SEC. 4. PHASEOUT OF EARNED INCOME CREDIT FOR INDI-
VIDUALS HAVING MORE THAN $2,500 OF TAX-
ABLE INTEREST AND DIVIDENDS.
(a) IN GENERAL.—Section 32 of the Internal Reve-
nue Code of 1986 is amended by redesignating subsections
(i) and (j) as subsections (j) and (k), respectively, and by
inserting after subsection (h) the following new subsection:
‘‘(i) PHASEOUT OF CREDIT FOR INDIVIDUALS HAV-
ING MORE THAN $2,500 OF TAXABLE INTEREST AND
DIVIDENDS.—If the aggregate amount of interest and
dividends includible in the gross income of the taxpayer
for the taxable year exceeds $2,500, the amount of the
credit which would (but for this subsection) be allowed
under this section for such taxable year shall be reduced
(but not below zero) by an amount which bears the same
ratio to such amount of credit as such excess bears to
$650.’’
(b) INFLATION ADJUSTMENT.—Subsection (j) of sec-
tion 32 of such Code (relating to inflation adjustments),
as redesignated by subsection (a), is amended by striking
paragraph (2) and by inserting the following new para-
graphs:
‘‘(2) INTEREST AND DIVIDEND INCOME LIMITA-
TION.—In the case of a taxable year beginning in a
calendar year after 1996, each dollar amount con-
tained in subsection (i) shall be increased by an
amount equal to—
‘‘(A) such dollar amount, multiplied by
‘‘(B) the cost-of-living adjustment deter-
mined under section 1(f)(3) for the calendar
year in which the taxable year begins, deter-
mined by substituting ‘calendar year 1995’ for
‘calendar
year
1992’
in
subparagraph
(B)
thereof.
‘‘(3) ROUNDING.—If any amount as adjusted
under paragraph (1) or (2) is not a multiple of $10,
such dollar amount shall be rounded to the nearest
multiple of $10.’’
(c) EFFECTIVE DATE.—The amendments made by
this section shall apply to taxable years beginning after
December 31, 1995.
SECTION 1. PERMANENT EXTENSION AND INCREASE OF DE-
DUCTION FOR HEALTH INSURANCE COSTS OF
SELF-EMPLOYED INDIVIDUALS.
(a) PERMANENT EXTENSION.—Subsection (l) of sec-
tion 162 of the Internal Revenue Code of 1986 (relating to
special rules for health insurance costs of self-employed in-
dividuals) is amended by striking paragraph (6).
(b) INCREASE IN DEDUCTION.—Paragraph (1) of sec-
tion 162(l) of the Internal Revenue Code of 1986 is amended
by striking ‘‘25 percent’’ and inserting ‘‘30 percent’’.
(c) EFFECTIVE DATES.—
(1) EXTENSION.—The amendment made by sub-
section (a) shall apply to taxable years beginning
after December 31, 1993.
(2) INCREASE.—The amendment made by sub-
section (b) shall apply to taxable years beginning
after December 31, 1994.
SEC. 2. REPEAL OF NONRECOGNITION ON FCC CERTIFIED
SALES AND EXCHANGES.
(a) IN GENERAL.—Subchapter O of chapter 1 of the
Internal Revenue Code of 1986 is amended by striking part
V (relating to changes to effectuate FCC policy).
(b) CONFORMING AMENDMENTS.—Sections 1245(b)(5)
and 1250(d)(5) of the Internal Revenue Code of 1986 are
each amended—
(1) by striking ‘‘section 1071 (relating to gain
from sale or exchange to effectuate polices of FCC)
or’’, and
(2) by striking ‘‘1071 AND’’ in the heading there-
of.
(c) CLERICAL AMENDMENT.—The table of parts for
such subchapter O is amended by striking the item relating
to part V.
(d) EFFECTIVE DATE.—
(1) IN
GENERAL.—The amendments made by
this section shall apply to—
(A) sales and exchanges on or after January
17, 1995, and
(B) sales and exchanges before such date if
the FCC tax certificate with respect to such sale
or exchange is issued on or after such date.
(2) BINDING CONTRACTS.—
(A) IN GENERAL.—The amendments made
by this section shall not apply to any sale or ex-
change pursuant to a written contract which was
binding on January 16, 1995, and at all times
thereafter before the sale or exchange, if the FCC
tax certificate with respect to such sale or ex-
change was applied for, or issued, on or before
such date.
(B) SALES CONTINGENT ON ISSUANCE OF
CERTIFICATE.—A contract shall be treated as not
binding for purposes of subparagraph (A) if the
sale or exchange pursuant to such contract, or
the material terms of such contract, were contin-