IB
Union Calendar No. 20
107TH CONGRESS
1ST SESSION
H. R. 6
[Report No. 107–29]
To amend the Internal Revenue Code of 1986 to reduce the marriage penalty
by providing for adjustments to the standard deduction, 15-percent rate
bracket, and earned income credit and to allow the nonrefundable per-
sonal credits against regular and minimum tax liability.
IN THE HOUSE OF REPRESENTATIVES
MARCH 15, 2001
Mr. WELLER (for himself, Mr. BARCIA, Mrs. CAPITO, Mr. KERNS, Mr.
ADERHOLT, Mr. AKIN, Mr. ARMEY, Mr. BAIRD, Mr. BAKER, Mr.
BALLENGER, Mr. BARR of Georgia, Mr. BARTLETT of Maryland, Mr.
BARTON of Texas, Mr. BASS, Mr. BACHUS, Mr. BEREUTER, Ms. BERK-
LEY, Mrs. BIGGERT, Mr. BILIRAKIS, Mr. BISHOP, Mr. BLUNT, Mr.
BOEHNER, Mr. BOEHLERT, Mr. BONILLA, Mrs. BONO, Mr. BRADY of
Texas, Mr. BROWN of South Carolina, Mr. BRYANT, Mr. BURR of North
Carolina, Mr. BURTON of Indiana, Mr. BUYER, Mr. CALLAHAN, Mr. CAL-
VERT, Mr. CAMP, Mr. CANNON, Mr. CANTOR, Mr. CHABOT, Mr.
CHAMBLISS, Mr. COBLE, Mr. COLLINS, Mrs. CUBIN, Mr. COMBEST, Mr.
COOKSEY, Mr. COX, Mr. CRANE, Mr. CRENSHAW, Mr. CULBERSON, Mr.
CUNNINGHAM, Mrs. JO ANN DAVIS of Virginia, Mr. DEAL of Georgia,
Mr. DEMINT, Mr. DIAZ-BALART, Mr. DREIER, Mr. DUNCAN, Ms. DUNN,
Mr. EHLERS, Mr. ISAKSON, Mr. EHRLICH, Mr. ENGLISH, Mrs. EMER-
SON, Mr. EVERETT, Mr. FERGUSON, Mr. FLAKE, Mr. FLETCHER, Mr.
FOLEY, Mr. FOSSELLA, Mr. FRELINGHUYSEN, Mr. GALLEGLY, Mr.
GEKAS, Mr. GANSKE, Mr. GIBBONS, Mr. GILCHREST, Mr. GILMAN, Mr.
GOODE, Mr. GOODLATTE, Mr. GORDON, Mr. GOSS, Mr. GRAHAM, Ms.
GRANGER, Mr. GRAVES, Mr. GREEN of Wisconsin, Mr. GREENWOOD, Mr.
GRUCCI, Mr. GUTKNECHT, Mr. HANSEN, Ms. HART, Mr. HASTINGS of
Washington, Mr. HAYES, Mr. HAYWORTH, Mr. HEFLEY, Mr. HERGER,
Mr. HILLEARY, Mr. HOBSON, Mr. HOEKSTRA, Mr. HOLT, Mr. HORN,
Mr. HOSTETTLER, Mr. HOUGHTON, Mr. HULSHOF, Mr. HUNTER, Mr.
HUTCHINSON, Mr. HYDE, Mr. ISSA, Mr. ISTOOK, Mr. JENKINS, Mrs.
JOHNSON of Connecticut, Mr. SAM JOHNSON of Texas, Mr. JOHNSON of
Illinois, Mr. JONES of North Carolina, Mr. KELLER, Mrs. KELLY, Mr.
KENNEDY of Minnesota, Mr. KNOLLENBERG, Mr. KING, Mr. KINGSTON,
Mr. KIRK, Mr. KOLBE, Mr. LARGENT, Mr. LATHAM, Mr. LAHOOD, Mr.
LATOURETTE, Mr. LEACH, Mr. LEWIS of Kentucky, Mr. LINDER, Mr.
LIPINSKI, Mr. LOBIONDO, Mr. LUCAS of Oklahoma, Mr. MALONEY of
Connecticut, Mr. MANZULLO, Mrs. MCCARTHY of New York, Mr.
