Tax Increase Prevention Act of 2007

Bill: 110-hr-3996
Sponsor: Rep. Rangel, Charles B. [D-NY-15]
Introduced: 2007-10-30 in the House
Policy area: Taxation
Subjects: Agriculture and Food
Alabama
Alcohol tax
American Samoa
Armed Forces and National Security
Arts, Culture, Religion
Bonds
Books
Brokers
Brownfields
Caribbean area
Charitable contributions
Civil Rights and Liberties, Minority Issues
Collection of accounts
College costs
Commerce
Computer software
Computers
Congress
Congressional reporting requirements
Cooperative housing
Corporation taxes
Crime and Law Enforcement
Debt
Depreciation and amortization
Discrimination in insurance
Discrimination in medical care
District of Columbia
Dividends
Earned income tax credit
Economic development
Economics and Public Finance
Education
Educational technology
Elementary and secondary education
Elementary education
Employee stock options
Environmental Protection
Estate tax
Expatriation
Families
Federal aid to education
Federal-local relations
Finance and Financial Sector
Foreign Trade and International Finance
Foreign corporations
Foreign tax credit
Gift tax
Government Operations and Politics
Government contractors
Government paperwork
Government travel
Hazardous wastes
Health insurance
Higher education
Home ownership
Housing and Community Development
Housing finance
Hurricanes
Immigration
Income tax
Indian lands
Individual retirement accounts
Industrial research
Insurance premiums
Interest
Intergovernmental fiscal relations
Investments
Labor and Employment
Leases
Liability for environmental damages
Local taxation
Louisiana
Maintenance and repair
Mental health services
Mental illness
Military pay
Military personnel
Minimum tax
Minorities
Mississippi
Mortgage guaranty insurance
Mortgages
Mutual funds
Native Americans
Nature conservation
Partnerships
Property tax
Public Lands and Natural Resources
Puerto Rico
Railroads
Research and development tax credit
Restaurants
Sales tax
Scholarships
School buildings
Science, Technology, Communications
Secondary education
Securities industry
Social Welfare
Social security taxes
Sports and Recreation
Sports facilities
State legislators
State taxation
Stocks
Student loan funds
Subsidiary corporations
Surety and fidelity
Tariff
Tax administration
Tax credits
Tax deductions
Tax deferral
Tax evasion
Tax exclusion
Tax incentives
Tax penalties
Tax refunds
Tax returns
Tax-deferred compensation plans
Tax-exempt organizations
Taxation of foreign income
Teachers
Teaching materials
Terrorism
Transportation and Public Works
Travel costs
Undercover operations
Valuation
Veterans' benefits
Virgin Islands
Wine
Withholding tax

Summary:
action_date: 2007-10-30
text: 
Temporary Tax Relief Act of 2007 - Amends Internal Revenue Code provisions relating to the alternative minimum tax, the discharge of mortgage indebtedness, and tax administration and extends certain expiring tax credits, deductions, and other tax incentives.

Extends through 2007: (1) offsets against the alternative minimum tax for certain nonrefundable income tax credits; and (2) increased alternative minimum tax exemptions for individual taxpayers. 

Extends through 2008 various expiring tax provisions primarily affecting individual taxpayers, including: (1) the tax deductions for state and local sales taxes, for qualified tuition and related expenses, for qualified conservation contributions, for certain expenses of elementary and secondary school teachers, and for the travel expenses of state legislators while away from home; (2) tax-free distributions from individual retirement accounts for charitable purposes; (3) the taxpayer election to include combat pay as earned income for purposes of the earned income tax credit; (4) special rules for qualified mortgage bonds to finance home purchases by veterans; and (5) tax-free distributions from retirement plans for individuals called to active military service. 

Extends through 2008 various expiring tax provisions primarily affecting businesses, including: (1) the tax credits for increasing research expenses, for hiring workers on Indian reservations, for investment in new markets, for railroad track maintenance, and for hiring workers in areas affected by Hurricane Katrina; (2) accelerated depreciation for qualified leasehold and restaurant improvements, for motorsports entertainment complexes, and for business property on Indian reservations; (3) expensing allowances for environmental remediation costs; (4) tax deductions for contributions of food and book inventories and for computer equipment for educational purposes; and (5) tax incentives for investment in the District of Columbia and American Samoa.

