(Sec. 105) Allows for withdrawal from an IDA for non-qualified expenses, but with forfeiture of all corresponding matching funds and interest earned on them, unless the withdrawn funds are recontributed within one year.
(Sec. 108) Disregards funds in parallel accounts of program participants for purposes of certain means-tested Federal programs.
Title II: Qualified Individual Development Account Program Investment Credits - Amends the Internal Revenue Code to allow a tax credit for a qualified IDA program investment by an eligible taxpayer (a QFI or a non-QFI meeting specified criteria) during the taxable year.
(Sec. 202) Declares that QFIs which establish qualified IDA programs shall not receive credit for funding, administration, and education expenses under any test contained in regulations for the Community Reinvestment Act of 1977 for those activities and expenses related to such programs and accounted for in the tax credit above.
(Sec. 203) Authorizes an individual to designate that a specified portion of any overpayment of tax for a taxable year attributable to the earned income credit shall be deposited by the Secretary into the individual's IDA.
[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[S. 2023 Introduced in Senate (IS)]
106th CONGRESS
2d Session
S. 2023
To provide for the establishment of Individual Development Accounts
(IDAs) that will allow individuals and families with limited means an
opportunity to accumulate assets, to access education, to own their own
homes and businesses, and ultimately to achieve economic self-
sufficiency, and for other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
February 2, 2000
Mr. Lieberman (for himself, Mr. Santorum, Ms. Landrieu, Mr. Abraham,
Mrs. Feinstein, Mr. Robb, and Mr. Bayh) introduced the following bill;
which was read twice and referred to the Committee on Finance
_______________________________________________________________________
A BILL
To provide for the establishment of Individual Development Accounts
(IDAs) that will allow individuals and families with limited means an
opportunity to accumulate assets, to access education, to own their own
homes and businesses, and ultimately to achieve economic self-
sufficiency, 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; TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``Savings for
Working Families Act of 2000''.
(b) Table of Contents.--The table of contents of this Act is as
follows:
Sec. 1. Short title; table of contents.
Sec. 2. Findings.
Sec. 3. Purposes.
Sec. 4. Definitions.
TITLE I--QUALIFIED INDIVIDUAL DEVELOPMENT ACCOUNTS FOR LOW-INCOME
WORKERS
Sec. 101. Structure and administration of qualified individual
development account programs.
Sec. 102. Procedures for opening an Individual Development Account and
qualifying for matching funds.
Sec. 103. Contributions to Individual Development Accounts.
Sec. 104. Deposits by qualified individual development account
programs.
Sec. 105. Withdrawal procedures.
Sec. 106. Certification and termination of qualified individual
development account programs.
Sec. 107. Reporting, monitoring, and evaluation.
Sec. 108. Funds in parallel accounts of program participants
disregarded for purposes of certain means-
tested Federal programs.
TITLE II--QUALIFIED INDIVIDUAL DEVELOPMENT ACCOUNT PROGRAM INVESTMENT
CREDITS
Sec. 201. Qualified individual development account program investment
credits.
Sec. 202. CRA credit treatment for qualified individual development
account program investments.
Sec. 203. Designation of earned income tax credit payments for deposit
to Individual Development Accounts.
SEC. 2. FINDINGS.
Congress makes the following findings:
(1) One-third of all Americans have no assets available for
investment, and another 20 percent have only negligible assets.
The household savings rate of the United States lags far behind
other industrial nations, presenting a barrier to national
economic growth and preventing many Americans from entering the
economic mainstream by buying a house, obtaining an adequate
education, or starting a business.
(2) By building assets, Americans can improve their
economic independence and stability, stimulate the development
of human and other capital, and work toward a viable and
hopeful future for themselves and their children. Thus,
economic well-being does not come solely from income, spending,
and consumption, but also requires savings, investment, and
accumulation of assets.
(3) Traditional public assistance programs based on income
and consumption have rarely been successful in promoting and
supporting the transition to increased economic self-
sufficiency. Income-based social policies that meet consumption
needs (including food, child care, rent, clothing, and health
care) should be complemented by asset-based policies that can
provide the means to achieve long-term independence and
economic well-being.
