To extend the special rules for the child tax credit that applied for 2021 and to increase the corporate tax rate.

SA 5208. Mr. SANDERS (for himself and Mr. Merkley) proposed an
amendment to amendment SA 5194 proposed by Mr. Schumer to the bill H.R.
5376, to provide for reconciliation pursuant to title II of S. Con.
Res. 14; which was ordered to lie on the table; as follows:

At the end of title I, insert the following:

Subtitle E--Other Provisions

SEC. 14001. AMENDMENT OF 1986 CODE.

Except as otherwise expressly provided, whenever in this
subtitle an amendment or repeal is expressed in terms of an
amendment to, or repeal of, a section or other provision, the
reference shall be considered to be made to a section or
other provision of the Internal Revenue Code of 1986.

PART 1--CHILD TAX CREDIT

SEC. 14101. EXTENSIONS AND MODIFICATIONS.

(a) Extensions.--
(1) Extension of child tax credit.--Section 24(i) is
amended--
(A) by striking ``January 1, 2022'' in the matter preceding
paragraph (1) and inserting ``January 1, 2027'', and
(B) by inserting ``and 2022'' after ``2021'' in the heading
thereof.
(2) Extension of provisions related to possessions of the
united states.--
(A) Section 24(k)(2)(B) is amended--
(i) by striking ``December 31, 2021'' in the matter
preceding clause (i) and inserting ``December 31, 2026'', and
(ii) by striking ``After 2021'' in the heading thereof and
inserting ``After 2026''.
(B) Section 24(k)(3)(C)(ii) is amended--
(i) in subclause (I), by striking ``in 2021'' and inserting
``after December 31, 2020, and before January 1, 2027'' after
``2021,'', and
(ii) in subclause (II), by striking ``December 31, 2021''
and inserting ``December 31, 2026''.
(C) The heading of section 24(k)(2)(A) is amended by
inserting ``Through 2026'' after ``2021''.
(b) Extension and Modification of Advance Payment.--
(1) In general.--Section 7527A is amended--
(A) in subsection (b)(1), by striking ``50 percent of'' and
inserting ``100 percent (25 percent in the case of calendar
year 2022) of'',
(B) in clauses (i) and (ii) of subsection (e)(4)(C), by
striking ``in 2021'' and inserting ``after December 31, 2020,
and before January 1, 2027'', and
(C) in subsection (f)--
(i) in paragraph (1), by striking ``or'',
(ii) in paragraph (2), by striking the period at the end
and inserting ``, or before October 1, 2022, or'', and
(iii) by adding at the end the following new paragraph:

[[Page S4232]]