Extends through 2008 authorities for: (1) issuing qualified zone academy bonds; (2) making disclosures of tax information to facilitate student loan repayments and for combating terrorist activities; and (3) Internal Revenue Service (IRS) undercover operations.

Allows an exclusion from gross income for up to $2 million of the income attributable to discharges of home mortgage indebtedness incurred after January 1, 2007. 

Extends through 2014 the tax deduction for mortgage insurance premiums.

Sets forth alternative criteria for qualifying a corporation as a cooperative housing corporation for purposes of the tax deduction for payments to such corporations. 

Limits the exclusion from gross income of gain from the sale of a principal residence by denying an exclusion of the gain that is allocable to a nonqualified use of such residence (i.e., use other than as a principal residence). 

Repeals the authority of the IRS to enter into private debt collection contracts.

Delays until 2012 the requirement for federal, state, and local agencies to withhold 3% of payments for goods and services provided to such agencies.

Revises tax administration provisions and rules relating to: (1) tax returns of certain U.S. Virgin Island residents; and (2) the tax treatment of high-income individuals who relinquish U.S. citizenship or residency to avoid U.S. taxation (expatriates). 

Repeals the 36-month suspension of interest and penalties on tax underpayments for taxpayers not notified of a tax deficiency by the IRS. Increases tax penalties for failure to file accurate tax information returns.

Amends the Tariff Act of 1930 to provide that wine of the same color shall be deemed to be commercially interchangeable for purposes of the duty drawback for unused merchandise.

action_date: 2007-11-09
text: 
Temporary Tax Relief Act of 2007 - Amends Internal Revenue Code provisions relating to the alternative minimum tax, the discharge of mortgage indebtedness, tax administration, deferral, and partnership tax rules and extends for one additional year certain expiring tax credits, deductions, and incentives
.

Title I: AMT Relief
 - (Sec. 101) Extends through 2007 for individual taxpayers: (1) the offset of nonrefundable personal tax credits against regular and alternative minimum tax (AMT) liability; and (2) the increased AMT exemption amounts.

(Sec. 103) Increases the AMT refundable credit amount for individual taxpayers with long-term unused tax credits in prior taxable years. Abates any underpayment of tax and related interest and penalties attributable to the application of special AMT rules for the treatment of incentive stock options.

Title II: Additional Individual Tax Relief
 - (Sec. 201) Lowers in 2008 (from $10,000 to $8,500) the earned income threshold amount for determining the refundable portion of the child tax credit.

(Sec. 202) Allows individual taxpayers an additional standard tax deduction in 2008 for state and local real property taxes. Limits the amount of such deduction to $350 ($700 for married individuals filing a joint tax return).

Title III: One-Year Extenders
 - 
Subtitle A: Extenders Primarily Affecting Individuals
 - (Sec. 301) Extends through 2008: (1) the tax deduction for state and local sales taxes in lieu of state and local income taxes; (2) the tax deduction for qualified tuition and related expenses; (3) the exemption from withholding of tax of interest-related and short-term capital gain dividends received from a regulated investment company (RIC); (4) the tax penalty for noncompliance with mental health parity requirements; (5) the special rule for charitable contributions of capital gain real property for conservation purposes; (6) tax-free distributions from individual retirement plans for charitable purposes; (7) the tax deduction for certain expenses of elementary and secondary school teachers; (8) the taxpayer election to include combat zone compensation as earned income for purposes of the earned income tax credit; (9) mortgage revenue bond financing of residences for veterans without regard to first-time homebuyer requirements; (10) tax-free distributions from retirement plans for individuals called or ordered to active military duty; (11) the special rule for RIC stock held in the estate of a nonresident non-citizen; (12) the inclusion of an RIC within the definition of &quot;qualified investment entity&quot; for income tax purposes; and (13) the special rule for state legislators' travel expenses while away from home. 

Subtitle B: Extenders Primarily Affecting Businesses
 - (Sec. 321) Extends through 2008: (1) the tax credit for increasing research activities; (2) the Indian employment tax credit; (3) the new markets tax credit; (4) the railroad track maintenance tax credit; (5) accelerated depreciation for qualified leasehold and restaurant property, for motorsports racing track facilities, and for business property on Indian reservations; (6) the taxpayer election to expense certain environmental remediation costs; (7) the tax deduction for income attributable to domestic production activities in Puerto Rico; (8) the special rule for the tax treatment of certain payments to tax-exempt organizations by a controlled subsidiary; (9) the authority for issuance of qualified zone academy bonds; (10) certain tax incentives for investment in the District of Columbia; (11) the American Samoa economic development credit; (12) the expanded tax deduction for contributions of food and book inventories by certain noncorporate taxpayers; (13) the tax deduction for charitable contributions of computer technology and equipment for educational purposes; (14) the special rule for reductions in the basis of S corporation stock for charitable contributions; and (15) the work opportunity tax credit for certain Hurricane Katrina employees (extended through August 28, 2008).

