Title I: Student and Family Tax Simplification Act - Student and Family Tax Simplification Act - (Sec. 102) Amends the Internal Revenue Code to provide for an American Opportunity Tax Credit, in lieu of the current Hope Scholarship and Lifetime Learning tax credits and the tax deduction for qualified tuition and related expenses, that provides for each eligible student (i.e., a student who meets certain requirements of the Higher Education Act of 1965 and who is carrying at least 1/2 the normal full-time course load) a credit of 100% of up to $2,000 of qualified tuition and related expenses (i.e., tuition, fees, and course materials, excluding expenses for courses involving sports, games, or hobbies or for expenses unrelated to academic instruction), plus 25% of so much of such expenses as exceeds $2,000, but not more than $4,000. Makes up to $1,500 of such credit refundable. Modifies the phaseout of such credit based on taxpayer modified adjusted gross income by increasing the income level for such phaseout. Allows an inflation adjustment to credit and phaseout amounts for taxable years beginning after 2018.
Eliminates the disallowance of the credit for students who have been convicted of a felony drug offense.
Requires a taxpayer claiming such credit to include on the his or her tax return the employer identification number of the educational institution to which qualified tuition and related expenses were paid.
(Sec. 103) Excludes from gross income, for income tax purposes, amounts received as a Federal Pell Grant in taxable years beginning after 2014.
(Sec. 104) Prohibits the entry of the budgetary effects of this Act on any PAYGO (pay-as-you-go) scorecard.
Title II: Child Tax Credit Improvement Act - Child Tax Credit Improvement Act of 2014 - (Sec. 202) Amends the Internal Revenue Code, with respect to the child tax credit, to: (1) increase from $110,00 to $150,000 ($75,000 for individual taxpayers and married taxpayers filing separately) the threshold amount applicable to married couples filing joint tax returns above which such tax credit is reduced, and (2) allow an inflation adjustment to the threshold amounts and the $1,000 credit amount beginning after 2014.
(Sec. 203) Requires taxpayers to include their social security numbers on their tax returns to claim the refundable portion of the child tax credit.
(Sec. 204) Prohibits the entry of the budgetary effects of this Act on any PAYGO (pay-as-you-go) scorecard.
[Congressional Bills 113th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3393 Introduced in House (IH)]
113th CONGRESS
1st Session
H. R. 3393
To amend the Internal Revenue Code of 1986 to consolidate certain tax
benefits for educational expenses, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
October 30, 2013
Mrs. Black (for herself and Mr. Danny K. Davis of Illinois) 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 consolidate certain tax
benefits for educational expenses, and for other purposes.
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 ``Student and Family Tax
Simplification Act''.
SEC. 2. CONSOLIDATION OF CERTAIN TAX BENEFITS FOR EDUCATIONAL EXPENSES.
(a) American Opportunity Tax Credit.--Section 25A of the Internal
Revenue Code of 1986 is amended to read as follows:
``SEC. 25A. AMERICAN OPPORTUNITY TAX CREDIT.
``(a) In General.--In the case of any individual for any taxable
year, there shall be allowed as a credit against the tax imposed by
this chapter for such taxable year an amount equal to the sum of--
``(1) 100 percent of so much of the qualified tuition and
related expenses paid by the taxpayer during the taxable year
(for education furnished to any eligible student for whom an
election is in effect under this section for such taxable year
during any academic period beginning in such taxable year) as
does not exceed $2,000, plus
``(2) 25 percent of such expenses so paid as exceeds the
dollar amount in effect under paragraph (1) but does not exceed
twice such dollar amount.
``(b) Portion of Credit Refundable.--So much of the credit
allowable under subsection (a) (determined without regard to this
subsection and section 26(a) and after application of all other
provisions of this section) as does not exceed $1,500 shall be treated
as a credit allowable under subpart C (and not allowable under
subsection (a)). The preceding sentence shall not apply to any taxpayer
for any taxable year if such taxpayer is a child to whom section 1(d)
applies for such taxable year.
