108TH CONGRESS

2D SESSION H. R. 4841

AN ACT

To amend the Internal Revenue Code of 1986 to

simplify certain tax rules for individuals.

108TH CONGRESS

2D SESSION H. R. 4841

AN ACT

To amend the Internal Revenue Code of 1986 to simplify

certain tax rules for individuals.

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. SHORT TITLE.

2 This Act may be cited as the ‘‘Tax Simplification for

3 Americans Act of 2004’’.

4 SEC. 2. HEAD OF HOUSEHOLD FILING STATUS CHANGED TO

5 SINGLE HEAD OF HOUSEHOLD.

6 (a) IN GENERAL.—The following provisions of the In7 ternal Revenue Code of 1986 are each amended by strik8 ing ‘‘head of a household’’ each place it appears and in9 serting ‘‘single head of household’’:

10 (1) Subsection (b) of section 1.

11 (2) Paragraphs (1) and (3) of section 2(b).

12 (3) The table in section 25B(b).

13 (4) Clause (iii) of section 151(c)(6)(B).

14 (5) Clauses (ii) and (iii) of section

15 151(d)(3)(C).

16 (6) Subparagraph (A) of section 6012(a)(1).

17 (b) OTHER CONFORMING AMENDMENTS.—

18 (1) Subparagraph (B) of section 63(c)(2) of

19 such Code is amended by striking ‘‘head of house20 hold’’ and inserting ‘‘single head of household’’.

21 (2) Section 1 of such Code is amended—

22 (A) in the heading for subsection (b) by in23 serting ‘‘SINGLE’’ before ‘‘HEADS’’ ,

24 (B) in subsection (c) by inserting ‘‘single’’

25 before ‘‘head’’, and
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1 (C) in the heading of subsection (c) by in2 serting ‘‘SINGLE’’ before ‘‘HEADS’’.

3 (3) The heading for section 2(b) of such Code

4 is amended to read as follows: ‘‘DEFINITION OF SIN5 GLE HEAD OF HOUSEHOLD’’.

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

7 this section shall apply to taxable years beginning after

8 December 31, 2004.

9 SEC. 3. EXPANDED AVAILABILITY OF 1040EZ AND 1040A.

10 (a) IN GENERAL.—Chapter 77 of the Internal Rev11 enue Code of 1986 (relating to miscellaneous provisions)

12 is amended by adding at the end the following new section:

13 ‘‘SEC. 7529. DOLLAR THRESHOLD FOR THE USE OF FORMS

14 1040EZ AND 1040A.

15 ‘‘(a) IN GENERAL.—An individual shall not be ineli16 gible to use Form 1040EZ and Form 1040A for filing in17 dividual income tax returns on the basis of—

18 ‘‘(1) the amount of the taxpayer’s taxable inter19 est income, or

20 ‘‘(2) the amount of the taxpayer’s taxable in21 come,

22 so long as the taxpayer’s taxable income does not exceed

23 $100,000.

24 ‘‘(b) INFLATION ADJUSTMENT.—In the case of any

25 taxable year beginning in a calendar year after 2004, the
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1 $100,000 dollar amount in subsection (a) shall be in2 creased by an amount equal to—

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

4 ‘‘(2) the cost-of-living adjustment determined

5 under section 1(f)(3) for such calendar year by sub6 stituting ‘calendar year 2003’ for ‘calendar year

7 1992’ in subparagraph (B) thereof.

8 If any amount as adjusted under the preceding sentence

9 is not a multiple of $10,000, such amount shall be round10 ed to the nearest multiple of $10,000.’’.

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

12 for chapter 77 of such Code is amended by adding at the

13 end the following new item:

‘‘Sec. 7529. Dollar threshold for the use of forms 1040EZ and

1040A.’’.

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

15 this section shall apply to taxable years beginning after

16 December 31, 2003.

17 SEC. 4. SIMPLIFICATION THROUGH ELIMINATION OF INOP18 ERATIVE PROVISIONS.

19 (a) IN GENERAL.—

20 (1) ADJUSTMENTS IN TAX TABLES SO THAT IN21 FLATION WILL NOT RESULT IN TAX INCREASES.—

22 Paragraph (7) of section 1(f) of the Internal Rev23 enue Code of 1986 is amended to read as follows:
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1 ‘‘(7) SPECIAL RULE FOR CERTAIN BRACKETS.—

2 In prescribing tables under paragraph (1) which

3 apply to taxable years beginning in a calendar year

4 after 1994, the cost-of-living adjustment used in

5 making adjustments to the dollar amounts at which

6 the 36 percent rate bracket begins or at which the

7 39.6 percent rate bracket begins shall be determined

8 under paragraph (3) by substituting ‘1993’ for

9 ‘1992’.’’.

