Makes the 25 percent individual income tax rate effective in calender year 2002 rather than 2006.
Temporarily expands penalty-free retirement plan distributions for health insurance premiums for individuals receiving unemployment compensation, as specified.
Increases the child tax credit to $1,000.
Allows a tax credit of up to $500 for qualified elementary and secondary education expenses (computer technology or equipment).
Allows for certain property acquired after September 10, 2001, and before September 11, 2002: (1) an additional first year 10 percent depreciation allowance; and (2) an additional allowance against the alternative minimum tax.
Temporary Emergency Unemployment Compensation Act of 2001 - Provides for a program of temporary emergency unemployment compensation.
Provides for a temporary reduction in the interest rate applicable to repayments of advances to State unemployment funds.
Amends the Workforce Investment Act of 1998 to temporarily expand the National Emergency Grant program to address employment needs resulting from the terrorist attacks of September 11, 2001, including: (1) assistance for employment and training and temporary health care coverage premiums for workers affected by major economic dislocations (2) personal/business income compensation to a dislocated worker/ independently owned business or proprietorship if such worker/business is unable to work/fully function; and (3) COBRA continuation coverage.
[Congressional Bills 107th Congress]
[From the U.S. Government Publishing Office]
[S. 1804 Introduced in Senate (IS)]
107th CONGRESS
1st Session
S. 1804
To amend the Internal Revenue Code of 1986 to provide tax incentives
for economic recovery and provide for the payment of emergency extended
unemployment compensation.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
December 11, 2001
Mr. Sessions (for himself, Mr. Allen, Mr. Hutchinson, and Mr. Smith of
New Hampshire) introduced the following bill; which was read twice and
referred to the Committee on Finance
_______________________________________________________________________
A BILL
To amend the Internal Revenue Code of 1986 to provide tax incentives
for economic recovery and provide for the payment of emergency extended
unemployment compensation.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE; ETC.
(a) Short Title.--This Act may be cited as the ``American Family
Economic Security and Stimulus Act''.
(b) References to Internal Revenue Code of 1986.--Except as
otherwise expressly provided, whenever in this Act an amendment or
repeal is expressed in terms of an amendment to, or repeal of, a
section or other provision, the reference shall be considered to be
made to a section or other provision of the Internal Revenue Code of
1986.
(c) Table of Contents.--
Sec. 1. Short title; etc.
TITLE I--ADVANCE PAYMENT OF EARNED INCOME CREDIT
Sec. 101. Additional requirements to ensure greater use of advance
payment of earned income credit.
Sec. 102. Extension of advance payment of earned income credit to all
eligible taxpayers.
TITLE II--INDIVIDUAL PROVISIONS
Sec. 201. Acceleration of 25 percent individual income tax rate.
Sec. 202. Temporary expansion of penalty-free retirement plan
distributions for health insurance premiums
of unemployed individuals.
Sec. 203. Increase in child tax credit.
Sec. 204. Temporary increase in deduction for capital losses of
taxpayers other than corporations.
Sec. 205. Nonrefundable credit for elementary and secondary school
expenses.
TITLE III--TEMPORARY EMERGENCY UNEMPLOYMENT BENEFITS
Sec. 301. Short title.
Sec. 302. Federal-State agreements.
Sec. 303. Temporary emergency unemployment compensation account.
Sec. 304. Payments to States having agreements for the payment of
temporary emergency unemployment
compensation.
Sec. 305. Financing provisions.
Sec. 306. Fraud and overpayments.
Sec. 307. Definitions.
Sec. 308. Applicability.
Sec. 309. Temporary reduction in interest rate applicable to repayments
of advances to State unemployment funds.
TITLE IV--NATIONAL EMERGENCY GRANTS
Sec. 401. National emergency grant assistance for workers.
TITLE V--TEMPORARY BUSINESS RELIEF PROVISIONS
Sec. 501. Special depreciation allowance for certain property.
TITLE I--ADVANCE PAYMENT OF EARNED INCOME CREDIT
SEC. 101. ADDITIONAL REQUIREMENTS TO ENSURE GREATER USE OF ADVANCE
PAYMENT OF EARNED INCOME CREDIT.