``(c) Limitation Based on Modified Adjusted Gross Income.--
``(1) In general.--The amount allowable as a credit under
subsection (a) for any taxable year shall be reduced (but not
below zero) by an amount which bears the same ratio to the
amount so allowable (determined without regard to this
subsection and subsection (b) but after application of all
other provisions of this section) as--
``(A) the excess of--
``(i) the taxpayer's modified adjusted
gross income for such taxable year, over
``(ii) $43,000 (twice such amount in the
case of a joint return), bears to
``(B) $20,000 (twice such amount in the case of a
joint return).
``(2) Modified adjusted gross income.--For purposes of this
subsection, the term `modified adjusted gross income' means the
adjusted gross income of the taxpayer for the taxable year
increased by any amount excluded from gross income under
section 911, 931, or 933.
``(d) Other Limitations.--
``(1) Credit allowed only for 4 taxable years.--An election
to have this section apply may not be made for any taxable year
if such an election (by the taxpayer or any other individual)
is in effect with respect to such student for any 4 prior
taxable years.
``(2) Credit allowed for year only if individual is at
least \1/2\ time student for portion of year.--No credit shall
be allowed under subsection (a) for a taxable year with respect
to the qualified tuition and related expenses of an individual
unless such individual is an eligible student for at least one
academic period which begins during such year.
``(3) Credit allowed only for first 4 years of
postsecondary education.--No credit shall be allowed under
subsection (a) for a taxable year with respect to the qualified
tuition and related expenses of an eligible student if the
student has completed (before the beginning of such taxable
year) the first 4 years of postsecondary education at an
eligible educational institution.
``(e) Definitions.--For purposes of this section--
``(1) Eligible student.--The term `eligible student' means,
with respect to any academic period, a student who--
``(A) meets the requirements of section 484(a)(1)
of the Higher Education Act of 1965 (20 U.S.C.
1091(a)(1)), as in effect on August 5, 1997, and
``(B) is carrying at least \1/2\ the normal full-
time work load for the course of study the student is
pursuing.
``(2) Qualified tuition and related expenses.--
``(A) In general.--The term `qualified tuition and
related expenses' means tuition, fees, and course
materials, required for enrollment or attendance of--
``(i) the taxpayer,
``(ii) the taxpayer's spouse, or
``(iii) any dependent of the taxpayer with
respect to whom the taxpayer is allowed a
deduction under section 151,
at an eligible educational institution for courses of
instruction of such individual at such institution.
``(B) Exception for education involving sports,
etc.--Such term does not include expenses with respect
to any course or other education involving sports,
games, or hobbies, unless such course or other
education is part of the individual's degree program.
``(C) Exception for nonacademic fees.--Such term
does not include student activity fees, athletic fees,
insurance expenses, or other expenses unrelated to an
individual's academic course of instruction.
``(3) Eligible educational institution.--The term `eligible
educational institution' means an institution--
``(A) which is described in section 481 of the
Higher Education Act of 1965 (20 U.S.C. 1088), as in
effect on August 5, 1997, and
``(B) which is eligible to participate in a program
under title IV of such Act.
``(f) Special Rules.--
``(1) Identification requirement.--No credit shall be
allowed under subsection (a) to a taxpayer with respect to the
qualified tuition and related expenses of an individual unless
the taxpayer includes the name and taxpayer identification
number of such individual, and the employer identification
number of any institution to which such expenses were paid, on
the return of tax for the taxable year.
``(2) Adjustment for certain scholarships, etc.--
``(A) In general.--The amount of qualified tuition
and related expenses otherwise taken into account under
subsection (a) with respect to an individual for an
academic period shall be reduced (before the
application of subsection (c)) by the sum of any
amounts paid for the benefit of such individual which
are allocable to such period as--
``(i) a qualified scholarship which is
excludable from gross income under section 117,
``(ii) an educational assistance allowance
under chapter 30, 31, 32, 34, or 35 of title
38, United States Code, or under chapter 1606
of title 10, United States Code, and
``(iii) a payment (other than a gift,
bequest, devise, or inheritance within the
meaning of section 102(a) for such individual's
educational expenses, or attributable to such
individual's enrollment at an eligible
educational institution, which is excludable
from gross income under any law of the United
States.
