II 

115TH CONGRESS 

1ST SESSION S. 1552 

To amend the Internal Revenue Code of 1986 to allow individuals to designate 

that up to 10 percent of their income tax liability be used to reduce 

the national debt, and to require spending reductions equal to the 

amounts so designated. 

IN THE SENATE OF THE UNITED STATES 

JULY 13, 2017 

Mr. FLAKE 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 allow individuals to designate that up to 10 percent of their income 

tax liability be used to reduce the national debt, and 

to require spending reductions equal to the amounts 

so designated. 

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 ‘‘Debt Buy-Down Act’’. 


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1 SEC. 2. DESIGNATION OF AMOUNTS FOR REDUCTION OF 

2 PUBLIC DEBT. 

3 (a) IN GENERAL.—Subchapter A of chapter 61 of the 

4 Internal Revenue Code of 1986 (relating to returns and 

5 records) is amended by adding at the end the following 

6 new part: 

7 ‘‘PART IX—DESIGNATION FOR REDUCTION OF 

8 PUBLIC DEBT 

‘‘Sec. 6097. Designation. 

9 ‘‘SEC. 6097. DESIGNATION. 

10 ‘‘(a) IN GENERAL.—Every individual with adjusted 

11 income tax liability for any taxable year may designate 

12 that a portion of such liability (not to exceed 10 percent 

13 thereof) shall be used to reduce the public debt. 

14 ‘‘(b) MANNER AND TIME OF DESIGNATION.—A des15 ignation under subsection (a) may be made with respect 

16 to any taxable year only at the time of filing the return 

17 of tax imposed by chapter 1 for the taxable year. The des18 ignation shall be made on the first page of the return or 

19 on the page bearing the taxpayer’s signature. 

20 ‘‘(c) ADJUSTED INCOME TAX LIABILITY.—For pur21 poses of this section, the adjusted income tax liability of 

22 an individual for any taxable year is the income tax liabil23 ity of the individual for the taxable year determined under 

24 section 6096(b), reduced by any amount designated under 

25 section 6096(a).’’. 


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1 (b) CLERICAL AMENDMENT.—The table of parts for 

2 such subchapter A is amended by adding at the end the 

3 following new item: 

‘‘PART IX. DESIGNATION FOR REDUCTION OF PUBLIC DEBT’’. 

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

5 this section shall apply to taxable years ending after the 

6 date of the enactment of this Act. 

7 SEC. 3. PUBLIC DEBT REDUCTION TRUST FUND. 

8 (a) IN GENERAL.—Subchapter A of chapter 98 of the 

9 Internal Revenue Code of 1986 (relating to trust fund 

10 code) is amended by adding at the end the following sec11 tion: 

12 ‘‘SEC. 9512. PUBLIC DEBT REDUCTION TRUST FUND. 

13 ‘‘(a) CREATION OF TRUST FUND.—There is estab14 lished in the Treasury of the United States a trust fund 

15 to be known as the ‘Public Debt Reduction Trust Fund’, 

16 consisting of any amount appropriated or credited to the 

17 Trust Fund as provided in this section or section 9602(b). 

18 ‘‘(b) TRANSFERS TO TRUST FUND.—There are here19 by appropriated to the Public Debt Reduction Trust Fund 

20 amounts equivalent to the amounts designated under sec21 tion 6097 (relating to designation for public debt reduc22 tion). 

23 ‘‘(c) EXPENDITURES.—Amounts in the Public Debt 

24 Reduction Trust Fund shall be used by the Secretary for 

25 purposes of paying at maturity, or to redeem or buy before 


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1 maturity, any obligation of the Federal Government in2 cluded in the public debt (other than an obligation held 

3 by the Federal Old-Age and Survivors Insurance Trust 

4 Fund, or the Department of Defense Military Retirement 

5 Fund). Any obligation which is paid, redeemed, or bought 

6 with amounts from the Public Debt Reduction Trust Fund 

7 shall be canceled and retired and may not be reissued.’’. 

8 (b) CLERICAL AMENDMENT.—The table of sections 

9 for such subchapter is amended by adding at the end the 

10 following new item: 

‘‘Sec. 9512. Public Debt Reduction Trust Fund.’’. 

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

12 this section shall apply to amounts received after the date 

13 of the enactment of this Act. 

