SAFE Act

[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 990 Introduced in House (IH)]

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119th CONGRESS
  1st Session
                                H. R. 990

  To amend the Internal Revenue Code of 1986 to allow individuals to 
  avoid a penalty for failure to pay income tax by timely paying 125 
        percent of the income tax liability for the prior year.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            February 5, 2025

  Ms. Chu (for herself and Mr. Carey) 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 individuals to 
  avoid a penalty for failure to pay income tax by timely paying 125 
        percent of the income tax liability for the prior year.

    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 ``Simplify Automatic Filing Extensions 
Act'' or the ``SAFE Act''.

SEC. 2. NO PENALTY FOR FAILURE TO PAY INCOME TAX FOR INDIVIDUALS WHO 
              TIMELY PAY 125 PERCENT OF INCOME TAX LIABILITY FOR PRIOR 
              YEAR.

    (a) In General.--Section 6651(c) of the Internal Revenue Code of 
1986 is amended by adding at the end the following new paragraph:
            ``(3) No penalty for failure to pay income tax for 
        individuals who timely pay 125 percent of income tax liability 
        for prior year.--
                    ``(A) In general.--Subsection (a)(2) shall not 
                apply with respect to an income tax return of an 
                individual if such individual pays, on or before the 
                date prescribed for the payment of the tax with respect 
                to which such return relates (determined with regard to 
                any extension of time for payment), 125 percent of the 
                amount of tax required to be shown on the income tax 
                return of such individual for the immediately preceding 
                taxable year.
                    ``(B) Failure to file; short taxable years.--
                Subparagraph (A) shall not apply--
                            ``(i) if the individual does not file an 
                        income tax return for the taxable year 
                        described in subparagraph (A) on or before the 
                        date prescribed therefor (determined with 
                        regard to any extension of time for filing),
                            ``(ii) if the individual did not file an 
                        income tax return for the immediately preceding 
                        taxable year referred to in subparagraph (A), 
                        or
                            ``(iii) if the immediately preceding 
                        taxable year referred to in subparagraph (A) 
                        was less than 12 months.
                    ``(C) Joint returns.--In the case of a joint 
                return, if the taxpayer did not file a joint return for 
                the immediately preceding taxable year referred to in 
                subparagraph (A), the amounts required to be shown on 
                the income tax returns of both spouses for such 
                immediately preceding taxable year shall be taken into 
                account under subparagraph (A). Except as otherwise 
                provided by the Secretary, if the individual does not 
                file a joint return for the taxable year to which 
                subparagraph (A) applies and filed a joint return for 
                the immediately preceding taxable year, the entire 
                amount of tax required to be shown on such joint return 
                shall be taken into account under subparagraph (A).
                    ``(D) Exception not applicable unless additional 
                payments are made with timely filed return.--
                Subparagraph (A) shall not apply with respect to any 
                period beginning after the earlier of--
                            ``(i) the date prescribed for filing the 
                        income tax return for the taxable year 
                        (including extensions thereof), or
                            ``(ii) the date on which such return was 
                        filed.''.
    (b) Conforming Amendment.--The heading of section 6651(c) of such 
Code is amended by striking ``Rule'' and inserting ``Rules''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2024.
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