I

106TH CONGRESS

1ST SESSION H. R. 1710

To amend the Internal Revenue Code of 1986 to allow a credit against

income tax for expenses of attending elementary and secondary schools

and for contributions to such schools and to charitable organizations

which provide scholarships for children to attend such schools.

IN THE HOUSE OF REPRESENTATIVES

MAY 5, 1999

Mr. SALMON (for himself, Mr. HAYWORTH, Mr. GARY MILLER of California,

Ms. PRYCE of Ohio, Mr. MCINTOSH, Mr. SENSENBRENNER, Mr.

LARGENT, Mr. FORBES, Mr. PICKERING, Mr. CUNNINGHAM, Mr.

LATOURETTE, Mr. SHADEGG, Mr. HOSTETTLER, Mr. HILL of Montana,

and Mrs. WILSON) 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 allow a

credit against income tax for expenses of attending elementary and secondary schools and for contributions to

such schools and to charitable organizations which provide scholarships for children to attend such schools.

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 ‘‘K–12 Education Excel5 lence Now Act of 1999’’.
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1 SEC. 2. CREDIT FOR ELEMENTARY AND SECONDARY

2 SCHOOL EXPENSES AND FOR CONTRIBU3 TIONS TO SUCH SCHOOLS AND TO CHARI4 TABLE ORGANIZATIONS WHICH PROVIDE

5 SCHOLARSHIPS FOR STUDENTS ATTENDING

6 SUCH SCHOOLS.

7 (a) IN GENERAL.—Subpart B of part IV of sub8 chapter A of chapter 1 of the Internal Revenue Code of

9 1986 is amended by adding at the end the following new

10 section:

11 ‘‘SEC. 30B. CREDIT FOR ELEMENTARY AND SECONDARY

12 SCHOOL EXPENSES AND FOR CONTRIBU13 TIONS TO SUCH SCHOOLS AND TO CHARI14 TABLE ORGANIZATIONS WHICH PROVIDE

15 SCHOLARSHIPS FOR STUDENTS ATTENDING

16 SUCH SCHOOLS.

17 ‘‘(a) ALLOWANCE OF CREDIT.—There shall be al18 lowed as a credit against the tax imposed by this chapter

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

20 ‘‘(1) the qualified elementary and secondary

21 education expenses which are paid or incurred by

22 the taxpayer during such taxable year, and

23 ‘‘(2) the qualified charitable contributions of

24 the taxpayer for the taxable year.

25 ‘‘(b) MAXIMUM CREDIT.—The credit allowed by sub26 section (a) for any taxable year shall not exceed—
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1 ‘‘(1) $100 in the case of taxable years begin2 ning in calendar year 1999,

3 ‘‘(2) $150 in the case of taxable years begin4 ning in calendar year 2000,

5 ‘‘(3) $200 in the case of taxable years begin6 ning in calendar year 2001, and

7 ‘‘(4) $250 in the case of taxable years begin8 ning after calendar year 2001.

9 In the case of a joint return, the limitation under this sub10 section shall be twice the dollar amount otherwise applica11 ble under the preceding sentence.

12 ‘‘(c) QUALIFIED ELEMENTARY AND SECONDARY

13 EDUCATION EXPENSES.—For purposes of this section—

14 ‘‘(1) IN GENERAL.—The term ‘qualified elemen15 tary and secondary education expenses’ means tui16 tion, fees, tutoring, special needs services, books,

17 supplies, computer equipment (including related

18 software and services) and other equipment, trans19 portation, and supplementary expenses required for

20 the enrollment or attendance of any individual at a

21 public, private, or religious elementary or secondary

22 school.

23 ‘‘(2) SPECIAL RULE FOR HOME-SCHOOLING.—

24 Such term shall include expenses described in para25 graph (1) required for education provided for
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1 homeschooling if the requirements of any applicable

2 State or local law are met with respect to such edu3 cation.

4 ‘‘(3) TEACHER-PROVIDED MATERIALS.—In the

5 case of an individual who is a teacher at an elemen6 tary or secondary school, such term includes

7 amounts paid by the individual for materials used by

8 such individual in the classroom.

9 ‘‘(4) ELEMENTARY OR SECONDARY SCHOOL.—

10 The term ‘elementary or secondary school’ means

11 any school which provides elementary education or

12 secondary education (through grade 12), as deter13 mined under State law.

14 ‘‘(d) QUALIFIED CHARITABLE CONTRIBUTION.—For

15 purposes of this section—

16 ‘‘(1) IN GENERAL.—The term ‘qualified chari17 table contribution’ means, with respect to any tax18 able year, the amount allowable as a deduction

19 under section 170 for cash contributions to—

20 ‘‘(A) an elementary or secondary school, or

21 ‘‘(B) a school tuition organization.

22 ‘‘(2) SCHOOL TUITION ORGANIZATION.—

23 ‘‘(A) IN GENERAL.—The term ‘school tui24 tion organization’ means any organization de25 scribed in section 170(c)(2) if the annual dis-
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1 bursements of the organization for elementary

2 and secondary school scholarship are normally

3 not less than 90 percent of the sum of such or4 ganization’s annual gross income and contribu5 tions and gifts.

6 ‘‘(B) EXCEPTIONS.—Such term shall not

7 include any organization if substantially all of

8 its scholarships (by value) may be used to at9 tend only 1 school.

10 ‘‘(C) ELEMENTARY AND SECONDARY

11 SCHOOL SCHOLARSHIP.—The term ‘elementary

12 and secondary school scholarship’ means any

13 scholarship excludable from gross income under

14 section 117 for expenses related to education at

15 an elementary or secondary school.

16 ‘‘(e) SPECIAL RULES.—

17 ‘‘(1) DENIAL OF DOUBLE BENEFIT.—No deduc18 tion shall be allowed under this chapter for any con19 tribution for which credit is allowed under this sec20 tion.

21 ‘‘(2) APPLICATION WITH OTHER CREDITS.—

22 The credit allowable under subsection (a) for any

23 taxable year shall not exceed the excess (if any) of—

24 ‘‘(A) the regular tax for the taxable year,

25 reduced by the sum of the credits allowable
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1 under subpart A and the preceding sections of

2 this subpart, over

3 ‘‘(B) the tentative minimum tax for the

4 taxable year.

5 ‘‘(3) CONTROLLED GROUPS.—All persons who

6 are treated as one employer under subsection (a) or

7 (b) of section 52 shall be treated as 1 taxpayer for

8 purposes of this section.

9 ‘‘(f) ELECTION TO HAVE CREDIT NOT APPLY.—A

10 taxpayer may elect to have this section not apply for any

11 taxable year.’’

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

13 for subpart B of part IV of subchapter A of chapter 1

14 of such Code is amended by adding at the end the fol15 lowing new item:

‘‘Sec. 30B. Credit for elementary and secondary school expenses

and for contributions to such schools and to charitable organizations which provide scholarships for

students attending such schools.’’

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

17 this section shall apply to taxable years beginning after

18 December 31, 1998.

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