To revise the eligibility criteria for the 2008 recovery rebates for individuals.

SA 4010. Mr. REID (for himself, Mr. McConnell, Mr. Baucus, Mr.
Grassley, Mr. Stevens, Mrs. Lincoln, Ms. Snowe, Mr. Salazar, Mr.
Bunning, Mr. Alexander, Mr. Sununu, Mr. Vitter, Mr. Wicker, Mr. Burr,
Mr. Roberts, Mr. Brownback, Mr. Isakson, and Mr. Coleman) proposed an
amendment to the bill H.R. 5140, to provide economic stimulus through
recovery rebates to individuals, incentives for business investment,
and an increase in conforming and FHA loan limits; as follows:

Strike all after the enacting clause and insert the
following:

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

(a) Short Title.--This Act may be cited as the ``Economic
Stimulus Act of 2008''.
(b) Table of Contents.--The table of contents of this Act
is as follows:

Sec. 1. Short title; table of contents.

TITLE I--RECOVERY REBATES AND INCENTIVES FOR BUSINESS INVESTMENT

Sec. 101. 2008 recovery rebates for individuals.
Sec. 102. Temporary increase in limitations on expensing of certain
depreciable business assets.
Sec. 103. Special allowance for certain property acquired during 2008.

TITLE II--HOUSING GSE AND FHA LOAN LIMITS

Sec. 201. Temporary conforming loan limit increase for Fannie Mae and
Freddie Mac.
Sec. 202. Temporary loan limit increase for FHA.

TITLE III--EMERGENCY DESIGNATION

Sec. 301. Emergency designation.

TITLE I--RECOVERY REBATES AND INCENTIVES FOR BUSINESS INVESTMENT

SEC. 101. 2008 RECOVERY REBATES FOR INDIVIDUALS.

(a) In General.--Section 6428 of the Internal Revenue Code
of 1986 is amended to read as follows:

``SEC. 6428. 2008 RECOVERY REBATES FOR INDIVIDUALS.

``(a) In General.--In the case of an eligible individual,
there shall be allowed as a credit against the tax imposed by
subtitle A for the first taxable year beginning in 2008 an
amount equal to the lesser of--
``(1) net income tax liability, or
``(2) $600 ($1,200 in the case of a joint return).
``(b) Special Rules.--
``(1) In general.--In the case of a taxpayer described in
paragraph (2)--
``(A) the amount determined under subsection (a) shall not
be less than $300 ($600 in the case of a joint return), and
``(B) the amount determined under subsection (a) (after the
application of subparagraph (A)) shall be increased by the
product of $300 multiplied by the number of qualifying
children (within the meaning of section 24(c)) of the
taxpayer.
``(2) Taxpayer described.--A taxpayer is described in this
paragraph if the taxpayer--
``(A) has qualifying income of at least $3,000, or
``(B) has--
``(i) net income tax liability which is greater than zero,
and
``(ii) gross income which is greater than the sum of the
basic standard deduction plus the exemption amount (twice the
exemption amount in the case of a joint return).
``(c) Treatment of Credit.--The credit allowed by
subsection (a) shall be treated as allowed by subpart C of
part IV of subchapter A of chapter 1.
``(d) Limitation Based on Adjusted Gross Income.--The
amount of the credit allowed by subsection (a) (determined
without regard to this subsection and subsection (f)) shall
be reduced (but not below zero) by 5 percent of so much of
the taxpayer's adjusted gross income as exceeds $75,000
($150,000 in the case of a joint return).
``(e) Definitions.--For purposes of this section--
``(1) Qualifying income.--The term `qualifying income'
means--
``(A) earned income,
``(B) social security benefits (within the meaning of
section 86(d)), and
``(C) any compensation or pension received under chapter
11, chapter 13, or chapter 15 of title 38, United States
Code.
``(2) Net income tax liability.--The term `net income tax
liability' means the excess of--
``(A) the sum of the taxpayer's regular tax liability
(within the meaning of section 26(b)) and the tax imposed by
section 55 for the taxable year, over

[[Page S798]]