``(3) any period after December 31, 2026.''.
(2) Annual advance amount.--Section 7527A(b) is amended--
(A) in paragraph (1)--
(i) in subparagraph (A), by inserting ``or based on any
other information known to the Secretary'' after ``reference
taxable year'',
(ii) in subparagraph (C), by inserting ``unless determined
by the Secretary based on any information known to the
Secretary,'' before ``the only children'', and
(iii) in subparagraph (D), by inserting ``unless determined
by the Secretary based on any information known to the
Secretary,'' before ``the ages of'', and
(B) in paragraph (3)(A)(ii), by striking `` provided by the
taxpayer'' and inserting ``provided, or known,''.
(3) Monthly payments.--
(A) In general.--Section 7527A(a) is amended to read as
follows:
``(a) In General.--The Secretary shall establish a program
for making monthly payments to taxpayers in amounts equal to
1/12 of the annual advance amount with respect to such
taxpayer.''.
(B) Modifications during calendar year.--Section
7527A(b)(3), as amended by the preceding provisions of this
Act, is amended--
(i) by amending subparagraph (A)(ii) to read as follows:
``(ii) any other information provided, or known, to the
Secretary which allows the Secretary to more accurately
estimate the amount treated as allowed under subpart C of
part IV of subchapter A of chapter 1 by reason of section
24(i)(1) with respect to the taxpayer for the reference
taxable year.'', and
(ii) in subparagraph (B), by striking ``periodic payment''
both places it appears and inserting ``monthly payment''.
(C) Conforming amendment.--Section 7527A(c)(2) is amended
by striking ``subsection (b)(3)(B)'' and inserting
``subsection (b)(3)''.
(4) Eligibility for advance payments limited based on
modified adjusted gross income.--Section 7527A(b) is amended
by adding at the end the following new paragraph:
``(6) Limitation based on modified adjusted gross income.--
``(A) In general.--If the modified adjusted gross income of
the taxpayer for the reference taxable year exceeds the
applicable threshold amount with respect to such taxpayer (as
defined in section 24(i)(4)(B)), the annual advance amount
with respect to such taxpayer shall be zero.
``(B) Exception for modifications made during the calendar
year.--Subparagraph (A) shall not apply to a reference
taxable year taken into account by reason of paragraph
(3)(A)(i) or subsection (c) if the taxpayer received one or
more payments under subsection (a) for months in the calendar
year which precede the month for which such reference taxable
year will be taken into account.''.
(5) Advance payments to puerto rico residents.--Section
7527A(e)(4) is amended--
(A) in subparagraph (A), by striking ``The advance'' and
inserting ``Except as provided in subparagraph (D), the
advance'', and
(B) by adding at the end the following new subparagraph:
``(D) Advance payments to puerto rico residents for certain
years.--For the period beginning on October 1, 2022, and
ending on December 31, 2022, the Secretary may apply this
section without regard to subparagraph (A)(i).''.
(c) Election to Apply Income Phaseout on Basis of Income
From the Preceding Taxable Year.--Section 24(i) is amended by
adding at the end the following new paragraph:
``(5) Election to apply income phaseout on basis of income
from the preceding taxable year.--In the case of a taxpayer
who elects (at such time and in such manner as the Secretary
may provide) the application of this paragraph for any
taxable year, paragraph (4) and subsection (b)(1) shall both
be applied with respect to the modified adjusted gross income
(as defined in subsection (b)) for the taxpayer's preceding
taxable year.''.
(d) Safe Harbor Exception for Fraud and Intentional
Disregard of Rules and Regulations.--
(1) In general.--Section 24(j)(2)(B) is amended--
(A) by striking ``qualified'' each place it appears in
clause (iv)(II) and inserting ``qualifying'', and
(B) by adding at the end the following new clause:
``(v) Exception for fraud and intentional disregard of
rules and regulations.--

``(I) In general.--For purposes of determining the safe
harbor amount under clause (iv) with respect to any taxpayer,
an individual shall not be treated as taken into account in
determining the annual advance amount of such taxpayer if the
Secretary determines that such individual was so taken into
account due to fraud by the taxpayer or intentional disregard
of rules and regulations by the taxpayer.
``(II) Arrangements to take individual into account more
than once.--For purposes of subclause (I), a taxpayer shall
not fail to be treated as intentionally disregarding rules
and regulations with respect to any individual taken into
account in determining the annual advance amount of such
taxpayer if such taxpayer entered into a plan or other
arrangement with, or expected, another taxpayer to take such
individual into account in determining the credit allowed
under this section for the taxable year.''.

(2) Additional modification.--Section 24(j)(2)(B)(iv), as
amended by the preceding provisions of this Act, is amended
to read as follows:
``(iv) Safe harbor amount.--For purposes of this
subparagraph, the term `safe harbor amount' means, with
respect to any taxpayer for any taxable year, the sum of--

``(I) an amount equal to the product of $3,600 multiplied
by the excess (if any) of the number of qualifying children
who have not attained age 6 as of the close of the calendar
year in which the taxable year of the taxpayer begins, and
who are taken into account in determining the annual advance
amount with respect to the taxpayer under section 7527A with
respect to months beginning in such taxable year, over the
number of such qualifying children taken into account in
determining the credit allowed under this section for such
taxable year, plus
``(II) an amount equal to the product of $3,000 multiplied
by the excess (if any) of the number of qualifying children
not described in clause (I), and who are taken into account
in determining the annual advance amount with respect to the
taxpayer under section 7527A with respect to months beginning
in such taxable year, over the number of such qualifying
children taken into account in determining the credit allowed
under this section for such taxable year.''.

