I 

109TH CONGRESS 

1ST SESSION H. R. 2249 

To amend the Internal Revenue Code of 1986 to modify and make refundable 

the credit for expenses for household and dependent care services necessary for gainful employment. 

IN THE HOUSE OF REPRESENTATIVES 

MAY 11, 2005 

Mr. PORTER 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 modify 

and make refundable the credit for expenses for household and dependent care services necessary for gainful 

employment. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. REFUNDABLE CREDIT FOR EXPENSES FOR 

4 HOUSEHOLD AND DEPENDENT CARE SERV5 ICES NECESSARY FOR GAINFUL EMPLOY6 MENT. 

7 (a) $3,000 PER CHILD LIMIT.—Paragraphs (1) and 

8 (2) of section 21(c) of the Internal Revenue Code of 1986 
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1 (relating to dollar limit on amount creditable) are amend2 ed to read as follows: 

3 ‘‘(1) $3,000, multiplied by 

4 ‘‘(2) the number of qualifying individuals with 

5 respect to the taxpayer for such taxable year.’’. 

6 (b) MODIFICATION OF ADJUSTED GROSS INCOME

7 LIMITATION.— 

8 (1) IN GENERAL.—Paragraph (2) of section 

9 21(a) of such Code is amended to read as follows: 

10 ‘‘(2) ADJUSTED GROSS INCOME LIMITATION.— 

11 The amount of the credit allowable under paragraph 

12 (1) shall be reduced (but not below zero) by $50 for 

13 each $1,000 (or fraction thereof) by which the tax14 payer’s adjusted gross income exceeds $125,000 

15 (twice such amount in the case of a joint return).’’. 

16 (2) CONFORMING AMENDMENT.—Section 

17 21(a)(1) of such Code is amended by striking ‘‘ap18 plicable percentage’’ and inserting ‘‘35 percent’’. 

19 (c) INFLATION ADJUSTMENT.—Subsection (e) of sec20 tion 21 of such Code is amended by adding at the end 

21 the following new paragraph: 

22 ‘‘(11) INFLATION ADJUSTMENT.—In the case of 

23 any taxable year beginning in a calendar year after 

24 2006, the $125,000 amount contained in subsection 

25 (a)(2) and the $3,000 amount contained in sub-
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1 section (c)(1) shall each 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 ‘2005’ for ‘1992’ in sub8 paragraph (B) thereof. 

9 Any increase determined under the preceding sen10 tence shall be rounded to the nearest multiple of 

11 $50.’’. 

12 (d) CREDIT MADE REFUNDABLE.— 

13 (1) CREDIT MOVED TO SUBPART RELATING TO

14 REFUNDABLE CREDITS.—The Internal Revenue 

15 Code of 1986 is amended— 

16 (A) by redesignating section 36 as section 

17 37, 

18 (B) by redesignating section 21, as amend19 ed by this Act, as section 36, and 

20 (C) by moving section 36 (as so redesig21 nated) from subpart A of part IV of subchapter 

22 A of chapter 1 to the location immediately be23 fore section 37 (as so redesignated) in subpart 

24 C of part IV of subchapter A of chapter 1. 

25 (2) CONFORMING AMENDMENTS.— 
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1 (A) Paragraph (2) of section 1324(b) of 

2 title 31, United States Code, is amended by in3 serting ‘‘or 36’’ after ‘‘section 35’’. 

4 (B) The table of sections for subpart A of 

5 part IV of subchapter A of chapter 1 of the In6 ternal Revenue Code of 1986 is amended by 

7 striking the item relating to section 21. 

8 (C) The table of sections for subpart C of 

9 part IV of subchapter A of chapter 1 of the In10 ternal Revenue Code of 1986 is amended by re11 designating the item relating to section 36 as 

12 an item relating to section 37 and by inserting 

13 before such item the following new item: 

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

gainful employment.’’. 

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

15 this section shall apply to taxable years beginning after 

16 December 31, 2005. 

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