(4) Individual Development Accounts (IDAs) can provide
working Americans with strong incentives to build assets, basic
financial management training, and access to secure and
relatively inexpensive banking services.
(5) There is reason to believe that Individual Development
Accounts would also foster greater participation in electric
fund transfers (EFT), generate financial returns, including
increased income, tax revenue, and decreased welfare cash
assistance, that will far exceed the cost of public investment
in the program.
SEC. 3. PURPOSES.
The purposes of this Act are to provide for the establishment of
individual development account programs that will--
(1) provide individuals and families with limited means an
opportunity to accumulate assets and to enter the financial
mainstream;
(2) promote education, homeownership, and the development
of small businesses;
(3) stabilize families and build communities; and
(4) support continued United States economic expansion.
SEC. 4. DEFINITIONS.
As used in this Act:
(1) Eligible individual.--
(A) In general.--The term ``eligible individual''
means an individual who--
(i) has attained the age of 18 years;
(ii) is a citizen or legal resident of the
United States; and
(iii) is a member of a household the gross
income of which does not exceed 80 percent of
the area median income (as published by the
Department of Housing and Urban Affairs).
(B) Household.--The term ``household'' means all
individuals who share use of a dwelling unit as primary
quarters for living and eating separate from other
individuals.
(2) Individual development account.--The term ``Individual
Development Account'' means a regular interest bearing savings
account established for an eligible individual as part of a
qualified individual development account program, but only if
the written governing instrument creating the account meets the
following requirements:
(A) The sole owner of the account is the eligible
individual.
(B) No contribution will be accepted unless it is
in cash, by check, or by electronic fund transfer.
(C) The holder of the account is a qualified
financial institution or a qualified nonprofit
organization.
(D) The assets of the account will not be
commingled with other property except in a common trust
fund or common investment fund.
(E) Except as provided in section 105(b), any
amount in the account may be paid out only for the
purpose of paying the qualified expenses of the
eligible individual.
(3) Parallel account.--The term ``parallel account'' means
a separate, parallel individual or pooled account for all
matching funds and earnings dedicated to an eligible individual
as part of a qualified individual account program, the sole
owner of which is a qualified financial institution or a
qualified nonprofit organization
(4) Qualified financial institution.--
(A) In general.--The term ``qualified financial
institution'' means any person authorized to be a
trustee of any individual retirement account under
section 408(a)(2).
(B) Rule of construction.--Nothing in this
paragraph shall be construed as preventing a person
described in subparagraph (A) from collaborating with 1
or more qualified nonprofit organizations to carry out
an individual development account program established
under section 101.
(5) Qualified nonprofit organization.--The term ``qualified
nonprofit organization'' means--
(A) any organization described in section 501(c)(3)
of the Internal Revenue Code of 1986 and exempt from
taxation under section 501(a) of such Code;
(B) any community development financial institution
as certified by the Community Development Financial
Institution Fund; or
(C) any credit union certified by the National
Credit Union Administration,
that meets standards for financial management and fiduciary
responsibility as defined by the Secretary or an organization
designated by the Secretary.
(6) Qualified individual development account program.--The
term ``qualified individual development program'' means a
program established under section 101 under which--
(A) individual development accounts and parallel
accounts are held by a qualified financial institution
or a qualified nonprofit organization; and
(B) additional activities determined by the
Secretary, or an organization designated by the
Secretary, as necessary to responsibly develop and
administer accounts, including recruiting, providing
financial education and other training to account
holders, and regular program monitoring, are carried
out by such institution or nonprofit organization.
(7) Qualified expense distribution.--
(A) In general.--The term ``qualified expense
distribution'' means any amount paid or distributed out
of an Individual Development Account and a parallel
account established for an eligible individual if such
amount--
(i) is used exclusively to pay the
qualified expenses of such individual or such
individual's spouse or dependents,
(ii) is paid by the qualified financial
institution or qualified nonprofit organization
directly to the person to whom the amount is
due or to another Individual Development
Account, and
(iii) is paid after the holder of the
Individual Development Account has completed a
financial education course as required under
section 102(b).
(B) Qualified expenses.--
(i) In general.--The term ``qualified
expenses'' means any of the following:
(I) Qualified higher education
expenses.