MCCRERY, Mr. LARSEN of Washington, Mr. MCHUGH, Mr. MCINNIS, Mr.
MCINTYRE, Mr. MCKEON, Mr. MICA, Mr. MILLER of Florida, Mr. GARY
MILLER of California, Mr. MORAN of Kansas, Mrs. MYRICK, Mr. NEY,
Mr. NETHERCUTT, Mrs. NORTHUP, Mr. NORWOOD, Mr. NUSSLE, Mr.
OSBORNE, Mr. OSE, Mr. OTTER, Mr. OXLEY, Mr. PAUL, Mr. PENCE, Mr.
PETERSON of Pennsylvania, Mr. PETRI, Mr. PICKERING, Mr. PITTS, Mr.
PLATTS, Mr. POMBO, Mr. PORTMAN, Ms. PRYCE of Ohio, Mr. PUTNAM,
Mr. QUINN, Mr. RADANOVICH, Mr. RAMSTAD, Mr. REGULA, Mr.
REHBERG, Mr. REYNOLDS, Mr. RILEY, Mrs. ROUKEMA, Mr. ROEMER,
Mr. ROGERS of Kentucky, Mr. ROGERS of Michigan, Mr. ROHRABACHER,
Mr. ROYCE, Mr. RYAN of Wisconsin, Mr. RYUN of Kansas, Mr. SCAR-
BOROUGH, Mr. SANDLIN, Mr. SCHAFFER, Mr. SCHROCK, Mr. SENSEN-
BRENNER, Mr. SESSIONS, Mr. SHADEGG, Mr. SHAW, Mr. SHAYS, Mr.
SHERWOOD, Mr. SHIMKUS, Mr. SHOWS, Mr. SIMMONS, Mr. SKEEN, Mr.
SMITH of New Jersey, Mr. SMITH of Texas, Mr. SIMPSON, Mr. SOUDER,
Mr. SPENCE, Mr. STEARNS, Mr. STUMP, Mr. SUNUNU, Mr. SWEENEY,
Mr. TAUZIN, Mr. TANCREDO, Mr. TAYLOR of North Carolina, Mr.
TERRY, Mr. THUNE, Mr. TIAHRT, Mr. TIBERI, Mr. TOOMEY, Mr.
UPTON, Mr. VITTER, Mr. WAMP, Mr. WALDEN of Oregon, Mr. WATKINS,
Mr. WATTS of Oklahoma, Mr. WELDON of Florida, Mr. WHITFIELD, Mr.
WICKER, Mrs. WILSON, Mr. WOLF, Mr. YOUNG of Florida, Mr. YOUNG
of Alaska, Mr. WALSH, Mr. THORNBERRY, and Mr. CONDIT) introduced
the following bill; which was referred to the Committee on Ways and
Means
MARCH 27, 2001
Additional sponsors: Mrs. TAUSCHER, Mr. SAXTON, Mr. TOM DAVIS of
Virginia, Mr. THOMAS, and Mr. HASTERT
MARCH 27, 2001
Reported with amendments, committed to the Committee of the Whole House
on the State of the Union, and ordered to be printed
[Strike out all after the enacting clause and insert the part printed in italic]
[For text of introduced bill, see copy of bill as introduced on March 15, 2001]
A BILL
To amend the Internal Revenue Code of 1986 to reduce
the marriage penalty by providing for adjustments to
the standard deduction, 15-percent rate bracket, and
earned income credit and to allow the nonrefundable
personal credits against regular and minimum tax liabil-
ity.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE, ETC.
(a) SHORT TITLE.—This Act may be cited as the
‘‘Marriage Penalty and Family Tax Relief Act of 2001’’.
(b) SECTION 15 NOT TO APPLY.—No amendment
made by this Act shall be treated as a change in a rate
of tax for purposes of section 15 of the Internal Revenue
Code of 1986.
SEC. 2. ELIMINATION OF MARRIAGE PENALTY IN STAND-
ARD DEDUCTION.