Not later than January 1, 2002, the Secretary of the Treasury by
regulation shall require--
(1) each employer of an employee who the employer
determines receives wages in an amount which indicates that
such employee would be eligible for the earned income credit
under section 32 of the Internal Revenue Code of 1986 to
provide such employee with a simplified application for an
earned income eligibility certificate, and
(2) require each employee wishing to receive the earned
income tax credit to complete and return the application to the
employer within 30 days of receipt.
Such regulations shall require an employer to provide such an
application within 30 days of the hiring date of an employee and at
least annually thereafter. Such regulations shall further provide that,
upon receipt of a completed form, an employer shall provide for the
advance payment of the earned income credit as provided under section
3507 of the Internal Revenue Code of 1986.
SEC. 102. EXTENSION OF ADVANCE PAYMENT OF EARNED INCOME CREDIT TO ALL
ELIGIBLE TAXPAYERS.
(a) In General.--Section 3507(b) of the Internal Revenue Code of
1986 (relating to earned income eligibility certificate) is amended by
striking paragraph (2) and by redesignating paragraphs (3) and (4) as
paragraphs (2) and (3), respectively.
(b) Conforming Amendments.--
(1) Section 3507(c)(2)(B) of the Internal Revenue Code of
1986 is amended by inserting ``has 1 or more qualifying
children and'' before ``is not married,''.
(2) Section 3507(c)(2)(C) of such Code is amended by
striking ``the employee'' and inserting ``an employee with 1 or
more qualifying children''.
(3) Section 3507(f) of such Code is amended by striking
``who have 1 or more qualifying children and''.
(c) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2001.
TITLE II--INDIVIDUAL PROVISIONS
SEC. 201. ACCELERATION OF 25 PERCENT INDIVIDUAL INCOME TAX RATE.
(a) In General.--The table contained in paragraph (2) of section
1(i) (relating to reductions in rates after June 30, 2001) is amended--
(1) by striking ``27.0%'' and inserting ``25.0%'', and
(2) by striking ``26.0%'' and inserting ``25.0%''.
(b) Reduction Not To Increase Minimum Tax.--
(1) Subparagraph (A) of section 55(d)(1) is amended by
striking ``($49,000 in the case of taxable years beginning in
2001, 2002, 2003, and 2004)'' and inserting ``($49,000 in the
case of taxable years beginning in 2001, $52,200 in the case of
taxable years beginning in 2002 or 2003, and $50,700 in the
case of taxable years beginning in 2004)''.
(2) Subparagraph (B) of section 55(d)(1) is amended by
striking ``($35,750 in the case of taxable years beginning in
2001, 2002, 2003, and 2004)'' and inserting ``($35,750 in the
case of taxable years beginning in 2001, $37,350 in the case of
taxable years beginning in 2002 or 2003, and $36,600 in the
case of taxable years beginning in 2004)''.
(c) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2001.
(d) Section 15 Not To Apply.--No amendment made by this section
shall be treated as a change in a rate of tax for purposes of section
15 of the Internal Revenue Code of 1986.
SEC. 202. TEMPORARY EXPANSION OF PENALTY-FREE RETIREMENT PLAN
DISTRIBUTIONS FOR HEALTH INSURANCE PREMIUMS OF UNEMPLOYED
INDIVIDUALS.
(a) In General.--Subparagraph (D) of section 72(t)(2) is amended by
adding at the end the following new clause:
``(iv) Special rules for individuals
receiving unemployment compensation after
september 10, 2001, and before january 1,
2003.--In the case of an individual who
receives unemployment compensation for 4
consecutive weeks after September 10, 2001, and
before January 1, 2003--
``(I) clause (i) shall apply to
distributions from all qualified
retirement plans (as defined in section
4974(c)), and
``(II) such 4 consecutive weeks
shall be substituted for the 12
consecutive weeks referred to in
subclause (I) of clause (i).''
(b) Effective Date.--The amendment made by this section shall apply
to distributions after the date of the enactment of this Act.
