I 
114TH CONGRESS 
1ST SESSION H. R. 3508 
To amend the Internal Revenue Code of 1986 to allow an annual elective 
surcharge in lieu of estate tax, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
SEPTEMBER 15, 2015 
Mr. HARRIS (for himself, Mr. MOONEY of West Virginia, and Mr. BEYER) in-
troduced the following bill; which was referred to the Committee on Ways 
and Means 
A BILL 
To amend the Internal Revenue Code of 1986 to allow an 
annual elective surcharge in lieu of estate tax, and for 
other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 
(a) SHORT TITLE.—This Act may be cited as the 
‘‘American Solution for Simplifying the Estate Tax Act 
of 2015’’. 
(b) TABLE OF CONTENTS.—The table of contents for 
this Act is as follows: 
Sec. 1. Short title; table of contents. 
Sec. 2. Congressional findings. 
VerDate Sep 11 2014 
23:01 Sep 15, 2015
Jkt 049200
PO 00000
Frm 00001
Fmt 6652
Sfmt 6211
E:\BILLS\H3508.IH
H3508
tkelley on DSK3SPTVN1PROD with BILLS
Sec. 3. Elective simplified estate tax. 
Sec. 4. Carry-over basis. 
Sec. 5. Returns. 
Sec. 6. Special rule for revocation of trusts in connection with election. 
SEC. 2. CONGRESSIONAL FINDINGS. 
Congress finds the following: 
(1) The current method of collecting Federal 
estate tax often cripples American family-owned 
businesses, farms, and ranches by forcing the sale of 
ongoing concerns in order to pay tax liability arising 
from the death of an owner, creating inefficiencies, 
dislocation, and often job losses. 
(2) From farmers and ranchers to urban busi-
ness owners, the Federal estate tax looms heavily 
and has a counterproductive effect on our Nation’s 
family-owned businesses that costs numerous jobs. 
(3) The job losses, economic dislocation, and ex-
cessive compliance costs are not justified given the 
fact that the estate tax has averaged one percent of 
total IRS collections since 1960, with $14 billion col-
lected in fiscal year 2013 (less than 1⁄2 percent of 
total IRS collections). 
(4) The Joint Economic Committee in its May 
2006 study concluded that in order to avoid wealth 
transfer taxes, individuals’ costs of complying with 
the estate tax roughly equals the revenue yield of the 
estate tax for the U.S. Treasury. 
VerDate Sep 11 2014 
23:01 Sep 15, 2015
Jkt 049200
PO 00000
Frm 00002
Fmt 6652
Sfmt 6201
E:\BILLS\H3508.IH
H3508
tkelley on DSK3SPTVN1PROD with BILLS
(5) The current method of collection of the es-
tate tax leads many wealthy Americans to lock up 
capital in trusts to minimize or eliminate tax liabil-
ity, meaning that billions of dollars are left idle in-
stead of facilitating the creation of new business 
ventures that could stimulate the economy. 
(6) As recently as 2009, of the 34,000 estate 
tax returns filed that year, only half owed any estate 
tax, indicating that many wealthy Americans have 
found means to avoid paying this tax. In 2012, 
9,400 Americans still had to file estate tax returns, 
even with the higher $5 million threshold. 
(7) It is in the national interest to modify the 
mechanism for collection of revenues from those 
Americans who have the largest estates, provided 
that it is done in a revenue neutral manner that en-
sures the ongoing collection of an appropriate per-
centage of the historical average of 1 percent of total 
IRS tax receipts that reflects the lower amount of 
estate tax revenues generated under the 2010 and 
2012 amendments due to a higher exemption 
amount. 
VerDate Sep 11 2014 
23:01 Sep 15, 2015
Jkt 049200
PO 00000
Frm 00003
Fmt 6652
Sfmt 6201
E:\BILLS\H3508.IH
H3508
tkelley on DSK3SPTVN1PROD with BILLS
SEC. 3. ELECTIVE SIMPLIFIED ESTATE TAX. 
(a) IN GENERAL.—Chapter 11 of the Internal Rev-
enue Code of 1986 is amended by adding at the end the 
following new subchapter: 
‘‘Subchapter D—Simplified Estate Tax 
‘‘Sec. 2301. Simplified estate tax. 
‘‘Sec. 2302. Imposition and rate. 
‘‘Sec. 2303. Election. 
