I 

112TH CONGRESS 

2D SESSION H. R. 4397 

To amend the Internal Revenue Code of 1986 to allow a deduction for 

expenses paid for household and dependent care services necessary for 

gainful employment and to increase, and make refundable, the credit 

for such expenses. 

IN THE HOUSE OF REPRESENTATIVES 

APRIL 18, 2012 

Mrs. MALONEY introduced the following bill; which was referred to the 

Committee on Ways and Means 

A BILL 

To amend the Internal Revenue Code of 1986 to allow a 

deduction for expenses paid for household and dependent 

care services necessary for gainful employment and to 

increase, and make refundable, the credit for such expenses. 

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. 

4 This Act may be cited as the ‘‘Child Care Afford5 ability Act of 2012’’. 


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1 SEC. 2. ALLOWANCE OF DEDUCTION FOR EXPENSES FOR 

2 HOUSEHOLD AND DEPENDENT CARE SERV3 ICES NECESSARY FOR GAINFUL EMPLOY4 MENT. 

5 (a) IN GENERAL.—Part VII of subchapter B of chap6 ter 1 of the Internal Revenue Code of 1986 (relating to 

7 additional itemized deductions for individuals) is amended 

8 by redesignating section 224 as section 225 and inserting 

9 after section 223 the following new section: 

10 ‘‘SEC. 224. EXPENSES FOR HOUSEHOLD AND DEPENDENT 

11 CARE SERVICES NECESSARY FOR GAINFUL 

12 EMPLOYMENT. 

13 ‘‘(a) ALLOWANCE OF DEDUCTION.—In the case of an 

14 individual for whom there are 1 or more qualifying individ15 uals with respect to such individual, there shall be allowed 

16 as a deduction an amount equal to so much of the employ17 ment-related expenses paid by such individual during the 

18 taxable year as do not exceed— 

19 ‘‘(1) $13,000 if there is 1 qualifying individual 

20 with respect to the taxpayer for such taxable year, 

21 or 

22 ‘‘(2) 200 percent of the dollar amount in effect 

23 under paragraph (1) for the taxable year if there are 

24 2 or more qualifying individuals with respect to the 

25 taxpayer for such taxable year. 


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1 ‘‘(b) DEFINITIONS AND SPECIAL RULES.—For pur2 poses of this section— 

3 ‘‘(1) QUALIFYING INDIVIDUAL; EMPLOYMENT4 RELATED EXPENSES.—The terms ‘qualifying indi5 vidual’ and ‘employment-related expenses’ shall have 

6 the respective meanings given such terms by section 

7 21(b). 

8 ‘‘(2) DENIAL OF DOUBLE BENEFIT.— 

9 ‘‘(A) COORDINATION WITH DEPENDENT

10 CARE ASSISTANCE PROGRAM.—The amount of 

11 employment-related expenses otherwise taken 

12 into account under subsection (a) shall be re13 duced by the aggregate amount excludable from 

14 gross income under section 129 for the taxable 

15 year. 

16 ‘‘(B) COORDINATION WITH CREDIT FOR

17 EMPLOYMENT-RELATED EXPENSES.—No deduc18 tion shall be allowed under subsection (a) for a 

19 taxable year with respect to the employment-re20 lated expenses of the taxpayer if the taxpayer 

21 elects to have section 21 apply for such taxable 

22 year. 

23 ‘‘(3) SPECIAL RULE FOR SPOUSE WHO IS A

24 STUDENT OR INCAPABLE OF CARING FOR HIM25 SELF.—In the case of a spouse who is a student or 


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1 a qualified individual described in section 

2 21(b)(1)(C), for purposes of paragraph (4), such 

3 spouse shall be deemed for each month during which 

4 such spouse is a full-time student at an educational 

5 institution, or is such a qualifying individual, to be 

6 gainfully employed and to have earned income of not 

7 less than— 

‘‘(A) 1 8 ⁄12 of the amount in effect under 

9 subsection (a)(1) if such subsection applies for 

10 the taxable year, or 

‘‘(B) 1 11 ⁄12 of the amount in effect under 

12 subsection (a)(2) if such subsection applies for 

13 the taxable year. 