Subtitle C: Other Extenders
 - (Sec. 341) Extends through 2008 authorities for: (1) combined employment tax reporting; (2) Internal Revenue Service (IRS) disclosures to federal officials relating to terrorist activities; (3) IRS disclosures to the Department of Education for the income-contingent student loan repayment program; (4) IRS undercover operations; and (5) IRS disclosures to the Department of Veteran Affairs (VA) for certain veteran benefit programs. 

(Sec. 346) Extends through 2008 the increased payment ($10.50 to $13.25 per proof gallon) of distilled spirits excise tax to the Treasuries of Puerto Rico and the Virgin Islands;

Title IV: Mortgage Forgiveness Debt Relief
 - (Sec. 401) Excludes from gross income amounts attributable to a discharge of indebtedness incurred to acquire a principal residence. Limits to $2 million the excludable amount of such indebtedness. Reduces the basis of a principal residence by the amount of discharged indebtedness excluded from gross income. Disallows an exclusion for a discharge of indebtedness on account of services performed for the lender or any other factor not directly related to a decline in the value of the residence or to the financial condition of the taxpayer. Sets forth rules for determining the allowable amount of the exclusion for taxpayers with nonqualifying indebtedness and who are insolvent.

(Sec. 402) Extends through 2014 the tax deduction for mortgage insurance premiums.

(Sec. 403) Sets forth alternative tests for qualifying as a cooperative housing corporation for purposes of the tax deduction for payments to such corporations. Qualifies a corporation if: (1) 80% or more of the total square footage of the corporation's property is used or available for use by its tenant-stockholders for residential purposes, or (2) 90% of the corporation's expenditures are for the acquisition, construction, management, maintenance, or care of its property for the benefit of the tenant-stockholders. 

(Sec. 404) Limits the exclusion from gross income of gain from the sale of a principal residence by denying an exclusion of the gain that is allocable to a nonqualified use of such residence (i.e., use other than as a principal residence).

Title V: Administrative Provisions
 - (Sec. 501) Repeals the authority of the IRS to enter into private debt collection contracts. Exempts contracts entered into before July 18, 2007, if such contracts are not renewed or extended after such date. Nullifies any contract entered into, extended, or renewed on or after July 18, 2007.

(Sec. 502) Delays until 2012 the requirement for federal, state, and local agencies to withhold 3% of payments for goods and services provided to such agencies.

Requires the Secretary of the Treasury to report to the House Committee on Ways and Means and the Senate Committee on Finance on issues relating to the administration of the withholding requirement.

(Sec. 503) Treats income tax returns filed with the U.S. Virgin Islands by an individual claiming to be a bona fide resident of the Virgin Islands during the entire taxable year as filed with the United States for tax administration purposes. 

(Sec. 504) Sets forth additional rules for the tax treatment of high-income individuals who relinquish U.S. citizenship or residency to avoid U.S. taxation (expatriates). Treats all property of expatriates as sold for its fair market value on the day before the expatriation date and includes gain (over $600,000) or loss from such sale in the gross income of such expatriates. Allows expatriates to elect to defer payment of any tax resulting from expatriation if adequate security for payment of such tax is given.

Requires 30% withholding of tax for certain items of deferred compensation payable to expatriates.

Imposes a separate tax on gifts and bequests from expatriates exceeding $10,000, payable by the recipient of such gift or bequest.

(Sec. 505) Repeals provisions providing for a 36-month suspension of interest and penalties on tax underpayments for taxpayers who had not been notified of a tax deficiency by the IRS. 

(Sec. 506) Amends the Tariff Act of 1930 to provide that wine of the same color with a price variation not more than 50% between the imported and exported wine shall be deemed to be commercially interchangeable for purposes of the duty drawback for unused merchandise.