SEC. 203. INCREASE IN CHILD TAX CREDIT.
(a) In General.--The table contained in section 24(a)(2) (relating
to per child amount) is amended by striking all matter preceding the
second item and inserting the following:
``The per child
``In the case of any taxable year amount is--
beginning in--
2001.......................................... $1,000
2002, 2003, or 2004........................... 600''.
(b) Effective Date.--The amendment made by this section shall apply
to taxable years beginning after December 31, 2000.
SEC. 204. TEMPORARY INCREASE IN DEDUCTION FOR CAPITAL LOSSES OF
TAXPAYERS OTHER THAN CORPORATIONS.
(a) In General.--Subsection (b) of section 1211 (relating to
limitation on capital losses for taxpayers other than corporations) is
amended by adding at the end the following flush sentence:
``Paragraph (1) shall be applied by substituting `$5,000' for `$3,000'
and `$2,500' for `$1,500' in the case of taxable years beginning in
2001 or 2002.''.
(b) Effective Date.--The amendment made by subsection (a) shall
apply to taxable years beginning after December 31, 2000.
SEC. 205. NONREFUNDABLE CREDIT FOR ELEMENTARY AND SECONDARY SCHOOL
EXPENSES.
(a) In General.--Subpart A of part IV of subchapter A of chapter 1
(relating to nonrefundable personal credits) is amended by inserting
after section 25B the following new section:
``SEC. 25C. CREDIT FOR ELEMENTARY AND SECONDARY SCHOOL EXPENSES.
``(a) Allowance of Credit.--In the case of an individual who
maintains a household which includes as a member one or more qualifying
students (as defined in subsection (b)(1)), there shall be allowed as a
credit against the tax imposed by this chapter for the taxable year an
amount equal to the qualified elementary and secondary education
expenses with respect to such students which are paid or incurred by
the taxpayer during such taxable year.
``(b) Dollar Limit on Amount Creditable.--The amount of qualified
elementary and secondary education expenses paid or incurred during any
taxable year which may be taken into account under subsection (a) shall
not exceed $500.
``(c) Qualifying Student.--For purposes of this section, the term
``qualifying student'' means a dependent of the taxpayer (within the
meaning of section 152) who is enrolled in school on a full-time basis.
``(d) Qualified Elementary and Secondary Education Expenses.--For
purposes of this section--
``(1) In general.--The term `qualified elementary and
secondary education expenses' means computer technology or
equipment expenses.
``(2) Computer technology or equipment.--The term `computer
technology or equipment' has the meaning given such term by
section 170(e)(6)(F)(i) and includes Internet access and
related services and computer software if such software is
predominately educational in nature.
``(e) School.--For purposes of this section, the term `school'
means any public, charter, private, religious, or home school which
provides elementary education or secondary education (through grade
12), as determined under State law.
``(f) Denial of Double Benefit.--No deduction shall be allowed
under this chapter for any contribution for which credit is allowed
under this section.
``(g) Election To Have Credit Not Apply.--A taxpayer may elect to
have this section not apply for any taxable year.
``(h) Termination.--This section shall not apply to expenses paid
or incurred after the date which is 90 days after the date of the
enactment of this section.''.
(b) Conforming Amendments.--
(1) Section 24(b)(3)(B), as added and amended by the
Economic Growth and Tax Relief Reconciliation Act of 2001, is
amended by striking ``23 and 25B'' and inserting ``23, 25B, and
25C''.
(2) Section 25(e)(1)(C) is amended by striking ``23 and
1400C'' and by inserting ``23, 25C, and 1400C''.
(3) Section 25(e)(1)(C), as amended by the Economic Growth
and Tax Relief Reconciliation Act of 2001, is amended by
inserting ``25C,'' after ``25B,''.
(4) Section 25B, as added by the Economic Growth and Tax
Relief Reconciliation Act of 2001, is amended by striking
``section 23'' and inserting ``sections 23 and 25C''.
(5) Section 26(a)(1), as amended by the Economic Growth and
Tax Relief Reconciliation Act of 2001, is amended by striking
``and 25B'' and inserting ``25B, and 25C''.