‘‘Sec. 2304. Seven taxable year minimum. 
‘‘SEC. 2301. SIMPLIFIED ESTATE TAX. 
‘‘In the case of an individual (and, if married, such 
individual’s spouse) who elects the application of this sub-
chapter— 
‘‘(1) chapter 11 shall thereafter not apply with 
respect to the transfer of the estate of such indi-
vidual (or such spouse), 
‘‘(2) chapter 13 shall thereafter not apply with 
respect to any generation-skipping transfer (as de-
fined in section 2611) made by such individual (or 
such spouse), and 
‘‘(3) a tax shall be imposed by section 2302 
with respect to such individual (and such spouse) for 
the taxable year of the election and each taxable 
year thereafter. 
‘‘SEC. 2302. IMPOSITION AND RATE. 
‘‘(a) IN GENERAL.—The tax imposed by this section 
for any taxable year shall be treated as an increase in the 
VerDate Sep 11 2014 
23:01 Sep 15, 2015
Jkt 049200
PO 00000
Frm 00004
Fmt 6652
Sfmt 6201
E:\BILLS\H3508.IH
H3508
tkelley on DSK3SPTVN1PROD with BILLS
taxpayer’s tax under chapter 1 for the taxable year by an 
amount equal to 1 percent of the modified adjusted gross 
income of the taxpayer for the taxable year. 
‘‘(b) MODIFIED ADJUSTED GROSS INCOME.—For 
purposes of this section, the term ‘modified adjusted gross 
income’ means adjusted gross income increased by— 
‘‘(1) any amount excluded from gross income 
under section 911, 931, or 933, or 
‘‘(2) any amount of interest received or accrued 
by the taxpayer during the taxable year which is ex-
empt from tax. 
‘‘(c) APPLICATION OF INCREASE IN RATE.—Any in-
crease in the rate of tax imposed by subsection (a) shall 
not apply to any individual who has elected the application 
of this subchapter prior to the effective date of such in-
crease. 
‘‘SEC. 2303. ELECTION. 
‘‘(a) IN GENERAL.—Except as the Secretary shall by 
regulation prescribe in the case of separation, divorce, re-
marriage, or other circumstances the Secretary determines 
equitable, election for this subchapter to apply, once made, 
shall be irrevocable. 
‘‘(b) MARRIED COUPLES TO FILE JOINTLY.—If the 
taxpayer and the taxpayer’s spouse elect the application 
of this subchapter and are married (within the meaning 
VerDate Sep 11 2014 
23:01 Sep 15, 2015
Jkt 049200
PO 00000
Frm 00005
Fmt 6652
Sfmt 6201
E:\BILLS\H3508.IH
H3508
tkelley on DSK3SPTVN1PROD with BILLS
of section 7703) at the end of the taxable year, the tax-
payer and the taxpayer’s spouse shall file a joint return 
for the taxable year. 
‘‘SEC. 2304. SEVEN TAXABLE YEAR MINIMUM. 
‘‘(a) IN GENERAL.—In the case of a decedent whose 
last taxable year is not at least the 7th taxable year for 
which the tax under section 2302 is imposed, the applica-
tion of this subchapter shall be treated as not having been 
elected. 
‘‘(b) TRANSITION RULE FOR 2016 AND 2017.— 
‘‘(1) IN GENERAL.—In the case of a decedent 
who first elected the application of this subchapter 
during 2016 or 2017, subsection (a) shall not apply 
if the executor of the decedent’s estate elects to in-
crease the amount of the tax imposed under chapter 
1 for the decedent’s last taxable year by an amount 
equal to— 
‘‘(A) the highest amount of tax imposed by 
section 2302 with respect to such decedent for 
any taxable year (including the decedent’s last 
taxable year), multiplied by 
‘‘(B) an amount equal to the difference 
of— 
‘‘(i) 7, over 
VerDate Sep 11 2014 
23:01 Sep 15, 2015
Jkt 049200
PO 00000
Frm 00006
Fmt 6652
Sfmt 6201
E:\BILLS\H3508.IH
H3508
tkelley on DSK3SPTVN1PROD with BILLS
‘‘(ii) the number of taxable years for 
which such tax was imposed with respect 
to such decedent (including the decedent’s 
last taxable year). 