(a) IN GENERAL.—Paragraph (2) of section 63(c) of
the Internal Revenue Code of 1986 (relating to standard
deduction) is amended—
(1) by striking ‘‘$5,000’’ in subparagraph (A)
and inserting ‘‘200 percent of the dollar amount in
effect under subparagraph (C) for the taxable year’’;
(2) by adding ‘‘or’’ at the end of subparagraph
(B);
(3) by striking ‘‘in the case of’’ and all that fol-
lows in subparagraph (C) and inserting ‘‘in any
other case.’’; and
(4) by striking subparagraph (D).
(b) TECHNICAL AMENDMENTS.—
(1) Subparagraph (B) of section 1(f )(6) of such
Code is amended by striking ‘‘(other than with’’ and
all that follows through ‘‘shall be applied’’ and insert-
ing ‘‘(other than with respect to sections 63(c)(4) and
151(d)(4)(A)) shall be applied’’.
(2) Paragraph (4) of section 63(c) of such Code
is amended by adding at the end the following flush
sentence:
‘‘The preceding sentence shall not apply to the
amount referred to in paragraph (2)(A).’’.
(c) EFFECTIVE DATE.—The amendments made by this
section shall apply to taxable years beginning after Decem-
ber 31, 2001.
SEC. 3. PHASEOUT OF MARRIAGE PENALTY IN 15-PERCENT
BRACKET.
(a) IN GENERAL.—Subsection (f ) of section 1 of the
Internal Revenue Code of 1986 (relating to adjustments in
tax tables so that inflation will not result in tax increases)
is amended by adding at the end the following new para-
graph:
‘‘(8) PHASEOUT OF MARRIAGE PENALTY IN 15-
PERCENT BRACKET.—
‘‘(A) IN GENERAL.—With respect to taxable
years beginning after December 31, 2003, in pre-
scribing the tables under paragraph (1)—
‘‘(i) the maximum taxable income in
the lowest rate bracket in the table con-
tained in subsection (a) (and the minimum
taxable income in the next higher taxable
income bracket in such table) shall be the
applicable percentage of the maximum tax-
able income in the lowest rate bracket in the
table contained in subsection (c) (after any
other adjustment under this subsection),
and
‘‘(ii) the comparable taxable income
amounts in the table contained in sub-
section (d) shall be 1⁄2 of the amounts deter-
mined under clause (i).
‘‘(B) APPLICABLE PERCENTAGE.—For pur-
poses of subparagraph (A), the applicable per-
centage shall be determined in accordance with
the following table:
‘‘For taxable years beginning
The applicable
in calendar year—
percentage is—
2004 ....................................................................................
172
2005 ....................................................................................
178
2006 ....................................................................................
183
2007 ....................................................................................
189
2008 ....................................................................................
195
2009 and thereafter ...........................................................
200.
‘‘(C) ROUNDING.—If any amount deter-
mined under subparagraph (A)(i) is not a mul-
tiple of $50, such amount shall be rounded to the
next lowest multiple of $50.’’
(b) REPEAL OF REDUCTION OF REFUNDABLE TAX
CREDITS.—
(1) Subsection (d) of section 24 of such Code is
amended by striking paragraph (2) and redesignating
paragraph (3) as paragraph (2).
(2) Section 32 of such Code is amended by strik-
ing subsection (h).
(c) INCREASE IN ALTERNATIVE MINIMUM TAX EXEMP-
TION AMOUNT FOR JOINT RETURNS.—
(1) IN GENERAL.—Subsection (d) of section 55 of
such Code is amended by adding at the end the fol-
lowing new paragraph:
‘‘(4) ADJUSTMENT OF EXEMPTION AMOUNT FOR
JOINT RETURNS.—
‘‘(A) IN GENERAL.—The dollar amount ap-
plicable under paragraph (1)(A) for 2008 and
each even-numbered calendar year thereafter—
‘‘(i) shall be $500 greater than the dol-
lar amount applicable under paragraph
(1)(A) for the prior even-numbered calendar
year, and
‘‘(ii) shall apply to taxable years be-
ginning in such even-numbered calendar
year and in the succeeding calendar year.
In no event shall the dollar amount applicable
under paragraph (1)(A) exceed twice the dollar
amount applicable under paragraph (1)(B).