(6) Section 1400C(d) is amended by inserting ``and section
25C'' after ``this section''.
(7) Section 1400C(d), as amended by the Economic Growth and
Tax Relief Reconciliation Act of 2001, is amended by striking
``and 25B'' and inserting ``25B, and 25C''.
(8) The table of sections for subpart A of part IV of
subchapter A of chapter 1 is amended by inserting before the
item relating to section 26 the following new item:
``Sec. 25C. Credit for elementary and
secondary school expenses.''.
(c) Effective Date.--The amendments made by this section shall
apply to taxable years ending after the date of the enactment of this
Act.
TITLE III--TEMPORARY EMERGENCY UNEMPLOYMENT BENEFITS
SEC. 301. SHORT TITLE.
This title may be cited as the ``Temporary Emergency Unemployment
Compensation Act of 2001''.
SEC. 302. FEDERAL-STATE AGREEMENTS.
(a) In General.--Any State which desires to do so may enter into
and participate in an agreement under this title with the Secretary of
Labor (in this title referred to as the ``Secretary''). Any State which
is a party to an agreement under this title may, upon providing 30 days
written notice to the Secretary, terminate such agreement.
(b) Provisions of Agreement.--Any agreement under subsection (a)
shall provide that the State agency of the State will make payments of
temporary emergency unemployment compensation to individuals who--
(1) have exhausted all rights to regular compensation under
the State law;
(2) have no rights to compensation (including both regular
compensation and extended compensation) with respect to a week
under such law or any other State unemployment compensation law
or to compensation under any other Federal law (and are not
paid or entitled to be paid any additional compensation under
any State or Federal law); and
(3) are not receiving compensation with respect to such
week under the unemployment compensation law of Canada.
(c) Exhaustion of Benefits.--For purposes of subsection (b)(1), an
individual shall be deemed to have exhausted such individual's rights
to regular compensation under a State law when--
(1) no payments of regular compensation can be made under
such law because such individual has received all regular
compensation available to such individual based on employment
or wages during such individual's base period; or
(2) such individual's rights to such compensation have been
terminated by reason of the expiration of the benefit year with
respect to which such rights existed.
(d) Weekly Benefit Amount.--For purposes of any agreement under
this title--
(1) the amount of temporary emergency unemployment
compensation which shall be payable to any individual for any
week of total unemployment shall be equal to the amount of the
regular compensation (including dependents' allowances) payable
to such individual during such individual's benefit year under
the State law for a week of total unemployment;
(2) the terms and conditions of the State law which apply
to claims for regular compensation and to the payment thereof
shall apply to claims for temporary emergency unemployment
compensation and the payment thereof, except where inconsistent
with the provisions of this title or with the regulations or
operating instructions of the Secretary promulgated to carry
out this title; and
(3) the maximum amount of temporary emergency unemployment
compensation payable to any individual for whom a temporary
emergency unemployment compensation account is established
under section 303 shall not exceed the amount established in
such account for such individual.
(e) Election by States.--Notwithstanding any other provision of
Federal law (and if State law permits), the Governor of a State is
authorized and may elect to trigger off an extended compensation period
in order to provide payment of temporary emergency unemployment
compensation to individuals who have exhausted their rights to regular
compensation under State law.
SEC. 303. TEMPORARY EMERGENCY UNEMPLOYMENT COMPENSATION ACCOUNT.
(a) In General.--Any agreement under this title shall provide that
the State will establish, for each eligible individual who files an
application for temporary emergency unemployment compensation, a
temporary emergency unemployment compensation account with respect to
such individual's benefit year.
(b) Amount in Account.--
(1) In general.--The amount established in an account under
subsection (a) shall be equal to 13 times the individual's
average weekly benefit amount for the benefit year.
(2) Reduction for extended benefits.--The amount in an
account under paragraph (1) shall be reduced (but not below
zero) by the aggregate amount of extended compensation (if any)
received by such individual relating to the same benefit year
under the Federal-State Extended Unemployment Compensation Act
of 1970 (26 U.S.C. 3304 note).
