S.Amdt. 2719

1. Adds SEC. ___. RESTORATION OF THE PHASEOUT OF PERSONAL EXEMPTIONS AND THE OVERALL LIMITATION ON ITEMIZED DEDUCTION; EXPANSION OF CHILD AND DEPENDANT CARE CREDIT wherever appropriate

   Adds a section

   Inserted: SEC. ___. RESTORATION OF THE PHASEOUT OF PERSONAL EXEMPTIONS AND THE OVERALL LIMITATION ON ITEMIZED DEDUCTION; EXPANSION OF CHILD AND DEPENDANT CARE CREDIT.

   Inserted: (a) Restoration of the Phaseout of Personal Exemptions and the Overall Limitation on Itemized Deductions.--

   Inserted: (1) Restoration of phaseout of personal exemptions.--

   Inserted: (A) In general.--Paragraph (3) of section 151(d) (relating to exemption amount) is amended by striking subparagraphs (E) and (F).

   Inserted: (B) Effective date.--The amendment made by this paragraph shall apply to taxable years beginning after December 31, 2005.

   Inserted: (2) Restoration of phaseout of overall limitation on itemized deductions.--

   Inserted: (A) In general.--Section 68 is amended by striking subsections (f) and (g).

   Inserted: (B) Effective date.--The amendment made by this paragraph shall apply to taxable years beginning after December 31, 2005.

   Inserted: (b) Expansion of Child and Dependant Care Credit.--

   Inserted: (1) Increase in credit.--Paragraph (2) of section 21(a) (relating to credit for expenses for household and dependent care services necessary for gainful employment) is amended to read as follows:

   Inserted: "(2) Applicable percentage defined.--For purposes of paragraph (1), the term 'applicable percentage' means 35 percent reduced (but not below 20 percent) by 1 percentage point for each $3,000 (or fraction thereof) by which the taxpayer's adjusted gross income exceeds $60,000.".

   Inserted: (2) Increase in maximum amount creditable.--

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   Inserted: (A) In general.--Section 21(c) (relating to dollar limit on amount creditable) is amended--

   Inserted: (i) in paragraph (1), by striking "$3,000" and inserting "$5,000"; and

   Inserted: (ii) in paragraph (2), by striking "$6,000 " and inserting "$10,000".

   Inserted: (B) Phase-out for taxpayers with adjusted gross income in excess of $50,000.--

   Inserted: (i) In general.--Section 21(c) is amended by adding at the end the following new paragraph:

   Inserted: "(2) Limitation based on adjusted gross income.--If the taxpayer's adjusted gross income for the taxable year exceeds $50,000, the dollar amounts under paragraph (1) shall be reduced as follows:

   Inserted: "(A) The $5,000 amount under paragraph (1)(A) shall be reduced (but not below $3,000) by $50 for each $1,000 (or fraction thereof) of such excess.

   Inserted: "(B) The $10,000 amount under paragraph (1)(B) shall be reduced (but not below $6,000) by $100 for each $1,000 (or fraction thereof) of such excess.".

   Inserted: (3) Conforming amendments.--Section 21(c), as amended by paragraph (2), is amended--

   Inserted: (A) by striking "The amount" and inserting:

   Inserted: "(1) In general.--The amount";

   Inserted: (B) by redesignating paragraphs (1) and (2) as subparagraphs (A) and (B), respectively; and

   Inserted: (C) by striking "paragraph (1) or (2)" and inserting "subparagraph (A) or (B)".

   Inserted: (4) Effective date.--The amendments made by this subsection shall apply to taxable years beginning after December 31, 2006, and before January 1, 2010.

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   Original wording

   At the appropriate place, insert the following:

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As printed