(II) Qualified first-time homebuyer
costs.
(III) Qualified business
capitalization costs.
(IV) Qualified rollovers.
(ii) Qualified higher education expenses.--
(I) In general.--The term
``qualified higher education expenses''
has the meaning given such term by
section 72(t)(7) of the Internal
Revenue Code of 1986, determined by
treating postsecondary vocational
educational schools as eligible
educational institutions.
(II) Postsecondary vocational
education school.--The term
``postsecondary vocational educational
school'' means an area vocational
education school (as defined in
subparagraph (C) or (D) of section
521(4) of the Carl D. Perkins
Vocational and Applied Technology
Education Act (20 U.S.C. 2471(4)))
which is in any State (as defined in
section 521(33) of such Act), as such
sections are in effect on the date of
enactment of this Act.
(III) Coordination with other
benefits.--The amount of qualified
higher education expenses for any
taxable year shall be reduced as
provided in section 25A(g)(2) of such
Code and by the amount of such expenses
for which a credit or exclusion is
allowed under chapter 1 of such Code
for such taxable year.
(iii) Qualified first-time homebuyer
costs.--The term ``qualified first-time
homebuyer costs'' means qualified acquisition
costs (as defined in section 72(t)(8) of such
Code without regard to subparagraph (B)
thereof) with respect to a principal residence
(within the meaning of section 121 of such
Code) for a qualified first-time homebuyer (as
defined in section 72(t)(8) of such Code).
(iv) Qualified business capitalization
costs.--
(I) In general.--The term
``qualified business capitalization
costs'' means qualified expenditures
for the capitalization of a qualified
business pursuant to a qualified
business plan.
(II) Qualified expenditures.--The
term ``qualified expenditures'' means
expenditures included in a qualified
business plan, including capital,
plant, equipment, working capital and
inventory expenses.
(III) Qualified business.--The term
``qualified business'' means any
business that does not contravene any
law.
(IV) Qualified business plan.--The
term ``qualified business plan'' means
a business plan which meets such
requirements as the Secretary or an
organization designated by the
Secretary may specify.
(v) Qualified rollovers.--The term
``qualified rollover'' means, with respect to
any distribution from an Individual Development
Account, the payment, within 120 days of such
distribution, of all or a portion of such
distribution to such account or to another
Individual Development Account established in
another qualified financial institution or
qualified nonprofit organization for the
benefit of the eligible individual. Rules
similar to the rules of section 408(d)(3) of
such Code (other than subparagraph (C) thereof)
shall apply for purposes of this clause.
(8) Secretary.--The term ``Secretary'' means the Secretary
of the Treasury.
TITLE I--INDIVIDUAL DEVELOPMENT ACCOUNTS FOR LOW-INCOME WORKERS
SEC. 101. STRUCTURE AND ADMINISTRATION OF QUALIFIED INDIVIDUAL
DEVELOPMENT ACCOUNT PROGRAMS.
(a) Establishment of Qualified Individual Development Account
Programs.--Any qualified financial institution or qualified nonprofit
organization may establish 1 or more qualified individual development
account programs which meet the requirements of this Act.
(b) Basic Program Structure.--
(1) In general.--All qualified individual development
account programs shall consist of the following 2 components:
(A) An Individual Development Account to which an
eligible individual may contribute money in accordance
with section 103.
(B) A parallel account to which all matching funds
shall be deposited in accordance with section 104.
(2) Tailored ida programs.--A qualified financial
institution or qualified nonprofit organization may tailor its
qualified individual development account program to allow
matching funds to be spent on 1 or more of the categories of
qualified expenses.
(c) Account Population Distribution Requirement.--An individual
development account program shall be treated as qualified under this
Act only if not less than one third of the Individual Development
Accounts under such program are owned by eligible individuals each of
whom is a member of a household the gross income of which does not
exceed 50 percent of the area median income (as published by the
Department of Housing and Urban Affairs).
(d) Tax Treatment of Accounts.--Any account described in
subparagraph (B) of subsection (b)(1) is exempt from taxation under the
Internal Revenue Code of 1986 unless such account has ceased to be such
an account by reason of section 105(c) or the termination of the
qualified individual development account program under section 106(b).
