I

104TH CONGRESS

2D SESSION H. R. 3998

To provide that individuals otherwise entitled to receive payments from the

Federal Government may specify that a portion of those payments be

used for deficit reduction.

IN THE HOUSE OF REPRESENTATIVES

AUGUST 2, 1996

Mr. NETHERCUTT (for himself, Mr. WICKER, and Mr. BARRETT of Wisconsin)

introduced the following bill; which was referred to the Committee on

Ways and Means, and in addition to the Committees on National Security, Veterans’ Affairs, and the Budget, for a period to be subsequently

determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned

A BILL

To provide that individuals otherwise entitled to receive payments from the Federal Government may specify that

a portion of those payments be used for deficit reduction.

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; TABLE OF CONTENTS.

4 (a) SHORT TITLE.—This Act may be cited as the

5 ‘‘Citizen Debt Reduction Contribution Act’’.

6 (b) TABLE OF CONTENTS.—

Sec. 1. Short title; table of contents.

Sec. 2. Sense of the Congress.
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Sec. 3. Income tax refunds.

Sec. 4. Donation of social security benefits for purposes of reducing the Federal

deficit.

Sec. 5. Donation of military retirement benefits for purposes of reducing the

Federal deficit.

Sec. 6. Donation of veterans’ disability compensation for purposes of reducing

the Federal deficit.

Sec. 7. Budgetary treatment of savings resulting from this Act.

1 SEC. 2. SENSE OF THE CONGRESS.

2 It is the sense of the Congress that any budget sav3 ings resulting from this Act should be used solely to re4 duce net Government spending. Congress appreciates and

5 respects the contributions made by citizens participating

6 in the programs authorized by this Act, and shares their

7 concerns at excessive Government spending.

8 SEC. 3. INCOME TAX REFUNDS.

9 (a) GENERAL RULE.—Subchapter A of chapter 61 of

10 the Internal Revenue Code of 1986 (relating to returns

11 and records) is amended by adding at the end the follow12 ing new part:

13 ‘‘PART IX—DESIGNATION OF IN14 COME TAX OVERPAYMENTS

15 TO BE USED TO REDUCE PUB16 LIC DEBT

‘‘Sec. 6097. Designation of income tax overpayments.

17 ‘‘SEC. 6097. DESIGNATION OF INCOME TAX OVERPAYMENTS.

18 ‘‘(a) GENERAL RULE.—Every taxpayer who makes a

19 return of the tax imposed by chapter 1 for any taxable

20 year may designate that a specified portion (not less than
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1 $1) of any overpayment of tax for such taxable year shall

2 be used to reduce the public debt of the United States.

3 ‘‘(b) MANNER AND TIME OF DESIGNATION.—Any

4 designation under subsection (a) for any taxable year shall

5 be made—

6 ‘‘(1) at the time of filing the return of the tax

7 imposed by chapter 1 for such taxable year, and

8 ‘‘(2) in such manner as the Secretary may by

9 regulation prescribe, except that such designation

10 shall be made either on the first page of the return

11 or on the page bearing the taxpayer’s signature.

12 ‘‘(c) TREATMENT OF AMOUNTS DESIGNATED.—For

13 purposes of this title, the amount designated by any tax14 payer under subsection (a)—

15 ‘‘(1) shall be treated as being refunded to such

16 taxpayer as of the last date prescribed for filing the

17 return of tax imposed by chapter 1 (determined

18 without regard to extensions) or, if later, the date

19 the return is filed, and

20 ‘‘(2) shall be treated as a contribution made by

21 such taxpayer on such date to the United States.’’

22 (b) TRANSFER OF DESIGNATED AMOUNTS FOR DEF23 ICIT REDUCTION.—The Secretary of the Treasury shall,

24 from time to time, transfer to the special account de25 scribed in section 3113(d) of title 31, United States Code,
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1 the amounts designated under section 6097 of the Internal

2 Revenue Code of 1986 to be used to reduce the public

3 debt of the United States.

4 (c) CLERICAL AMENDMENT.—The table of parts for

5 subchapter A of chapter 61 of such Code is amended by

6 adding at the end the following new item:

‘‘Part IX. Designation of income tax overpayments to be used to

reduce public debt.’’