(3) Weekly benefit amount.--For purposes of this
subsection, an individual's weekly benefit amount for any week
is the amount of regular compensation (including dependents'
allowances) under the State law payable to such individual for
such week for total unemployment.
SEC. 304. PAYMENTS TO STATES HAVING AGREEMENTS FOR THE PAYMENT OF
TEMPORARY EMERGENCY UNEMPLOYMENT COMPENSATION.
(a) General Rule.--There shall be paid to each State that has
entered into an agreement under this title an amount equal to 100
percent of the temporary emergency unemployment compensation paid to
individuals by the State pursuant to such agreement.
(b) Treatment of Reimbursable Compensation.--No payment shall be
made to any State under this section in respect of any compensation to
the extent the State is entitled to reimbursement in respect of such
compensation under the provisions of any Federal law other than this
title or chapter 85 of title 5, United States Code. A State shall not
be entitled to any reimbursement under such chapter 85 in respect of
any compensation to the extent the State is entitled to reimbursement
under this title in respect of such compensation.
(c) Determination of Amount.--Sums payable to any State by reason
of such State having an agreement under this title shall be payable,
either in advance or by way of reimbursement (as may be determined by
the Secretary), in such amounts as the Secretary estimates the State
will be entitled to receive under this title for each calendar month,
reduced or increased, as the case may be, by any amount by which the
Secretary finds that the Secretary's estimates for any prior calendar
month were greater or less than the amounts which should have been paid
to the State. Such estimates may be made on the basis of such
statistical, sampling, or other method as may be agreed upon by the
Secretary and the State agency of the State involved.
SEC. 305. FINANCING PROVISIONS.
(a) In General.--Funds in the extended unemployment compensation
account (as established by section 905(a) of the Social Security Act
(42 U.S.C. 1105(a)) of the Unemployment Trust Fund (as established by
section 904(a) of such Act (42 U.S.C. 1104(a)) shall be used for the
making of payments to States having agreements entered into under this
title.
(b) Certification.--The Secretary shall from time to time certify
to the Secretary of the Treasury for payment to each State the sums
payable to such State under this title. The Secretary of the Treasury,
prior to audit or settlement by the General Accounting Office, shall
make payments to the State in accordance with such certification, by
transfers from the extended unemployment compensation account (as so
established) to the account of such State in the Unemployment Trust
Fund (as so established).
(c) Assistance to States.--There are appropriated, without fiscal
year limitation, such funds as may be necessary for purposes of
assisting States (as provided in title III of the Social Security Act
(42 U.S.C. 501 et seq.) in meeting the costs of administration of
agreements under this title.
(d) Authorization of Appropriations for Certain Payments.--There
are appropriated from the general fund of the Treasury, without fiscal
year limitation, to the extended unemployment compensation account (as
so established) of the Unemployment Trust Fund (as so established) such
sums as the Secretary estimates to be necessary to make the payments
under this section in respect of--
(1) compensation payable under chapter 85 of title 5,
United States Code; and
(2) compensation payable on the basis of services to which
section 3309(a)(1) of the Internal Revenue Code of 1986
applies.
Amounts appropriated pursuant to the preceding sentence shall not be
required to be repaid.
SEC. 306. FRAUD AND OVERPAYMENTS.
(a) In General.--If an individual knowingly has made, or caused to
be made by another, a false statement or representation of a material
fact, or knowingly has failed, or caused another to fail, to disclose a
material fact, and as a result of such false statement or
representation or of such nondisclosure such individual has received an
amount of temporary emergency unemployment compensation under this
title to which he was not entitled, such individual--
(1) shall be ineligible for further temporary emergency
unemployment compensation under this title in accordance with
the provisions of the applicable State unemployment
compensation law relating to fraud in connection with a claim
for unemployment compensation; and
(2) shall be subject to prosecution under section 1001 of
title 18, United States Code.