SEC. 102. PROCEDURES FOR OPENING AN INDIVIDUAL DEVELOPMENT ACCOUNT AND
QUALIFYING FOR MATCHING FUNDS.
(a) Opening an Account.--An eligible individual must open an
Individual Development Account with a qualified financial institution
or qualified nonprofit organization and contribute money in accordance
with section 103 to qualify for matching funds in a parallel account.
(b) Required Completion of Financial Education Course.--
(1) In general.--Before becoming eligible to withdraw
matching funds to pay for qualified expenses, holders of
Individual Development Accounts must complete a financial
education course offered by a qualified financial institution,
a qualified nonprofit organization, or a government entity.
(2) Standard and applicability of course.--The Secretary or
an organization designated by the Secretary, in consultation
with representatives of qualified individual development
account programs and financial educators, shall establish
minimum performance standards for financial education courses
offered under paragraph (1) and a protocol to exempt eligible
individuals from the requirement under paragraph (1) because of
hardship or lack of need.
SEC. 103. CONTRIBUTIONS TO INDIVIDUAL DEVELOPMENT ACCOUNTS.
(a) In General.--Except in the case of a qualified rollover,
individual contributions to an Individual Development Account will not
be accepted for the taxable year in excess of the lesser of--
(1) $2,000; or
(2) an amount equal to the compensation (as defined in
section 219(f)(1) of the Internal Revenue Code of 1986)
includible in the individual's gross income for such taxable
year.
(b) Proof of Compensation and Status as an Eligible Individual.--
Federal W-2 forms and other forms specified by the Secretary proving
the eligible individual's wages and other compensation and the status
of the individual as an eligible individual shall be presented at the
time of the establishment of the Individual Development Account and at
least once annually thereafter.
(c) Time When Contributions Deemed Made.--For purposes of this
section, a taxpayer shall be deemed to have made a contribution to an
Individual Development Account on the last day of the preceding taxable
year if the contribution is made on account of such taxable year and is
made not later than the time prescribed by law for filing the Federal
income tax return for such taxable year (not including extensions
thereof).
(d) Cross Reference.--
For designation of earned income tax
credit payments for deposit to an Individual Development Account, see
section 32(o) of the Internal Revenue Code of 1986.
SEC. 104. DEPOSITS BY QUALIFIED INDIVIDUAL DEVELOPMENT ACCOUNT
PROGRAMS.
(a) Parallel Accounts.--The qualified financial institution or
qualified nonprofit organization shall deposit all matching funds for
each Individual Development Account into a parallel account at a
qualified financial institution or qualified nonprofit organization.
The parallel account or accounts shall earn not less than the market
rate of interest.
(b) Regular Deposits of Matching Funds.--
(1) In general.--Subject to paragraph (2), the qualified
financial institution or qualified nonprofit organization shall
deposit not less than quarterly into the parallel account with
respect to each eligible individual the following:
(A) A dollar-for-dollar match for the first $500
contributed by the eligible individual into an
Individual Development Account with respect to any
taxable year.
(B) Any matching funds provided by State, local, or
private sources in accordance to the matching ratio set
by those sources.
(2) Cross reference.--
For allowance of tax credit to
qualified financial institutions for Individual Development Account
subsidies, including matching funds, see section 30B of the Internal
Revenue Code of 1986.
(c) Forfeiture of Matching Funds.--Matching funds that are
forfeited under section 105(b) shall be used by the qualified financial
institution or qualified nonprofit organization to pay matches for
other Individual Development Account contributions by eligible
individuals.
(d) Uniform Accounting Regulations.--The Secretary shall prescribe
regulations with respect to accounting for matching funds from all
possible sources in the parallel accounts.
(e) Regular Reporting of Accounts.--Any qualified financial
institution or qualified nonprofit organization shall report the
balances in any Individual Development Account and parallel account of
an eligible individual on not less than a quarterly basis.
SEC. 105. WITHDRAWAL PROCEDURES.
