To amend the Internal Revenue Code of 1986 to provide that the deduction for certain flood-related attorney fees shall be fully allowable in computing both taxable income and alternative minimum taxable income.

Amends the Internal Revenue Code to exempt from the limitation on miscellaneous itemized tax deductions (i.e., only expenses in excess of two percent of adjusted gross income are deductible) any deduction for attorney fees paid in connection with flood-related damages from a natural disaster.

[Congressional Bills 109th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4041 Introduced in House (IH)]







109th CONGRESS
  1st Session
                                H. R. 4041

    To amend the Internal Revenue Code of 1986 to provide that the 
   deduction for certain flood-related attorney fees shall be fully 
  allowable in computing both taxable income and alternative minimum 
                            taxable income.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            October 7, 2005

  Mr. Herger 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 provide that the 
   deduction for certain flood-related attorney fees shall be fully 
  allowable in computing both taxable income and alternative minimum 
                            taxable income.

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

SECTION 1. CERTAIN FLOOD-RELATED ATTORNEY FEES DEDUCTIBLE IN COMPUTING 
              TAXABLE INCOME AND ALTERNATIVE MINIMUM TAXABLE INCOME.

    (a) In General.--Subsection (b) of section 67 of the Internal 
Revenue Code of 1986 (relating to 2-percent floor on miscellaneous 
itemized dedections) is amended by striking ``and'' at the end of 
paragraph (11), by striking the period at the end of paragraph (12) and 
inserting ``, and'', and by adding at the end the following new 
paragraph:
            ``(13) any deduction under section 212 (relating to 
        deduction for expenses for production of income) for attorney 
        fees, paid by, or on behalf of the taxpayer to the extent such 
        attorney fees are in connection with damages received (whether 
        by suit or agreement or whether as lump sums or periodic 
        payments) by such taxpayer as a result of a natural disaster 
        which is a flood.''.
    (b) Effective Date.--The amendments made by this section shall 
apply to attorney fees paid after the date of enactment of this Act, 
with respect to damages received after the date of enactment of this 
Act.
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