Working Americans Tax Relief Act

Working Americans Tax Relief Act - Amends the Internal Revenue Code to allow a deduction for Old Age, Survivors and Disability Insurance employee and self-employment taxes.

[Congressional Bills 105th Congress]
[From the U.S. Government Printing Office]
[H.R. 2966 Introduced in House (IH)]







105th CONGRESS
  1st Session
                                H. R. 2966

  To amend the Internal Revenue Code of 1986 to allow a deduction for 
 employment taxes paid by employees and self-employed individuals, and 
                          for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            November 8, 1997

 Mr. Sandlin 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 allow a deduction for 
 employment taxes paid by employees and self-employed individuals, 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 ``Working Americans Tax Relief Act''.

SEC. 2. DEDUCTION FOR EMPLOYMENT TAXES OF EMPLOYEES AND SELF-EMPLOYED 
              INDIVIDUALS.

    (a) Taxes of Employees.--
            (1) Deduction allowed in arriving at adjusted gross 
        income.--Section 62(a) of the Internal Revenue Code of 1986 
        (defining adjusted gross income) is amended by inserting after 
        paragraph (17) the following new paragraph:
            ``(18) Employees' employment taxes.--The deduction allowed 
        by section 164(g).''
            (2) Determination of deduction.--Section 164 of such Code 
        (relating to deduction for taxes) is amended by redesignating 
        subsection (g) as subsection (h) and by inserting after 
        subsection (f) the following new subsection:
    ``(g) Employees' Employment Taxes.--
            ``(1) In general.--In the case of an individual, in 
        addition to the taxes described in subsection (a), there shall 
        be allowed as a deduction for the taxable year an amount equal 
        to the sum of--
                    ``(A) the taxes imposed by section 3101 for the 
                taxable year, and
                    ``(B) the taxes imposed by section 3201(a) for the 
                taxable year.
            ``(2) Special rule for certain agreements.--For purposes of 
        paragraph (1), taxes imposed by section 3101 shall include 
        amounts equivalent to such taxes imposed with respect to 
        remuneration covered by--
                    ``(A) an agreement under section 218 of the Social 
                Security Act, or
                    ``(B) an agreement under section 3121(l) (relating 
                to agreements entered into by American employers with 
                respect to foreign affiliates).
            ``(3) Coordination with special refund of social security 
        taxes.--Taxes shall not be taken into account under paragraph 
        (1) to the extent the taxpayer is entitled to a special refund 
        of such taxes under section 6413(c).''
            (3) Conforming amendment.--The next to last sentence of 
        section 275(a) of such Code is amended by inserting ``or 
        164(g)'' after ``164(f)''.
    (b) Deduction for Self-Employed Individuals.--
            (1) In general.--Paragraph (1) of section 164(f) of the 
        Internal Revenue Code of 1986 (relating to deduction for one-
        half of self-employment taxes) is amended to read as follows:
            ``(1) In general.--In the case of an individual, in 
        addition to the taxes described in subsection (a), there shall 
        be allowed as a deduction for the taxable year an amount equal 
        to the taxes imposed by section 1401 for such taxable year.''
            (2) Conforming amendments.--
                    (A) The heading for section 164(f) of such Code is 
                amended by striking ``One-Half of''.
                    (B) Section 1402(a)(12) of such Code is amended--
                            (i) by striking ``one-half of'', and
                            (ii) by striking subparagraph (B) and 
                        inserting:
                    ``(B) a percentage equal to the sum for such year 
                of the rates of tax under section 1401;''.
                    (C) Clause (ii) of section 32(c)(2)(A) of such Code 
                is amended by inserting ``one-half'' before 
                ``deduction''.
                    (D) Clause (vi) of section 401(c)(2) of such Code 
                is amended by inserting ``only one-half of'' after 
                ``with regard to''.
                    (E) Paragraph (3) of section 832(c) of such Code is 
                amended by inserting ``(other than subsection (g))'' 
                after ``section 164''.
                    (F) Paragraph (3) of section 834(c) of such Code is 
                amended by inserting ``(other than subsection (g))'' 
                after ``section 164''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 1997.
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