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(b) TECHNICAL AMENDMENTS.—
(1) Subparagraph (B) of section 1(f )(6) of such
Code is amended by striking ‘‘(other than with’’ and
all that follows through ‘‘shall be applied’’ and insert-
ing ‘‘(other than with respect to sections 63(c)(4) and
151(d)(4)(A)) shall be applied’’.
(2) Paragraph (4) of section 63(c) of such Code
is amended by adding at the end the following flush
sentence:
‘‘The preceding sentence shall not apply to the
amount referred to in paragraph (2)(A).’’.
(c) EFFECTIVE DATE.—The amendments made by this
section shall apply to taxable years beginning after Decem-
ber 31, 2000.
SEC. 3. PHASEOUT OF MARRIAGE PENALTY IN 15-PERCENT
BRACKET; REPEAL OF REDUCTION OF RE-
FUNDABLE TAX CREDITS.
(a) IN GENERAL.—Subsection (f ) of section 1 of the
Internal Revenue Code of 1986 (relating to adjustments in
tax tables so that inflation will not result in tax increases)
is amended by adding at the end the following new para-
graph:
‘‘(8) PHASEOUT OF MARRIAGE PENALTY IN 15-
PERCENT BRACKET.—
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‘‘(A) IN GENERAL.—With respect to taxable
years beginning after December 31, 2002, in pre-
scribing the tables under paragraph (1)—
‘‘(i) the maximum taxable income in
the lowest rate bracket in the table con-
tained in subsection (a) (and the minimum
taxable income in the next higher taxable
income bracket in such table) shall be the
applicable percentage of the maximum tax-
able income in the lowest rate bracket in the
table contained in subsection (c) (after any
other adjustment under this subsection),
and
‘‘(ii) the comparable taxable income
amounts in the table contained in sub-
section (d) shall be 1⁄2 of the amounts deter-
mined under clause (i).
‘‘(B) APPLICABLE PERCENTAGE.—For pur-
poses of subparagraph (A), the applicable per-
centage shall be determined in accordance with
the following table:
‘‘For taxable years beginning
The applicable
in calendar year—
percentage is—
2003 ....................................................................................
170.3
2004 ....................................................................................
173.8
2005 ....................................................................................
183.5
2006 ....................................................................................
184.3
2007 ....................................................................................
187.9
2008 and thereafter ...........................................................
200.0.
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‘‘(C) ROUNDING.—If any amount deter-
mined under subparagraph (A)(i) is not a mul-
tiple of $50, such amount shall be rounded to the
next lowest multiple of $50.’’.
(b) REPEAL OF REDUCTION OF REFUNDABLE TAX
CREDITS.—
(1) Subsection (d) of section 24 of such Code is
amended by striking paragraph (2) and redesignating
paragraph (3) as paragraph (2).
(2) Section 32 of such Code is amended by strik-
ing subsection (h).
(c) TECHNICAL AMENDMENTS.—
(1) Subparagraph (A) of section 1(f )(2) of such
Code is amended by inserting ‘‘except as provided in
paragraph (8),’’ before ‘‘by increasing’’.
(2) The heading for subsection (f ) of section 1 of
such Code is amended by inserting ‘‘PHASEOUT OF
MARRIAGE PENALTY IN 15-PERCENT BRACKET;’’ be-
fore ‘‘ADJUSTMENTS’’.
(d) EFFECTIVE DATES.—
(1) IN GENERAL.—Except as provided by para-
graph (2), the amendments made by this section shall
apply to taxable years beginning after December 31,
2002.
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(2) REPEAL OF REDUCTION OF REFUNDABLE TAX
CREDITS.—The amendments made by subsection (b)
shall apply to taxable years beginning after December
31, 2001.
SEC. 4. MARRIAGE PENALTY RELIEF FOR EARNED INCOME
CREDIT.
(a) IN GENERAL.—Paragraph (2) of section 32(b) of
the Internal Revenue Code of 1986 (relating to percentages
and amounts) is amended—
(1) by striking ‘‘AMOUNTS.—The earned’’ and
inserting ‘‘AMOUNTS.—
‘‘(A) IN
GENERAL.—Subject to subpara-
graph (B), the earned’’, and
(2) by adding at the end the following new sub-
paragraph:
‘‘(B) JOINT
RETURNS.—In the case of a
joint return, the phaseout amount determined
under subparagraph (A) shall be increased by
$2,000.’’.
(b) INFLATION ADJUSTMENT.—Paragraph (1)(B) of
section 32( j) of such Code (relating to inflation adjust-
ments) is amended to read as follows:
‘‘(B) the cost-of-living adjustment deter-
mined under section 1(f )(3) for the calendar
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year 
in 
which 
the 
taxable 
year 
begins,
determined—
‘‘(i) in the case of amounts in sub-
sections (b)(2)(A) and (i)(1), by sub-
stituting ‘calendar year 1995’ for ‘calendar
year 1992’ in subparagraph (B) thereof,
and
‘‘(ii) in the case of the $2,000 amount
in subsection (b)(2)(B), by substituting ‘cal-
endar year 2000’ for ‘calendar year 1992’
in subparagraph (B) of such section 1.’’.
(c) ROUNDING.—Section 32( j)(2)(A) of such Code (re-
lating to rounding) is amended by striking ‘‘subsection
(b)(2)’’ and inserting ‘‘subsection (b)(2)(A) (after being in-
creased under subparagraph (B) thereof)’’.
(d) EFFECTIVE DATE.—The amendments made by this
section shall apply to taxable years beginning after Decem-
ber 31, 2000.
Amend the title so as to read: ‘‘A bill to amend the
Internal Revenue Code of 1986 to reduce the marriage
penalty by providing for adjustments to the standard de-
duction, 15-percent rate bracket, and earned income
credit and to repeal the reduction of the refundable tax
credits.’’.