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107TH CONGRESS

1ST SESSION H. R. 1835

To amend the Internal Revenue Code of 1986 to exclude from gross income

computers and Internet access provided by an employer for the personal

use of employees.

IN THE HOUSE OF REPRESENTATIVES

MAY 15, 2001

Mr. WELLER (for himself, Mr. LEWIS of Georgia, Mr. MATSUI, Mr. COLLINS,

Mr. MCDERMOTT, Mr. TOM DAVIS of Virginia, Mr. ISAKSON, Mr. MORAN

of Virginia, Mr. MEEKS of New York, Mrs. JONES of Ohio, Mrs.

TAUSCHER, Ms. DEGETTE, Mr. BOUCHER, Ms. MCKINNEY, Mr. GIBBONS, Mr. LANTOS, Mr. BERMAN, Mr. QUINN, Mr. UDALL of Colorado,

Mr. STRICKLAND, and Mr. TURNER) 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 exclude

from gross income computers and Internet access provided by an employer for the personal use of employees.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,
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1 SECTION 1. EMPLOYER PROVIDED COMPUTERS AND

2 INTERNET ACCESS TREATED AS EDU3 CATIONAL ASSISTANCE PROGRAMS.

4 (a) IN GENERAL.—Paragraph (1) of section 127(c)

5 of the Internal Revenue Code of 1986 (relating to certain

6 educational assistance programs) is amended—

7 (1) by striking ‘‘and’’ at the end of subpara8 graph (A), by inserting ‘‘and’’ at the end of sub9 paragraph (B), and by inserting after subparagraph

10 (B) the following new subparagraph:

11 ‘‘(C) the provision, by an employer, of

12 computer equipment or Internet access for an

13 employee,’’, and

14 (2) by inserting ‘‘(other than computer equip15 ment and Internet access)’’ after ‘‘supplies’’ in the

16 material following subparagraph (C).

17 (b) MAXIMUM EXCLUSION RULE NOT TO APPLY.—

18 Paragraph (2) of section 127(a) of such Code is

19 amended—

20 (1) by striking ‘‘such assistance’’ and inserting

21 ‘‘educational assistance described in subsection

22 (c)(1)(A) or (B)’’, and

23 (2) by inserting ‘‘FOR CERTAIN EDUCATIONAL

24 ASSISTANCE PROGRAMS’’ after ‘‘EXCLUSION’’ in the

25 heading.
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1 (c) DEFINITIONS.—Subsection (c) of section 127 of

2 such Code is amended by adding at the end the following

3 new paragraphs:

4 ‘‘(8) INTERNET ACCESS.—For purposes of this

5 section, the term ‘Internet access’ means access to

6 the Internet (including necessary equipment) pro7 vided by the employer or pursuant to a contract

8 which is arranged for or entered into by the em9 ployer.

10 ‘‘(9) COMPUTER EQUIPMENT.—For purposes of

11 this section, the term ‘computer equipment’, whether

12 purchased directly or subsidized by the employer,

13 includes—

14 ‘‘(A) any computer or peripheral equip15 ment (as defined by section 168(i)(2)(B), with16 out regard to clause (iv)(II) of such section),

17 ‘‘(B) any software which is loaded into

18 such computer, and

19 ‘‘(C) technical and service support and

20 other incidental benefits provided in connection

21 with the employer’s computer educational pro22 gram.’’.

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

24 this section shall apply to computers and Internet access
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1 provided in taxable years beginning after December 31,

2 1999.

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