Child Tax Credit Expansion Act of 2000

Child Tax Credit Expansion Act of 2000 - Amends the Internal Revenue Code to repeal the current child tax credit provisions and allow a refundable tax credit (with cost-of-living adjustments) with respect to each qualifying child of a taxpayer of up to $1,000, depending on income.

[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[S. 3138 Introduced in Senate (IS)]

  2d Session
                                S. 3138

 To amend the Internal Revenue Code of 1986 to increase the amount and 
  availability of the child tax credit and make the credit refundable.


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                   IN THE SENATE OF THE UNITED STATES

           September 28 (legislative day, September 22), 2000

   Mr. Grams introduced the following bill; which was read twice and 
                  referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL


 
 To amend the Internal Revenue Code of 1986 to increase the amount and 
  availability of the child tax credit and make the credit refundable.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Child Tax Credit Expansion Act of 
2000''.

SEC. 2. REFUNDABLE CHILD TAX CREDIT.

    (a) In General.--Subpart C of part IV of subchapter A of chapter 1 
of the Internal Revenue Code of 1986 (relating to refundable credits) 
is amended by redesignating section 35 as section 36 and by inserting 
after section 34 the following new section:

``SEC. 35. CHILD TAX CREDIT.

    ``(a) Allowance of Credit.--There shall be allowed as a credit 
against the tax imposed by this subtitle for the taxable year with 
respect to each qualifying child of the taxpayer an amount equal to 
$1,000.
    ``(b) Limitation Based on Adjusted Gross Income.--
            ``(1) In general.--The amount of the credit allowable under 
        subsection (a) shall be reduced (but not below zero) by $50 for 
        each $1,000 (or fraction thereof) by which the taxpayer's 
        modified adjusted gross income exceeds the threshold amount. 
        For purposes of the preceding sentence, the term `modified 
        adjusted gross income' means adjusted gross income increased by 
        any amount excluded from gross income under section 911, 931, 
        or 933.
            ``(2) Threshold amount.--For purposes of paragraph (1), the 
        term `threshold amount' means--
                    ``(A) $110,000 in the case of a joint return,
                    ``(B) $75,000 in the case of an individual who is 
                not married, and
                    ``(C) $55,000 in the case of a married individual 
                filing a separate return.
        For purposes of this paragraph, marital status shall be 
        determined under section 7703.
    ``(c) Qualifying Child.--For purposes of this section--
            ``(1) In general.--The term `qualifying child' means any 
        individual if--
                    ``(A) the taxpayer is allowed a deduction under 
                section 151 with respect to such individual for the 
                taxable year,
                    ``(B) such individual is described in clause (i) or 
                (ii) of section 151(c)(1)(B), and
                    ``(C) such individual bears a relationship to the 
                taxpayer described in section 32(c)(3)(B).
            ``(2) Exception for certain noncitizens.--The term 
        `qualifying child' shall not include any individual who would 
        not be a dependent if the first sentence of section 152(b)(3) 
        were applied without regard to all that follows `resident of 
        the United States'.
    ``(d) Cost-of-Living Adjustment.--
            ``(1) In general.--In the case of any taxable year 
        beginning in a calendar year after 2001, each dollar amount 
        under subsection (a) or (b)(2) shall be increased by an amount 
        equal to--
                    ``(A) such dollar amount, multiplied by
                    ``(B) the cost-of-living adjustment determined 
                under section 1(f)(3) for the calendar year in which 
                the taxable year begins, determined by substituting 
                `calendar year 2000' for `calendar year 1992' in 
                subparagraph (B) thereof.
            ``(2) Rounding rule.--If any amount after adjustment under 
        paragraph (1) is not a multiple of--
                    ``(A) $50 in the case of subsection (a), such 
                amount shall be rounded to the next lower multiple of 
                $50, and
                    ``(B) $1,000 in the case of subsection (b)(2), such 
                amount shall be rounded to the next lower multiple of 
                $1,000.
    ``(e) Identification Requirement.--No credit shall be allowed under 
this section to a taxpayer with respect to any qualifying child unless 
the taxpayer includes the name and taxpayer identification number of 
such qualifying child on the return of tax for such taxable year.
    ``(f) Taxable Year Must Be Full Taxable Year.--Except in the case 
of a taxable year closed by reason of the death of the taxpayer, no 
credit shall be allowable under this section in the case of a taxable 
year covering a period of less than 12 months.''.
    (b) Conforming Amendments.--
            (1) Section 24 of the Internal Revenue Code of 1986 is 
        hereby repealed.
            (2) The table of sections for subpart A of part IV of 
        subchapter A of chapter 1 of such Code is amended by striking 
        the item relating to section 24.
            (3) Section 32 of such Code is amended by striking 
        subsection (n).
            (4) The table of sections for subpart C of part IV of 
        subchapter A of chapter 1 of such Code is amended by striking 
        the item relating to section 35 and inserting the following new 
        items:

``Sec. 35. Refundable child tax credit.
``Sec. 36. Overpayments of tax.''
            (5) Section 1324(b)(2) of title 31, United States Code, is 
        amended by striking ``or'' before ``enacted'' and by inserting 
        before the period at the end ``, or enacted by the Child Tax 
        Credit Expansion Act of 2000''.
            (6) Section 6213(g)(2)(I) of the Internal Revenue Code of 
        1986 is amended by striking ``section 24(e)'' and inserting 
        ``section 35(e)''.
            (7) Section 6213(g)(2)(L) of such Act is amended by 
        striking ``24, or 32'' and inserting ``32, or 35''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2000.
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