(a) Withdrawals for Qualified Expenses.--To withdraw money from an
eligible individual's Individual Development Account to pay qualified
expenses of such individual or such individual's spouse or dependents,
the qualified financial institution or qualified nonprofit organization
shall directly transfer such funds from the Individual Development
Account, and, if applicable, from the parallel account electronically
to the vendor or other Individual Development Account. If the vendor is
not equipped to receive funds electronically, the qualified financial
institution or qualified nonprofit organization may issue such funds by
paper check to the vendor.
(b) Withdrawals for Nonqualified Expenses.--An Individual
Development Account holder may unilaterally withdraw funds from the
Individual Development Account for purposes other than to pay qualified
expenses, but shall forfeit the corresponding matching funds and
interest earned on the matching funds by doing so, unless such
withdrawn funds are recontributed to such Account within 1 year of
withdrawal.
(c) Deemed Withdrawals From Accounts of Noneligible Individuals.--
If the individual for whose benefit an Individual Development Account
is established ceases to be an eligible individual, such account shall
cease to be an Individual Development Account as of the first day of
the taxable year of such individual and any balance in such account
shall be deemed to have been withdrawn on such first day by such
individual for purposes other than to pay qualified expenses.
(d) Tax Treatment of Matching Funds.--Any amount withdrawn from a
parallel account shall not be includible in an eligible individual's
gross income.
SEC. 106. CERTIFICATION AND TERMINATION OF QUALIFIED INDIVIDUAL
DEVELOPMENT ACCOUNT PROGRAMS.
(a) Certification Procedures.--Upon establishing a qualified
individual development account program under section 101, a qualified
financial institution or qualified nonprofit organization shall certify
to the Secretary, or an organization designated by the Secretary, on
forms prescribed by the Secretary or such organization and accompanied
by any documentation required by the Secretary or such organization,
that--
(1) the accounts described in subparagraphs (A) and (B) of
section 101(b)(1) are operating pursuant to all the provisions
of this Act; and
(2) the qualified financial institution or qualified
nonprofit organization agrees to implement an information
system necessary to monitor the cost and outcomes of the
qualified individual development account program.
(b) Authority To Terminate Qualified IDA Program.--If the
Secretary, or an organization designated by the Secretary, determines
that a qualified financial institution or qualified nonprofit
organization under this Act is not operating a qualified individual
development account program in accordance with the requirements of this
Act (and has not implemented any corrective recommendations directed by
the Secretary or such organization), the Secretary or such organization
shall terminate such institution's or nonprofit organization's
authority to conduct the program. If the Secretary, or an organization
designated by the Secretary, is unable to identify a qualified
financial institution or qualified nonprofit organization to assume the
authority to conduct such program, then any account established for the
benefit of any eligible individual under such program shall cease to be
an Individual Development Account as of the first day of such
termination and any balance in such account shall be deemed to have
been withdrawn on such first day by such individual for purposes other
than to pay qualified expenses.
SEC. 107. REPORTING, MONITORING, AND EVALUATION.
(a) Responsibilities of Qualified Financial Institutions and
Qualified Nonprofit Organizations.--Each qualified financial
institution or qualified nonprofit organization that establishes a
qualified individual development account program under section 101
shall report annually to the Secretary, directly or through an
organization designated by the Secretary, within 90 days after the end
of each calendar year on--
(1) the number of eligible individuals making contributions
into Individual Development Accounts;
(2) the amounts contributed into Individual Development
Accounts and deposited into parallel accounts for matching
funds;
(3) the amounts withdrawn from Individual Development
Accounts and parallel accounts, and the purposes for which such
amounts were withdrawn;
(4) the balances remaining in Individual Development
Accounts and parallel accounts; and
(5) such other information needed to help the Secretary, or
an organization designated by the Secretary, monitor the cost
and outcomes of the qualified individual development account
program.
(b) Responsibilities of the Secretary or Designated Organization.--
(1) Monitoring protocol.--Not later than 12 months after
the date of enactment of this Act, the Secretary, or an
organization designated by the Secretary, shall develop and
implement a protocol and process to continually monitor the
cost and outcomes of the qualified individual development
account programs established under section 101.