7 (d) EFFECTIVE DATE.—The amendments made by

8 this section shall apply to taxable years beginning after

9 December 31, 1995.

10 SEC. 4. DONATION OF SOCIAL SECURITY BENEFITS FOR

11 PURPOSES OF REDUCING THE FEDERAL DEF12 ICIT.

13 Section 201(i) of the Social Security Act (42 U.S.C.

14 401(i)) is amended—

15 (1) in paragraph (1), by inserting ‘‘(A)’’ after

16 ‘‘(1)’’;

17 (2) in paragraph (2), by striking ‘‘paragraph

18 (1)’’ and inserting ‘‘subparagraph (A)’’, and by re19 designating subparagraphs (A) and (B) as clauses

20 (i) and (ii), respectively;

21 (3) by redesignating paragraph (2) as subpara22 graph (B); and

23 (4) by adding at the end the following new

24 paragraph:
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1 ‘‘(2)(A) The Commissioner of Social Security shall

2 establish a program under which recipients of monthly in3 surance benefits under this title may elect to have the

4 Commissioner, in lieu of certification of payment of bene5 fits to the recipient pursuant to section 205(i), certify to

6 the Managing Trustee that all or a designated portion of

7 such benefits be transferred to the general fund of the

8 Treasury as a gift which the Managing Trustee is author9 ized, as Secretary of the Treasury, to accept as a gift

10 under subsection (a)(1)(A) of section 3113 of title 31,

11 United States Code (relating to accepting gifts for reduc12 ing the public debt).

13 ‘‘(B) Amounts to which an election under subpara14 graph (A) applies shall not be includible in gross income

15 for purposes of the Internal Revenue Code of 1986. No

16 deduction shall be allowed under such Code with respect

17 to any amount which is not includible in gross income by

18 reason of the preceding sentence.’’

19 SEC. 5. DONATION OF MILITARY RETIREMENT BENEFITS

20 FOR PURPOSES OF REDUCING THE FEDERAL

21 DEFICIT.

22 (a) IN GENERAL.—Chapter 71 of title 10, United

23 States Code, is amended by adding at the end the follow24 ing new section:
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1 ‘‘§ 1413. Donations for purposes of reducing the pub2 lic debt

3 ‘‘(a) The Secretary concerned shall establish a pro4 gram under which a member or former member of the

5 armed forces under the jurisdiction of the Secretary who

6 is entitled to receive retired or retainer pay may elect that

7 all or a designated portion of such pay for any month be

8 transferred to the general fund of the Treasury as a gift

9 to reduce the public debt. Any such election may be re10 voked at any time.

11 ‘‘(b) For any month for which an election under sub12 section (a) is in effect, the Secretary concerned shall with13 hold from the retired or retainer pay of the person making

14 the election the amount designated by that person in such

15 election and shall transfer the amount so withheld to the

16 Secretary of the Treasury.

17 ‘‘(c) The Secretary of the Treasury is authorized to

18 accept any amount transferred to the Secretary under this

19 section as a gift under subsection (a)(1)(A) of section

20 3113 of title 31 (relating to accepting gifts for reducing

21 the public debt).

22 ‘‘(d) Amounts to which an election under subsection

23 (a) applies shall not be includible in gross income for pur24 poses of the Internal Revenue Code of 1986. No deduction

25 shall be allowed under such Code with respect to any
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1 amount which is not includible in gross income by reason

2 of the preceding sentence.’’

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

4 at the beginning of such chapter is amended by adding

5 at the end the following new item:

‘‘1413. Donations for purposes of reducing the public debt.’’.

6 SEC. 6. DONATION OF VETERANS’ DISABILITY COMPENSA7 TION FOR PURPOSES OF REDUCING THE FED8 ERAL DEFICIT.

9 (a) IN GENERAL.—Chapter 53 of title 38, United

10 States Code, is amended by adding at the end the follow11 ing new section:

12 ‘‘§ 5320. Donations of compensation for purposes of

13 reducing the public debt

14 ‘‘(a) The Secretary shall establish a program under

15 which a veteran who is entitled to compensation may elect

16 that all or a designated portion of such compensation for

17 any month be transferred to the general fund of the Treas18 ury as a gift to reduce the public debt. Any such election

19 may be revoked at any time.

20 ‘‘(b) For any month for which an election under sub21 section (a) is in effect, the Secretary shall withhold from

22 the compensation payable to the veteran making the elec23 tion the amount designated by the veteran in such election

24 and shall transfer the amount so withheld to the Secretary

25 of the Treasury.
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1 ‘‘(c) The Secretary of the Treasury is authorized to

2 accept any amount transferred to the Secretary under this

3 section as a gift under subsection (a)(1)(A) of section

4 3113 of title 31 (relating to accepting gifts for reducing

5 the public debt).

6 ‘‘(d) Amounts to which an election under subsection

7 (a) applies shall not be includible in gross income for pur8 poses of the Internal Revenue Code of 1986. No deduction

9 shall be allowed under such Code with respect to any

10 amount which is not includible in gross income by reason

11 of the preceding sentence.’’

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

13 at the beginning of such chapter is amended by adding

14 at the end the following new item:

‘‘5320. Donations of compensation for purposes of reducing the public debt.’’.

15 SEC. 7. BUDGETARY TREATMENT OF SAVINGS RESULTING

16 FROM THIS ACT.

17 Savings resulting from the enactment of this Act

18 shall not be considered for purposes of estimates made for

19 this Act under section 252(d) of the Balanced Budget and

20 Emergency Deficit Control Act of 1985.

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