``(B) Coordination with pell grants not used for
qualified tuition and related expenses.--Any amount
determined with respect to an individual under
subparagraph (A) which is attributable to a Federal
Pell Grant under section 401 of the Higher Education
Act of 1965 (20 U.S.C. 1070a) shall be reduced (but not
below zero) by the amount of expenses (other than
qualified tuition and related expenses) which are taken
into account in determining the cost of attendance (as
defined in section 472 of the Higher Education Act of
1965, as in effect on the date of the enactment of this
paragraph) of such individual at an eligible
educational institution for the academic period for
which the credit under this section is being
determined.
``(3) Treatment of expenses paid by dependent.--If a
deduction under section 151 with respect to an individual is
allowed to another taxpayer for a taxable year beginning in the
calendar year in which such individual's taxable year begins--
``(A) no credit shall be allowed under subsection
(a) to such individual for such individual's taxable
year, and
``(B) qualified tuition and related expenses paid
by such individual during such individual's taxable
year shall be treated for purposes of this section as
paid by such other taxpayer.
``(4) Treatment of certain prepayments.--If qualified
tuition and related expenses are paid by the taxpayer during a
taxable year for an academic period which begins during the
first 3 months following such taxable year, such academic
period shall be treated for purposes of this section as
beginning during such taxable year.
``(5) Denial of double benefit.--No credit shall be allowed
under this section for any amount for which a deduction is
allowed under any other provision of this chapter.
``(6) No credit for married individuals filing separate
returns.--If the taxpayer is a married individual (within the
meaning of section 7703), this section shall apply only if the
taxpayer and the taxpayer's spouse file a joint return for the
taxable year.
``(7) Nonresident aliens.--If the taxpayer is a nonresident
alien individual for any portion of the taxable year, this
section shall apply only if such individual is treated as a
resident alien of the United States for purposes of this
chapter by reason of an election under subsection (g) or (h) of
section 6013.
``(g) Inflation Adjustment.--
``(1) In general.--In the case of a taxable year beginning
after 2018, the $2,000 amount in subsection (a)(1), the $1,500
amount in subsection (b), and the $43,000 amount in subsection
(c)(1)(A)(ii) shall each 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 2017' for `calendar year 1992' in
subparagraph (B) thereof.
``(2) Rounding.--If any amount as adjusted under paragraph
(1) is not a multiple of $100 ($1,000 in the case of the amount
in subsection (c)(1)(A)(ii)), such amount shall be rounded to
the next lowest multiple of $100 ($1,000 in the case of the
amount in subsection (c)(1)(A)(ii)).
``(h) Regulations.--The Secretary may prescribe such regulations or
other guidance as may be necessary or appropriate to carry out this
section, including regulations providing for a recapture of the credit
allowed under this section in cases where there is a refund in a
subsequent taxable year of any amount which was taken into account in
determining the amount of such credit.''.
(b) Repeal of Deduction for Qualified Tuition and Related
Expenses.--Part VII of subchapter B of chapter 1 of such Code is
amended by striking section 222 (and by striking the item relating to
such section in the table of sections for such part).
(c) Conforming Amendments.--
(1) Section 62(a) of such Code is amended by striking
paragraph (18).
(2) Section 72(t)(7)(B) of such Code is amended by striking
``section 25A(g)(2)'' and inserting ``section 25A(f)(2)''.
(3) Section 529(c)(3)(B)(v)(I) of such Code is amended by
striking ``section 25A(g)(2)'' and inserting ``section
25A(f)(2)''.
(4) Section 529(e)(3)(B)(i) of such Code is amended by
striking ``section 25A(b)(3)'' and inserting ``section
25A(d)''.
(5) Section 530(d)(2)(C) of such Code is amended--
(A) by striking ``section 25A(g)(2)'' in clause
(i)(I) and inserting ``section 25A(f)(2)'', and
(B) by striking ``Hope and lifetime learning
credits'' in the heading and inserting ``American
opportunity tax credit''.
(6) Section 530(d)(4)(B)(iii) of such Code is amended by
striking ``section 25A(g)(2)'' and inserting ``section
25A(d)(4)(B)''.
(7) Section 6050S(e) of such Code is amended by striking
``subsection (g)(2)'' and inserting ``subsection (f)(2)''.
