I
106TH CONGRESS
1ST SESSION
H. R. 3178
To amend the Internal Revenue Code of 1986 to make the dependent care
credit refundable and to provide for advance payments of such credit.
IN THE HOUSE OF REPRESENTATIVES
OCTOBER 28, 1999
Mr. PETERSON of Minnesota introduced the following bill; which was referred
to the Committee on Ways and Means
A BILL
To amend the Internal Revenue Code of 1986 to make
the dependent care credit refundable and to provide for
advance payments of such credit.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. DEPENDENT CARE CREDIT MADE REFUND-
ABLE; ADVANCE PAYMENT OF SUCH CREDIT.
(a) CREDIT TO BE REFUNDABLE.—
(1) IN GENERAL.—Section 21 of the Internal
Revenue Code of 1986 (relating to expenses for
household and dependent care services necessary for
gainful employment) is hereby moved to subpart C
of part IV of subchapter A of chapter 1 of such
Code (relating to refundable credits) and inserted
after section 34.
(2) REDESIGNATIONS.—
(A) Section 35 of such Code is redesig-
nated as section 36.
(B) Section 21 of such Code is redesig-
nated as section 35.
(b) ADVANCE PAYMENT OF CREDIT.—Chapter 25 of
such Code (relating to general provisions relating to em-
ployment taxes) is amended by inserting after section
3507 the following:
‘‘SEC. 3507A. ADVANCE PAYMENT OF DEPENDENT CARE
CREDIT.
‘‘(a) GENERAL RULE.—Except as otherwise provided
in this section, every employer making payment of wages
with respect to whom a dependent care eligibility certifi-
cate is in effect shall, at the time of paying such wages,
make an additional payment equal to such employee’s de-
pendent care advance amount.
‘‘(b) DEPENDENT
CARE
ELIGIBILITY
CERTIFI-
CATE.—For purposes of this title, a dependent care eligi-
bility certificate is a statement furnished by an employee
to the employer which—
‘‘(1) certifies that the employee will be eligible
to receive the credit provided by section 35 for the
taxable year,
‘‘(2) certifies that the employee reasonably ex-
pects to be an applicable taxpayer for the taxable
year,
‘‘(3) certifies that the employee does not have
a dependent care eligibility certificate in effect for
the calendar year with respect to the payment of
wages by another employer,
‘‘(4) states whether or not the employee’s
spouse has a dependent care eligibility certificate in
effect,
‘‘(5) states the number of qualifying individuals
in the household maintained by the employee, and
‘‘(6) estimates the amount of employment-re-
lated expenses for the calendar year.
‘‘(c) DEPENDENT CARE ADVANCE AMOUNT.—
‘‘(1) IN GENERAL.—For purposes of this title,
the term ‘dependent care advance amount’ means,
with respect to any payroll period, the amount
determined—
‘‘(A) on the basis of the employee’s wages
from the employer for such period,
‘‘(B) on the basis of the employee’s esti-
mated employment-related expenses included in
the dependent care eligibility certificate, and
‘‘(C) in accordance with tables provided by
the Secretary.
‘‘(2) ADVANCE AMOUNT TABLES.—The tables
referred to in paragraph (1)(C) shall be similar in
form to the tables prescribed under section 3402
and, to the maximum extent feasible, shall be coordi-
nated with such tables and the tables prescribed
under section 3507(c).
‘‘(d) OTHER RULES.—For purposes of this section,
rules similar to the rules of subsections (d) and (e) of sec-
tion 3507 shall apply.
‘‘(e) DEFINITIONS.—For purposes of this section,
terms used in this section which are defined in section 35
shall have the respective meanings given such terms by
section 35.’’.
(c) CONFORMING AMENDMENTS.—
(1) Section 35(a)(1) of such Code, as redesig-
nated by subsection (a), is amended by striking
‘‘chapter’’ and inserting ‘‘subtitle’’.
(2) Section 35(e) of such Code, as so redesig-
nated, is amended by adding at the end the fol-
lowing:
‘‘(12) COORDINATION
WITH
ADVANCE
PAY-
MENTS AND MINIMUM TAX.—Rules similar to the
rules of subsections (g) and (h) of section 32 shall
apply for purposes of this section.’’.
(3) Sections 23(f)(1) and 129(a)(2)(C) of such
Code are each amended by striking ‘‘section 21(e)’’
and inserting ‘‘section 35(e)’’.
(4) Section 129(b)(2) of such Code is amended
by striking ‘‘section 21(d)(2)’’ and inserting ‘‘section
35(d)(2)’’.
(5) Section 129(e)(1) of such Code is amended
by striking ‘‘section 21(b)(2)’’ and inserting ‘‘section
35(b)(2)’’.
(6) Section 213(e) of such Code is amended by
striking ‘‘section 21’’ and inserting ‘‘section 35’’.
(7) Section 995(f)(2)(C) of such Code is
amended by striking ‘‘and 34’’ and inserting ‘‘34,
and 35’’.
(8) Section 6211(b)(4)(A) of such Code is
amended by striking ‘‘and 34’’ and inserting ‘‘, 34,
and 35’’.
(9) Section 6213(g)(2)(H) of such Code is
amended by striking ‘‘section 21’’ and inserting
‘‘section 35’’.