVING

24 EXCESSIVE INVESTMENT INCOME.— 


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1 ‘‘(1) IN GENERAL.—No credit shall be allowed 

2 under subsection (a) for the taxable year if the ag3 gregate amount of disqualified income of the tax4 payer for the taxable year exceeds $5,000. 

5 ‘‘(2) DISQUALIFIED INCOME.—For purposes of 

6 paragraph (1), the term ‘disqualified income’ 

7 means— 

8 ‘‘(A) interest or dividends to the extent in9 cludible in income for the taxable year, 

10 ‘‘(B) interest received or accrued during 

11 the taxable year which is exempt from tax im12 posed by this chapter, 

13 ‘‘(C) the excess (if any) of— 

14 ‘‘(i) gross income from rents or royal15 ties not derived in the ordinary course of 

16 a trade or business, over 

17 ‘‘(ii) the sum of— 

18 ‘‘(I) the deductions (other than 

19 interest) which are clearly and directly 

20 allocable to such gross income, plus 

21 ‘‘(II) interest deductions properly 

22 allocable to such gross income, 

23 ‘‘(D) the capital gain net income (as de24 fined in section 1222) of the taxpayer for such 

25 taxable year, and 


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1 ‘‘(E) the excess (if any) of— 

2 ‘‘(i) the aggregate income from all 

3 passive activities for the taxable year (de4 termined without regard to any amount in5 cluded in earned income under subsection 

6 (f) or described in a preceding subpara7 graph), over 

8 ‘‘(ii) the aggregate losses from all pas9 sive activities for the taxable year (as so 

10 determined). 

11 ‘‘(3) PASSIVE ACTIVITY.—For purposes of para12 graph (2)(E), the term ‘passive activity’ has the 

13 meaning given such term by section 469. 

14 ‘‘(l) INFLATION ADJUSTMENTS.— 

15 ‘‘(1) IN GENERAL.—In the case of any taxable 

16 year beginning after 2022, each of the dollar 

17 amounts in subsections (b), (c), (d), and (j)(1) shall 

18 each be increased by an amount equal to— 

19 ‘‘(A) such dollar amount, multiplied by 

20 ‘‘(B) the cost-of-living adjustment deter21 mined under section 1(f)(3) for the calendar 

22 year in which the taxable year begins, deter23 mined by substituting ‘2021’ for ‘2016’ in sub24 paragraph (A)(ii) thereof. 


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1 ‘‘(2) ROUNDING.—If any dollar amount in sub2 sections (b), (c), (d), and (j)(1), after being in3 creased under paragraph (1), is not a multiple of 

4 $100, such dollar amount shall be rounded to the 

5 nearest multiple of $100. 

6 ‘‘(m) RESTRICTIONS ON TAXPAYERS WHO IMPROP7 ERLY CLAIMED CREDIT IN PRIOR YEAR.— 

8 ‘‘(1) TAXPAYERS MAKING PRIOR FRAUDULENT

9 OR RECKLESS CLAIMS.— 

10 ‘‘(A) IN GENERAL.—No credit shall be al11 lowed under this section for any taxable year in 

12 the disallowance period. 

13 ‘‘(B) DISALLOWANCE PERIOD.—For pur14 poses of subparagraph (A), the disallowance pe15 riod is— 

16 ‘‘(i) the period of 10 taxable years 

17 after the most recent taxable year for 

18 which there was a final determination that 

19 the taxpayer’s claim of credit under this 

20 section was due to fraud, and 

21 ‘‘(ii) the period of 2 taxable years 

22 after the most recent taxable year for 

23 which there was a final determination that 

24 the taxpayer’s claim of credit under this 

25 section was due to reckless or intentional 


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1 disregard of rules and regulations (but not 

2 due to fraud). 

3 ‘‘(2) TAXPAYERS MAKING IMPROPER PRIOR

4 CLAIMS.—In the case of a taxpayer who is denied 

5 credit under this section for any taxable year as a 

6 result of the deficiency procedures under subchapter 

7 B of chapter 63, no credit shall be allowed under 

8 this section for any subsequent taxable year unless 

9 the taxpayer provides such information as the Sec10 retary may require to demonstrate eligibility for 

11 such credit.’’. 

12 (b) CONFORMING AMENDMENTS.— 

13 (1) Section 86(f)(2) is amended by striking 

14 ‘‘section 32(c)(2)’’ and inserting ‘‘section 32(g)’’. 