(8) Section 6211(b)(4)(A) of such Code is amended by
striking ``subsection (i)(6)'' and inserting ``subsection
(b)''.
(9) Section 6213(g)(2)(J) of such Code is amended by
striking ``TIN required under section 25A(g)(1)'' and inserting
``TIN, and employer identification number, required under
section 25A(f)(1)''.
(10) Section 1004(c) of division B of the American Recovery
and Reinvestment Tax Act of 2009 is amended--
(A) in paragraph (1)--
(i) by striking ``section 25A(i)(6)'' each
place it appears and inserting ``section
25A(b)'', and
(ii) by striking ``with respect to taxable
years beginning after 2008 and before 2018''
each place it appears and inserting ``with
respect to each taxable year'',
(B) in paragraph (2), by striking ``Section
25A(i)(6)'' and inserting ``Section 25A(b)'', and
(C) in paragraph (3)(C), by striking ``subsection
(i)(6)'' and inserting ``subsection (b)''.
(11) The table of sections for subpart A of part IV of
subchapter A of chapter 1 of the Internal Revenue Code of 1986
is amended by striking the item relating to section 25A and
inserting the following new item:
``Sec. 25A. American opportunity tax credit.''.
(d) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2014.
SEC. 3. EXPANSION OF PELL GRANT EXCLUSION FROM GROSS INCOME.
(a) In General.--Paragraph (1) of section 117(b) of the Internal
Revenue Code of 1986 is amended--
(1) by striking the period at the end and inserting ``,
or'',
(2) by striking ``received by an individual as a
scholarship'' and inserting the following: ``received by an
individual--
``(A) as a scholarship'', and
(3) by adding at the end the following new subparagraph:
``(B) as a Federal Pell Grant under section 401 of
the Higher Education Act of 1965 (20 U.S.C. 1070a).''.
(b) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2014.
<all>
Referred to the House Committee on Ways and Means.
Committee Consideration and Mark-up Session Held.
Ordered to be Reported in the Nature of a Substitute (Amended) by the Yeas and Nays: 22 - 13.
Reported (Amended) by the Committee on Ways and Means. H. Rept. 113-526.
Reported (Amended) by the Committee on Ways and Means. H. Rept. 113-526.
Placed on the Union Calendar, Calendar No. 392.
Rules Committee Resolution H. Res. 680 Reported to House. The rule provides for the consideration of H.R. 3393 and H.R. 4935 under a closed rules.
Considered under the provisions of rule H. Res. 680. (consideration: CR H6779-6791; text of amendment in the nature of a substitute: CR H6779-6780)
The rule provides for the consideration of H.R. 3393 and H.R. 4935 under a closed rule.
DEBATE - The House proceeded with one hour of debate on H.R. 3393.
The previous question was ordered pursuant to the rule. (consideration: CR H6789)
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Ms. Sinema moved to recommit with instructions to the Committee on Ways and Means. (consideration: CR H6789-6790; text: CR H6789)
DEBATE - The House proceeded with 10 minutes of debate on the Sinema motion to recommit with instructions, pending reservation of a point of order. Subsequently, the point of order was withdrawn. The instructions contained in the motion seek to require the bill to be reported back to the House with an amendment to require the Secretary of the Treasury to provide a table for student loan borrowers in any publication related to the underlying bill. That table shall illustrate their current monthly payments for higher education loans and the amount that they would pay for that same loan had they been able to benefit from the lower interest rates that would go into effect if H.R. 4582, Bank on Students Emergency Loan Refinancing Act, were passed.
The previous question on the motion to recommit with instructions was ordered without objection. (consideration: CR H6790)
On motion to recommit with instructions Failed by the Yeas and Nays: 195 - 219 (Roll no. 448).
Roll Call #448 (House)Passed/agreed to in House: On passage Passed by the Yeas and Nays: 227 - 187 (Roll no. 449).
Roll Call #449 (House)On passage Passed by the Yeas and Nays: 227 - 187 (Roll no. 449).
Roll Call #449 (House)Motion to reconsider laid on the table Agreed to without objection.
Received in the Senate. Read the first time. Placed on Senate Legislative Calendar under Read the First Time.
Read the second time. Placed on Senate Legislative Calendar under General Orders. Calendar No. 493.