‘‘(2) SPECIAL
RULE
FOR
DECEDENT
DYING 
DURING YEAR OF ELECTION.—In the case of a dece-
dent to whom paragraph (1) applies and who first 
elected the application of this subchapter with re-
spect to the last taxable year of the decedent, the 
amount under subparagraph (A) shall not be less 
than the amount of tax which would have been im-
posed by section 2302 had such election first been 
elected with respect to the preceding taxable year. 
‘‘(c) CREDIT FOR TAXES PAID.— 
‘‘(1) IN GENERAL.—In the case of a decedent 
to which subsection (a) applies, the Secretary shall 
by regulation provide for allowing for a credit 
against the tax imposed by chapter 11 with respect 
to the decedent to account for any taxes paid by the 
decedent under section 2302. 
‘‘(2) INTEREST.—The amount of any credit de-
termined under paragraph (1) with respect to any 
tax paid shall include interest, which shall be deter-
mined— 
VerDate Sep 11 2014 
23:01 Sep 15, 2015
Jkt 049200
PO 00000
Frm 00007
Fmt 6652
Sfmt 6201
E:\BILLS\H3508.IH
H3508
tkelley on DSK3SPTVN1PROD with BILLS
‘‘(A) at the overpayment rate established 
under section 6621, and 
‘‘(B) from the date of payment of such tax 
to the due date of the amount against which 
the credit is allowed.’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after, 
and estates of decedents dying after, December 31, 2015. 
SEC. 4. CARRY-OVER BASIS. 
(a) IN GENERAL.—Part II of subchapter O of chap-
ter 1 of such Code is amended by inserting after section 
1021 the following new section: 
‘‘SEC. 1022. TREATMENT OF PROPERTY ACQUIRED FROM A 
DECEDENT WHO ELECTED SIMPLIFIED ES-
TATE TAX TREATMENT. 
‘‘(a) IN GENERAL.—In the case of property acquired 
from a decedent who elected the application of subchapter 
D of chapter 11— 
‘‘(1) such property shall be treated for purposes 
of this subtitle as transferred by gift, and 
‘‘(2) the basis of the person acquiring property 
from such a decedent shall be the lesser of— 
‘‘(A) the adjusted basis of the decedent, or 
‘‘(B) the fair market value of the property 
at the date of the decedent’s death. 
VerDate Sep 11 2014 
23:01 Sep 15, 2015
Jkt 049200
PO 00000
Frm 00008
Fmt 6652
Sfmt 6201
E:\BILLS\H3508.IH
H3508
tkelley on DSK3SPTVN1PROD with BILLS
‘‘(b) PROPERTY ACQUIRED FROM THE DECEDENT.— 
For purposes of this section, the following property shall 
be considered to have been acquired from the decedent: 
‘‘(1) Property acquired by bequest, devise, or 
inheritance, or by the decedent’s estate from the de-
cedent. 
‘‘(2) Property transferred by the decedent dur-
ing his lifetime— 
‘‘(A) to a qualified revocable trust (as de-
fined in section 645(b)(1)), or 
‘‘(B) to any other trust with respect to 
which the decedent reserved the right to make 
any change in the enjoyment thereof through 
the exercise of a power to alter, amend, or ter-
minate the trust. 
‘‘(3) Any other property passing from the dece-
dent by reason of death to the extent that such 
property passed without consideration.’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall apply with respect to estates of decedents 
dying after December 31, 2015. 
SEC. 5. SIMPLIFIED ESTATE TAX RETURNS. 
(a) INFORMATION RETURNS.— 
(1) IN GENERAL.—Subpart C of part II of sub-
chapter A of chapter 61 of such Code is amended by 
VerDate Sep 11 2014 
23:01 Sep 15, 2015
Jkt 049200
PO 00000
Frm 00009
Fmt 6652
Sfmt 6201
E:\BILLS\H3508.IH
H3508
tkelley on DSK3SPTVN1PROD with BILLS
inserting after section 6018 the following new sec-
tion: 
‘‘SEC. 6018A. SIMPLIFIED ESTATE TAX RETURNS. 
‘‘(a) IN GENERAL.—In the case of property acquired 
from a decedent who has in effect an election under sub-
chapter D of chapter 11, the executor of the estate of such 
decedent shall make a return containing the following in-
formation with respect to such property: 
‘‘(1) The name and TIN of the recipient of 
such property. 
‘‘(2) An accurate description of such property. 
‘‘(3) The adjusted basis of such property in the 
hands of the decedent and its fair market value at 
the time of death. 
