I
106TH CONGRESS
1ST SESSION
H. R. 2923
To amend the Internal Revenue Code of 1986 to extend expiring provisions,
to fully allow the nonrefundable personal credits against regular tax
liability, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
SEPTEMBER 23, 1999
Mr. ARCHER 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 extend
expiring provisions, to fully allow the nonrefundable per-
sonal credits against regular tax liability, 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. NONREFUNDABLE PERSONAL CREDITS FULLY
ALLOWED AGAINST REGULAR TAX LIABILITY.
(a) IN GENERAL.—Subsection (a) of section 26 of the
Internal Revenue Code of 1986 (relating to limitation
based on amount of tax) is amended to read as follows:
‘‘(a) LIMITATION BASED ON AMOUNT OF TAX.—The
aggregate amount of credits allowed by this subpart for
the taxable year shall not exceed the taxpayer’s regular
tax liability for the taxable year.’’.
(b) CHILD CREDIT.—Subsection (d) of section 24 of
such Code is amended by striking paragraph (2) and by
redesignating paragraph (3) as paragraph (2).
(c) EFFECTIVE DATE.—The amendments made by
this section shall apply to taxable years beginning after
December 31, 1998.
SEC. 2. RESEARCH CREDIT.
(a) EXTENSION.—
(1) IN
GENERAL.—Paragraph (1) of section
41(h) of the Internal Revenue Code of 1986 (relat-
ing to termination) is amended—
(A) by striking ‘‘June 30, 1999’’ and in-
serting ‘‘June 30, 2004’’, and
(B) by striking the material following sub-
paragraph (B).
(2) TECHNICAL
AMENDMENT.—Subparagraph
(D) of section 45C(b)(1) of such Code is amended
by striking ‘‘June 30, 1999’’ and inserting ‘‘June
30, 2004’’.
(3) EFFECTIVE DATE.—The amendments made
by this subsection shall apply to amounts paid or in-
curred after June 30, 1999.
(b) INCREASE
IN PERCENTAGES UNDER ALTER-
NATIVE INCREMENTAL CREDIT.—
(1) IN GENERAL.—Subparagraph (A) of section
41(c)(4) of such Code is amended—
(A) by striking ‘‘1.65 percent’’ and insert-
ing ‘‘2.65 percent’’,
(B) by striking ‘‘2.2 percent’’ and inserting
‘‘3.2 percent’’, and
(C) by striking ‘‘2.75 percent’’ and insert-
ing ‘‘3.75 percent’’.
(2) EFFECTIVE DATE.—The amendments made
by this subsection shall apply to taxable years begin-
ning after June 30, 1999.
(c) SPECIAL RULE.—
(1) IN GENERAL.—For purposes of the Internal
Revenue Code of 1986, the credit determined under
section 41 of such Code which is attributable to the
suspension period—
(A) shall not be taken into account under
section 6654 or 6655 of such Code for any tax-
able year in determining the amount of any in-
stallment the due date for which is before Octo-
ber 1, 2000, and
(B) shall not be allowed for any taxable
year ending before October 1, 2000.
(2) SUSPENSION PERIOD.—For purposes of this
subsection, the suspension period is the period be-
ginning on July 1, 1999, and ending on September
30, 2000.
(3) SUSPENDED CREDIT TREATED AS PAYMENT
OF TAX ON OCTOBER 1, 2000.—
(A) IN GENERAL.—The amount of credit
not allowed by reason of paragraph (1) for any
taxable year ending before October 1, 2000,
shall be treated as a payment of tax imposed by
chapter 1 of such Code for such taxable year
which is made on such date.
(B) ACCELERATED REFUNDS.—If, as a re-
sult of the payment referred to in subparagraph
(A) with respect to a taxable year, there is an
overpayment of tax for such year, the taxpayer
may file an application for a tentative refund of
such overpayment. Such application shall be in
such manner and form, and contain such infor-
mation, as the Secretary may prescribe.
(C) DEADLINE FOR APPLICATIONS.—Sub-
paragraph (B) shall apply only to applications
filed before October 1, 2001.
(D) ALLOWANCE OF ADJUSTMENTS.—Not
later than 90 days after the date on which an
application is filed under this paragraph, the
Secretary shall—
(i) review the application,
(ii) determine the amount of the over-
payment, and
(iii) apply, credit, or refund such over-
payment,
in a manner similar to the manner provided in
section 6411(b) of such Code.
(E) CONSOLIDATED RETURNS.—The provi-
sions of section 6411(c) of such Code shall
apply to an adjustment under this paragraph in
such manner as the Secretary may provide.
(4) CREDIT ATTRIBUTABLE TO SUSPENSION PE-
RIOD.—
(A) IN GENERAL.—For purposes of this
subsection, in the case of a taxable year which
includes a portion of the suspension period, the
amount of credit determined under section 41
of such Code for such taxable year which is at-
tributable to such period is the amount which
bears the same ratio to the amount of credit de-
termined under such section 41 for such taxable
year as the number of months in the suspension
period which are during such taxable year bears
to the number of months in such taxable year.
(B) WAIVER
OF
ESTIMATED
TAX
PEN-
ALTIES.—No addition to tax shall be made
under section 6654 or 6655 of such Code for
any period before July 1, 1999, with respect to
any underpayment of tax imposed by such Code
to the extent such underpayment was created or
increased by reason of subparagraph (A).
(5) SECRETARY.—For purposes of this sub-
section, the term ‘‘Secretary’’ means the Secretary
of the Treasury (or such Secretary’s delegate).
SEC. 3. SUBPART F EXEMPTION FOR ACTIVE FINANCING IN-
COME.
(a) 
IN
GENERAL.—Sections 
953(e)(10) 
and
954(h)(9) of the Internal Revenue Code of 1986 (relating
to application) are each amended—
(1) by striking ‘‘the first taxable year’’ and in-
serting ‘‘taxable years’’,
(2) by striking ‘‘January 1, 2000’’ and insert-
ing ‘‘January 1, 2005’’, and
(3) by striking ‘‘within which such’’ and insert-
ing ‘‘within which any such’’.
(b) EFFECTIVE DATE.—The amendments made by
this section shall apply to taxable years beginning after
December 31, 1999.
SEC. 4. TAXABLE INCOME LIMIT ON PERCENTAGE DEPLE-
TION FOR MARGINAL PRODUCTION.
(a) IN GENERAL.—Subparagraph (H) of section
613A(c)(6) of the Internal Revenue Code of 1986 (relating
to temporary suspension of taxable limit with respect to
marginal production) is amended by striking ‘‘January 1,
2000’’ and inserting ‘‘January 1, 2005’’.
(b) EFFECTIVE DATE.—The amendment made by
this section shall apply to taxable years beginning after
December 31, 1999.
SEC. 5. WORK OPPORTUNITY CREDIT AND WELFARE-TO-
WORK CREDIT.
(a) TEMPORARY EXTENSION.—Sections 51(c)(4)(B)
and 51A(f ) of the Internal Revenue Code of 1986 (relat-
ing to termination) are each amended by striking ‘‘June
30, 1999’’ and inserting ‘‘December 31, 2001’’.
(b) CLARIFICATION OF FIRST YEAR OF EMPLOY-
MENT.—Paragraph (2) of section 51(i) of such Code is
amended by striking ‘‘during which he was not a member
of a targeted group’’.
(c) EFFECTIVE DATE.—The amendments made by
this section shall apply to individuals who begin work for
the employer after June 30, 1999.
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