IIB 
116TH CONGRESS 
2D SESSION 
H. R. 5377 
IN THE SENATE OF THE UNITED STATES 
JANUARY 3, 2020 
Received; read twice and referred to the Committee on Finance 
AN ACT 
To amend the Internal Revenue Code of 1986 to modify 
the limitation on deduction of State and local taxes, 
and for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
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SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Restoring Tax Fair-
ness for States and Localities Act’’. 
SEC. 2. ELIMINATION FOR 2019 OF MARRIAGE PENALTY IN 
LIMITATION ON DEDUCTION OF STATE AND 
LOCAL TAXES. 
(a) IN GENERAL.—Section 164(b) of the Internal 
Revenue Code of 1986 is amended by adding at the end 
the following new paragraph: 
‘‘(7) SPECIAL RULE FOR LIMITATION ON INDI-
VIDUAL DEDUCTIONS FOR 2019.—In the case of a 
taxable year beginning after December 31, 2018, 
and before January 1, 2020, if the adjusted gross 
income of the taxpayer for such taxable year does 
not exceed $100,000,000, paragraph (6) shall be ap-
plied by substituting ‘($20,000 in the case of a joint 
return)’ for ‘($5,000 in the case of a married indi-
vidual filing a separate return)’.’’. 
(b) EFFECTIVE DATE.—The amendment made by 
this section shall apply to taxable years beginning after 
December 31, 2018. 
SEC. 3. ELIMINATION FOR 2020 AND 2021 OF LIMITATION ON 
DEDUCTION OF STATE AND LOCAL TAXES. 
(a) IN GENERAL.—Section 164(b) of the Internal 
Revenue Code of 1986, as amended by section 2, is further 
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amended by adding at the end the following new para-
graph: 
‘‘(8) SUSPENSION OF DOLLAR LIMITATION ON 
STATE AND LOCAL TAXES FOR 2020 AND 2021.— 
‘‘(A) IN
GENERAL.—In the case of any 
taxable year beginning in 2020 or 2021, sub-
paragraph (B) of paragraph (6) shall not apply. 
‘‘(B) EXCEPTION FOR CERTAIN HIGH-IN-
COME
TAXPAYERS.—Subparagraph (A) shall 
not apply to any taxpayer for any taxable year 
if the adjusted gross income of such taxpayer 
for such taxable year exceeds $100,000,000.’’. 
(b) CONFORMING AMENDMENTS.—Section 164(b)(6) 
of the Internal Revenue Code of 1986 is amended— 
(1) by striking ‘‘For purposes of subparagraph 
(B)’’ and inserting ‘‘For purposes of this section’’; 
(2) by striking ‘‘January 1, 2018’’ and insert-
ing ‘‘January 1, 2022’’; 
(3) by striking ‘‘December 31, 2017, shall’’ and 
inserting ‘‘December 31, 2021, shall’’; and 
(4) by adding at the end the following: ‘‘For 
purposes of this section, in the case of State or local 
taxes with respect to any real or personal property 
paid during a taxable year beginning in 2020 or 
2021, the Secretary shall prescribe rules which treat 
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all or a portion of such taxes as paid in a taxable 
year or years other than the taxable year in which 
actually paid as necessary or appropriate to prevent 
the avoidance of the limitations of this subsection.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxes paid or accrued in taxable 
years beginning after December 31, 2019. 
SEC. 4. INCREASE IN DEDUCTION FOR CERTAIN EXPENSES 
OF ELEMENTARY AND SECONDARY SCHOOL 
TEACHERS. 
(a) INCREASE.—Section 62(a)(2)(D) of the Internal 
Revenue Code of 1986 is amended by striking ‘‘$250’’ and 
inserting ‘‘$1,000’’. 
(b) CONFORMING AMENDMENTS.—Section 62(d)(3) 
of the Internal Revenue Code of 1986 is amended— 
(1) by striking ‘‘2015’’ and inserting ‘‘2019’’; 
(2) by striking ‘‘$250’’ and inserting ‘‘$1,000’’; 
and 
(3) in subparagraph (B), by striking ‘‘2014’’ 
and inserting ‘‘2018’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2018. 
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(3) in subparagraph (C)— 
(A) by striking ‘‘$500,000’’ each place 
such term appears and inserting ‘‘$425,800’’; 
and 
(B) by striking ‘‘$150,689.50’’ and insert-
ing ‘‘$124,719.50’’; and 
(4) in subparagraph (D)— 
(A) by striking ‘‘$300,000’’ each place 
such term appears and inserting ‘‘$239,500’’; 
and 
(B) by striking ‘‘$80,689.50’’ and insert-
ing ‘‘$59,514.50’’. 
(b) CONFORMING AMENDMENTS.— 
(1) Section 1(j)(4)(B)(iii) of the Internal Rev-
enue Code of 1986 is amended— 
(A) in the matter preceding subclause (I), 
by striking ‘‘37 percent’’ and inserting ‘‘39.6 
percent’’; 
(B) in subclause (II), by striking ‘‘37-per-
cent bracket’’ and inserting ‘‘39.6-percent 
bracket’’; and 
(C) in the heading, by striking ‘‘37-PER-
CENT BRACKET’’ and inserting ‘‘39.6-PERCENT 
BRACKET’’. 
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(2) Section 1(j)(4)(C) of such Code is amend-
ed— 
(A) in clause (i)(II), by striking ‘‘para-
graph (5)(B)(i)(IV)’’ and inserting ‘‘paragraph 
(5)(B)(iv)’’; and 
(B) by amending clause (ii) to read as fol-
lows: 
‘‘(ii) the amount which would (without 
regard to this paragraph) be taxed at a 
rate below 39.6 percent shall not be more 
than the sum of— 
‘‘(I) the earned taxable income of 
such child, plus 
‘‘(II) 
the 
maximum 
dollar 
amount for the 35-percent rate brack-
et for estates and trusts.’’. 
(3) The heading of section 1(j)(5) of such Code 
is amended to read as follows: ‘‘APPLICATION OF 
ZERO PERCENT CAPITAL GAIN RATE BRACKETS’’. 
(4) Subparagraphs (A) and (B) of section 
1(j)(5) of such Code are amended to read as follows: 
‘‘(A) 
IN
GENERAL.—Subsection 
(h)(1)(B)(i) shall be applied by substituting 
‘below the maximum zero rate amount’ for 
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‘which would (without regard to this paragraph) 
be taxed at a rate below 25 percent’. 
‘‘(B) MAXIMUM ZERO RATE AMOUNT DE-
FINED.—For purposes of subparagraph (A), the 
term ‘maximum zero rate amount’ means— 
‘‘(i) in the case of a joint return or 
surviving spouse, $77,200; 
‘‘(ii) in the case of an individual who 
is a head of household (as defined in sec-
tion 2(b)), $51,700; 
‘‘(iii) in the case of any other indi-
vidual (other than an estate or trust), an 
amount equal to 1⁄2 of the amount in effect 
for the taxable year under clause (i); and 
‘‘(iv) in the case of an estate or trust, 
$2,600.’’. 
(5) Section 1(j)(5)(C) of such Code is amended 
by striking ‘‘clauses (i) and (ii) of’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2019. 
(d) SECTION 15 NOT TO APPLY.—Section 15 of the 
Internal Revenue Code of 1986 shall not apply to any 
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change in a rate of tax by reason of any amendment made 
by this section. 
Passed the House of Representatives December 19, 
2019. 
Attest: 
CHERYL L. JOHNSON, 
Clerk. 
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