‘‘(B) EXEMPTION AMOUNTS FOR 2005, 2006,
AND 2007.—The dollar amount applicable under
paragraph (1)(A) shall be—
‘‘(i) $46,000 for taxable years begin-
ning in 2005, and
‘‘(ii) $46,500 for taxable years begin-
ning in 2006 or 2007.’’
(2) CONFORMING AMENDMENTS.—
(A) Paragraph (1) of section 55(d) of such
Code is amended by striking ‘‘and’’ at the end of
subparagraph (B), by striking subparagraph (C),
and by inserting after subparagraph (B) the fol-
lowing new subparagraphs:
‘‘(C) 50 percent of the dollar amount appli-
cable under paragraph (1)(A) in the case of a
married individual who files a separate return,
and
‘‘(D) $22,500 in the case of an estate or
trust.’’
(B) Subparagraph (C) of section 55(d)(3) of
such Code is amended by striking ‘‘paragraph
(1)(C)’’ and inserting ‘‘subparagraph (C) or (D)
of paragraph (1)’’.
(C) The last sentence of section 55(d)(3) of
such Code is amended—
(i) by striking ‘‘paragraph (1)(C)(i)’’
and inserting ‘‘paragraph (1)(C)’’, and
(ii) by striking ‘‘$165,000 or (ii)
$22,500’’ and inserting ‘‘the minimum
amount of such income (as so determined)
for which the exemption amount under
paragraph (1)(C) is zero, or (ii) such ex-
emption amount (determined without re-
gard to this paragraph)’’.
(d) TECHNICAL AMENDMENTS.—
(1) Subparagraph (A) of section 1(f )(2) of such
Code is amended by inserting ‘‘except as provided in
paragraph (8),’’ before ‘‘by increasing’’.
(2) The heading for subsection (f ) of section 1 of
such Code is amended by inserting ‘‘PHASEOUT OF
MARRIAGE PENALTY IN 15-PERCENT BRACKET;’’ be-
fore ‘‘ADJUSTMENTS’’.
(e) EFFECTIVE DATES.—
(1) IN GENERAL.—Except as otherwise provided
in this subsection, the amendments made by this sec-
tion shall apply to taxable years beginning after De-
cember 31, 2003.
(2) SUBSECTION (b).—The amendments made by
subsection (b) shall apply to taxable years beginning
after December 31, 2001.
(3) SUBSECTION (c).—The amendments made by
subsection (c) shall apply to taxable years beginning
after December 31, 2004.
SEC. 4. MARRIAGE PENALTY RELIEF FOR EARNED INCOME
CREDIT; EARNED INCOME TO INCLUDE ONLY
AMOUNTS INCLUDIBLE IN GROSS INCOME.
(a) IN GENERAL.—Paragraph (2) of section 32(b) of
the Internal Revenue Code of 1986 (relating to percentages
and amounts) is amended—
(1) by striking ‘‘AMOUNTS.—The earned’’ and
inserting ‘‘AMOUNTS.—
‘‘(A) IN
GENERAL.—Subject to subpara-
graph (B), the earned’’; and
(2) by adding at the end the following new sub-
paragraph:
‘‘(B) JOINT
RETURNS.—In the case of a
joint return, the earned income amount deter-
mined under subparagraph (A) shall be 110 per-
cent of the otherwise applicable amount. If any
amount determined under the preceding sentence
is not a multiple of $10, such amount shall be
rounded to the nearest multiple of $10.’’
(b) EARNED INCOME TO INCLUDE ONLY AMOUNTS IN-
CLUDIBLE
IN
GROSS
INCOME.—Clause (i) of section
32(c)(2)(A) of such Code (defining earned income) is
amended by inserting ‘‘, but only if such amounts are in-
cludible in gross income for the taxable year’’ after ‘‘other
employee compensation’’.
(c) EFFECTIVE DATE.—The amendments made by this
section shall apply to taxable years beginning after Decem-
ber 31, 2001.
SEC. 5. MODIFICATIONS TO CHILD TAX CREDIT.
(a) INCREASE IN PER CHILD AMOUNT.—Subsection
(a) of section 24 of the Internal Revenue Code of 1986 (re-
lating to child tax credit) is amended to read as follows:
‘‘(a) ALLOWANCE OF CREDIT.—
‘‘(1) IN GENERAL.—There shall be allowed as a
credit against the tax imposed by this chapter for the
taxable year with respect to each qualifying child of
the taxpayer an amount equal to the per child
amount.