14 SEC. 4. TAXPAYER-GENERATED SEQUESTRATION OF FED15 ERAL SPENDING TO REDUCE THE PUBLIC 

16 DEBT. 

17 (a) SEQUESTRATION TO REDUCE THE PUBLIC

18 DEBT.—Part C of the Balanced Budget and Emergency 

19 Deficit Control Act of 1985 is amended by inserting after 

20 section 253 the following new section: 

21 ‘‘SEC. 253A. SEQUESTRATION TO REDUCE THE PUBLIC 

22 DEBT. 

23 ‘‘(a) SEQUESTRATION.—Within 15 days after Con24 gress adjourns to end a session, and on the same day as 

25 sequestration (if any) under sections 251, 252, and 253, 


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1 and under section 5(b) of the Statutory Pay-As-You-Go 

2 Act of 2010, but after any sequestration required by those 

3 sections, there shall be a sequestration equivalent to the 

4 estimated aggregate amount designated under section 

5 6097 of the Internal Revenue Code of 1986 for the last 

6 taxable year ending 1 year before the beginning of that 

7 session of Congress, as estimated by the Department of 

8 the Treasury on October 1 and as modified by the total 

9 of— 

10 ‘‘(1) any amounts by which net discretionary 

11 spending is reduced by an Act of Congress to be 

12 below the discretionary spending limits that is en13 acted after the date of enactment of this section and 

14 relate to the fiscal year subject to the sequestration 

15 (or, in the absence of such limits, any net deficit 

16 change from the baseline amount calculated under 

17 section 257); and 

18 ‘‘(2) the net deficit change that has resulted 

19 from all direct spending legislation enacted after the 

20 date of enactment of this section that relate to the 

21 fiscal year subject to the sequestration, as estimated 

22 by the Office of Management and Budget. 

23 If the reduction in spending under paragraphs (1) and (2) 

24 for a fiscal year is greater than the estimated aggregate 

25 amount designated under section 6097 of the Internal 


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1 Revenue Code of 1986 for that fiscal year, then there shall 

2 be no sequestration under this section. 

3 ‘‘(b) APPLICABILITY.— 

4 ‘‘(1) IN GENERAL.—Notwithstanding sections 

5 255 and 256, and except as provided by paragraph 

6 (2), each account of the United States shall be re7 duced by a dollar amount calculated by multiplying 

8 the level of budgetary resources in that account at 

9 that time by the uniform percentage necessary to 

10 carry out subsection (a). All obligational authority 

11 reduced under this section shall be done in a manner 

12 that makes such reductions permanent. 

13 ‘‘(2) EXEMPT ACCOUNTS.—No order issued 

14 under this section may— 

15 ‘‘(A) reduce benefits payable to the old-age 

16 and survivors insurance program established 

17 under title II of the Social Security Act; 

18 ‘‘(B) reduce retired or retainer pay payable 

19 to a member or former member of the uni20 formed services; or 

21 ‘‘(C) reduce payments for net interest (all 

22 of major functional category 900).’’. 

23 (b) REPORTS.—Section 254 of the Balanced Budget 

24 and Emergency Deficit Control Act of 1985 is amended— 


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1 (1) in subsection (a), by adding at the end of 

2 the table the following new item: 

‘‘October 1 ..................................... Department of the Treasury report to 

Congress estimating amount of income tax designated pursuant to 

section 6097 of the Internal Revenue Code of 1986.’’; 

3 (2) in subsection (c)— 

4 (A) in paragraph (1), by inserting ‘‘, and 

5 sequestration to reduce the public debt,’’ after 

6 ‘‘sequestration’’; 

7 (B) by redesignating paragraph (5) as 

8 paragraph (6); and 

9 (C) by inserting after paragraph (4) the 

10 following: 

11 ‘‘(5) REPORTS ON SEQUESTRATION TO REDUCE

12 THE PUBLIC DEBT.—The preview reports shall set 

13 forth for the budget year estimates for each of the 

14 following: 

15 ‘‘(A) The aggregate amount designated 

16 under section 6097 of the Internal Revenue 

17 Code of 1986 for the last taxable year ending 

18 before the budget year. 

19 ‘‘(B) The amount of reductions required 

20 under section 253A and the deficit remaining 

21 after those reductions have been made. 


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1 ‘‘(C) The sequestration percentage nec2 essary to achieve the required reduction in ac3 counts under section 253A(b).’’; and 

4 (3) in subsection (f)— 

5 (A) by redesignating paragraphs (4) and 

6 (5) as paragraphs (5) and (6), respectively; and 

7 (B) by inserting after paragraph (3) the 

8 following: 

9 ‘‘(4) REPORTS ON SEQUESTRATION TO REDUCE

10 THE PUBLIC DEBT.—The final reports shall contain 

11 all of the information contained in the public debt 

12 taxation designation report required on October 1.’’. 

13 (c) CONFORMING AMENDMENT.—The table of con14 tents in section 250(a) of the Balanced Budget and Emer15 gency Deficit Control Act of 1985 is amended by inserting 

16 after the item relating to section 253 the following: 

‘‘Sec. 253A. Sequestration to reduce the public debt.’’. 

17 (d) SUNSET.—The amendments made by this section 

18 shall cease to have force or effect after the first fiscal year 

19 during which there is no public debt. 

Æ 


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