10 (2) EARNED INCOME CREDIT.—Paragraph (1)

11 of section 32(b) of such Code is amended—

12 (A) by striking subparagraphs (B) and

13 (C), and

14 (B) in subparagraph (A) by striking ‘‘(A)

15 IN GENERAL.—In the case of taxable years be16 ginning after 1995’’ and moving the table 2

17 ems to the left.

18 (3) ANNUITIES; CERTAIN PROCEEDS OF EN19 DOWMENT AND LIFE INSURANCE CONTRACTS.—Sec20 tion 72 of such Code is amended—

21 (A) in subsection (c)(4) by striking ‘‘; ex22 cept that if such date was before January 1,

23 1954, then the annuity starting date is January

24 1, 1954’’, and
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1 (B) in subsection (g)(3) by striking ‘‘Janu2 ary 1, 1954, or’’ and ‘‘, whichever is later’’.

3 (4) ACCIDENT AND HEALTH PLANS.—Section

4 105(f) of such Code is amended by striking ‘‘or (d)’’.

5 (5) FLEXIBLE SPENDING ARRANGEMENTS.—

6 Section 106(c)(1) of such Code is amended by strik7 ing ‘‘Effective on and after January 1, 1997, gross’’

8 and inserting ‘‘Gross’’.

9 (6) CERTAIN COMBAT ZONE COMPENSATION OF

10 MEMBERS OF THE ARMED FORCES.—Subsection (c)

11 of section 112 of such Code is amended—

12 (A) by striking ‘‘(after June 24, 1950)’’ in

13 paragraph (2), and

14 (B) striking ‘‘such zone;’’ and all that fol15 lows in paragraph (3) and inserting ‘‘such

16 zone.’’.

17 (7) PRINCIPAL RESIDENCE.—Section 121(b)(3)

18 of such Code is amended—

19 (A) by striking subparagraph (B), and

20 (B) in subparagraph (A) by striking ‘‘(A)

21 IN GENERAL.—’’ and moving the text 2 ems to

22 the left.

23 (8) CERTAIN REDUCED UNIFORMED SERVICES

24 RETIREMENT PAY.—Section 122(b)(1) of such Code

25 is amended by striking ‘‘after December 31, 1965,’’.
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1 (9) MORTGAGE REVENUE BONDS FOR RESI2 DENCES IN FEDERAL DISASTER AREAS.—Section

3 143(k) of such Code is amended by striking para4 graph (11).

5 (10) STATE LEGISLATORS’ TRAVEL EXPENSES

6 AWAY FROM HOME.—Paragraph (4) of section

7 162(h) of such Code is amended by striking ‘‘For

8 taxable years beginning after December 31, 1980,

9 this’’ and inserting ‘‘This’’.

10 (11) HEALTH INSURANCE COSTS OF SELF-EM11 PLOYED INDIVIDUALS.—Paragraph (1) of section

12 162(l) of such Code is amended to read as follows:

13 ‘‘(1) ALLOWANCE OF DEDUCTION.—In the case

14 of an individual who is an employee within the

15 meaning of section 401(c)(1), there shall be allowed

16 as a deduction under this section an amount equal

17 to 100 percent of the amount paid during the tax18 able year for insurance which constitutes medical

19 care for the taxpayer and the taxpayer’s spouse and

20 dependents.’’.

21 (12) INTEREST.—

22 (A) Section 163 of such Code is

23 amended—

24 (i) by striking paragraph (6) of sub25 section (d), and
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1 (ii) by striking paragraph (5) of sub2 section (h).

3 (B) Section 56(b)(1)(C) of such Code is

4 amended by striking clause (ii) and by redesig5 nating clauses (iii), (iv), and (v) as clauses (ii),

6 (iii), and (iv), respectively.