(2) Annual reports.--In each year after the date of
enactment of this Act, the Secretary, or an organization
designated by the Secretary, shall issue a progress report on
the status of such qualified individual development account
programs.
(3) Appropriations for monitoring.--There is authorized to
be appropriated $5,000,000 for the purposes of monitoring
qualified individual development account programs established
under section 101, to remain available until expended.
SEC. 108. FUNDS IN PARALLEL ACCOUNTS OF PROGRAM PARTICIPANTS
DISREGARDED FOR PURPOSES OF CERTAIN MEANS-TESTED FEDERAL
PROGRAMS.
Notwithstanding any provision of the Internal Revenue Code of 1986
or the Social Security Act that requires consideration of 1 or more
financial circumstances of an individual, for the purposes of
determining eligibility to receive, or the amount of, any assistance or
benefit authorized by such provision to be provided to or for the
benefit of such individual, the lesser of--
(1) the sum of all contributions by an eligible individual
(including earnings thereon) to any Individual Development
Account and matching deposits made on behalf of such individual
(including earnings thereon) in any parallel account; or
(2) $10,000,
shall be disregarded for such purpose with respect to any period during
which the individual participates in a qualified individual development
account program established under section 101.
TITLE II--QUALIFIED INDIVIDUAL DEVELOPMENT ACCOUNT PROGRAM INVESTMENT
CREDITS
SEC. 201. QUALIFIED INDIVIDUAL DEVELOPMENT ACCOUNT PROGRAM INVESTMENT
CREDITS.
(a) In General.--Subpart B of part IV of subchapter A of chapter 1
of the Internal Revenue Code of 1986 (relating to other credits) is
amended by inserting after section 30A the following:
``SEC. 30B. QUALIFIED INDIVIDUAL DEVELOPMENT ACCOUNT PROGRAM INVESTMENT
CREDIT.
``(a) Determination of Amount.--There shall be allowed as a credit
against the applicable tax for the taxable year an amount equal to the
qualified individual development account program investment provided by
an eligible taxpayer during the taxable year under a qualified
individual development account program established under section 101 of
the Savings for Working Families Act.
``(b) Applicable Tax.--For the purposes of this section, the term
`applicable tax' means the excess (if any) of--
``(1) the sum of--
``(A) the tax imposed under this chapter (other
than the taxes imposed under the provisions described
in subparagraphs (C) through (Q) of section 26(b)(1)),
plus
``(B) the tax imposed under section 3111, over
``(2) the credits allowable under subparts B and D of this
part.
``(c) Qualified Individual Development Account Program
Investment.--For purposes of this section, the term `qualified
individual development account program investment' means, with respect
to a qualified individual development account program of an eligible
taxpayer in any taxable year, an amount equal to--
``(1) in the case of an eligible taxpayer which is a
qualified financial institution, the sum of--
``(A) the lesser of--
``(i) 90 percent of the aggregate amount of
dollar-for-dollar matches under such program by
such taxpayer under section 104 of the Savings
for Working Families Act for such taxable year,
or
``(ii) $90,000,000, plus
``(B) the lesser of--
``(i) 50 percent of the aggregate costs
paid or incurred under such program by the
eligible taxpayer during such taxable year--
``(I) to provide financial
education courses to Individual
Development Account holders under
section 102(b) of such Act, and
``(II) to underwrite program
activities described in section 4(6)(B)
of such Act), or
``(ii) $5,000,000, and
``(2) in the case of an eligible taxpayer which is not a
qualified financial institution, the lesser of--
``(A) the sum of--
``(i) 50 percent of the aggregate amount of
such dollar-for-dollar matches by such taxpayer
for such taxable year, plus
``(ii) 50 percent of the aggregate costs
described in paragraph (1)(B)(i) paid
or incurred under such program by the eligible taxpayer during such
taxable year, or
``(B) $5,000,000.
``(d) Eligible Taxpayer.--For purposes of this section, a taxpayer
shall be considered an eligible taxpayer if at least 70 percent of the
expenditures by such taxpayer with respect to any qualified individual
development account program for any taxable year are described in
subsection (c)(1)(A).
