h computer modeling

of analysis relating to

e to any Member of

like assistance in

sals and examining the

 administrative, and

ch proposals.

LATION

volved in every aspect

ocess. Among other

1) prepares hearing

ports, and conference

nagers), (2) assists the

ative Counsel in the

anguage, (3) assists

h the development of

embers of Congress in

ues and problems, (5)

e estimates of all tax

the Congress, and (6)

and studies of various

system.

T staff has prepared

damental tax reform,

te and gift taxes, the

nimum tax, effective

 the taxation of capital

avings, tax provisions

 complexity for small

uring of the Internal

UTIES

ired to (1) investigate

f Federal taxes and the

axes, (2) investigate

 taxes, (3) report the

igations and make

recommendations, and (4) review proposedincome tax refunds in excess of $1 million.From time to time, the JCT staff is asked toundertake special studies or investigations. Forexample, in the early 1970's, the JCT staff wasasked to review President Nixon’s tax returns.More recently, the JCT staff was asked toinvestigate allegations of bias in the IRS handlingof exempt organization matters.The JCT staff also prepares special reports thatare required by law or requested by a Member.The JCT staff is required to prepare a complexityanalysis of provisions contained in revenuelegislation that are of widespread applicability toindividuals and small business. The JCT staffconducted studies during 1999 of (1) the interestand penalty provisions in the Internal RevenueCode, and (2) provisions relating to taxpayerconfidentiality. The JCT staff is also required toconduct a study of the complexity of the presentlaw Federal tax system and prepare materials inconnection with annual joint hearings relating toIRS operations for calendar years 1999-2003.Each year the JCT staff prepares and publishes alist of tax expenditures, as required by theCongressional Budget and Impoundment ControlAct of 1974 (the “Budget Act”). Taxexpenditures are “revenue losses attributable toprovisions of the Federal tax laws which allow aspecial exclusion, exemption, or deduction fromgross income or which provide a special credit, apreferential rate of tax, or a deferral of taxliability.” The most recent JCT tax expenditurereport was published in December 1999.

REVENUE ESTIMATES

Under the Budget Act, the JCT staff is theofficial scorekeeper of Congress for thebudgetary implications (“revenue effects”) of anyproposed revenue legislation.

Any Member of Congress may request a revenueestimate for a tax proposal. A written requestsigned by the requesting Member should be sentto the Chief of Staff, Joint Committee onTaxation, 1015 Longworth House OfficeBuilding. The request should describe in detailthe proposal to be estimated (including theeffective date) and should include the name of acontact person in case there are questions aboutthe proposal. Statutory language should beincluded if available.Work on revenue estimates generally is done ona first-in first-out basis, with some exceptionsmade for previously estimated proposals. Someresponses take longer than others because ofdifficulties in obtaining data and developing thenecessary models. When revenue legislation ispending in the House or the Senate, requestsrelating to such pending legislation receive higherpriority.When revenue estimates are completed, therequesting Member receives a written responsefrom the JCT Chief of Staff. The responsecontains a brief summary of the proposal and therevenue estimate for the proposal. The JCT staffdoes not provide verbal (telephone) responses torevenue requests.

ESTIMATING METHODOLOGY

The starting point for many revenue estimates isthe tax return data supplied to the JCT staff bythe Internal Revenue Service (“IRS”). Theseconfidential data include statistically validsamples of individual and corporate tax returns.The JCT individual income tax model is based ona sample of approximately 150,000 individual taxreturns chosen to reflect accurately all majorfeatures of the individual income tax. The dataare statistically adjusted to match current baselineforecasts of all relevant economic anddemographic variables for the current budgetperiod. If a revenue estimate cannot be
roups, (2) data on the

ted taxpayers are not

) in some cases, no

lable to allocate to

 by businesses. The

distributional analyses

n which the effects of

ome groups cannot be

accuracy.

Y OF REQUESTS

rs of Congress to the

imates, distributional

istance are treated as

 responses to such

o the Member making

T response remains

mber decides to make

This confidential

posals extends to the

egislation, which may

sultation between a

aff) and the JCT staff.

n provided to the JCT

ulation of a revenue

nfidential and is not

taff.

may request a revenue

on which has been

wise has entered the

revenue estimate has

y available document

mmarizing a markup

 markup), the estimate

e upon request.

JCT PUBLICATIONS

The JCT website (www.house.gov/jct)contains a listing of all JCT publicationsissued since 1981. Copies may be obtainedfrom the JCT documents room (1620Longworth HOB), by calling (202) 225-2647, or by sending an e-mail request tojctpublications@mail.house.gov.

Publications issued in 1998 and 1999 areavailable on the website for viewing ordownloading. Publications issued in 2000generally will be available on the websitewithin one or two days of publication.

JCT OFFICES

The JCT maintains offices on both theHouse and Senate sides of the Capitol.The main JCT offices are located at:1015 Longworth House Office BuildingWashington, D.C. 20515Phone: 202-225-3621Fax: 202-225-0832204 Dirksen Senate Office BuildingWashington, D.C. 20510Phone: 202-224-5561

BACKGROUND

INFORMATION

RELATING TO THE

JOINT COMMITTEE

ON TAXATION

January 12, 2000

JCX-1-00