S. 557Senate108th Congress (2003-2005)In Committee

Civil Rights Tax Relief Act of 2003

Introduced March 6, 2003

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Read twice and referred to the Committee on Finance.

March 6, 2003

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SenateIntro Referral

Introduced in Senate

March 6, 2003

SenateIntro Referral

Read twice and referred to the Committee on Finance.

March 6, 2003

Floor Debate

17 members

What members said about S. 557 on the floor

8 Republicans9 Democrats
Lisa Murkowski
Sen. Lisa MurkowskiR-AK · Mar 6, 2003

Mr. President, earlier this week, the Senate, in a 94- 0 vote, went on record expressing its unanimous opposition to last week's decision by the Ninth Circuit Court of Appeals refusing to review a…

Olympia J. Snowe
Sen. Olympia J. SnoweR-ME · Mar 6, 2003

Mr. President, today I am introducing a bill that will provide revolutionary changes to the health insurance choices available for small businesses. This bill, ``The Small Business Health Fairness…

William H. Frist
Sen. William H. FristR-TN · Mar 6, 2003

Mr. President, this year, due to the rapid and tremendous advancements in our knowledge and in the science of organ transplantation, thousands of Americans will receive a life-saving organ…

Mary L. Landrieu
Sen. Mary L. LandrieuD-LA · Mar 6, 2003

Mr. President, today I rise to introduce the Emergency Communications and Competition Act, ECCA, along with my colleague from New Hampshire, Senator Sununu. We are joined by twelve of our colleagues,…

Ben Nighthorse Campbell
Sen. Ben Nighthorse CampbellR-CO · Mar 6, 2003

Mr. President, I am pleased to be joined by Senators Inouye and Thomas in introducing key legislation to help stop Indian land fractionation. One of the most enduring and damaging legacies of…

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Susan M. Collins
Sen. Susan M. CollinsR-ME · Mar 6, 2003

Mr. President, I am pleased to join my colleague from Illinois in reintroducing this legislation to recognize and promote bicycling's important impact on energy savings and public health. With…

John Edwards
Sen. John EdwardsD-NC · Mar 6, 2003

Mr. President, I rise today to introduce the Homeland Protection and Tax Hike Prevention Act of 2003. As I speak, State governments face a budget gap of $80 billion in 2004, according to the National…

Christopher J. Dodd
Sen. Christopher J. DoddD-CT · Mar 6, 2003

Mr. President, for tragic reasons, organ donation has been in the spotlight of late. On Saturday, February 23, 2002, 17-year-old Jessica Santillan died after receiving organs from a donor with an…

Barbara A. Mikulski
Sen. Barbara A. MikulskiD-MD · Mar 6, 2003

Mr. President, I rise to introduce the Alzheimer's Disease Research, Prevention, and Care Act of 2003. I am pleased that Senators Bond, Kennedy, Lincoln, Breaux, and Dodd are joining me as original…

Daniel K. Akaka
Sen. Daniel K. AkakaD-HI · Mar 6, 2003

Mr. President, I rise today to introduce The Paleontological Resources Preservation Act to protect and preserve the Nation's important fossil record for the benefit of our citizens. I am pleased to…

Chuck Grassley
Sen. Chuck GrassleyR-IA · Mar 6, 2003

Mr. President, I rise today to introduce the Sunshine in the Courtroom Act of 2003, a bill to allow media coverage of court proceedings. This legislation will provide Federal judges with the…

Susan M. Collins
Sen. Susan M. CollinsR-ME · Mar 6, 2003

Mr. President, I rise to introduce the Civil Rights Tax Relief Act of 2003, a bill designed to promote the fair and equitable settlement of civil rights claims. I am very pleased to be joined today…

Richard J. Durbin
Sen. Richard J. DurbinD-IL · Mar 6, 2003

Mr. President, I rise today to introduce the Conserve by Bike Act to promote energy conservation and improve public health. I am pleased to be joined by my colleagues from Maine, Senator Susan…

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John D. Rockefeller IV
Sen. John D. Rockefeller IVD-WV · Mar 6, 2003

Mr. President, as a senior member of the Senate Committee on Veterans' Affairs, I am proud to reintroduce legislation today intended to strengthen mental health programs within the Department of…

Russell D. Feingold
Sen. Russell D. FeingoldD-WI · Mar 6, 2003

Mr. President, I am pleased today to show my support for the Milk Import Tariff Equity Act of 2003 by being an original cosponsor of Senator Craig's bill. This legislation will prevent foreign dairy…

John McCain
Sen. John McCainR-AZ · Mar 6, 2003

Mr. President, I rise to introduce legislation to designate the Director of the Indian Health Service as an Assistant Secretary for Indian Health within the Department of Health and Human Services.…

