21 st Century Worker Tax Cut Act

To amend the Internal Revenue Code of 1986 to establish a credit for married couples who are both employed and have young children. 1. Short title This Act may be cited as the 21 st 2. Credit for dual-earner families (a) In general Subpart A of part IV of subchapter A of chapter 1 25E. Dual-earner families (a) Allowance of credit In the case of an eligible taxpayer, there shall be allowed as a credit against the tax imposed by this chapter for the taxable year an amount equal to 10 percent of the lesser of— (1) $10,000, or (2) the earned income of the spouse with the lower amount of earned income for such taxable year. (b) Limitation The amount of the credit allowable under subsection (a) shall be reduced (but not below zero) by an amount which bears the same ratio to the amount determined under subsection (a) (as determined without regard to this subsection) as the amount of the taxpayer's excess adjusted gross income bears to $20,000. (c) Definitions In this section: (1) Earned income The term earned income (2) Eligible taxpayer (A) In general The term eligible taxpayer (i) files a joint return for the taxable year under section 6013, and (ii) has at least 1 qualifying child (as defined in section 152(c)) who has not attained 12 years of age before the close of the taxable year. (3) Excess adjusted gross income The term excess adjusted gross income (d) Inflation adjustment (1) In general In the case of any taxable year beginning after 2016, each of the dollar amounts in subsections (a)(1) and (c)(3) shall be increased by an amount equal to— (A) such dollar amount, multiplied by (B) the cost-of-living adjustment determined under section 1(f)(3) for the calendar year in which the taxable year begins, determined by substituting calendar year 2015 calendar year 1992 (2) Rounding If any dollar amount in subsection (a)(1) or (c)(3), after being increased under paragraph (1), is not a multiple of $1,000, such dollar amount shall be rounded to the nearest multiple of $1,000. (e) Additional eligibility requirements (1) Individual claiming benefits under section 911 No credit shall be allowed under this section if an individual (or the individual's spouse) claims the benefits of section 911 for the taxable year. (2) Non-resident aliens No credit shall be allowed under this section if an individual (or the individual's spouse) is a nonresident alien individual for any portion of the taxable year unless such individual is treated for such taxable year as a resident of the United States for purposes of this chapter by reason of an election under subsection (g) or (h) of section 6013. (3) Identification number requirement No credit shall be allowed under this section if the eligible taxpayer does not include on the joint return of tax for the taxable year— (A) the taxpayer identification number of the individual and the individual's spouse, and (B) the name, age, and taxpayer identification number of any qualifying children. (f) Taxable year must be full taxable year Except in the case of a taxable year closed by reason of the death of an individual, no credit shall be allowable under this section in the case of a taxable year covering a period of less than 12 months. . (b) Enhancement of earned income tax credit Section 32 of such Code is amended— (1) in subsection (a)(2)(B), by striking earned income modified earned income (as defined in subsection (c)(5)) (2) in subsection (c), by adding at the end the following new paragraph: (5) Modified earned income The term modified earned income (A) the amount of any credit allowed to the taxpayer under section 25E for the taxable year, multiplied by (B) 10. . (c) Conforming amendment The table of sections for subpart A of part IV of subchapter A of chapter 1 Sec. 25E. Dual-earner families. . (d) Effective date The amendments made by this section shall apply to taxable years beginning after the date of the enactment of this Act.

Summary: 21st Century Worker Tax Cut Act This bill allows a married taxpayer who files a joint tax return and has at least one qualifying child under the age of 12 a tax credit for 10% of the lesser of $10,000 or the earned income of the spouse with the lower amount of earned income for the taxable year. The credit is denied to nonresident aliens and to taxpayers who fail to include certain identifying information on their tax returns.