II 

115TH CONGRESS 

1ST SESSION S. 2018 

To amend the Internal Revenue Code of 1986 to make the child tax credit 

fully refundable, establish an increased child tax credit for young children, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

OCTOBER 26, 2017 

Mr. BENNET (for himself and Mr. BROWN) 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 make 

the child tax credit fully refundable, establish an increased child tax credit for young children, 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. 

4 This Act may be cited as the ‘‘American Family Act 

5 of 2017’’. 


lotter on DSKBCFDHB2PROD with BILLS
2 

•S 2018 IS

1 SEC. 2. ESTABLISHMENT OF FULLY REFUNDABLE CHILD 

2 TAX CREDIT. 

3 (a) ELIMINATION OF EXISTING CHILD TAX CRED4 IT.—Subpart A of part IV of subchapter A of chapter 1 

5 of subtitle A of the Internal Revenue Code of 1986 is 

6 amended by striking section 24. 

7 (b) ESTABLISHMENT OF FULLY REFUNDABLE

8 CHILD TAX CREDIT.—Subpart C of part IV of subchapter 

9 A of chapter 1 of subtitle A of such Code is amended by 

10 inserting after section 36B the following new section: 

11 ‘‘SEC. 36C. CHILD TAX CREDIT. 

12 ‘‘(a) ALLOWANCE OF CREDIT.—There shall be al13 lowed as a credit against the tax imposed by this chapter 

14 for the taxable year an amount equal to the sum of— 

15 ‘‘(1) with respect to each qualifying child of the 

16 taxpayer who has attained 6 years of age before the 

17 close of such taxable year and for which the tax18 payer is allowed a deduction under section 151, an 

19 amount equal to $3,000, and 

20 ‘‘(2) with respect to each qualifying child of the 

21 taxpayer who has not attained 6 years of age before 

22 the close of such taxable year and for which the tax23 payer is allowed a deduction under section 151, an 

24 amount equal to 120 percent of the dollar amount 

25 in paragraph (1). 

26 ‘‘(b) LIMITATION.— 


lotter on DSKBCFDHB2PROD with BILLS
3 

•S 2018 IS

1 ‘‘(1) IN GENERAL.—The amount of the credit 

2 allowable under subsection (a) shall be reduced (but 

3 not below zero) by the applicable amount for each 

4 $1,000 (or fraction thereof) by which the taxpayer’s 

5 modified adjusted gross income exceeds the thresh6 old amount. For purposes of the preceding sentence, 

7 the term ‘modified adjusted gross income’ means ad8 justed gross income increased by any amount ex9 cluded from gross income under section 911, 931, or 

10 933. 

11 ‘‘(2) THRESHOLD AMOUNT.— 

12 ‘‘(A) IN GENERAL.—For purposes of para13 graph (1), the term ‘threshold amount’ 

14 means— 

15 ‘‘(i) $110,000 in the case of a joint 

16 return, 

17 ‘‘(ii) $75,000 in the case of an indi18 vidual who is not married, and 

19 ‘‘(iii) $55,000 in the case of a married 

20 individual filing a separate return. 

21 ‘‘(B) MARITAL STATUS.—For purposes of 

22 this paragraph, marital status shall be deter23 mined under section 7703. 


lotter on DSKBCFDHB2PROD with BILLS
4 

•S 2018 IS

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

2 paragraph (1), the term ‘applicable amount’ means 

3 an amount equal to the quotient of— 

4 ‘‘(A) the amount of the credit allowable 

5 under subsection (a), as determined without re6 gard to this subsection, divided by 

7 ‘‘(B) an amount equal to the product of— 

8 ‘‘(i) $20, multiplied by 

9 ‘‘(ii) the total number of qualifying 

10 children of the taxpayer. 

11 ‘‘(c) QUALIFYING CHILD.— 

12 ‘‘(1) IN GENERAL.—In this section, the term 

13 ‘qualifying child’ means a qualifying child of the tax14 payer (as defined in section 152(c)) who has not at15 tained 19 years of age. 

