COMPARISON OF REVENUE PROVISIONS IN H.R. 434

AS PASSED BY THE HOUSE AND THE SENATE

Prepared by the Staff

of the

JOINT COMMITTEE ON TAXATION

March 1, 2000

JCX-16-00
(i)

CONTENTS

Page

N AND LEGISLATIVE BACKGROUND ............................................. 1

VISIONS ........................................................................ 2

on Use of Nonaccrual Experience Method of Accounting (sec. 21 of the House bill and sec. 504 of the

endment) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

f Certain Vaccines Against Streptococcus Pneumonia in List of Taxable Vaccines (sec. 22 of the

................................................................................ 2

on of Installment Method and Repeal of Installment Method for Accrual Method Taxpayers

f the Senate amendment) ............................................................ 3

s on Prefunding Certain Employee Benefits (sec. 502 of the Senate amendment) ................. 3

of Gain from Constructive Ownership Transactions (sec. 503 of the Senate amendment) .......... 4

of Basis on Transfers of Intangibles in Certain Nonrecognition Transactions (sec. 505 of the Senate

t) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

 Elective Withholding Rate for Nonperiodic Distributions from Deferred Compensation Plans

f the Senate amendment) ............................................................ 4

Relating to Real Estate Investment Trusts (secs. 610-623 of the Senate amendment) ............. 5
Page

(ii)

on of Individual Estimated Tax Safe Harbor (sec. 623 of the Senate amendment) ................ 5

aiver from Denial of Foreign Tax Credits (sec. 724 of the Senate amendment) .................. 6
nt may be cited as follows: Joint Committee on Taxation, Comparison of Revenue Provisions in H.R. 434, as

nd the Senate (JCX-16-00), March 1, 2000.

ve history to the Senate amendment, see S. Rep. 106-119 (Senate Committee on Finance), S. Rep. 106-137

 Finance), and S. Rep. 106-160 (Senate Committee on Finance).

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INTRODUCTION AND LEGISLATIVE BACKGROUND

,1 prepared by the staff of the Joint Committee on Taxation, provides a comparison of the revenue provisions

 the “African Growth and Opportunity Act,” as passed by the House and as amended by the Senate. 

passed by the House on July 16, 1999. The bill, as amended by the Senate, was passed by the Senate on
as passed by the House on October 6, 1999. H.R. 2990 as passed by the House has two divisions. Division A is

he Uninsured Act of 1999,” and Division B is the “Bipartisan Consumers Managed Care Improvement Act of

mended by the provisions of S. 1344 as amended by the Senate (the “Patients Bill of Rights Plus Act”), was

n October 14, 1999.

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EM HOUSE BILL SENATE AMENDMENT

Use of Nonaccrual

hod of Accounting

House bill and sec.

te amendment)

` Limits use of the nonaccrual method to

receivables from the provision ofqualified personal services.

` The effect of change in method to be

taken into account over a period of upto 4 years.

` Effective for taxable years ending after

the date of enactment.

` Provision included in H.R. 2488 as

passed by the Congress and vetoed bythe President.

` Provision included in H.R. 2990 as

passed by the Senate.3

Same as the House bill.

rtain Vaccines

coccus Pneumonia

ble Vaccines (sec. 22

l)

Provision included in the Ticket to Workand Work Incentives Improvement Act of1999, Pub. L. No. 106-170 (December 17,1999).

No provision.
EM HOUSE BILL SENATE AMENDMENT

-3-

 Installment

peal of Installment

rual Method

 501 of the Senate

No provision. Provision included in the Ticket to Work

and Work Incentives Improvement Act of1999, Pub. L. No. 106-170 (December 17,1999).

Prefunding Certain

fits (sec. 502 of the

ment)

No provision. ` Limits the present-law exception for

10-or-more employer plans tootherwise applicable deduction limit toplans that provide only medical,disability and qualifying group-termlife insurance benefits.

` An excise tax is imposed on the

employer if any portion of a welfarebenefit fund attributable tocontributions that are deductible underthe 10-or-more employer rule is for apurpose other than which thecontributions were made.

` Effective with respect to contributions

paid or accrued after June 9, 1999, intaxable years ending after such date.

` Same provision included in H.R. 2488,

as passed by the Congress and vetoedby the President (except for theeffective date). Same provisionincluded in the Senate amendment toH.R. 2990.
EM HOUSE BILL SENATE AMENDMENT

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ain from

wnership

ec. 503 of the Senate

No provision. Provision included in the Ticket to Work

and Work Incentives Improvement Act of1999, Pub. L. No. 106-170 (December 17,1999).

asis on Transfers of

Certain

 Transactions (sec.

te amendment)

No provision. ` Provides that an interest in intangible

property constituting less than all thesubstantial rights of the transferorqualifies as property for purposes ofnonrecognition treatment under theprovisions allowing tax-free transfersof property to a corporation or apartnership. Basis allocation isrequired. 

` Applicable to transfers on or after the

date of enactment.

ctive Withholding

riodic Distribuions

Compensation Plans

Senate amendment)

No provision. Increases the elective withholding rate on

nonperiodic distributions from deferredcompensation plans from 10 percent to 15percent, effective for distributions afterDecember 31, 2000.
EM HOUSE BILL SENATE AMENDMENT

-5-

ting to Real Estate

sts (“REITs”) (secs.

Senate amendment)

No provision. Provisions included in the Ticket to Work

and Work Incentives Improvement Act of1999, Pub. L. No. 106-170 (December 17,1999), except for the provision relating tocontrolled entities ineligible for REITstatus.

ual Estimated Tax

c. 623 of the Senate

No provision. ` Modifies the prior-year's estimated tax

safe harbor for taxpayers with AGIabove $150,000 so that it is 106.5% for 2000 and 106 percent for 2001.

` Pursuant to the Ticket to Work and

Work Incentives Improvement Act of1999, Pub. L. No. 106-170 (December17, 1999), the present-law safe harboris 108.6% for 2000 and 110% for 2001.
EM HOUSE BILL SENATE AMENDMENT

-6-

 from Denial of

edits (sec. 724 of the

ment)

No provision. Provides that section 901(j) (relating to

the denial of foreign tax credits to certaincountries such as those the United Statesdoes not recognize or with respect towhich the United States has severeddiplomatic relations) no longer applieswith respect to a foreign country if thePresident determines that such a waiver isin the national interest and will expandtrade and investment opportunities forU.S. companies in that country and certain reporting requirements aresatisfied. Effective on or after February 1,2001.