‘‘(2) PER
CHILD
AMOUNT.—For purposes of
paragraph (1), the per child amount shall be deter-
mined as follows:
‘‘In the case of any taxable
year beginning in—
The per child amount is—
2001 and 2002 ...............................................................................
$
600
2003 ................................................................................................
700
2004 ................................................................................................
800
2005 ................................................................................................
900
2006 or thereafter ..........................................................................
1,000.’’
(b) CREDIT ALLOWED AGAINST ALTERNATIVE MIN-
IMUM TAX.—
(1) IN GENERAL.—Subsection (b) of section 24 of
such Code is amended by adding at the end the fol-
lowing new paragraph:
(2) CONFORMING AMENDMENTS.—
(A) The heading for section 24(b) of such
Code is amended to read as follows: ‘‘LIMITA-
TIONS.—’’.
(B) The heading for section 24(b)(1) of such
Code is amended to read as follows: ‘‘LIMITATION
BASED ON ADJUSTED GROSS INCOME.—’’.
(C) 
Section 
24(d) 
of 
such 
Code 
is
amended—
(i) by striking ‘‘section 26(a)’’ each
place it appears and inserting ‘‘subsection
(b)(3)’’, and
(ii) in paragraph (1)(B) by striking
‘‘aggregate amount of credits allowed by
this subpart’’ and inserting ‘‘amount of
credit allowed by this section’’.
(D) Paragraph (1) of section 26(a) of such
Code is amended by inserting ‘‘(other than sec-
tion 24)’’ after ‘‘this subpart’’.
(E) Subsection (c) of section 23 of such
Code is amended by striking ‘‘and section
1400C’’ and inserting ‘‘and sections 24 and
1400C’’.
(F) Subparagraph (C) of section 25(e)(1) of
such Code is amended by inserting ‘‘, 24,’’ after
‘‘sections 23’’.
(G) Section 904(h) of such Code is amended
by inserting ‘‘(other than section 24)’’ after
‘‘chapter’’.
(H) Subsection (d) of section 1400C of such
Code is amended by inserting ‘‘and section 24’’
after ‘‘this section’’.
(c) ADDITIONAL CREDIT FOR FAMILIES WITH 3 OR
MORE CHILDREN AVAILABLE
TO ALL FAMILIES.—Sub-
section (d) of section 24 of such Code is amended—
(1) in paragraph (1) by striking ‘‘In the case of
a taxpayer with three or more qualifying children for
any taxable year, the’’ and inserting ‘‘The’’, and
(2) in the subsection heading by striking ‘‘WITH
3 OR MORE CHILDREN’’ and inserting ‘‘PAYING SO-
CIAL SECURITY TAXES’’.
(d) EFFECTIVE DATE.—
(1) IN GENERAL.—Except as provided in para-
graph (2), the amendments made by this section shall
apply to taxable years beginning after December 31,
2000.
(2) SUBSECTION (b).—The amendments made by
subsection (b) shall apply to taxable years beginning
after December 31, 2001.
SEC. 6. PROTECTION OF SOCIAL SECURITY AND MEDICARE.
The amounts transferred to any trust fund under the
Social Security Act shall be determined as if this Act had
not been enacted.
Amend the title so as to read: ‘‘A bill to amend the
Internal Revenue Code of 1986 to reduce the marriage
penalty by providing for adjustments to the standard de-
duction, the 15-percent rate bracket, and the earned in-
come credit, to increase the child credit, and for other
purposes.’’.
Union Calendar No. 20
107TH CONGRESS
1ST SESSION
H. R. 6
[Report No. 107–29]
A BILL
To amend the Internal Revenue Code of 1986 to
reduce the marriage penalty by providing for ad-
justments to the standard deduction, 15-percent
rate bracket, and earned income credit and to
allow the nonrefundable personal credits against
regular and minimum tax liability.
MARCH 27, 2001
Reported with amendments, committed to the Committee
of the Whole House on the State of the Union, and or-
dered to be printed