16 ‘‘(2) EXCEPTION FOR CERTAIN NON-CITI17 ZENS.—The term ‘qualifying child’ shall not include 

18 any individual who would not be a dependent if sub19 paragraph (A) of section 152(b)(3) were applied 

20 without regard to all that follows ‘resident of the 

21 United States’. 

22 ‘‘(d) INFLATION ADJUSTMENT.— 

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

24 year beginning after 2017, the $3,000 amount in 


lotter on DSKBCFDHB2PROD with BILLS
5 

•S 2018 IS

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

2 equal to— 

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

4 ‘‘(B) the cost of living adjustment deter5 mined under section 1(f)(3) for the calendar 

6 year in which the taxable year begins deter7 mined by substituting ‘calendar year 2016’ for 

8 ‘calendar year 1992’ in subparagraph (B) 

9 thereof. 

10 ‘‘(2) ROUNDING.—If any increase determined 

11 under paragraph (1) is not a multiple of $50, such 

12 increase shall be rounded to the nearest multiple of 

13 $50. 

14 ‘‘(e) IDENTIFICATION REQUIREMENTS.— 

15 ‘‘(1) QUALIFYING CHILD IDENTIFICATION RE16 QUIREMENT.—No credit shall be allowed under this 

17 section to a taxpayer with respect to any qualifying 

18 child unless the taxpayer includes the name and tax19 payer identification number of such qualifying child 

20 on the return of tax for the taxable year and such 

21 taxpayer identification number was issued on or be22 fore the due date for filing such return. 

23 ‘‘(2) TAXPAYER IDENTIFICATION REQUIRE24 MENT.—No credit shall be allowed under this section 

25 if the identifying number of the taxpayer was issued 


lotter on DSKBCFDHB2PROD with BILLS
6 

•S 2018 IS

1 after the due date for filing the return for the tax2 able year. 

3 ‘‘(f) TAXABLE YEAR MUST BE FULL TAXABLE

4 YEAR.—Except in the case of a taxable year closed by rea5 son of the death of the taxpayer, no credit shall be allow6 able under this section in the case of a taxable year cov7 ering a period of less than 12 months. 

8 ‘‘(g) RESTRICTIONS ON TAXPAYERS WHO IMPROP9 ERLY CLAIMED CREDIT IN PRIOR YEAR.— 

10 ‘‘(1) TAXPAYERS MAKING PRIOR FRAUDULENT

11 OR RECKLESS CLAIMS.— 

12 ‘‘(A) IN GENERAL.—No credit shall be al13 lowed under this section for any taxable year in 

14 the disallowance period. 

15 ‘‘(B) DISALLOWANCE PERIOD.—For pur16 poses of subparagraph (A), the disallowance pe17 riod is— 

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

19 after the most recent taxable year for 

20 which there was a final determination that 

21 the taxpayer’s claim of credit under this 

22 section was due to fraud, and 

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

24 after the most recent taxable year for 

25 which there was a final determination that 


lotter on DSKBCFDHB2PROD with BILLS
7 

•S 2018 IS

1 the taxpayer’s claim of credit under this 

2 section was due to reckless or intentional 

3 disregard of rules and regulations (but not 

4 due to fraud). 

5 ‘‘(2) TAXPAYERS MAKING IMPROPER PRIOR

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

7 credit under this section for any taxable year as a 

8 result of the deficiency procedures under subchapter 

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

10 this section for any subsequent taxable year unless 

11 the taxpayer provides such information as the Sec12 retary may require to demonstrate eligibility for 

13 such credit. 

14 ‘‘(h) RECONCILIATION OF CREDIT AND ADVANCE

15 CREDIT.— 

16 ‘‘(1) IN GENERAL.—The amount of the credit 

17 allowed under this section for any taxable year shall 

18 be reduced (but not below zero) by the aggregate 

19 amount of any advance payments of such credit 

20 under section 7527A for such taxable year. 

21 ‘‘(2) EXCESS ADVANCE PAYMENTS.—If the ag22 gregate amount of advance payments under section 

23 7527A for the taxable year exceed the amount of the 

24 credit allowed under this section for such taxable 

25 year (determined without regard to paragraph (1)), 


lotter on DSKBCFDHB2PROD with BILLS
8 

•S 2018 IS

1 the tax imposed by this chapter for such taxable 

2 year shall be increased by the amount of such ex3 cess’’. 

4 (c) ADVANCE PAYMENT OF CREDIT.—Chapter 77 of 

5 the Internal Revenue Code of 1986 is amended by insert6 ing after section 7527 the following new section: 

7 ‘‘SEC. 7527A. ADVANCE PAYMENT OF CHILD TAX CREDIT. 

