To provide for line item veto; capital gains tax reduction; enterprise zones; raising the social security earnings limit workfare.

TABLE OF CONTENTS:

Title I: Line-Item Veto

Title II: Capital Gains

Title III: Social Security Earnings Test

Title IV: Urban Tax Enterprise Zones and Rural Development

Investment Zones

Subtitle A: Designation and Tax Incentives

Subtitle B: Redevelopment Bonds for Tax Enterprise Zones

Subtitle C: Credit for Contributions to Certain

Community Development Corporations

Subtitle D: Indian Employment and Investment

Subtitle E: Study

Title V: Workfare

Title I: Line Item Veto - Amends the Congressional Budget and Impoundment Control Act of 1974 to grant the President legislative line item veto rescission authority. Authorizes the President to rescind all or part of any budget authority if the President determines that such rescission: (1) would help balance the Federal budget, reduce the Federal budget deficit, or reduce the public debt; (2) will not impair any essential Government functions; and (3) will not harm the national interest. Requires the President to notify the Congress of such a rescission by special message.

Makes such a rescission effective unless the Congress, during a review period of 20 calendar days, enacts a rescission disapproval bill.

Describes: (1) information to be included in the President's message; and (2) procedures to govern consideration of rescission disapproval legislation in the Senate and the House of Representatives.

Title II: Capital Gains - Amends the Internal Revenue Code to set forth a formula for the determination of a deduction for gain on investments in new small business stock (seed capital) held for at least five years. Establishes special rules for such investments. Provides for determining the maximum capital gains rate for small business net capital gain or seed capital gain. Treats capital gains on the sale of such stock as a preference item for purposes of the minimum tax.

Title III: Social Security Earnings Test - Amends title II (Old Age, Survivors and Disability Insurance) (OASDI) of the Social Security Act to increase the retirement test exempt amount and lower the reduction factor with respect to certain earnings.

Title IV: Urban Tax Enterprise Zones and Rural Development Investment Zones - Declares it to be the purpose of this title to establish a demonstration program of providing incentives for the creation of tax enterprise zones in order to: (1) revitalize economically and physically distressed areas; (2) promote meaningful employment for zone residents; and (3) encourage individuals to reside in the zones in which they are employed.

Subtitle A: Designation and Tax Incentives - Amends the Internal Revenue Code to provide for the designation of tax enterprise zones during calendar years after 1992 and before 1998: (1) by the Secretary of Housing and Urban Development, in the case of an urban tax enterprise zone; and (2) by the Secretary of Agriculture, in consultation with the Secretary of Commerce, in the case of a rural development investment zone.

Sets forth the eligibility criteria for such designation for urban tax enterprise zones and for rural development investment zones.

Allows an enterprise zone employment credit to small employers as a general business credit of 15 percent of the qualified zone wages.

Allows a deduction for the purchase of enterprise zone stock paid in cash.

Excludes from gross income 50 percent of qualified capital gain recognized on the sale or exchange of a new qualified zone asset held for more than five years.

Subtitle B: Redevelopment Bonds for Tax Enterprise Zones - Sets forth special rules for tax-exempt redevelopment bonds which provide financing for tax enterprise zones for the first 60-month period after a zone is so designated.

Subtitle C: Credit for Contributions to Certain Community Development Corporations - Allows a general business tax credit for contributions to selected community development corporations to provide employment of, and business opportunities for, low-income individuals who are residents of the operational areas of the community.

Subtitle D: Indian Employment and Investment - Amends the Internal Revenue Code to establish an Indian reservation credit as a tax credit for investment in qualified Indian reservation property.

Allows businesses an employment credit of ten percent (30 percent in the case of an employer with at least 85 percent Indian employees) of the sum of the qualified wages and qualified employee health insurance costs paid or incurred during a taxable year.

Subtitle E: Study - Requires the Secretary of the Treasury, in consultation with the appropriate Secretary, to contract with the National Academy of Sciences to report to the House Committee on Ways and Means and the Senate Committee on Finance on the effectiveness of the incentives provided by this subtitle in achieving its purposes.

Title V: Workfare - Requires the Secretary of Labor to report to the Congress on a comprehensive legislative proposal which would require adults receiving aid to families with dependent children under the Social Security Act to enter the workforce within two years of receiving such aid.