Child Care Family Tax Relief Act of 2007

Child Care Family Tax Relief Act of 2007 - Amends the Internal Revenue Code to: (1) increase the rate of the tax credit for expenses for household and dependent care services; and (2) allow an inflation adjustment after 2007 to the adjusted gross income limitation applicable to such credit. Makes such increased tax credit permanent.

[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4039 Introduced in House (IH)]







110th CONGRESS
  1st Session
                                H. R. 4039

  To amend the Internal Revenue Code of 1986 to increase, expand the 
 availability of, and repeal the sunset with respect to, the dependent 
                            care tax credit.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            November 1, 2007

  Mr. Barrow 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 increase, expand the 
 availability of, and repeal the sunset with respect to, the dependent 
                            care tax credit.

    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 Care Family Tax Relief Act of 
2007''.

SEC. 2. INCREASE AND INFLATION ADJUSTMENT FOR DEPENDENT CARE CREDIT.

    (a) In General.--
            (1) Increase.--Paragraph (2) of section 21(a) of the 
        Internal Revenue Code of 1986 (relating to expenses for 
        household and dependent care services necessary for gainful 
        employment) is amended to read as follows:
            ``(2) Applicable percentage.--The term `applicable 
        percentage' means--
                    ``(A) 40 percent in the case of a taxpayer whose 
                adjusted gross income is $70,000 or less, and
                    ``(B) 20 percent in the case of any other 
                taxpayer.''.
            (2) Inflation adjustment.--Section 21 of such Code is 
        amended by redesignating subsection (f) as subsection (g) and 
        by inserting after subsection (e) the following new subsection:
    ``(f) Cost-of-Living Adjustment.--In the case of any taxable year 
beginning in a calendar year after 2007, the $70,000 amount contained 
in subsection (a)(2)(A) shall be increased by an amount equal to--
            ``(1) such dollar amount, multiplied by
            ``(2) 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 2006' for 
        `calendar year 1992' in subparagraph (B) thereof.
Any increase determined under the preceding sentence shall be rounded 
to the nearest multiple of $1,000.''.
    (b) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2006.

SEC. 3. INCREASE IN DEPENDENT CARE CREDIT MADE PERMANENT.

    Section 901 of the Economic Growth and Tax Relief Reconciliation 
Act of 2001 shall not apply to the amendments made by section 204 of 
such Act (relating to dependent care credit).
                                 <all>