To amend the Internal Revenue Code of 1986 to repeal the scheduled reductions in the child tax credit, marriage penalty relief, and 10-percent rate bracket, and for other purposes.

May 4, 2004

Mr. BUNNING (for himself and Mr. MILLER) introduced the following bill; which was read twice and referred to the Committee on Finance

To amend the Internal Revenue Code of 1986 to repeal the scheduled reductions in the child tax credit, marriage penalty relief, and 10-percent rate bracket, 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 Family Tax Relief Act of 2004'.

SEC. 2. REPEAL OF SCHEDULED REDUCTIONS IN CHILD TAX CREDIT, MARRIAGE PENALTY RELIEF, AND 10-PERCENT RATE BRACKET.

(a) CHILD TAX CREDIT- Subsection (a) of section 24 of the Internal Revenue Code of 1986 (relating to child tax credit) is amended to read as follows:

`(a) ALLOWANCE OF CREDIT- There shall be allowed as a credit against the tax imposed by this chapter for the taxable year with respect to each qualifying child of the taxpayer an amount equal to $1,000.'.

(b) MARRIAGE PENALTY RELIEF IN STANDARD DEDUCTION-

(1) IN GENERAL- Paragraph (2) of section 63(c) of the Internal Revenue Code of 1986 (relating to basic standard deduction) is amended to read as follows:

`(2) BASIC STANDARD DEDUCTION- For purposes of paragraph (1), the basic standard deduction is--

`(A) 200 percent of the dollar amount in effect under subparagraph (C) for the taxable year in the case of--

`(i) a joint return, or

`(ii) a surviving spouse (as defined in section 2(a)),

`(B) $4,400 in the case of a head of household (as defined in section 2(b)), or

`(C) $3,000 in any other case.'.

(2) CONFORMING AMENDMENTS-

(A) Section 63(c)(4) of such Code is amended by striking `(2)(D)' each place it occurs and inserting `(2)(C)'.

(B) Section 63(c) of such Code is amended by striking paragraph (7).

(c) MARRIAGE PENALTY RELIEF IN 15-PERCENT INCOME TAX BRACKET- Paragraph (8) of section 1(f) of the Internal Revenue Code of 1986 is amended to read as follows:

`(8) ELIMINATION OF MARRIAGE PENALTY IN 15-PERCENT BRACKET- With respect to taxable years beginning after December 31, 2004, in prescribing the tables under paragraph (1)--

`(A) the maximum taxable income in the 15-percent rate bracket in the table contained in subsection (a) (and the minimum taxable income in the next higher taxable income bracket in such table) shall be 200 percent of the maximum taxable income in the 15-percent rate bracket in the table contained in subsection (c) (after any other adjustment under this subsection), and

`(B) the comparable taxable income amounts in the table contained in subsection (d) shall be 1/2 of the amounts determined under subparagraph (A).'.

(d) 10-PERCENT RATE BRACKET-

(1) IN GENERAL- Clause (i) of section 1(i)(1)(B) of the Internal Revenue Code of 1986 is amended by striking `($12,000 in the case of taxable years beginning after December 31, 2004, and before January 1, 2008)'.

(2) INFLATION ADJUSTMENT- Subparagraph (C) of section 1(i)(1) of such Code is amended to read as follows:

`(C) INFLATION ADJUSTMENT- In prescribing the tables under subsection (f) which apply with respect to taxable years beginning in calendar years after 2003--

`(i) the cost-of-living adjustment shall be determined under subsection (f)(3) by substituting `2002' for `1992' in subparagraph (B) thereof, and

`(ii) the adjustments under clause (i) shall not apply to the amount referred to in subparagraph (B)(iii).

If any amount after adjustment under the preceding sentence is not a multiple of $50, such amount shall be rounded to the next lowest multiple of $50.'.

(e) PROVISIONS MADE PERMANENT- Title IX of the Economic Growth and Tax Relief Reconciliation Act of 2001 (relating to sunset of provisions of such Act) shall not apply to--

(1) section 1(i)(1) of the Internal Revenue Code of 1986 as added by subsection (a) of section 101 of such Act,

(2) paragraphs (1) and (7) of section 101(c) of such Act,

(3) section 201(a) of such Act, and

(4) title III of such Act.

(f) EFFECTIVE DATES- The amendments made by this section shall apply to taxable years beginning after December 31, 2004.

SEC. 3. EXTENSION OF MINIMUM TAX RELIEF TO INDIVIDUALS.

(a) IN GENERAL- Subparagraphs (A) and (B) of section 55(d)(1) of the Internal Revenue Code of 1986 (relating to exemption amount for taxpayers other than corporations) are each amended by striking `2003 and 2004' and inserting `2003, 2004, and 2005'.

(b) EFFECTIVE DATE- The amendments made by this section shall apply to taxable years beginning after December 31, 2004.

END