(b) Repayment.--In the case of individuals who have received
amounts of temporary emergency unemployment compensation under this
title to which they were not entitled, the State shall require such
individuals to repay the amounts of such emergency unemployment
compensation to the State agency, except that the State agency may
waive such repayment if it determines that--
(1) the payment of such emergency unemployment compensation
was without fault on the part of any such individual; and
(2) such repayment would be contrary to equity and good
conscience.
(c) Recovery by State Agency.--
(1) In general.--The State agency may recover the amount to
be repaid, or any part thereof, by deductions from any
temporary emergency unemployment compensation payable to such
individual under this title or from any unemployment
compensation payable to such individual under any Federal
unemployment compensation law administered by the State agency
or under any other Federal law administered by the State agency
which provides for the payment of any assistance or allowance
with respect to any week of unemployment, during the 3-year
period after the date such individuals received the payment of
the temporary emergency unemployment compensation to which they
were not entitled, except that no single deduction may exceed
50 percent of the weekly benefit amount from which such
deduction is made.
(2) Opportunity for hearing.--No repayment shall be
required, and no deduction shall be made, until a determination
has been made, notice thereof and an opportunity for a fair
hearing has been given to the individual, and the determination
has become final.
(d) Review.--Any determination by a State agency under this section
shall be subject to review in the same manner and to the same extent as
determinations under the State unemployment compensation law, and only
in that manner and to that extent.
SEC. 307. DEFINITIONS.
In this title, the terms ``compensation'', ``regular
compensation'', ``extended compensation'', ``additional compensation'',
``benefit year'', ``base period'', ``State'', ``State agency'', ``State
law'', and ``week'' have the respective meanings given such terms under
section 205 of the Federal-State Extended Unemployment Compensation Act
of 1970 (26 U.S.C. 3304 note).
SEC. 308. APPLICABILITY.
An agreement entered into under this Act shall apply to weeks of
unemployment--
(1) beginning no earlier than the first day of the first
week beginning after the date on which such agreement is
entered into; and
(2) ending before the date that is 18 months after the date
of enactment of this Act.
SEC. 309. TEMPORARY REDUCTION IN INTEREST RATE APPLICABLE TO REPAYMENTS
OF ADVANCES TO STATE UNEMPLOYMENT FUNDS.
With respect to advances made to a State under section 1201 of the
Social Security Act (42 U.S.C. 1321) during the period beginning on the
date of enactment of this Act and ending on the date that is 18 months
after such date of enactment, the rate of interest paid by a State on
such an advance shall be determined under section 1202(b)(4) of the
such Act (42 U.S.C. 1322(b)(4)) by substituting ``5 percent'' for ``10
percent'' in the matter preceding subparagraph (A).
TITLE IV--NATIONAL EMERGENCY GRANTS
SEC. 401. NATIONAL EMERGENCY GRANT ASSISTANCE FOR WORKERS.
(a) Eligibility for Grants.--Section 173(a) of the Workforce
Investment Act of 1998 (29 U.S.C. 2918(a)) is amended--
(1) in paragraph (2), by striking ``and'',
(2) in paragraph (3), by striking the period and inserting
``; and'', and
(3) by adding at the end the following new paragraph:
``(4) from funds appropriated under section 174(c), to a
State to provide employment and training assistance and the
assistance described in subsections (f) and (g) to dislocated
workers affected by a plant closure, mass layoff, or multiple
layoffs if the Governor certifies in the application for
assistance that the attacks of September 11, 2001, contributed
importantly to such plant closures, mass layoffs, and multiple
layoffs, and to independently owned businesses and
proprietorships.''.
(b) Use of Funds.--Section 173 of the Workforce Investment Act of
1998 (29 U.S.C. 2918) is amended by adding at the end the following new
subsections:
``(f) COBRA Continuation Coverage Payment Requirements.--
``(1) In general.--Funds made available to a State under
paragraph (4) of subsection (a) may be used by the State to
assist a participant in the program under such paragraph by
paying up to 75 percent of the participant's and any
dependents' contribution for COBRA continuation coverage of the
participant and dependents for a period not to exceed 10
months.