7 (13) AMOUNTS RECEIVED BY SURVIVING ANNU8 ITANT UNDER JOINT AND SURVIVOR ANNUITY CON9 TRACT.—Subparagraph (A) of section 691(d)(1) of

10 such Code is amended by striking ‘‘after December

11 31, 1953, and’’.

12 (14) INCOME TAXES OF MEMBERS OF ARMED

13 FORCES ON DEATH.—Section 692(a)(1) of such

14 Code is amended by striking ‘‘after June 24, 1950’’.

15 (15) TAX ON NONRESIDENT ALIEN INDIVID16 UALS.—Subparagraph (B) of section 871(a)(1) of

17 such Code is amended to read as follows:

18 ‘‘(B) gains described in subsection (b) or

19 (c) of section 631,’’.

20 (16) OLD-AGE, SURVIVORS, AND DISABILITY IN21 SURANCE.—Subsection (a) of section 1401 of such

22 Code is amended by striking ‘‘the following percent’’

23 and all that follows and inserting ‘‘12.4 percent of

24 the amount of the self-employment income for such

25 taxable year.’’.
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1 (17) HOSPITAL INSURANCE.—Subsection (b) of

2 section 1401 of such Code is amended by striking

3 ‘‘the following percent’’ and all that follows and in4 serting ‘‘2.9 percent of the amount of the self-em5 ployment income for such taxable year.’’.

6 (18) MINISTERS, MEMBERS OF RELIGIOUS OR7 DERS, AND CHRISTIAN SCIENCE PRACTITIONERS.—

8 Paragraph (3) of section 1402(e) of such Code is

9 amended by striking ‘‘whichever of the following

10 dates is later: (A)’’ and by striking ‘‘; or (B)’’ and

11 all that follows and inserting a period.

12 (19) WITHHOLDING OF TAX ON NONRESIDENT

13 ALIENS.—The first sentence of subsection (b) of sec14 tion 1441 of such Code and the first sentence of

15 paragraph (5) of section 1441(c) of such Code are

16 each amended by striking ‘‘gains subject to tax’’ and

17 all that follows through ‘‘October 4, 1966’’ and in18 serting ‘‘and gains subject to tax under section

19 871(a)(1)(D)’’.

20 (20) RETIREMENT.—Section 7447(i)(3)(B)(ii)

21 of such Code is amended by striking ‘‘at 4 percent

22 per annum to December 31, 1947, and at 3 percent

23 per annum thereafter’’, and inserting ‘‘at 3 percent

24 per annum’’.
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1 (21) ANNUITIES TO SURVIVING SPOUSES AND

2 DEPENDENT CHILDREN OF JUDGES.—

3 (A) Paragraph (2) of section 7448(a) of

4 such Code is amended by striking ‘‘or under

5 section 1106 of the Internal Revenue Code of

6 1939’’ and by striking ‘‘or pursuant to section

7 1106(d) of the Internal Revenue Code of

8 1939’’.

9 (B) Subsection (g) of section 7448 of such

10 Code is amended by striking ‘‘or other than

11 pursuant to section 1106 of the Internal Rev12 enue Code of 1939’’.

13 (C) Subsections (g), (j)(1), and (j)(2) of

14 section 7448 of such Code are each amended by

15 striking ‘‘at 4 percent per annum to December

16 31, 1947, and at 3 percent per annum there17 after’’ and inserting ‘‘at 3 percent per annum’’.

18 (b) EFFECTIVE DATE.—

19 (1) GENERAL RULE.—Except as otherwise pro20 vided in paragraph (2), the amendments made by

21 subsection (a) shall take effect on the date of enact22 ment of this Act.

23 (2) SAVINGS PROVISION.—If—

24 (A) any provision amended or repealed by

25 subsection (a) applied to—
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1 (i) any transaction occurring before

2 the date of the enactment of this Act,

3 (ii) any property acquired before such

4 date of enactment, or

5 (iii) any item of income, loss, deduc6 tion, or credit taken into account before

7 such date of enactment, and

8 (B) the treatment of such transaction,

9 property, or item under such provision would

10 (without regard to the amendments made by

11 subsection (a)) affect the liability for tax for pe12 riods ending after such date of enactment,

13 nothing in the amendments made by subsection (a)

14 shall be construed to affect the treatment of such

15 transaction, property, or item for purposes of deter16 mining liability for tax for periods ending after such

17 date of enactment.

Passed the House of Representatives July 21, 2004.

Attest:

Clerk.