‘‘(4) The decedent’s holding period for such 
property. 
‘‘(5) Sufficient information to determine wheth-
er any gain on the disposition of the property would 
be treated as ordinary income. 
‘‘(b) PROPERTY ACQUIRED FROM DECEDENT.—For 
purposes of this section, section 1022 shall apply for pur-
poses of determining the property acquired from a dece-
dent. 
‘‘(c) STATEMENTS TO BE FURNISHED TO CERTAIN 
PERSONS.—Every person required to make a return under 
VerDate Sep 11 2014 
23:01 Sep 15, 2015
Jkt 049200
PO 00000
Frm 00010
Fmt 6652
Sfmt 6201
E:\BILLS\H3508.IH
H3508
tkelley on DSK3SPTVN1PROD with BILLS
subsection (a) shall furnish to each person whose name 
is required to be set forth in such return (other than the 
person required to make such return) a written statement 
showing— 
‘‘(1) the name, address, and phone number of 
the person required to make such return, and 
‘‘(2) the information specified in subsection (a) 
with respect to property acquired from, or passing 
from, the decedent to the person required to receive 
such statement. 
The written statement required under the preceding sen-
tence shall be furnished not later than 30 days after the 
date that the return required by subsection (a) is filed. 
‘‘(d) ANNUAL BENEFICIARY ASSET STATUS RE-
TURN.—Each recipient of property with respect to whom 
a statement is required to be furnished under subsection 
(c) and who owns any such property during the taxable 
year shall make a return with respect to such property 
containing the following information: 
‘‘(1) An accurate description of such property. 
‘‘(2) An accounting of the disposition of any 
such property during the taxable year. 
‘‘(3) The adjusted basis of such property as of 
the later of the end of the taxable year or the date 
of any such disposition. 
VerDate Sep 11 2014 
23:01 Sep 15, 2015
Jkt 049200
PO 00000
Frm 00011
Fmt 6652
Sfmt 6201
E:\BILLS\H3508.IH
H3508
tkelley on DSK3SPTVN1PROD with BILLS
‘‘(e) EXCEPTED PROPERTY.— 
‘‘(1) IN
GENERAL.—Subsections (a) and (b) 
shall not apply with respect to— 
‘‘(A) any property the fair market value of 
which, at the time of the decedent’s death, does 
not exceed $10,000, and 
‘‘(B) any property the basis of which was 
determined by reference to the fair market 
value of the property at the date of the dece-
dent’s death. 
‘‘(2) INFLATION ADJUSTMENT.— 
‘‘(A) IN GENERAL.—In the case of any cal-
endar year after 2016, the $10,000 amount 
under paragraph (1) shall be increased by an 
amount equal to— 
‘‘(i) such dollar amount, multiplied by 
‘‘(ii) the cost-of-living adjustment de-
termined under section 1(f)(3) for the cal-
endar year, determined by substituting 
‘calendar year 2014’ for ‘calendar year 
1992’ in subparagraph (B) thereof. 
‘‘(B) ROUNDING.—If any amount as ad-
justed under subparagraph (A) is not a multiple 
of $100, such amount shall be rounded to the 
next lowest multiple of $100.’’. 
VerDate Sep 11 2014 
23:01 Sep 15, 2015
Jkt 049200
PO 00000
Frm 00012
Fmt 6652
Sfmt 6201
E:\BILLS\H3508.IH
H3508
tkelley on DSK3SPTVN1PROD with BILLS
(2) CLERICAL AMENDMENT.—The table of sec-
tions for subpart C of part II of subchapter A of 
chapter 61 of such Code is amended by inserting 
after the item relating to section 6018 the following 
new item: 
‘‘Sec. 6018A. Simplified estate tax returns.’’. 
(b) TIME FOR FILING RETURNS.—Section 6075(a) 
of such Code is amended— 
(1) by striking ‘‘ESTATE TAX RETURN.—Re-
turns made’’ and inserting the following: ‘‘ESTATE 
TAX RETURN.— 
‘‘(1) IN GENERAL.—Returns made’’, and 
(2) by adding at the end the following new 
paragraph: 
‘‘(2) SIMPLIFIED ESTATE TAX.— 
‘‘(A) IN GENERAL.—Returns made under 
section 6018A(a) shall be filed not later than 
180 days after the date of the decedent’s death. 