``(B) the credits allowed by part IV (other than section 24
and subpart C thereof) of subchapter A of chapter 1.
``(3) Eligible individual.--The term `eligible individual'
means any individual other than--
``(A) any nonresident alien individual,
``(B) any individual with respect to whom a deduction under
section 151 is allowable to another taxpayer for a taxable
year beginning in the calendar year in which the individual's
taxable year begins, and
``(C) an estate or trust.
``(4) Earned income.--The term `earned income' has the
meaning set forth in section 32(c)(2) except that--
``(A) subclause (II) of subparagraph (B)(vi) thereof shall
be applied by substituting `January 1, 2009' for `January 1,
2008', and
``(B) such term shall not include net earnings from self-
employment which are not taken into account in computing
taxable income.
``(5) Basic standard deduction; exemption amount.--The
terms `basic standard deduction' and `exemption amount' shall
have the same respective meanings as when used in section
6012(a).
``(f) Coordination With Advance Refunds of Credit.--
``(1) In general.--The amount of credit which would (but
for this paragraph) be allowable under this section shall be
reduced (but not below zero) by the aggregate refunds and
credits made or allowed to the taxpayer under subsection (g).
Any failure to so reduce the credit shall be treated as
arising out of a mathematical or clerical error and assessed
according to section 6213(b)(1).
``(2) Joint returns.--In the case of a refund or credit
made or allowed under subsection (g) with respect to a joint
return, half of such refund or credit shall be treated as
having been made or allowed to each individual filing such
return.
``(g) Advance Refunds and Credits.--
``(1) In general.--Each individual who was an eligible
individual for such individual's first taxable year beginning
in 2007 shall be treated as having made a payment against the
tax imposed by chapter 1 for such first taxable year in an
amount equal to the advance refund amount for such taxable
year.
``(2) Advance refund amount.--For purposes of paragraph
(1), the advance refund amount is the amount that would have
been allowed as a credit under this section for such first
taxable year if this section (other than subsection (f) and
this subsection) had applied to such taxable year.
``(3) Timing of payments.--The Secretary shall, subject to
the provisions of this title, refund or credit any
overpayment attributable to this section as rapidly as
possible. No refund or credit shall be made or allowed under
this subsection after December 31, 2008.
``(4) No interest.--No interest shall be allowed on any
overpayment attributable to this section.
``(h) Identification Number Requirement.--
``(1) In general.--No credit shall be allowed under
subsection (a) to an eligible individual who does not include
on the return of tax for the taxable year--
``(A) such individual's valid identification number,
``(B) in the case of a joint return, the valid
identification number of such individual's spouse, and
``(C) in the case of any qualifying child taken into
account under subsection (b)(1)(B), the valid identification
number of such qualifying child.
``(2) Valid identification number.--For purposes of
paragraph (1), the term `valid identification number' means a
social security number issued to an individual by the Social
Security Administration. Such term shall not include a TIN
issued by the Internal Revenue Service.''.
(b) Administrative Amendments.--
(1) Definition of deficiency.--Section 6211(b)(4)(A) of the
Internal Revenue Code of 1986 is amended by striking ``and
53(e)'' and inserting ``53(e), and 6428''.
(2) Mathematical or clerical error authority.--Section
6213(g)(2)(L) of such Code is amended by striking ``or 32''
and inserting ``32, or 6428''.
(c) Treatment of Possessions.--
(1) Payments to possessions.--
(A) Mirror code possession.--The Secretary of the Treasury
shall make a payment to each possession of the United States
with a mirror code tax system in an amount equal to the loss
to that possession by reason of the amendments made by this
section. Such amount shall be determined by the Secretary of
the Treasury based on information provided by the government
of the respective possession.
(B) Other possessions.--The Secretary of the Treasury shall
make a payment to each possession of the United States which
does not have a mirror code tax system in an amount estimated
by the Secretary of the Treasury as being equal to the
aggregate benefits that would have been provided to residents
of such possession by reason of the amendments made by this
section if a mirror code tax system had been in effect in
such possession. The preceding sentence shall not apply with
respect to any possession of the United States unless such
possession has a plan, which has been approved by the
Secretary of the Treasury, under which such possession will
promptly distribute such payment to the residents of such
possession.
(2) Coordination with credit allowed against united states
income taxes.--No credit shall be allowed against United
States income taxes under section 6428 of the Internal
Revenue Code of 1986 (as amended by this section) to any
person--
(A) to whom a credit is allowed against taxes imposed by
the possession by reason of the amendments made by this
section, or
(B) who is eligible for a payment under a plan described in
paragraph (1)(B).
(3) Definitions and special rules.--
(A) Possession of the united states.--For purposes of this
subsection, the term ``possession of the United States''
includes the Commonwealth of Puerto Rico and the Commonwealth
of the Northern Mariana Islands.
(B) Mirror code tax system.--For purposes of this
subsection, the term ``mirror code tax system'' means, with
respect to any possession of the United States, the income
tax system of such possession if the income tax liability of
the residents of such possession under such system is
determined by reference to the income tax laws of the United
States as if such possession were the United States.
(C) Treatment of payments.--For purposes of section
1324(b)(2) of title 31, United States Code, the payments
under this subsection shall be treated in the same manner as
a refund due from the credit allowed under section 6428 of
the Internal Revenue Code of 1986 (as amended by this
section).
(d) Refunds Disregarded in the Administration of Federal
Programs and Federally Assisted Programs.--Any credit or
refund allowed or made to any individual by reason of section
6428 of the Internal Revenue Code of 1986 (as amended by this
section) or by reason of subsection (c) of this section shall
not be taken into account as income and shall not be taken
into account as resources for the month of receipt and the
following 2 months, for purposes of determining the
eligibility of such individual or any other individual for
benefits or assistance, or the amount or extent of benefits
or assistance, under any Federal program or under any State
or local program financed in whole or in part with Federal
funds.
(e) Appropriations To Carry Out Rebates.--
(1) In general.--Immediately upon the enactment of this
Act, the following sums are appropriated, out of any money in
the Treasury not otherwise appropriated, for the fiscal year
ending September 30, 2008:
(A) Department of treasury.--
(i) For an additional amount for ``Department of the
Treasury--Financial Management Service--Salaries and
Expenses'', $64,175,000, to remain available until September
30, 2009.
(ii) For an additional amount for ``Department of the
Treasury--Internal Revenue Service--Taxpayer Services'',
$50,720,000, to remain available until September 30, 2009.
(iii) For an additional amount for ``Department of the
Treasury--Internal Revenue Service--Operations Support'',
$151,415,000, to remain available until September 30, 2009.
(B) Social security administration.--For an additional
amount for ``Social Security Administration--Limitation on
Administrative Expenses'', $31,000,000, to remain available
until September 30, 2008.
(2) Reports.--No later than 15 days after enactment of this
Act, the Secretary of the Treasury shall submit a plan to the
Committees on Appropriations of the House of Representatives
and the Senate detailing the expected use of the funds
provided by paragraph (1)(A). Beginning 90 days after
enactment of this Act, the Secretary of the Treasury shall
submit a quarterly report to the Committees on Appropriations
of the House of Representatives and the Senate detailing the
actual expenditure of funds provided by paragraph (1)(A) and
the expected expenditure of such funds in the subsequent
quarter.
(f) Conforming Amendments.--
(1) Paragraph (2) of section 1324(b) of title 31, United
States Code, is amended by inserting ``or 6428'' after
``section 35''.
(2) Paragraph (1) of section 1(i) of the Internal Revenue
Code of 1986 is amended by striking subparagraph (D).
(3) The item relating to section 6428 in the table of
sections for subchapter B of chapter 65 of such Code is
amended to read as follows:

