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‘‘(7) SPECIAL RULE FOR CERTAIN BRACKETS.—
In prescribing tables under paragraph (1) which 
apply to taxable years beginning in a calendar year 
after 1994, the cost-of-living adjustment used in 
making adjustments to the dollar amounts at which 
the 36 percent rate bracket begins or at which the 
39.6 percent rate bracket begins shall be determined 
under paragraph (3) by substituting ‘1993’ for 
‘1992’.’’. 
(2) EARNED INCOME CREDIT.—Paragraph (1) 
of section 32(b) of such Code is amended—
(A) by striking subparagraphs (B) and 
(C), and 
(B) in subparagraph (A) by striking ‘‘(A) 
IN GENERAL.—In the case of taxable years be-
ginning after 1995’’ and moving the table 2 
ems to the left. 
(3) ANNUITIES; CERTAIN
PROCEEDS
OF
EN-
DOWMENT AND LIFE INSURANCE CONTRACTS.—Sec-
tion 72 of such Code is amended—
(A) in subsection (c)(4) by striking ‘‘; ex-
cept that if such date was before January 1, 
1954, then the annuity starting date is January 
1, 1954’’, and
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(B) in subsection (g)(3) by striking ‘‘Janu-
ary 1, 1954, or’’ and ‘‘, whichever is later’’. 
(4) ACCIDENT AND HEALTH PLANS.—Section 
105(f) of such Code is amended by striking ‘‘or (d)’’. 
(5) FLEXIBLE
SPENDING
ARRANGEMENTS.—
Section 106(c)(1) of such Code is amended by strik-
ing ‘‘Effective on and after January 1, 1997, gross’’ 
and inserting ‘‘Gross’’. 
(6) CERTAIN COMBAT ZONE COMPENSATION OF 
MEMBERS OF THE ARMED FORCES.—Subsection (c) 
of section 112 of such Code is amended—
(A) by striking ‘‘(after June 24, 1950)’’ in 
paragraph (2), and 
(B) striking ‘‘such zone;’’ and all that fol-
lows in paragraph (3) and inserting ‘‘such 
zone.’’. 
(7) PRINCIPAL RESIDENCE.—Section 121(b)(3) 
of such Code is amended—
(A) by striking subparagraph (B), and 
(B) in subparagraph (A) by striking ‘‘(A) 
IN GENERAL.—’’ and moving the text 2 ems to 
the left. 
(8) CERTAIN REDUCED UNIFORMED SERVICES 
RETIREMENT PAY.—Section 122(b)(1) of such Code 
is amended by striking ‘‘after December 31, 1965,’’.
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(9) MORTGAGE
REVENUE
BONDS
FOR
RESI-
DENCES
IN
FEDERAL
DISASTER
AREAS.—Section 
143(k) of such Code is amended by striking para-
graph (11). 
(10) STATE LEGISLATORS’ TRAVEL EXPENSES 
AWAY
FROM
HOME.—Paragraph (4) of section 
162(h) of such Code is amended by striking ‘‘For 
taxable years beginning after December 31, 1980, 
this’’ and inserting ‘‘This’’. 
(11) HEALTH INSURANCE COSTS OF SELF-EM-
PLOYED
INDIVIDUALS.—Paragraph (1) of section 
162(l) of such Code is amended to read as follows: 
‘‘(1) ALLOWANCE OF DEDUCTION.—In the case 
of an individual who is an employee within the 
meaning of section 401(c)(1), there shall be allowed 
as a deduction under this section an amount equal 
to 100 percent of the amount paid during the tax-
able year for insurance which constitutes medical 
care for the taxpayer and the taxpayer’s spouse and 
dependents.’’. 
(12) INTEREST.—
(A) Section 163 of such Code is amend-
ed—
(i) by striking paragraph (6) of sub-
section (d), and
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(ii) by striking paragraph (5) of sub-
section (h). 
(B) Section 56(b)(1)(C) of such Code is 
amended by striking clause (ii) and by redesig-
nating clauses (iii), (iv), and (v) as clauses (ii), 
(iii), and (iv), respectively. 
(13) AMOUNTS RECEIVED BY SURVIVING ANNU-
ITANT UNDER JOINT AND SURVIVOR ANNUITY CON-
TRACT.—Subparagraph (A) of section 691(d)(1) of 
such Code is amended by striking ‘‘after December 
31, 1953, and’’. 
(14) INCOME TAXES OF MEMBERS OF ARMED 
FORCES
ON
DEATH.—Section 692(a)(1) of such 
Code is amended by striking ‘‘after June 24, 1950’’. 
(15) TAX
ON
NONRESIDENT
ALIEN
INDIVID-
UALS.—Subparagraph (B) of section 871(a)(1) of 
such Code is amended to read as follows: 
‘‘(B) gains described in subsection (b) or 
(c) of section 631,’’. 
(16) OLD-AGE, SURVIVORS, AND DISABILITY IN-
SURANCE.—Subsection (a) of section 1401 of such 
Code is amended by striking ‘‘the following percent’’ 
and all that follows and inserting ‘‘12.4 percent of 
the amount of the self-employment income for such 
taxable year.’’.