14 In the case of any husband and wife, this paragraph 

15 shall apply with respect to only one spouse for any 

16 one month. 

17 ‘‘(4) OTHER SPECIAL RULES.—Rules similar to 

18 the rules of subsections (d)(1) and (e) of section 21 

19 shall apply for purposes of this section. 

20 ‘‘(c) INFLATION ADJUSTMENT.— 

21 ‘‘(1) IN GENERAL.—In the case of a taxable 

22 year beginning after 2013, the dollar amount under 

23 subsection (a)(1) shall be increased by an amount 

24 equal to— 

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


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1 ‘‘(B) the cost-of-living adjustment deter2 mined under section 1(f)(3) for the calendar 

3 year in which the taxable year begins, deter4 mined by substituting ‘calendar year 2012’ for 

5 ‘calendar year 1992’ in subparagraph (B) 

6 thereof. 

7 ‘‘(2) ROUNDING.—If any amount as adjusted 

8 under subparagraph (A) is not a multiple of $100, 

9 such amount shall be rounded to the next lowest 

10 multiple of $100. 

11 ‘‘(d) REGULATIONS.—The Secretary shall prescribe 

12 such regulations as may be necessary to carry out the pur13 poses of this section.’’. 

14 (b) DEDUCTIBLE WHETHER OR NOT TAXPAYER

15 ITEMIZES.—Subsection (a) of section 62 of such Code (de16 fining adjusted gross income) is amended by inserting 

17 after paragraph (21) the following new paragraph: 

18 ‘‘(22) EXPENSES FOR HOUSEHOLD AND DE19 PENDENT CARE SERVICES NECESSARY FOR GAINFUL

20 EMPLOYMENT.—The deduction allowed by section 

21 224.’’. 

22 (c) CONFORMING AMENDMENTS.— 

23 (1) Subsection (e) of section 213 is amended by 

24 inserting ‘‘or deduction under section 224’’ after 

25 ‘‘section 21’’. 


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1 (2) Paragraph (2) of section 6213(g) is amend2 ed— 

3 (A) by striking ‘‘or’’ in subparagraph (H) 

4 and inserting ‘‘, section 224 (relating to ex5 penses for household and dependent care serv6 ices necessary for gainful employment), or’’, 

7 and 

8 (B) by striking ‘‘or 6428’’ in subparagraph 

9 (L) and inserting ‘‘224, or 6428’’. 

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

11 this section shall apply to expenses paid in taxable years 

12 beginning after the date of the enactment of this Act. 

13 SEC. 3. MODIFICATION OF CREDIT FOR EXPENSES FOR 

14 HOUSEHOLD AND DEPENDENT CARE SERV15 ICES NECESSARY FOR GAINFUL EMPLOY16 MENT. 

17 (a) IN GENERAL.— 

18 (1) INCREASE IN CREDIT LIMITATION.—Sub19 section (c) of section 21 of the Internal Revenue 

20 Code of 1986 (relating to dollar limit on amount 

21 creditable) is amended— 

22 (A) by striking ‘‘$3,000’’ in paragraph (1) 

23 and inserting ‘‘$13,000’’, and 

24 (B) by striking ‘‘$6,000’’ in paragraph (2) 

25 and inserting ‘‘200 percent of the dollar 


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1 amount in effect under paragraph (1) for the 

2 taxable year’’. 

3 (2) INFLATION ADJUSTMENT.—Section 21 of 

4 such Code is amended by redesignating subsection 

5 (f) as subsection (g) and inserting after subsection 

6 (e) the following new subsection: 

7 ‘‘(f) INFLATION ADJUSTMENT.— 

8 ‘‘(1) IN GENERAL.—In the case of a taxable 

9 year beginning after 2013, the dollar amount under 

10 subsection (a)(1) shall be increased by an amount 

11 equal to— 

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

13 ‘‘(B) the cost-of-living adjustment deter14 mined under section 1(f)(3) for the calendar 

15 year in which the taxable year begins, deter16 mined by substituting ‘calendar year 2012’ for 

17 ‘calendar year 1992’ in subparagraph (B) 

18 thereof. 