``Sec. 6428. 2008 recovery rebates for individuals.''.

SEC. 102. TEMPORARY INCREASE IN LIMITATIONS ON EXPENSING OF
CERTAIN DEPRECIABLE BUSINESS ASSETS.

(a) In General.--Subsection (b) of section 179 of the
Internal Revenue Code of 1986 (relating to limitations) is
amended by adding at the end the following new paragraph:
``(7) Increase in limitations for 2008.--In the case of any
taxable year beginning in 2008--
``(A) the dollar limitation under paragraph (1) shall be
$250,000,
``(B) the dollar limitation under paragraph (2) shall be
$800,000, and
``(C) the amounts described in subparagraphs (A) and (B)
shall not be adjusted under paragraph (5).''.
(b) Effective Date.--The amendment made by this section
shall apply to taxable years beginning after December 31,
2007.

SEC. 103. SPECIAL ALLOWANCE FOR CERTAIN PROPERTY ACQUIRED
DURING 2008.

(a) In General.--Subsection (k) of section 168 of the
Internal Revenue Code of 1986 (relating to special allowance
for certain property acquired after September 10, 2001, and
before January 1, 2005) is amended--
(1) by striking ``September 10, 2001'' each place it
appears and inserting ``December 31, 2007'',

[[Page S799]]