(e) Rules Relating to Reconciliation of Credit and Advance
Credit.--Section 24(j) is amended by adding at the end the
following new paragraphs:
``(3) Joint returns.--Except as otherwise provided by the
Secretary, in the case of an advance payment made under
section 7527A with respect to a joint return, half of such
payment shall be treated as having been made to each
individual filing such return.
``(4) Coordination with possessions of the united states.--
For purposes of this subsection, payments made under section
7527A include payments made by any jurisdiction other than
the United States under section 7527A of the income tax law
of such jurisdiction, and advance payments made by American
Samoa pursuant to a plan described in subsection (k)(3)(B).
In carrying out this section, the Secretary shall coordinate
with each possession of the United States to prevent any
application of this paragraph that is inconsistent with the
purposes of this subsection.''.
(f) Disclosure of Information Relating to Joint Filers and
Advance Payment of Child Tax Credit.--Section 6103(e) is
amended by adding at the end the following new paragraph:
``(12) Disclosure of information relating to joint filers
and advance payment of child tax credit.--In the case of an
individual to whom the Secretary makes payments under section
7527A, if the reference taxable year (as defined in section
7527A(b)(2)) that the Secretary uses to calculate such
payments is a year for which the individual filed an income
tax return jointly with another individual, the Secretary may
disclose to such individual any return information of such
other individual which is relevant in determining the payment
under section 7527A and the individual's eligibility for such
payment, including information regarding any of the
following:
``(A) The number of specified children, including by reason
of the birth of a child.
``(B) The name and TIN of specified children.
``(C) Marital status.
``(D) Modified adjusted gross income.
``(E) Principal place of abode.
``(F) Any other factor which the Secretary may provide
pursuant to section 7527A(c).''.
(g) Repeal of Social Security Number Requirement.--
(1) In general.--Section 24(h) is amended by striking
paragraph (7).
(2) Conforming amendments.--
(A) Section 24(h)(1) is amended by striking ``paragraphs
(2) through (7)'' and inserting ``paragraphs (2) through
(6)''.
(B) Section 24(h)(4) is amended by striking subparagraph
(C).
(h) Effective Date.--
(1) In general.--Except as provided in paragraphs (2) and
(3), the amendments made by this section shall apply to
taxable years beginning after December 31, 2021.
(2) Payments.--
(A) The amendments made by paragraphs (1), (2), (4), and
(5) of subsection (b) shall apply to payments after September
30, 2022.
(B) The amendments made by paragraph (3) of subsection (b)
shall apply to payments after December 31, 2022.
(3) Disclosure of information relating to joint filers and
advance payment of child tax credit.--The amendment made by
subsection (f) shall take effect on the date of the enactment
of this Act.

SEC. 14102. REFUNDABLE CHILD TAX CREDIT AFTER 2022.

(a) In General.--Section 24 is amended by adding at the end
the following new subsection:
``(l) Refundable Credit After 2022.--In the case of any
taxable year beginning after December 31, 2022, if the
taxpayer (in the case of a joint return, either spouse) has a
principal place of abode in the United States (determined as
provided in section 32) for more than one-half of the taxable
year or is a bona fide resident of Puerto Rico (within the
meaning of section 937(a)) for such taxable year--
``(1) subsection (d) shall not apply, and

[[Page S4233]]

``(2) so much of the credit determined under subsection (a)
(after application of paragraph (1)) as does not exceed the
amount of such credit which would be so determined without
regard to subsection (h)(4) shall be allowed under subpart C
(and not allowed under this subpart)''.
(b) Conforming Amendments Related to Possessions of the
United States.--
(1) Puerto rico.--Section 24(k)(2)(B), as amended by the
preceding provisions of this Act, is amended to read as
follows:
``(B) Application to taxable years after 2022.--For
application of refundable credit to residents of Puerto Rico
for taxable years after 2022, see subsection (l).''.
(2) American samoa.--Section 24(k)(3)(C)(ii)(II), as
amended by the preceding provisions of this Act, is amended
to read as follows:

``(II) if such taxable year begins after December 31, 2022,
subsection (l) shall be applied by substituting `Puerto Rico
or American Samoa' for `Puerto Rico'.''.