15 (2) Section 129(e)(2) is amended by striking 

16 ‘‘section 32(c)(2)’’ and inserting ‘‘section 32(g)’’. 

17 (3) Section 6213(g)(2) is amended— 

18 (A) in subparagraph (G), by striking ‘‘sec19 tion 32(c)(2)(A)’’ and inserting ‘‘section 

20 32(g)(1)’’, and 

21 (B) in subparagraph (K), by striking ‘‘sec22 tion 32(k)(2)’’ and inserting ‘‘section 

23 32(m)(2)’’. 


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1 (4) Paragraph (2) of section 1324(b) of title 

2 31, United States Code, is amended by inserting 

3 ‘‘32,’’ after ‘‘25A,’’. 

4 (5) The table of sections for subpart C of part 

5 IV of subchapter A of chapter 1 of subtitle A is 

6 amended by striking the item relating to section 32 

7 and inserting the following: 

‘‘Sec. 32. Progressive tax rebate.’’. 

8 (c) EFFECTIVE DATE.—The amendments made by 

9 this section shall apply to taxable years beginning after 

10 December 31, 2021. 

11 SEC. 208. TECHNICAL AND CONFORMING AMENDMENTS. 

12 The Secretary of the Treasury or the Secretary’s del13 egate shall, not later than 90 days after the date of the 

14 enactment of this Act, submit to the Committee on Ways 

15 and Means of the House of Representatives and the Com16 mittee on Finance of the Senate a draft of any technical 

17 and conforming changes in the Internal Revenue Code of 

18 1986 which are necessary to reflect throughout such Code 

19 the purposes of the provisions of, and amendments made 

20 by, this title. 

21 Subtitle B—Corporate Tax Reforms 

22 SEC. 211. CORPORATE INCOME TAX RATE REDUCTION. 

23 (a) IN GENERAL.—Subsection (b) of section 11 is 

24 amended to read as follows: 


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1 ‘‘(b) AMOUNT OF TAX.—The amount of the tax im2 posed by subsection (a) shall be an amount equal to 17 

3 percent of the taxable income.’’. 

4 (b) CONFORMING AMENDMENT.—Section 1551 is 

5 amended— 

6 (1) by striking ‘‘BENEFITS OF THE GRAD7 UATED CORPORATE RATES AND’’ in the heading, 

8 (2) by striking ‘‘the benefits of the rates con9 tained in section 11(b) which are lower than the 

10 highest rate specified in such section, or’’ in sub11 section (a), and 

12 (3) by striking ‘‘such benefits or credit’’ in sub13 section (a) and inserting ‘‘such credit’’. 

14 (c) EFFECTIVE DATE.—The amendments made by 

15 this section shall apply to taxable years beginning after 

16 December 31, 2021. 

17 TITLE III—REFUND OF EXCESS 

18 CONSUMPTION TAX REVENUE 

19 SEC. 301. REFUNDS OF EXCESS CONSUMPTION TAX REV20 ENUE. 

21 (a) IN GENERAL.—Subchapter B of chapter 65 is 

22 amended by adding at the end the following new section: 


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1 ‘‘SEC. 6433. REFUNDS OF EXCESS CONSUMPTION TAX REV2 ENUE. 

3 ‘‘(a) IN GENERAL.—In the case of any qualifying ex4 cess consumption tax revenue year, the Secretary shall pay 

5 to each eligible filer an amount equal to the consumption 

6 tax refund amount. 

7 ‘‘(b) QUALIFYING EXCESS CONSUMPTION TAX REV8 ENUE YEAR.—For purposes of this section— 

9 ‘‘(1) IN GENERAL.—The term ‘qualifying excess 

10 consumption tax revenue year’ means any calendar 

11 year for which the net consumption tax revenues ex12 ceed 10 percent of gross domestic product for such 

13 year. 

14 ‘‘(2) NET CONSUMPTION TAX REVENUES.—The 

15 net consumption tax revenues for any calendar year 

16 shall be the excess of— 

17 ‘‘(A) the tax imposed under section 3901 

18 with respect to taxable supplies the tax point 

19 for which is during such calendar year, over 

20 ‘‘(B) the credits allowed under section 

21 3916 for such calendar year. 

22 ‘‘(3) GROSS DOMESTIC PRODUCT.—The gross 

23 domestic product for any calendar year shall be the 

24 last estimate of the gross domestic product for such 

25 calendar year by the Department of Commerce 


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1 which is published before the date that is 3 months 

2 after the close of such calendar year. 