‘‘(B) ANNUAL BENEFICIARY ASSET STATUS 
RETURNS.—Returns 
made 
under 
section 
6018A(d) for a taxable year shall be filed con-
currently with the individual’s return of income 
tax for the taxable year.’’. 
(c) PENALTY FOR FAILURE TO FILE RETURNS.— 
VerDate Sep 11 2014 
23:01 Sep 15, 2015
Jkt 049200
PO 00000
Frm 00013
Fmt 6652
Sfmt 6201
E:\BILLS\H3508.IH
H3508
tkelley on DSK3SPTVN1PROD with BILLS
(1) IN GENERAL.—Part 1 of subchapter B of 
chapter 68 of such Code is amended by adding at 
the end the following new section: 
‘‘SEC. 6720D. FAILURE TO FILE INFORMATION WITH RE-
SPECT TO SIMPLIFIED ESTATE TAX RETURNS. 
‘‘(a) INFORMATION REQUIRED TO BE FILED WITH 
SECRETARY.—Any person required to furnish any infor-
mation under section 6018A(a) who fails to do so on the 
date prescribed therefor (determined with regard to any 
extension of time for filing) shall pay a penalty of $10,000 
for each such failure. 
‘‘(b) INFORMATION REQUIRED TO BE FURNISHED 
TO BENEFICIARIES.—Any person required to furnish in 
writing to each person described in section 6018A(c) the 
information required under such section who fails to do 
so shall pay a penalty of $250 for each such failure. 
‘‘(c) ANNUAL INFORMATION RETURN REQUIRED TO 
BE FURNISHED BY BENEFICIARY.—Any person required 
to furnish any information under section 6018A(d) who 
fails to do so on the date prescribed therefor (determined 
with regard to any extension of time for filing) shall pay 
a penalty of $5,000 for each such failure. 
‘‘(d) REASONABLE CAUSE EXCEPTION.—No penalty 
shall be imposed under subsection (a), (b), or (c) with re-
VerDate Sep 11 2014 
23:01 Sep 15, 2015
Jkt 049200
PO 00000
Frm 00014
Fmt 6652
Sfmt 6201
E:\BILLS\H3508.IH
H3508
tkelley on DSK3SPTVN1PROD with BILLS
spect to a failure if it is shown that such failure is due 
to reasonable cause. 
‘‘(e) INTENTIONAL
DISREGARD.—If any failure 
under subsection (a), (b), or (c) is due to intentional dis-
regard of the requirements under section 6018A, the pen-
alty under such subsection shall be 5 percent of the fair 
market value as of the date of death (in the case of section 
6018A(d), as of the date prescribed for furnishing such 
return (determined with regard to any extension of time 
for filing)) of the property with respect to which the infor-
mation is required. 
‘‘(f) DEFICIENCY PROCEDURES NOT TO APPLY.— 
Subchapter B of chapter 63 (relating to deficiency proce-
dures for income, estate, gift, and certain excise taxes) 
shall not apply in respect of the assessment or collection 
of any penalty imposed by this section.’’. 
(2) CLERICAL AMENDMENT.—The table of sec-
tions for part 1 of subchapter B of chapter 68 of 
such Code is amended by adding at the end the fol-
lowing new item: 
‘‘Sec. 6720D. Failure to file information with respect to simplified estate tax 
returns.’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply with respect to estates of decedents 
dying after December 31, 2015. 
VerDate Sep 11 2014 
23:01 Sep 15, 2015
Jkt 049200
PO 00000
Frm 00015
Fmt 6652
Sfmt 6201
E:\BILLS\H3508.IH
H3508
tkelley on DSK3SPTVN1PROD with BILLS
SEC. 6. SPECIAL RULE FOR REVOCATION OF TRUSTS IN 
CONNECTION WITH ELECTION. 
Any revesting in the grantor of title to property held 
in a trust, whether by revocation, dissolution, or otherwise, 
shall not be subject to any tax imposed by the Internal 
Revenue Code of 1986 if such revesting occurs in 2016 
or 2017 and is in connection with the grantor’s election 
for subchapter D of chapter 11 to apply. 
Æ 
VerDate Sep 11 2014 
23:01 Sep 15, 2015
Jkt 049200
PO 00000
Frm 00016
Fmt 6652
Sfmt 6301
E:\BILLS\H3508.IH
H3508
tkelley on DSK3SPTVN1PROD with BILLS