[Congressional Bills 107th Congress]
[From the U.S. Government Publishing Office]
[S. 492 Introduced in Senate (IS)]
107th CONGRESS
1st Session
S. 492
To amend the Internal Revenue Code of 1986 to repeal the alternative
minimum tax on individuals.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
March 8, 2001
Mr. Thompson (for himself, Mr. Murkowski, Mr. Kyl, and Mr. Hatch)
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 repeal the alternative
minimum tax on individuals.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. REPEAL OF ALTERNATIVE MINIMUM TAX ON INDIVIDUALS.
(a) In General.--Subsection (a) of section 55 of the Internal
Revenue Code of 1986 (relating to alternative minimum tax imposed) is
amended by adding at the end the following new flush sentence:
``Except in the case of a corporation, no tax shall be imposed by this
section for any taxable year beginning after December 31, 2001, and the
tentative minimum tax of any taxpayer other than a corporation shall be
zero for purposes of this title.''.
(b) Conforming Amendments.--
(1) Subparagraph (B) of section 1(g)(7) of the Internal
Revenue Code of 1986 is amended by adding ``and'' at the end of
clause (i), by striking ``, and'' at the end of clause (ii) and
inserting a period, and by striking clause (iii).
(2) Section 2(d) of such Code is amended by striking
``sections 1 and 55'' and inserting ``section 1''.
(3) Section 5(a) of such Code is amended by striking
paragraph (4).
(4) Subsection (c) of section 26 of such Code is amended by
inserting before the period ``; except that such amount shall
be treated as being zero in the case of a taxpayer other than a
corporation.''
(5) Paragraph (6) of section 29(b) of such Code is amended
to read as follows:
``(6) Application with other credits.--The credit allowed
by subsection (a) for any taxable year shall not exceed the
regular tax for the taxable year reduced by the sum of the
credits allowable under subpart A and section 27. In the case
of a corporation, the limitation under the preceding sentence
shall be reduced (but not below zero) by the tentative minimum
tax for the taxable year.''.
(6) Paragraph (3) of section 30(b) of such Code is amended
to read as follows:
``(3) Application with other credits.--The credit allowed
by subsection (a) for any taxable year shall not exceed the
regular tax for the taxable year reduced by the sum of the
credits allowable under subpart A and sections 27 and 29. In
the case of a corporation, the limitation under the preceding
sentence shall be reduced (but not below zero) by the tentative
minimum tax for the taxable year.''.
(7) Section 32 of such Code is amended by striking
subsection (h).
(8) Subsection (d) of section 53 of such Code is amended to
read as follows:
``(d) Definitions.--For purposes of this section--
``(1) Net minimum tax.--The term `net minimum tax' means
the tax imposed by section 55 increased by the amount of the
credit not allowed under section 29 (relating to credit for
producing fuel from a nonconventional source) solely by reason
of the application of the last sentence of section 29(b)(6), or
not allowed under section 30 solely by reason of the
application of the last sentence of section 30(b)(3).
``(2) Tentative minimum tax.--The term `tentative minimum
tax' has the meaning given to such term by section 55(b);
except that such tax shall be treated as being zero in the case
of a taxpayer other than a corporation.''.
(9)(A) Subsection (b) of section 55 of such Code (relating
to alternative minimum tax imposed) is amended to read as
follows:
``(b) Tentative Minimum Tax.--For purposes of this part--
``(1) Amount of tentative tax.--The tentative minimum tax
for the taxable year is--
``(A) 20 percent of so much of the alternative
minimum taxable income for the taxable year as exceeds
the exemption amount, reduced by
``(B) the alternative minimum tax foreign tax
credit for the taxable year.
``(2) Alternative minimum taxable income.--The term
`alternative minimum taxable income' means the taxable income
of the taxpayer for the taxable year--
``(A) determined with the adjustments provided in
section 56, and
``(B) increased by the amount of the items of tax
preference described in section 57.
If a taxpayer is subject to the regular tax, such taxpayer
shall be subject to the tax imposed by this section (and, if
the regular tax is determined by reference to an amount other
than taxable income, such amount shall be treated as the
taxable income of such taxpayer for purposes of the preceding
sentence).''.
(B) Subsection (d) of section 55 of such Code is amended to
read as follows:
``(d) Exemption Amount.--For purposes of this section--
``(1) In general.--The term `exemption amount' means
$40,000.