(c) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
2022.

SEC. 14103. APPROPRIATIONS.

Immediately upon the enactment of this Act, in addition to
amounts otherwise available, there are appropriated out of
any money in the Treasury not otherwise appropriated:
(1) $3,963,300,000 to remain available until September 30,
2026, for necessary expenses for the Internal Revenue Service
to administer the Child Tax Credit, and advance payments of
the Child Tax Credit, including the costs of disbursing such
payments, which shall supplement and not supplant any other
appropriations that may be available for this purpose, and
(2) $1,000,000,000 is appropriated to the Department of the
Treasury, to remain available until September 30, 2026, to
support efforts to increase enrollment of eligible families
in the Child Tax Credit, for advance payments of the Child
Tax Credit, and for other tax benefits, including but not
limited to program outreach, costs of data sharing
arrangements, systems changes, forms changes, and related
efforts, and efforts to support the cross-enrollment of
beneficiaries of other programs in the Child Tax Credit, and
for advance payments of the Child Tax Credit, including by
establishing intergovernmental cooperative agreements with
states and local governments, the District of Columbia,
tribal governments, and possessions of the United States:
Provided, that such amount shall be available in addition to
any amounts otherwise available: Provided further, that these
funds may be awarded by federal agencies to state and local
governments, the District of Columbia, tribal governments,
and possessions of the United States, and private entities,
including organizations dedicated to free tax return
preparation and low income taxpayer clinics funded under
section 7526 of the Internal Revenue Code of 1986.

PART 2--CORPORATE TAX RATE

SEC. 14201. INCREASE IN CORPORATE TAX RATE.