8 ‘‘(a) IN GENERAL.—As soon as practicable and not 

9 later than 1 year after the date of the enactment of this 

10 section, the Secretary shall establish a program for mak11 ing advance payments of the credit allowed under section 

12 36C on a monthly basis (determined without regard to 

13 subsection (h)(1) of such section), or as frequently as the 

14 Secretary determines to be administratively feasible, to 

15 taxpayers allowed such credit. 

16 ‘‘(b) LIMITATION.— 

17 ‘‘(1) IN GENERAL.—The Secretary may make 

18 payments under subsection (a) only to the extent 

19 that the total amount of such payments made to any 

20 taxpayer during the taxable year does not exceed an 

21 amount equal to the excess, if any, of— 

22 ‘‘(A) subject to paragraph (2), the amount 

23 determined under subsection (a) of section 36C 

24 with respect to such taxpayer (determined withVerDate Sep 11 2014 01:12 Oct 28, 2017 Jkt 079200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S2018.IS S2018

lotter on DSKBCFDHB2PROD with BILLS
9 

•S 2018 IS

1 out regard to subsection (h) of such section) for 

2 such taxable year, over 

3 ‘‘(B) the estimated tax imposed by subtitle 

4 A, as reduced by the credits allowable under 

5 subparts A and C (with the exception of section 

6 36C) of such part IV, with respect to such tax7 payer for such taxable year, as determined in 

8 such manner as the Secretary deems appro9 priate. 

10 ‘‘(2) APPLICATION OF THRESHOLD AMOUNT

11 LIMITATION.—The program described in subsection 

12 (a) shall make reasonable efforts to apply the limita13 tion of section 36C(b) with respect to payments 

14 made under such program.’’. 

15 (d) CONFORMING AMENDMENTS.— 

16 (1) The table of sections for subpart A of part 

17 IV of subchapter A of chapter 1 of subtitle A of the 

18 Internal Revenue Code of 1986 is amended by strik19 ing the item relating to section 24. 

20 (2) The table of sections for subpart C of part 

21 IV of subchapter A of chapter 1 of subtitle A of 

22 such Code is amended by inserting after the item re23 lating to section 36B the following: 

‘‘Sec. 36C. Child tax credit.’’. 


lotter on DSKBCFDHB2PROD with BILLS
10 

•S 2018 IS

1 (3) The table of sections for chapter 77 of such 

2 Code is amended by inserting after the item relating 

3 to section 7527 the following new item: 

‘‘Sec. 7527A. Advance payment of child tax credit.’’. 

4 (4) Subparagraph (B) of section 45R(f)(3) of 

5 such Code is amended to read as follows: 

6 ‘‘(B) SPECIAL RULE.—Any amounts paid 

7 pursuant to an agreement under section 3121(l) 

8 (relating to agreements entered into by Amer9 ican employers with respect to foreign affiliates) 

10 which are equivalent to the taxes referred to in 

11 subparagraph (A) shall be treated as taxes re12 ferred to in such subparagraph.’’. 

13 (5) Section 152(f)(6)(B)(ii) of such Code is 

14 amended by striking ‘‘section 24’’ and inserting 

15 ‘‘section 36C’’. 

16 (6) Paragraph (26) of section 501(c) of such 

17 Code is amended in the flush matter at the end by 

18 striking ‘‘section 24(c))’’ and inserting ‘‘section 

19 36C(c)) who has not attained 17 years of age’’. 

20 (7) Section 6211(b)(4)(A) of such Code is 

21 amended— 

22 (A) by striking ‘‘24(d),’’, and 

23 (B) by inserting ‘‘36C,’’ after ‘‘36B,’’. 

24 (8) Section 6213(g)(2) of such Code is amend25 ed— 


lotter on DSKBCFDHB2PROD with BILLS
11 

•S 2018 IS

1 (A) in subparagraph (I), by striking ‘‘sec2 tion 24(e)’’ and inserting ‘‘section 36C(e)’’, and 

3 (B) in subparagraph (L), by striking ‘‘24, 

4 or 32’’ and inserting ‘‘32, or 36C’’. 

5 (9) Paragraph (2) of section 1324(b) of title 

6 31, United States Code, is amended by inserting 

7 ‘‘36C,’’ after ‘‘36B,’’. 

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

9 this section shall apply to taxable years beginning after 

10 December 31, 2016. 

Æ 


lotter on DSKBCFDHB2PROD with BILLS