(2) by striking ``September 11, 2001'' each place it
appears and inserting ``January 1, 2008'',
(3) by striking ``January 1, 2005'' each place it appears
and inserting ``January 1, 2009'', and
(4) by striking ``January 1, 2006'' each place it appears
and inserting ``January 1, 2010''.
(b) 50 Percent Allowance.--Subparagraph (A) of section
168(k)(1) of such Code is amended by striking ``30 percent''
and inserting ``50 percent''.
(c) Conforming Amendments.--
(1) Subclause (I) of section 168(k)(2)(B)(i) of such Code
is amended by striking ``and (iii)'' and inserting ``(iii),
and (iv)''.
(2) Subclause (IV) of section 168(k)(2)(B)(i) of such Code
is amended by striking ``clauses (ii) and (iii)'' and
inserting ``clause (iii)''.
(3) Clause (i) of section 168(k)(2)(C) of such Code is
amended by striking ``and (iii)'' and inserting ``, (iii),
and (iv)''.
(4) Clause (i) of section 168(k)(2)(F) of such Code is
amended by striking ``$4,600'' and inserting ``$8,000''.
(5)(A) Subsection (k) of section 168 of such Code is
amended by striking paragraph (4).
(B) Clause (iii) of section 168(k)(2)(D) of such Code is
amended by striking the last sentence.
(6) Paragraph (4) of section 168(l) of such Code is amended
by redesignating subparagraphs (A), (B), and (C) as
subparagraphs (B), (C), and (D) and inserting before
subparagraph (B) (as so redesignated) the following new
subparagraph:
``(A) Bonus depreciation property under subsection (k).--
Such term shall not include any property to which section
168(k) applies.''.
(7) Paragraph (5) of section 168(l) of such Code is
amended--
(A) by striking ``September 10, 2001'' in subparagraph (A)
and inserting ``December 31, 2007'', and
(B) by striking ``January 1, 2005'' in subparagraph (B) and
inserting ``January 1, 2009''.
(8) Subparagraph (D) of section 1400L(b)(2) of such Code is
amended by striking ``January 1, 2005'' and inserting
``January 1, 2010''.
(9) Paragraph (3) of section 1400N(d) of such Code is
amended--
(A) by striking ``September 10, 2001'' in subparagraph (A)
and inserting ``December 31, 2007'', and
(B) by striking ``January 1, 2005'' in subparagraph (B) and
inserting ``January 1, 2009''.
(10) Paragraph (6) of section 1400N(d) of such Code is
amended by adding at the end the following new subparagraph:
``(E) Exception for bonus depreciation property under
section 168(k).--The term `specified Gulf Opportunity Zone
extension property' shall not include any property to which
section 168(k) applies.''.
(11) The heading for subsection (k) of section 168 of such
Code is amended--
(A) by striking ``September 10, 2001'' and inserting
``December 31, 2007'', and
(B) by striking ``January 1, 2005'' and inserting ``January
1, 2009''.
(12) The heading for clause (ii) of section 168(k)(2)(B) of
such Code is amended by striking ``pre-january 1, 2005'' and
inserting ``pre-january 1, 2009''.
(d) Effective Date.--The amendments made by this section
shall apply to property placed in service after December 31,
2007, in taxable years ending after such date.

TITLE II--HOUSING GSE AND FHA LOAN LIMITS

SEC. 201. TEMPORARY CONFORMING LOAN LIMIT INCREASE FOR FANNIE
MAE AND FREDDIE MAC.

(a) Increase of High Cost Areas Limits for Housing GSEs.--
For mortgages originated during the period beginning on July
1, 2007, and ending at the end of December 31, 2008:
(1) Fannie mae.--With respect to the Federal National
Mortgage Association, notwithstanding section 302(b)(2) of
the Federal National Mortgage Association Charter Act (12
U.S.C. 1717(b)(2)), the limitation on the maximum original
principal obligation of a mortgage that may be purchased by
the Association shall be the higher of--
(A) the limitation for 2008 determined under such section
302(b)(2) for a residence of the applicable size; or
(B) 125 percent of the area median price for a residence of
the applicable size, but in no case to exceed 175 percent of
the limitation for 2008 determined under such section
302(b)(2) for a residence of the applicable size.
(2) Freddie mac.--With respect to the Federal Home Loan
Mortgage Corporation, notwithstanding section 305(a)(2) of
the Federal Home Loan Mortgage Corporation Act (12 U.S.C.
1454(a)(2)), the limitation on the maximum original principal
obligation of a mortgage that may be purchased by the
Corporation shall be the higher of--
(A) the limitation determined for 2008 under such section
305(a)(2) for a residence of the applicable size; or
(B) 125 percent of the area median price for a residence of
the applicable size, but in no case to exceed 175 percent of
the limitation determined for 2008 under such section
305(a)(2) for a residence of the applicable size.
(b) Determination of Limits.--The areas and area median
prices used for purposes of the determinations under
subsection (a) shall be the areas and area median prices used
by the Secretary of Housing and Urban Development in
determining the applicable limits under section 202 of this
title.
(c) Rule of Construction.--A mortgage originated during the
period referred to in subsection (a) that is eligible for
purchase by the Federal National Mortgage Association or the
Federal Home Loan Mortgage Corporation pursuant to this
section shall be eligible for such purchase for the duration
of the term of the mortgage, notwithstanding that such
purchase occurs after the expiration of such period.
(d) Effect on Housing Goals.--Notwithstanding any other
provision of law, mortgages purchased in accordance with the
increased maximum original principal obligation limitations
determined pursuant to this section shall not be considered
in determining performance with respect to any of the housing
goals established under section 1332, 1333, or 1334 of the
Housing and Community Development Act of 1992 (12 U.S.C.
4562-4), and shall not be considered in determining
compliance with such goals pursuant to section 1336 of such
Act (12 U.S.C. 4566) and regulations, orders, or guidelines
issued thereunder.
(e) Sense of Congress.--It is the sense of the Congress
that the securitization of mortgages by the Federal National
Mortgage Association and the Federal Home Loan Mortgage
Corporation plays an important role in providing liquidity to
the United States housing markets. Therefore, the Congress
encourages the Federal National Mortgage Association and the
Federal Home Loan Mortgage Corporation to securitize
mortgages acquired under the increased conforming loan limits
established in this section, to the extent that such
securitizations can be effected in a timely and efficient
manner that does not impose additional costs for mortgages
originated, purchased, or securitized under the existing
limits or interfere with the goal of adding liquidity to the
market.