``(2) Phase-out of exemption amount.--The exemption amount
of any taxpayer shall be reduced (but not below zero) by an
amount equal to 25 percent of the amount by which the
alternative minimum taxable income of the taxpayer exceeds
$150,000.''.
(10)(A) Paragraph (6) of section 56(a) of such Code is
amended to read as follows:
``(6) Adjusted basis.--The adjusted basis of any property
to which paragraph (1) or (5) applies (or with respect to which
there are any expenditures to which paragraph (2) applies)
shall be determined on the basis of the treatment prescribed in
paragraph (1), (2), or (5), whichever applies.''.
(B) Section 56 of such Code is amended by striking
subsection (b).
(C) Subsection (c) of section 56 of such Code is amended by
striking so much of the subsection as precedes paragraph (1),
by redesignating paragraphs (1), (2), and (3) as paragraphs
(8), (9), and (10), respectively, and moving them to the end of
subsection (a).
(D) Paragraph (8) of section 56(a) of such Code, as
redesignating by subparagraph (C), is amended by striking
``subsection (g)'' and inserting ``subsection (c)''.
(E) Section 56 of such Code is amended by striking
subsection (e) and by redesignating subsections (d) and (g) as
subsections (b) and (c), respectively.
(11)(A) Section 58 of such Code is repealed.
(B) Clause (i) of section 56(b)(2)(A) of such Code (as
redesignated by paragraph (10)(E), is amended by inserting ``,
in the case of taxable years beginning before January 1,
2002,'' before ``section 58''.
(C) Subsection (h) of section 59 of such Code is amended--
(i) by striking ``, 465, and 1366(d)'' and
inserting ``and 465'', and
(ii) by striking ``56, 57, and 58'' and inserting
``56 and 57''.
(12)(A) Subparagraph (C) of section 59(a)(1) of such Code
is amended by striking ``subparagraph (A)(i) or (B)(i) of
section 55(b)(1) (whichever applies)'' and inserting ``section
55(b)(1)(A)''.
(B) Paragraph (3) of section 59(a) of such Code is amended
to read as follows:
``(3) Pre-credit tentative minimum tax.--For purposes of
this subsection, the term `pre-credit tentative minimum tax'
means the amount determined under section 55(b)(1)(A).''.
(C) Section 59 of such Code is amended by striking
subsection (c).
(D) Section 59 of such Code is amended by striking
subsection (j).
(13) Paragraph (7) of section 382(l) of such Code is
amended by striking ``section 56(d)'' and inserting ``section
56(b)''.
(14) Paragraph (2) of section 641(c) of such Code is
amended by striking subparagraph (B) and by redesignating
subparagraphs (C) and (D) as subparagraphs (B) and (C),
respectively.
(15) Subsections (b) and (c) of section 666 of such Code
are each amended by striking ``(other than the tax imposed by
section 55)''.
(16) Subsections (c)(5) and (d)(3)(B) of section 772 of
such Code are each amended by striking ``56, 57, and 58'' and
inserting ``56 and 57''.
(17) Sections 847 and 848(i) of such Code are each amended
by striking ``section 56(g)'' and inserting ``section 56(c)''.
(18) Sections 871(b)(1) and 877(b) of such Code are each
amended by striking ``or 55''.
(19) Subsection (a) of section 897 of such Code is amended
to read as follows:
``(a) General Rule.--For purposes of this title, gain or loss of a
nonresident alien individual or a foreign corporation from the
disposition of a United States real property interest shall be taken
into account--
``(1) in the case of a nonresident alien individual, under
section 871(b)(1), or
``(2) in the case of a foreign corporation, under section
882(a)(1),
as if the taxpayer were engaged in a trade or business within the
United States during the taxable year and as if such gain or loss were
effectively connected with such trade or business.''.
(20) Paragraph (1) of section 962(a) of such Code is
amended by striking ``sections 1 and 55'' and inserting
``section 1''.
(21) Paragraph (1) of section 1397E(c) of such Code is
amended to read as follows:
``(1) the regular tax liability (as defined in section
26(b), over''
(22) The last sentence of section 1563(a) of such Code is
amended by striking ``section 55(d)(3)'' and inserting
``section 55(d)(2)''.
(23) Subparagraph (B) of section 6015(d)(2) of such Code is
amended by striking ``or 55''.
(c) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2001.
<all>
Introduced in Senate
Read twice and referred to the Committee on Finance.
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