I 
116TH CONGRESS 
1ST SESSION H. R. 4728 
To amend the Internal Revenue Code of 1986 to modify the taxation of 
unearned income of certain children. 
IN THE HOUSE OF REPRESENTATIVES 
OCTOBER 17, 2019 
Ms. MOORE (for herself, Mr. ESTES, Mr. CISNEROS, Mr. YOUNG, Mr. PA-
NETTA, Mr. COLE, Mr. KILDEE, Mr. CALVERT, Ms. DAVIDS of Kansas, 
Mr. STEUBE, and Ms. HAALAND) 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 modify 
the taxation of unearned income of certain children. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Youth Tax Fairness 
Act of 2019’’. 
SEC. 2. MODIFICATION OF TAXATION OF UNEARNED IN-
COME OF CERTAIN CHILDREN. 
(a) CERTAIN INCOME TREATED AS EARNED INCOME 
FOR PURPOSES OF KIDDIE TAX.—Section 1(g)(4)(C) of 
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the Internal Revenue Code of 1986 is amended to read 
as follows: 
‘‘(C) TREATMENT OF CERTAIN AMOUNTS 
AS EARNED INCOME.—For purposes of this sub-
section, each of following amounts shall be 
treated as earned income of the child referred 
to in paragraph (1) to the extent included in 
the gross income of such child: 
‘‘(i) DISTRIBUTIONS FROM QUALIFIED 
DISABILITY
TRUSTS.—Any amount in-
cluded in the gross income of such child 
under section 652 or 662 by reason of 
being a beneficiary of a qualified disability 
trust 
(as 
defined 
in 
section 
642(b)(2)(C)(ii)). 
‘‘(ii) CERTAIN
MILITARY
SURVIVOR 
BENEFITS.—Any benefit under laws ad-
ministered by the Secretary of Defense or 
the Secretary of Veterans Affairs which is 
received by such child by reason of the 
child being the survivor of a deceased 
member of the Armed Forces or of a de-
ceased veteran. 
‘‘(iii) CERTAIN
FIRST
RESPONDER 
SURVIVOR BENEFITS.—Any payment made 
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by Federal, State, or local government to 
such child if such payment is made by rea-
son of the death of the parent of such child 
during such parent’s service as a law en-
forcement officer, firefighter, paramedic, or 
emergency medical technician. 
‘‘(iv) CERTAIN
INDIAN
TRIBAL
PAY-
MENTS.—Any payment made by an Indian 
tribal government (as defined in section 
139E(c)(1)), or from a trust of which the 
Indian tribal government is treated as the 
owner under subpart E of part I of sub-
chapter J, to such child if— 
‘‘(I) such child is an enrolled 
member of the tribe with respect to 
such Indian tribal government, and 
‘‘(II) such payment is received by 
such child by reason of such enroll-
ment. 
‘‘(v) CERTAIN SCHOLARSHIPS OR FEL-
LOWSHIP GRANTS.—Any scholarship or fel-
lowship grant which is received by such 
child if— 
‘‘(I) such child is a candidate for 
a degree at an educational organiza-
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tion 
described 
in 
section 
170(b)(1)(A)(ii), and 
‘‘(II) such scholarship or grant 
supports such candidacy. 
‘‘(vi) 
ALASKA
PERMANENT
FUND 
DIVIDENDS.—Any Alaska Permanent Fund 
dividend. 
‘‘(vii) SOCIAL SECURITY BENEFITS.— 
Any social security benefit (as defined in 
section 86(d)).’’. 
(b) REPEAL OF TEMPORARY RULE FOR TAXATION 
OF UNEARNED INCOME OF CERTAIN CHILDREN.—Section 
1(j) of such Code is amended by striking paragraph (4). 
(c) APPLICATION TO ALTERNATIVE MINIMUM TAX.— 
(1) IN GENERAL.—Section 59(j)(1)(A) of such 
Code is amended by inserting ‘‘and including 
amounts treated as earned income under section 
1(g)(4)(C)’’ after ‘‘section 911(d)(2)’’. 
(2) SUSPENSION OF KIDDIE TAX LIMITATION 
ON ALTERNATIVE MINIMUM TAX EXEMPTION DUR-
ING
PERIOD
OF
INCREASED
EXEMPTION.—Section 
55(d)(4)(A) of such Code is amended by striking 
‘‘and’’ at the end of clause (i)(II), by striking the 
period at the end of clause (ii)(III) and inserting ‘‘, 
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and’’, and by adding at the end the following new 
clause: 
‘‘(iii) subsection (j) of section 59 shall 
not apply.’’. 
(d) EFFECTIVE DATES.— 
(1) IN
GENERAL.—Except as otherwise pro-
vided in this subsection, the amendments made by 
this section shall apply to taxable years beginning 
after December 31, 2017. 
(2) REPEAL OF TEMPORARY RULE FOR TAX-
ATION OF UNEARNED INCOME OF CERTAIN CHIL-
DREN.— 
(A) IN GENERAL.—Except as provided in 
subparagraph (B), the amendment made by 
subsection (b) shall apply to taxable years be-
ginning after December 31, 2018. 
(B) ELECTIVE
RETROACTIVE
APPLICA-
TION.—In the case of a taxpayer who elects the 
application of this subparagraph (at such time 
and in such manner as the Secretary of the 
Treasury (or the Secretary’s designee) may pro-
vide), the amendment made by subsection (b) 
shall apply to taxable years beginning after De-
cember 31, 2017. 
Æ 
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