II 

114TH CONGRESS 

2D SESSION S. 3451 

To amend the Internal Revenue Code of 1986 to provide a refundable and 

advanceable tax credit for individuals with young children. 

IN THE SENATE OF THE UNITED STATES 

SEPTEMBER 28, 2016 

Mr. BROWN 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 provide 

a refundable and advanceable tax credit for individuals 

with young children. 

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; FINDINGS. 

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

5 ‘‘Young Child Tax Credit Act’’. 

6 (b) FINDINGS.—Congress finds the following: 

7 (1) Economists have found similar effects of the 

8 importance of income in the earliest years with re9 turns to school achievement. 

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1 (2) Pediatricians and other child development 

2 experts have long talked about the critical impor3 tance of the earliest years of life. 

4 (3) Young children, including babies and tod5 dlers, are the poorest people in the country by age. 

6 (4) With the recent improvements signed into 

7 law in December, together, the Child Tax Credit and 

8 Earned Income Tax Credit now lift more children 

9 out of poverty than any other Federal policies. 

10 (5) Families with young children receive the 

11 smallest child tax credits, despite the fact that the 

12 economic literature suggests that these credits have 

13 particularly beneficial effects for families with young 

14 children. 

15 (6) Economists have found that large fluctua16 tions in a family’s income can be detrimental to the 

17 development of young children. Research on scarcity 

18 have found it is hard for parents to focus on chil19 dren if they are worrying about having sufficient in20 come to meet their family’s needs. 

21 SEC. 2. YOUNG CHILD TAX CREDIT. 

22 (a) IN GENERAL.—Subpart C of part IV of sub23 chapter A of chapter 1 of the Internal Revenue Code of 

24 1986 is amended by inserting after section 36B the fol25 lowing new section: 

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1 ‘‘SEC. 36C. YOUNG CHILD TAX CREDIT. 

2 ‘‘(a) IN GENERAL.—In the case of an individual, 

3 there shall be allowed as a credit against the tax imposed 

4 by this subtitle for the taxable year an amount equal to 

5 the product of— 

6 ‘‘(1) the applicable dollar amount, multiplied by 

7 ‘‘(2) the number of qualifying children of the 

8 taxpayer for which the taxpayer is allowed a deduc9 tion under section 151 and who (as of the close of 

10 such taxable year) have not attained age 3. 

11 ‘‘(b) APPLICABLE DOLLAR AMOUNT.—For purposes 

12 of this section, the term ‘applicable dollar amount’ means 

13 with respect to any taxable year, the product of— 

14 ‘‘(1) 1.5, multiplied by 

15 ‘‘(2) the dollar amount in effect under section 

16 24(a) for the taxable year. 

17 ‘‘(c) LIMITATION BASED ON ADJUSTED GROSS IN18 COME.— 

19 ‘‘(1) IN GENERAL.—The amount of the credit 

20 allowable under subsection (a) shall be reduced (but 

21 not below zero) by the phaseout amount for each 

22 $1,000 (or fraction thereof) by which the taxpayer’s 

23 modified adjusted gross income (as defined in sec24 tion 24(b)(1)) exceeds the threshold amount (as de25 fined in section 24(b)(2)). 

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1 ‘‘(2) PHASEOUT AMOUNT.—For purposes of 

2 this subsection, the term ‘phaseout amount’ means 

3 1.5 multiplied by the first dollar amount in section 

4 24(b)(1). 

5 ‘‘(d) QUALIFYING CHILD.—For purposes of this sec6 tion, the term ‘qualifying child’ has the meaning given 

7 such term by section 24(c). 

8 ‘‘(e) IDENTIFICATION REQUIREMENT.—No credit 

9 shall be allowed under this section to a taxpayer with re10 spect to any qualifying child unless the taxpayer includes 

11 the name and taxpayer identification number of such 

12 qualifying child on the return of tax for the taxable year. 

13 ‘‘(f) RECONCILIATION OF CREDIT AND ADVANCE

14 CREDIT.— 

15 ‘‘(1) IN GENERAL.—The amount of the credit 

16 allowed under this section for any taxable year shall 

17 be reduced (but not below zero) by the aggregate 

18 amount of any advance payments of such credit 

19 under section 7527A for such taxable year. 