(a) In General.--Section 11(b) is amended to read as
follows:
``(b) Amount of Tax.--
``(1) In general.--The amount of the tax imposed by
subsection (a) shall be the sum of--
``(A) 18 percent of so much of the taxable income as does
not exceed $400,000,
``(B) 21 percent of so much of the taxable income as
exceeds $400,000 but does not exceed $5,000,000, and
``(C) 28 percent of so much of the taxable income as
exceeds $5,000,000.
In the case of a corporation which has taxable income in
excess of $10,000,000 for any taxable year, the amount of tax
determined under the preceding sentence for such taxable year
shall be increased by the lesser of (i) 3 percent of such
excess, or (ii) $362,000.
``(2) Certain personal service corporation not eligible for
graduated rates.--Notwithstanding paragraph (1), the amount
of the tax imposed by subsection (a) on the taxable income of
a qualified personal service corporation (as defined in
section 448(d)(2)) shall be equal to 28 percent of the
taxable income.''.
(b) Proportional Adjustment of Deduction for Dividends
Received.--
(1) In general.--Section 243(a)(1) is amended by striking
``50 percent'' and inserting ``60 percent''.
(2) Dividends from 20-percent owned corporations.--Section
243(c)(1) is amended--
(A) prior to amendment by subparagraph (B), by striking
``65 percent'' and inserting ``72.5 percent'', and
(B) by striking ``50 percent'' and inserting ``60
percent''.
(c) Conforming Amendment.--Section 1561 is amended--
(1) by amending subsection (a) to read as follows:
``(a) In General.--The component members of a controlled
group of corporations on a December 31 shall, for their
taxable years which include such December 31, be limited for
purposes of this subtitle to--
``(1) amounts in each taxable income bracket in the
subparagraphs of section 11(b)(1) which do not aggregate more
than the maximum amount in each such bracket to which a
corporation which is not a component member of a controlled
group is entitled, and
``(2) one $250,000 ($150,000 if any component member is a
corporation described in section 535(c)(2)(B)) amount for
purposes of computing the accumulated earnings credit under
section 535(c)(2) and (3).
The amounts specified in paragraph (1) shall be divided
equally among the component members of such group on such
December 31 unless all of such component members consent (at
such time and in such manner as the Secretary shall by
regulations prescribe) to an apportionment plan providing for
an unequal allocation of such amounts. The amounts specified
in paragraph (2) shall be divided equally among the component
members of such group on such December 31 unless the
Secretary prescribes regulations permitting an unequal
allocation of such amounts. Notwithstanding paragraph (1), in
applying the last sentence of section 11(b)(1) to such
component members, the taxable income of all such component
members shall be taken into account and any increase in tax
under such last sentence shall be divided among such
component members in the same manner as amounts under
paragraph (1).'', and
(2) by striking ``accumulated earnings credit'' in the
heading and inserting ``certain multiple tax benefits''.
(d) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
2022.
(e) Normalization Requirements.--
(1) In general.--A normalization method of accounting shall
not be treated as being used with respect to any public
utility property for purposes of section 167 or 168 of the
Internal Revenue Code of 1986 if the taxpayer, in computing
its cost of service for ratemaking purposes and reflecting
operating results in its regulated books of account, reduces
the tax reserve deficit less rapidly or to a lesser extent
than such reserve would be reduced under the average rate
assumption method.
(2) Alternative method for certain taxpayers.--If, as of
the first day of the taxable year that includes the date of
enactment of this Act--
(A) the taxpayer was required by a regulatory agency to
compute depreciation for public utility property on the basis
of an average life or composite rate method, and
(B) the taxpayer's books and underlying records did not
contain the vintage account data necessary to apply the
average rate assumption method,
the taxpayer will be treated as using a normalization method
of accounting if, with respect to such jurisdiction, the
taxpayer uses the alternative method for public utility
property that is subject to the regulatory authority of that
jurisdiction.
(3) Definitions.--For purposes of this subsection--
(A) Tax reserve deficit.--The term ``tax reserve deficit''
means the excess of--
(i) the amount which would be the balance in the reserve
for deferred taxes (as described in section 168(i)(9)(A)(ii)
of the Internal Revenue Code of 1986, or section
167(l)(3)(G)(ii) of such Code as in effect on the day before
the date of the enactment of the Tax Reform Act of 1986) if
the amount of such reserve were determined by assuming that
the corporate rate increases provided in the amendments made
by this section were in effect for all prior periods, over
(ii) the balance in such reserve as of the day before such
corporate rate increases take effect.
(B) Average rate assumption method.--The average rate
assumption method is the method under which the excess in the
reserve for deferred taxes is reduced over the remaining
lives of the property as used in its regulated books of
account which gave rise to the reserve for deferred taxes.
Under such method, if timing differences for the property
reverse, the amount of the adjustment to the reserve for the
deferred taxes is calculated by multiplying--
(i) the ratio of the aggregate deferred taxes for the
property to the aggregate timing differences for the property
as of the beginning of the period in question, by
(ii) the amount of the timing differences which reverse
during such period.
(C) Alternative method.--The ``alternative method'' is the
method in which the taxpayer--
(i) computes the tax reserve deficit on all public utility
property included in the plant account on the basis of the
weighted average life or composite rate used to compute
depreciation for regulatory purposes, and
(ii) reduces the tax reserve deficit ratably over the
remaining regulatory life of the property.
(4) Treatment of normalization violation.--If, for any
taxable year ending after the date of the enactment of this
Act, the taxpayer does not use a normalization method of
accounting, such taxpayer shall not be treated as using a
normalization method of accounting for purposes of
subsections (f)(2) and (i)(9)(C) of section 168 of the
Internal Revenue Code of 1986.
(5) Regulations.--The Secretary of the Treasury, or the
Secretary's designee, shall issue such regulations or other
guidance as may be necessary or appropriate to carry out this
subsection, including regulations or other guidance to
provide appropriate coordination between this subsection,
section 13001(d) of Public Law 115-97, and section 203(e) of
the Tax Reform Act of 1986.
______