II 

109TH CONGRESS 

1ST SESSION S. 605 

To amend the Internal Revenue Code of 1986 to restore the phaseout of 

personal exemptions and the overall limitation on itemized deductions, 

and to create a trust fund for the funding of education programs. 

IN THE SENATE OF THE UNITED STATES 

MARCH 11, 2005 

Mr. HARKIN (for himself and Mr. DURBIN) introduced the following bill; 

which was read twice and referred to the Committee on Finance 

A BILL

To amend the Internal Revenue Code of 1986 to restore 

the phaseout of personal exemptions and the overall limitation on itemized deductions, and to create a trust 

fund for the funding of education programs.

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 ‘‘Education Funding 

5 Act of 2005’’. 
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•S 605 IS

1 SEC. 2. RESTORATION OF PHASEOUT OF PERSONAL EX2 EMPTIONS. 

3 (a) IN GENERAL.—Paragraph (3) of section 151(d) 

4 of the Internal Revenue Code of 1986 (relating to exemp5 tion amount) is amended by striking subparagraphs (E) 

6 and (F). 

7 (b) EFFECTIVE DATE.—The amendment made by 

8 this section shall apply to taxable years beginning after 

9 December 31, 2005. 

10 SEC. 3. RESTORATION OF PHASEOUT OF OVERALL LIMITA11 TION ON ITEMIZED DEDUCTIONS. 

12 (a) IN GENERAL.—Section 68 of the Internal Rev13 enue Code of 1986 is amended by striking subsections (f) 

14 and (g). 

15 (b) EFFECTIVE DATE.—The amendment made by 

16 this section shall apply to taxable years beginning after 

17 December 31, 2005. 

18 SEC. 4. DEDICATION OF REVENUES FOR EDUCATION PRO19 GRAMS. 

20 (a) CREATION OF TRUST FUND.—There is estab21 lished in the Treasury of the United States a trust fund 

22 to be known as the ‘‘Education Trust Fund’’, consisting 

23 of such amounts as may be appropriated or credited to 

24 the Education Trust Fund as provided in this section. 

25 (b) TRANSFERS TO EDUCATION TRUST FUND.— 
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1 (1) IN GENERAL.—There are hereby appro2 priated to the Education Trust Fund amounts equiv3 alent to the sum of 50 percent of the net PEP reve4 nues and 50 percent of the net Pease revenues re5 ceived in the Treasury. 

6 (2) DEFINITIONS.— 

7 (A) NET PEP REVENUES.—For purposes 

8 of paragraph (1), the term ‘‘net PEP revenues’’ 

9 means the amount estimated by the Secretary 

10 of the Treasury based on the taxes received 

11 under chapter 1 of the Internal Revenue Code 

12 of 1986 which are attributable to the amend13 ment made by section 2 of this Act. 

14 (B) NET PEASE REVENUES.—For purposes 

15 of paragraph (1), the term ‘‘net Pease reve16 nues’’ means the amount estimated by the Sec17 retary of the Treasury based on the taxes re18 ceived under chapter 1 of the Internal Revenue 

19 Code of 1986 which are attributable to the 

20 amendment made by section 3 of this Act. 

21 (c) EXPENDITURES FROM TRUST FUND.—Amounts 

22 in the Education Trust Fund shall be available, as pro23 vided in appropriations Acts, only for programs adminis24 tered by the Department of Education to the degree that 
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•S 605 IS

1 funding for the specified programs are increased from the 

2 fiscal year 2005 level. 

3 (d) OTHER SPECIAL RULES.—Rules similar to the 

4 rules of subchapter B of chapter 98 of the Internal Rev5 enue Code of 1986 shall apply for purposes of this section. 

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