``(2) Definition.--For purposes of paragraph (1), the term
`COBRA continuation coverage' means coverage under a group
health plan provided by an employer pursuant to title XXII of
the Public Health Service Act, section 4980B of the Internal
Revenue Code of 1986, part 6 of subtitle B of title I of the
Employee Retirement Income Security Act of 1974, or section
8905a of title 5, United States Code.
``(g) Government Intervention Supplements.--
``(1) Personal income.--Using funds made available under
subsection (a)(4), a State may provide personal income
compensation to a dislocated worker described in such
subsection if--
``(A) the worker is unable to work due to direct
Federal Government intervention, as a result of a
direct response to the terrorist attacks which occurred
on September 11, 2001, leading to--
``(i) closure of the facility at which the
worker was employed, prior to the intervention;
or
``(ii) a restriction on how business may be
conducted at the facility; and
``(B) the facility is located within an area in a
State in which a major disaster or emergency was
certified by the Governor.
``(2) Business income.--Using funds made available under
subsection (a)(4), a State may provide business income
compensation to an independently owned business or
proprietorship if--
``(A) the business or proprietorship is unable to
earn revenue due to direct Federal intervention, as a
result of a direct response to the terrorist attacks
which occurred on September 11, 2001, leading to--
``(i) closure of the facility at which the
business or proprietorship was located, prior
to the intervention; or
``(ii) a restriction on how customers may
access the facility; and
``(B) the facility is located within an area in a
State in which a major disaster or emergency was
certified by the Governor.''.
(c) Authorization of Appropriations.--Section 174 of the Workforce
Investment Act of 1998 (29 U.S.C. 2919) is amended by adding at the end
the following new subsection:
``(c) National Emergency Grants Relating to September 11 Attacks.--
There are authorized to be appropriated to carry out subsection (a)(4)
of section 173 $5,000,000,000 for fiscal year 2002. Funds appropriated
under this subsection shall be available for obligation for a period
beginning with the date of enactment of such appropriations and ending
18 months thereafter.''.
(d) Effective Date.--The amendments made by this section shall take
effect on the date of enactment of this section.
TITLE V--TEMPORARY BUSINESS RELIEF PROVISIONS
SEC. 501. SPECIAL DEPRECIATION ALLOWANCE FOR CERTAIN PROPERTY.
(a) In General.--Section 168 (relating to accelerated cost recovery
system) is amended by adding at the end the following new subsection:
``(k) Special Allowance for Certain Property Acquired After
September 10, 2001, and Before September 11, 2002.--
``(1) Additional allowance.--In the case of any qualified
property--
``(A) the depreciation deduction provided by
section 167(a) for the taxable year in which such
property is placed in service shall include an
allowance equal to 10 percent of the adjusted basis of
the qualified property, and
``(B) the adjusted basis of the qualified property
shall be reduced by the amount of such deduction before
computing the amount otherwise allowable as a
depreciation deduction under this chapter for such
taxable year and any subsequent taxable year.
``(2) Qualified property.--For purposes of this
subsection--
``(A) In general.--The term `qualified property'
means property--
``(i)(I) to which this section applies
which has an applicable recovery period of 20
years or less or which is water utility
property,
``(II) which is computer software (as
defined in section 167(f)(1)(B)) for which a
deduction is allowable under section 167(a)
without regard to this subsection,
``(III) which is qualified leasehold
improvement property, or
``(IV) which is eligible for depreciation
under section 167(g),
``(ii) the original use of which commences
with the taxpayer after September 10, 2001,
``(iii) which is--
``(I) acquired by the taxpayer
after September 10, 2001, and before
September 11, 2002, but only if no
written binding contract for the
acquisition was in effect before
September 11, 2001, or
``(II) acquired by the taxpayer
pursuant to a written binding contract
which was entered into after September
10, 2001, and before September 11,
2002, and
``(iv) which is placed in service by the
taxpayer before January 1, 2003.
``(B) Exceptions.--
``(i) Alternative depreciation property.--
The term `qualified property' shall not include
any property to which the alternative
depreciation system under subsection (g)
applies, determined--
``(I) without regard to paragraph
(7) of subsection (g) (relating to
election to have system apply), and
``(II) after application of section
280F(b) (relating to listed property
with limited business use).