19 ‘‘(2) ROUNDING.—If any amount as adjusted 

20 under subparagraph (A) is not a multiple of $100, 

21 such amount shall be rounded to the next lowest 

22 multiple of $100.’’. 

23 (3) INCREASE IN DEEMED EARNED INCOME

24 AMOUNTS.—Paragraph (2) of section 21(d) of such 

25 Code (relating to special rules for spouse who is a 


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1 student or incapable of caring for himself) is amend2 ed— 

3 (A) by striking ‘‘$250 if subsection (c)(1)’’ 

in subparagraph (A) and inserting ‘‘1 4 ⁄12 of the 

5 amount in effect under subsection (c)(1) if such 

6 subsection’’, and 

7 (B) by striking ‘‘$500 if subsection (c)(2)’’ 

in subparagraph (B) and inserting ‘‘1 8 ⁄12 of the 

9 amount in effect under subsection (c)(2) if such 

10 subsection’’. 

11 (4) INCREASES IN CREDIT NOT SUBJECT TO

12 EGTRRA SUNSET.—Section 901 of the Economic 

13 Growth and Tax Relief Reconciliation Act of 2001 

14 shall not apply to the amendments made by section 

15 204 of such Act. 

16 (b) COORDINATION WITH DEDUCTION FOR EMPLOY17 MENT-RELATED EXPENSES.—Subsection (e) of section 21 

18 of such Code (relating to special rules) is amended by add19 ing at the end the following new paragraph: 

20 ‘‘(11) ELECTION TO HAVE SECTION APPLY.— 

21 This section shall apply to any taxpayer for any tax22 able year only if such taxpayer elects (at such time 

23 and in such manner as the Secretary may by regula24 tions prescribe) to have this section apply for such 

25 taxable year.’’. 


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1 (c) CREDIT MADE REFUNDABLE.— 

2 (1) CREDIT MOVED TO SUBPART RELATING TO

3 REFUNDABLE CREDITS.—Such Code is amended— 

4 (A) by redesignating section 21, as amend5 ed by this section, as section 36B, and 

6 (B) by moving section 36B (as so redesig7 nated) from subpart A of part IV of subchapter 

8 A of chapter 1 to the location immediately be9 fore section 37 in subpart C of part IV of sub10 chapter A of chapter 1. 

11 (d) CONFORMING AMENDMENTS.— 

12 (1) Section 224(b) of such Code, as added by 

13 this Act, is amended— 

14 (A) by striking ‘‘section 21(b)’’ in para15 graph (1) and inserting ‘‘section 36B(b)’’, 

16 (B) by striking ‘‘section 21’’ in paragraph 

17 (2)(B) and inserting ‘‘section 36B’’, 

18 (C) by striking ‘‘section 21(b)(1)(C)’’ in 

19 paragraph (3) and inserting ‘‘section 

20 36B(b)(1)(C)’’, and 

21 (D) by striking ‘‘section 21’’ in paragraph 

22 (4) and inserting ‘‘section 36B’’. 

23 (2) Subsection (e) of section 213 of such Code 

24 is amended by striking ‘‘section 21’’ and inserting 

25 ‘‘section 36B’’. 


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1 (3) Paragraph (2) of section 6213(g) of such 

2 Code is amended by striking ‘‘section 21’’ each place 

3 it appears and inserting ‘‘section 36B’’. 

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

5 31, United States Code, is amended by inserting ‘‘, 

6 36B,’’ after ‘‘36A,’’. 

7 (5) The table of sections for subpart A of part 

8 IV of subchapter A of chapter 1 of the Internal Rev9 enue Code of 1986 is amended by striking the item 

10 relating to section 21. 

11 (6) The table of sections for subpart C of part 

12 IV of subchapter A of chapter 1 of such Code is 

13 amended by inserting after the item relating to sec14 tion 36A the following new item: 

‘‘Sec. 36B. Expenses for household and dependent care services necessary for 

gainful employment.’’. 

15 (e) EFFECTIVE DATE.—The amendments made by 

16 this section shall apply to expenses paid in taxable years 

17 beginning after the date of the enactment of this Act. 

Æ 


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