Title VI: Revenue Provisions
 - 
Subtitle A: Nonqualified Deferred Compensation from Certain Tax Indifferent Parties -
 (Sec. 601) Requires the inclusion in gross income for income tax purposes of employee compensation deferred under a nonqualified deferred compensation plan of a nonqualified entity when there is no substantial risk of forfeiture of the rights to such compensation. Defines &quot;nonqualified entity&quot; as any foreign corporation unless substantially all of its income is: (1) effectively connected with a trade or business in the United States; or (2) subject to a comprehensive foreign income tax. Includes certain partnerships within such definition.

Subtitle B: Provisions Related to Certain Investment Partnerships
 - (Sec. 611) Allows the recharacterization of certain net income and loss from an investment services partnership interest for the performance of services as ordinary income or loss, unless such income relates to a partner's invested capital.

(Sec. 612) Exempts any tax-exempt organization that is a partner with limited liability in a partnership from the unrelated business income rules relating to indebtedness incurred for acquiring certain securities and commodities.

(Sec. 613) Revises the rule for treating gain from the sale or exchange of property between related persons as ordinary income to include depreciable property which is an interest in a partnership. 

Subtitle C: Other Provisions
 - (Sec. 621) Delays until 2018 the application of special rules for the worldwide allocation of interest for purposes of computing the limitation on the foreign tax credit. 

(Sec. 622) Requires brokers to include in their information returns for sales of any covered security: (1) the customer's adjusted basis in the security; and (2) whether any gain or loss with respect to the security is long-term or short-term. Extends until February 15 of each year the date by which broker statements must be sent to their customers. Imposes additional reporting requirements on transferors (to brokers) of covered securities and issuers of certain securities. 

(Sec. 623) Increases the penalty for failure to file a partnership tax return.

(Sec. 624) Imposes an additional penalty on S corporations for failure to file required tax returns. 

(Sec. 625) Amends the Tax Increase Prevention and Reconciliation Act of 2005 to increase the estimated tax payment due in the third quarter of 2012 for corporations with assets of at least $1 billion.

action_date: 2007-12-06
text: 
Tax Increase Prevention Act of 2007 - Amends the Internal Revenue Code to extend through 2007 for individual taxpayers: (1) the increased alternative minimum tax (AMT) exemption amounts; and (2) the offset of nonrefundable personal tax credits against regular and AMT liability.

action_date: 2007-12-26
text: 

(This measure has not been amended since it was passed by the Senate on December 6, 2007. The summary of that version is repeated here.)

Tax Increase Prevention Act of 2007 - Amends the Internal Revenue Code to extend through 2007 for individual taxpayers: (1) the increased alternative minimum tax (AMT) exemption amounts; and (2) the offset of nonrefundable personal tax credits against regular and AMT liability.


