To amend the Internal Revenue Code of 1986 to increase the tax on high income individuals.

SA 5687. Mr. SANDERS proposed an amendment to amendment SA 5685
proposed by Mr. Dodd to the bill H.R. 1424, of 1974, section 2705 of
the Public Health Service Act, section 9812 of the Internal Revenue
Code of 1986 to require equity in the provision of mental health and
substance-related disorder benefits under group health plans, to
prohibit discrimination on the basis of genetic information with
respect to health insurance and employment, and for other purposes; as
follows:

At the end add the following:

SEC. 304. SURTAX ON HIGH INCOME EARNERS.

(a) In General.--Part I of subchapter A of chapter 1 of the
Internal Revenue Code of 1986 is amended by inserting after
section 1 the following new section:

``SEC. 1A. INCREASE IN TAX ON HIGH INCOME INDIVIDUALS.

``(a) General Rule.--In the case of a taxpayer other than a
corporation, there is hereby imposed (in addition to any
other tax imposed by this subtitle) a tax equal to 10 percent
of so much of modified adjusted gross income as exceeds
$500,000 ($1,000,000 in the case of a joint return or a
surviving spouse (as defined in section 2(a)).
``(b) Modified Adjusted Gross Income.--For purposes of this
section, the term `modified adjusted gross income' means
adjusted gross income reduced by any deduction allowed for
investment interest (as defined in section 163(d)). In the
case of an estate or trust, a rule similar to the rule of
section 67(e) shall apply for purposes of determining
adjusted gross income for purposes of this section.
``(c) Nonresident Alien.--In the case of a nonresident
alien individual, only amounts taken into account in
connection with the tax imposed by section 871(b) shall be
taken into account under this section.
``(d) Marital Status.--For purposes of this section,
marital status shall be determined under section 7703.
``(e) Not Treated as Tax Imposed by This Chapter for
Certain Purposes.--The tax imposed under this section shall
not be treated as tax imposed by this chapter for purposes of
determining the amount of any credit under this chapter or
for purposes of section 55.
``(f) Termination.--This section shall not apply to taxable
years beginning after the date which is 5 years after the
date of the enactment of this section.''.
(b) Clerical Amendment.--The table of sections for part I
of subchapter A of chapter 1 of the Internal Revenue Code of
1986 is amended by inserting after the item relating to
section 1 the following new item:

``Sec. 1A. Increase in tax on high income individuals.''.

(c) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after the date of the
enactment of this Act.
(d) Section 15 Not to Apply.--The amendment made by
subsection (a) shall not be treated as a change in a rate of
tax for purposes of section 15 of the Internal Revenue Code
of 1986.
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