3 ‘‘(c) ELIGIBLE FILER.—For purposes of this sec4 tion— 

5 ‘‘(1) DEFINITION.— 

6 ‘‘(A) IN GENERAL.—The term ‘eligible 

7 filer’ means, with respect to any qualifying ex8 cess consumption tax revenue year, any indi9 vidual (other than an individual described in 

10 paragraph (2)) who filed a return of income tax 

11 for the individual’s qualifying rebate taxable 

12 year. 

13 ‘‘(B) EXCLUSION.—The term ‘eligible filer’ 

14 shall not include— 

15 ‘‘(i) any nonresident alien individual, 

16 ‘‘(ii) any individual who is a depend17 ent (as defined in section 152) of another 

18 taxpayer for the individual’s qualifying re19 bate taxable year, or 

20 ‘‘(iii) an estate or trust. 

21 ‘‘(2) QUALIFYING REBATE TAXABLE YEAR.— 

22 The term ‘qualifying rebate taxable year’ means, 

23 with respect to any individual in connection with a 

24 qualifying excess consumption tax revenue year, the 

25 taxable year of such individual which contains 6 or 


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•S 5031 IS

1 more months of such qualifying excess consumption 

2 tax revenue year. 

3 ‘‘(3) IDENTIFICATION REQUIREMENT.— 

4 ‘‘(A) IN GENERAL.—An individual shall 

5 not be treated as an eligible filer for any year 

6 unless such individual includes on the return of 

7 tax for such year— 

8 ‘‘(i) such individual’s valid identifica9 tion number, 

10 ‘‘(ii) in the case of a joint return, the 

11 valid identification number of such individ12 ual’s spouse, and 

13 ‘‘(iii) the valid identification number 

14 of any qualifying child (as defined in sec15 tion 32(f)) claimed on such return. 

16 ‘‘(B) VALID IDENTIFICATION NUMBER.— 

17 For purposes of subparagraph (A), the term 

18 ‘valid identification number’ means a social se19 curity number issued to an individual by the 

20 Social Security Administration. Such term shall 

21 not include a TIN issued by the Internal Rev22 enue Service. 

23 ‘‘(C) SPECIAL RULE FOR MEMBERS OF

24 THE ARMED FORCES.—Subparagraph (A) shall 

25 not apply to a joint return where at least 1 


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•S 5031 IS

1 spouse was a member of the Armed Forces of 

2 the United States at any time during the tax3 able year. 

4 ‘‘(d) CONSUMPTION TAX REFUND AMOUNT.— 

5 ‘‘(1) IN GENERAL.—The consumption tax re6 fund amount for any eligible filer for any qualifying 

7 excess consumption tax year shall be the product 

8 of— 

9 ‘‘(A) the applicable amount, times 

10 ‘‘(B) the applicable shares of the eligible 

11 filer. 

12 ‘‘(2) APPLICABLE AMOUNT.—The applicable 

13 amount for any qualifying excess revenue consump14 tion tax year is an amount equal to— 

15 ‘‘(A) the excess described in subsection 

16 (b)(1), divided by 

17 ‘‘(B) the total number of applicable shares 

18 of all eligible filers for such year. 

19 ‘‘(3) APPLICABLE SHARE.—The number of ap20 plicable shares for any eligible filer shall be the sum 

21 of— 

22 ‘‘(A) 1 (2 in the case of a joint return), 

23 plus 

‘‘(B) 1 24 ⁄2 of the number of qualifying chil25 dren (as defined in section 32(f)) claimed on 


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1 the eligible filer’s return for the filer’s quali2 fying rebate taxable year. 

3 ‘‘(e) TIME FOR PAYMENT.—Payments under sub4 section (a) shall be made as soon as practical after the 

5 Secretary has determined the consumption tax refund 

6 amount.’’. 

7 (b) CONFORMING AMENDMENTS.— 

8 (1) Section 1324(b)(2) of title 31, United 

9 States Code, is amended by striking ‘‘or 6431’’ and 

10 inserting ‘‘6431, or 6433’’. 

11 (2) The table of sections for subchapter B of 

12 chapter 65 is amended by adding at the end the fol13 lowing new item: 

‘‘Sec. 6433. Refunds of excess consumption tax revenue.’’. 

14 (c) EFFECTIVE DATE.—The amendments made by 

15 this section shall apply to calendar years beginning after 

16 the date of the enactment of this Act. 

Æ 


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