``(ii) Election out.--If a taxpayer makes
an election under this clause with respect to
any class of property for any taxable year,
this subsection shall not apply to all property
in such class placed in service during such
taxable year.
``(C) Special rules.--
``(i) Self-constructed property.--In the
case of a taxpayer manufacturing, constructing,
or producing property for the taxpayer's own
use, the requirements of clause (iii) of
subparagraph (A) shall be treated as met if the
taxpayer begins manufacturing, constructing, or
producing the property after September 10,
2001, and before September 11, 2002.
``(ii) Sale-leasebacks.--For purposes of
subparagraph (A)(ii), if property--
``(I) is originally placed in
service after September 10, 2001, by a
person, and
``(II) sold and leased back by such
person within 3 months after the date
such property was originally placed in
service,
such property shall be treated as originally
placed in service not earlier than the date on
which such property is used under the leaseback
referred to in subclause (II).
``(D) Coordination with section 280f.--For purposes
of section 280F--
``(i) Automobiles.--In the case of a
passenger automobile (as defined in section
280F(d)(5)) which is qualified property, the
Secretary shall increase the limitation under
section 280F(a)(1)(A)(i) by $1,600.
``(ii) Listed property.--The deduction
allowable under paragraph (1) shall be taken
into account in computing any recapture amount
under section 280F(b)(2).
``(3) Qualified leasehold improvement property.--For
purposes of this subsection--
``(A) In general.--The term `qualified leasehold
improvement property' means any improvement to an
interior portion of a building which is nonresidential
real property if--
``(i) such improvement is made under or
pursuant to a lease (as defined in subsection
(h)(7))--
``(I) by the lessee (or any
sublessee) of such portion, or
``(II) by the lessor of such
portion,
``(ii) such portion is to be occupied
exclusively by the lessee (or any sublessee) of
such portion, and
``(iii) such improvement is placed in
service more than 3 years after the date the
building was first placed in service.
``(B) Certain improvements not included.--Such term
shall not include any improvement for which the
expenditure is attributable to--
``(i) the enlargement of the building,
``(ii) any elevator or escalator,
``(iii) any structural component benefiting
a common area, and
``(iv) the internal structural framework of
the building.
``(C) Definitions and special rules.--For purposes
of this paragraph--
``(i) Binding commitment to lease treated
as lease.--A binding commitment to enter into a
lease shall be treated as a lease, and the
parties to such commitment shall be treated as
lessor and lessee, respectively.
``(ii) Related persons.--A lease between
related persons shall not be considered a
lease. For purposes of the preceding sentence,
the term `related persons' means--
``(I) members of an affiliated
group (as defined in section 1504), and
``(II) persons having a
relationship described in subsection
(b) of section 267; except that, for
purposes of this clause, the phrase `80
percent or more' shall be substituted
for the phrase `more than 50 percent'
each place it appears in such
subsection.
``(D) Improvements made by lessor.--In the case of
an improvement made by the person who was the lessor of
such improvement when such improvement was placed in
service, such improvement shall be qualified leasehold
improvement property (if at all) only so long as such
improvement is held by such person.''.
(b) Allowance Against Alternative Minimum Tax.--
(1) In general.--Section 56(a)(1)(A) (relating to
depreciation adjustment for alternative minimum tax) is amended
by adding at the end the following new clause:
``(iii) Additional allowance for certain
property acquired after september 10, 2001, and
before september 11, 2002.--The deduction under
section 168(k) shall be allowed.''.
(2) Conforming amendment.--Clause (i) of section
56(a)(1)(A) is amended by striking ``clause (ii)'' both places
it appears and inserting ``clauses (ii) and (iii)''.
(c) Effective Date.--The amendments made by this section shall
apply to property placed in service after September 10, 2001, in
taxable years ending after such date.
<all>
Introduced in Senate
Sponsor introductory remarks on measure. (CR S12861-12863)
Read twice and referred to the Committee on Finance.
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