``(e) Other Definitions and Special Rules.--
``(1) Other definitions.--For purposes of this section, the
terms `Individual Development Account' , `qualified individual
development account program', and `qualified financial
institution' have the meanings given such terms by section 4 of
the Savings for Workings Families Act.
``(2) Certain rules made applicable.--Rules similar to the
rules of paragraphs (1) and (2) of section 41(f) shall apply
for purposes of this section.
``(f) Regulations.--The Secretary may prescribe such regulations 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 forfeiture under section 105(b) of
the Savings for Workings Families Act in a subsequent taxable year of
any amount which was taken into account in determining the amount of
such credit.
``(g) Termination.--This section shall not apply to any taxable
year beginning after December 31, 2005.''.
(b) Transfer to Trust Funds.--The Secretary of the Treasury shall
transfer from the general fund of the United States Treasury to the
Federal Old-Age and Survivors Insurance Trust Fund, the Federal
Disability Insurance Trust Fund, and the Federal Hospital Insurance
Trust Fund amounts equivalent to the amount of the reduction in taxes
imposed by section 3111 of the Internal Revenue Code of 1986 by reason
of the credit determined under section 30B (relating to the qualified
individual development account program investment credit). Any such
transfer shall be made at the same time that the reduced taxes would
have been deposited in such Trust Funds.
(c) Conforming Amendment.--The table of sections for subpart B of
part IV of subchapter A of chapter 1 of the Internal Revenue Code of
1986 is amended by inserting after the item relating to section 30A the
following:
``Sec. 30B. Qualified individual development account program investment
credit.''.
(d) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2000.
SEC. 202. CRA CREDIT TREATMENT FOR QUALIFIED INDIVIDUAL DEVELOPMENT
ACCOUNT PROGRAM INVESTMENTS.
Qualified financial institutions which establish qualified
individual development account programs under section 101 shall not
receive credit for funding, administration, and education expenses
under any test contained in regulations for the Community Reinvestment
Act of 1977 for those activities and expenses related to such programs
and taken into account for purposes of the tax credit allowed under
section 30B of the Internal Revenue Code of 1986.
SEC. 203. DESIGNATION OF EARNED INCOME TAX CREDIT PAYMENTS FOR DEPOSIT
TO INDIVIDUAL DEVELOPMENT ACCOUNTS.
(a) In General.--Section 32 of the Internal Revenue Code of 1986
(relating to earned income credit) is amended by adding at the end the
following:
``(o) Designation of Credit for Deposit to Individual Development
Account.--
``(1) In general.--With respect to the return of any
eligible individual (as defined in section 4(1) of the Savings
for Working Families Act) for the taxable year of the tax
imposed by this chapter, such individual may designate that a
specified portion (not less than $1) of any overpayment of tax
for such taxable year which is attributable to the credit
allowed under this section shall be deposited by the Secretary
into an Individual Development Account (as defined in section
4(2) of such Act) of such individual. The Secretary shall so
deposit such portion designated under this paragraph.
``(2) Manner and time of designation.--A designation under
paragraph (1) may be made with respect to any taxable year--
``(A) at the time of filing the return of the tax
imposed by this chapter for such taxable year, or
``(B) at any other time (after the time of filing
the return of the tax imposed by this chapter for such
taxable year) specified in regulations prescribed by
the Secretary.
Such designation shall be made in such manner as the Secretary
prescribes by regulations.
``(3) Portion attributable to earned income tax credit.--
For purposes of paragraph (1), an overpayment for any taxable
year shall be treated as attributable to the credit allowed
under this section for such taxable year to the extent that
such overpayment does not exceed the credit so allowed.
``(4) Overpayments treated as refunded.--For purposes of
this title, any portion of an overpayment of tax designated
under paragraph (1) shall be treated as being refunded to the
taxpayer as of the last date prescribed for filing the return
of tax imposed by this chapter (determined without regard to
extensions) or, if later, the date the return is filed.
``(5) Termination.--This subsection shall not apply to any
taxable year beginning after December 31, 2005.''.
(b) Effective Date.--The amendment made by this section shall apply
to taxable years beginning after December 31, 2000.
<all>
Introduced in Senate
Sponsor introductory remarks on measure. (CR S287-288)
Read twice and referred to the Committee on Finance.
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