Legislative actions:
action_date: 2007-12-26
text: Became Public Law No: 110-166.
action_date: 2007-12-26
text: Became Public Law No: 110-166.
action_date: 2007-12-26
text: Signed by President.
action_date: 2007-12-26
text: Signed by President.
action_date: 2007-12-20
text: Presented to President.
action_date: 2007-12-20
text: Presented to President.
action_date: 2007-12-19
text: Cleared for White House.
action_date: 2007-12-19
text: Motion to reconsider laid on the table Agreed to without objection.
action_date: 2007-12-19
text: On motion that the House suspend the rules and agree to the Senate amendment Agreed to by the Yeas and Nays: (2/3 required): 352 - 64 (Roll no. 1183). (text as House agreed to Senate amendment: CR H16889)
action_date: 2007-12-19
text: Resolving differences -- House actions: On motion that the House suspend the rules and agree to the Senate amendment Agreed to by the Yeas and Nays: (2/3 required): 352 - 64 (Roll no. 1183).(text as House agreed to Senate amendment: CR H16889)
action_date: 2007-12-19
text: DEBATE - The House proceeded with forty minutes of debate on the motion to suspend the rules and agree to the Senate amendment on H.R. 3996.
action_date: 2007-12-19
text: Mr. Rangel moved that the House suspend the rules and agree to the Senate amendment. (consideration: CR H16889-16899)
action_date: 2007-12-19
text: Rules Committee Resolution H. Res. 894 Reported to House. Rule provides for consideration of H.R. 3996 with 1 hour of general debate. Previous question shall be considered as ordered without intervening motions. Measure will be considered read. Bill is closed to amendments.
action_date: 2007-12-17
text: Message on Senate action sent to the House.
action_date: 2007-12-06
text: Passed Senate with an amendment by Yea-Nay Vote. 88 - 5. Record Vote Number: 415.
action_date: 2007-12-06
text: Passed/agreed to in Senate: Passed Senate with an amendment by Yea-Nay Vote. 88 - 5. Record Vote Number: 415.
action_date: 2007-12-06
text: Measure laid before Senate by unanimous consent. (consideration: CR S14835-14838)
action_date: 2007-12-06
text: Motion by Senator Reid to reconsider the vote by which cloture on the motion to proceed was not invoked (Record Vote No. 414) entered in Senate. (consideration: CR S14814)
action_date: 2007-12-06
text: Cloture on the motion to proceed to the measure not invoked in Senate by Yea-Nay Vote. 46 - 48. Record Vote Number: 414. (consideration: CR S14809-14814)
action_date: 2007-12-05
text: Motion to proceed to measure considered in Senate. (consideration: CR S14773-14774)
action_date: 2007-12-05
text: Motion to proceed to consideration of measure withdrawn in Senate.
action_date: 2007-12-05
text: Motion to proceed to measure considered in Senate.
action_date: 2007-12-04
text: Cloture motion on the motion to proceed to the measure presented in Senate. (consideration: CR S14731; text: CR S14731)
action_date: 2007-12-04
text: Motion to proceed to consideration of measure made in Senate. (consideration: CR S14731-14733)
action_date: 2007-11-14
text: Read the second time. Placed on Senate Legislative Calendar under General Orders. Calendar No. 487.
action_date: 2007-11-13
text: Received in the Senate. Read the first time. Placed on Senate Legislative Calendar under Read the First Time.
action_date: 2007-11-09
text: On passage Passed by the Yeas and Nays: 216 - 193 (Roll no. 1081). (text: CR H13434-13445)
action_date: 2007-11-09
text: Motion to reconsider laid on the table Agreed to without objection.
action_date: 2007-11-09
text: Passed/agreed to in House: On passage Passed by the Yeas and Nays: 216 - 193 (Roll no. 1081).(text: CR H13434-13445)
action_date: 2007-11-09
text: The previous question was ordered pursuant to the rule. (consideration: CR H13461)
action_date: 2007-11-09
text: DEBATE - The House resumed debate on H.R. 3996.
action_date: 2007-11-09
text: DEBATE - The House proceeded with one hour of debate on H.R. 3996.
action_date: 2007-11-09
text: Rule provides for consideration of H.R. 3996 with 1 hour of general debate. Previous question shall be considered as ordered without intervening motions except motion to recommit with or without instructions. Measure will be considered read. A specified amendment is in order. All points of order against consideration of the bill except those arising under clause 9 or 10 of rule XXI. The amendment in the nature of a substitute recommended by the Committee on Ways and Means now printed in the bill shall be considered as adopted and the bill, as amended.
action_date: 2007-11-09
text: Considered under the provisions of rule H. Res. 809. (consideration: CR H13428-13462; text of measure as introduced: CR H13428-13434)
action_date: 2007-11-09
text: Rule H. Res. 809 passed House.
action_date: 2007-11-08
text: Rules Committee Resolution H. Res. 809 Reported to House. Rule provides for consideration of H.R. 3996 with 1 hour of general debate. Previous question shall be considered as ordered without intervening motions except motion to recommit with or without instructions. Measure will be considered read. A specified amendment is in order. All points of order against consideration of the bill except those arising under clause 9 or 10 of rule XXI. The amendment in the nature of a substitute recommended by the Committee on Ways and Means now printed in the bill shall be considered as adopted and the bill, as amended.
action_date: 2007-11-06
text: Placed on the Union Calendar, Calendar No. 271.
action_date: 2007-11-06
text: Reported (Amended) by the Committee on Ways and Means. H. Rept. 110-431.
action_date: 2007-11-06
text: Reported (Amended) by the Committee on Ways and Means. H. Rept. 110-431.
action_date: 2007-11-02
text: Ordered to be Reported (Amended) by the Yeas and Nays: 22 - 13.
action_date: 2007-11-02
text: Committee Consideration and Mark-up Session Held.
action_date: 2007-10-30
text: Referred to the House Committee on Ways and Means.
action_date: 2007-10-30
text: Introduced in House
action_date: 2007-10-30
text: Introduced in House

Enacted as: number: 110-166