20 ‘‘(2) EXCESS ADVANCE PAYMENTS.—If the ag21 gregate amount of advance payments under section 

22 7527A for the taxable year exceed the amount of the 

23 credit allowed under this section for such taxable 

24 year (determined without regard to paragraph (1)), 

25 the tax imposed by this chapter for such taxable 

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1 year shall be increased by the amount of such ex2 cess.’’. 

3 (b) ADVANCE PAYMENT OF CREDIT.—Chapter 77 of 

4 such Code is amended by inserting after section 7527 the 

5 following new section: 

6 ‘‘SEC. 7527A. ADVANCE PAYMENT OF YOUNG CHILD TAX 

7 CREDIT. 

8 ‘‘(a) IN GENERAL.—As soon as practicable and not 

9 later than 1 year after the date of the enactment of this 

10 Act, the Secretary shall establish a program for making 

11 advance payments of the credit allowed under section 36C 

12 on a monthly basis, or as frequently as the Secretary de13 termines to be administratively feasible, to taxpayers al14 lowed such credit (determined without regard to section 

15 36C(f)(1)). 

16 ‘‘(b) LIMITATION.—The Secretary may make pay17 ments under subsection (a) only to the extent that the 

18 total amount of such payments made to any taxpayer dur19 ing the taxable year does not exceed the amount deter20 mined under subsection (a) of section 36C with respect 

21 to such taxpayer (determined without regard to sub22 sections (c) and (f) of such section). Such program shall 

23 make reasonable efforts to apply the limitation of section 

24 36C(c) with respect to payments made under such pro25 gram.’’. 

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1 (c) CONFORMING AMENDMENTS.— 

2 (1) Section 152(f)(6)(B) of such Code is 

3 amended by striking ‘‘and’’ at the end of clause (iii), 

4 by striking the period at the end of clause (iv) and 

5 inserting ‘‘, and’’, and by adding at the end the fol6 lowing new clause: 

7 ‘‘(v) the credit under section 36C (re8 lating to young child tax credit).’’. 

9 (2) Section 6211(b)(4)(A) of such Code is 

10 amended by inserting ‘‘36C,’’ after ‘‘36B,’’. 

11 (3) Section 6213(g)(2) of such Code is amend12 ed by striking ‘‘and’’ at the end of subparagraph 

13 (P), by striking the period at the end of subpara14 graph (Q) and inserting ‘‘, and’’, and by inserting 

15 after subparagraph (Q) the following new subpara16 graph: 

17 ‘‘(R) an omission of a correct TIN re18 quired under section 36C(e) (relating to young 

19 child tax credit) to be included on a return.’’. 

20 (4) Section 6402(m) of such Code is amended 

21 by striking ‘‘or 32’’ and inserting ‘‘, 32 or 36C’’. 

22 (5) Section 6695(g) of such Code is amended 

23 by striking ‘‘or 32’’ and inserting ‘‘32, or 36C’’. 

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1 (6) Section 1324(b)(2) of title 31, United 

2 States Code, is amended by inserting ‘‘36C,’’ after 

3 ‘‘36B,’’. 

4 (7) The table of sections for subpart C of part 

5 IV of subchapter A of chapter 1 of the Internal Rev6 enue Code of 1986 is amended by inserting after the 

7 item relating to section 36B the following new item: 

‘‘Sec. 36C. Young child tax credit.’’. 

8 (8) The table of sections for chapter 77 of such 

9 Code is amended by inserting after the item relating 

10 to section 7527 the following new item: 

‘‘Sec. 7527A. Advance payment of young child tax credit.’’. 

11 (d) EFFECTIVE DATE.— 

12 (1) IN GENERAL.—The amendments made by 

13 this section shall apply to taxable years beginning 

14 after December 31, 2016. 

15 (2) ADVANCE PAYMENT PROGRAM.—The Sec16 retary of the Treasury, or his designee, shall estab17 lish the program described in section 7527A of the 

18 Internal Revenue Code of 1986 (as added by this 

19 section) not later than such date. 

Æ 

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