SEC. 202. TEMPORARY LOAN LIMIT INCREASE FOR FHA.

(a) Increase of High-Cost Area Limit.--For mortgages for
which the mortgagee has issued credit approval for the
borrower on or before December 31, 2008, subparagraph (A) of
section 203(b)(2) of the National Housing Act (12 U.S.C.
1709(b)(2)(A)) shall be considered (except for purposes of
section 255(g) of such Act (12 U.S.C. 1715z-20(g))) to
require that a mortgage shall involve a principal obligation
in an amount that does not exceed the lesser of--
(1) in the case of a 1-family residence, 125 percent of the
median 1-family house price in the area, as determined by the
Secretary; and in the case of a 2-, 3-, or 4-family
residence, the percentage of such median price that bears the
same ratio to such median price as the dollar amount
limitation determined for 2008 under section 305(a)(2) of the
Federal Home Loan Mortgage Corporation Act (12 U.S.C.
1454(a)(2)) for a 2-, 3-, or 4-family residence,
respectively, bears to the dollar amount limitation
determined for 2008 under such section for a 1-family
residence; or
(2) 175 percent of the dollar amount limitation determined
for 2008 under such section 305(a)(2) for a residence of the
applicable size (without regard to any authority to increase
such limitation with respect to properties located in Alaska,
Guam, Hawaii, or the Virgin Islands);

except that the dollar amount limitation in effect under this
subsection for any size residence for any area shall not be
less than the greater of (A) the dollar amount limitation in
effect under such section 203(b)(2) for the area on October
21, 1998; or (B) 65 percent of the dollar amount limitation
determined for 2008 under such section 305(a)(2) for a
residence of the applicable size. Any reference in this
subsection to dollar amount limitations in effect under
section 305 (a)(2) of the Federal Home Loan Mortgage
Corporation Act means such limitations as in effect without
regard to any increase in such limitation pursuant to section
201 of this title.
(b) Discretionary Authority.--If the Secretary of Housing
and Urban Development determines that market conditions
warrant such an increase, the Secretary may, for the period
that begins upon the date of the enactment of this Act and
ends at the end of the date specified in subsection (a),
increase the maximum dollar amount limitation determined
pursuant to subsection (a) with respect to any particular
size or sizes of residences, or with respect to residences
located in any particular area or areas, to an amount that
does not exceed the maximum dollar amount then otherwise in
effect pursuant to subsection (a) for such size residence, or
for such area (if applicable), by not more than $100,000.
(c) Publication of Area Median Prices and Loan Limits.--The
Secretary of Housing and Urban Development shall publish the
median house prices and mortgage principal obligation limits,
as revised pursuant to this section, for all areas as soon as
practicable, but in no case more than 30 days after the date
of the enactment of this Act. With respect to existing areas
for which the Secretary has not established area median
prices before such date of enactment, the Secretary may rely
on existing commercial data in determining area median prices
and calculating such revised principal obligation limits.

TITLE III--EMERGENCY DESIGNATION

SEC. 301. EMERGENCY DESIGNATION.

For purposes of Senate enforcement, all provisions of this
Act are designated as emergency requirements and necessary to
meet emergency needs pursuant to section

[[Page S800]]

204 of S. Con. Res. 21 (110th Congress), the concurrent
resolution on the budget for fiscal year 2008.
______