Patrick J. Leahy
Sen. Patrick J. LeahyD-VT · Mar 6, 2003

Mr. President, I am pleased to join my colleagues Senator Mark Dayton and Senator Larry Craig in introducing the bipartisan Milk Import Tariff Equity Act. Our bill will prevent importers of dairy…

Richard G. Lugar
Sen. Richard G. LugarR-IN · Mar 6, 2003

Mr. President, by request, I introduce for appropriate reference a bill to establish the Millennium Challenge Account and the Millennium Challenge Corporation in order to reduce global poverty…

Bill Text

Latest available legislative text

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Introduced in SenateIssued March 6, 2003
        [Congressional Bills 108th Congress]
[From the U.S. Government Publishing Office]
[S. 557 Introduced in Senate (IS)]

108th CONGRESS
1st Session
S. 557

To amend the Internal Revenue Code of 1986 to exclude from gross income
amounts received on account of claims based on certain unlawful
discrimination and to allow income averaging for backpay and frontpay
awards received on account of such claims, and for other purposes.

_______________________________________________________________________

IN THE SENATE OF THE UNITED STATES

March 6, 2003

Ms. Collins (for herself, Mr. Grassley, Mr. Bingaman, Mr. Cochran, Mr.
Daschle, Mr. Sarbanes, and Mr. Smith) introduced the following bill;
which was read twice and referred to the Committee on Finance

_______________________________________________________________________

A BILL

To amend the Internal Revenue Code of 1986 to exclude from gross income
amounts received on account of claims based on certain unlawful
discrimination and to allow income averaging for backpay and frontpay
awards received on account of such claims, 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 ``Civil Rights Tax Relief Act of
2003''.

SEC. 2. EXCLUSION FROM GROSS INCOME FOR AMOUNTS RECEIVED ON ACCOUNT OF
CERTAIN UNLAWFUL DISCRIMINATION.

(a) In General.--Part III of subchapter B of chapter 1 of the
Internal Revenue Code of 1986 (relating to items specifically excluded
from gross income) is amended by redesignating section 140 as section
140A and by inserting after section 139 the following new section:

``SEC. 140. AMOUNTS RECEIVED ON ACCOUNT OF CERTAIN UNLAWFUL
DISCRIMINATION.

``(a) In General.--
``(1) Exclusion.--Gross income does not include amounts
received by a claimant (whether by suit or agreement and
whether as lump sums or periodic payments) on account of a
claim of unlawful discrimination.
``(2) Amounts covered.--For purposes of paragraph (1), the
term `amounts' does not include--
``(A) backpay or frontpay, as defined in section
1302(b), or
``(B) punitive damages.
``(b) Unlawful Discrimination Defined.--For purposes of this
section, the term `unlawful discrimination' means an act that is
unlawful under any of the following:
``(1) Section 302 of the Civil Rights Act of 1991 (2 U.S.C.
1202).
``(2) Section 201, 202, 203, 204, 205, 206, or 207 of the
Congressional Accountability Act of 1995 (2 U.S.C. 1311, 1312,
1313, 1314, 1315, 1316, or 1317).
``(3) The National Labor Relations Act (29 U.S.C. 151 et
seq.).
``(4) The Fair Labor Standards Act of 1938 (29 U.S.C. 201
et seq.).
``(5) Section 4 or 15 of the Age Discrimination in
Employment Act of 1967 (29 U.S.C. 623 or 633a).
``(6) Section 501 or 504 of the Rehabilitation Act of 1973
(29 U.S.C. 791 or 794).
``(7) Section 510 of the Employee Retirement Income
Security Act of 1974 (29 U.S.C. 1140).
``(8) Title IX of the Education Amendments of 1972 (29
U.S.C. 1681 et seq.).
``(9) The Employee Polygraph Protection Act of 1988 (29
U.S.C. 201 et seq.).
``(10) The Worker Adjustment and Retraining Notification
Act (29 U.S.C. 2102 et seq.).
``(11) Section 105 of the Family and Medical Leave Act of
1993 (29 U.S.C. 2615).
``(12) Chapter 43 of title 38, United States Code (relating
to employment and reemployment rights of members of the
uniformed services).
``(13) Section 1977, 1979, or 1980 of the Revised Statutes
(42 U.S.C. 1981, 1983, or 1985).
``(14) Section 703, 704, or 717 of the Civil Rights Act of
1964 (42 U.S.C. 2000e-2, 2000e-3, or 2000e-16).
``(15) Section 804, 805, 806, 808, or 818 of the Fair
Housing Act (42 U.S.C. 3604, 3605, 3606, 3608, or 3617).
``(16) Section 102, 202, 302, or 503 of the Americans with
Disabilities Act of 1990 (42 U.S.C. 12112, 12132, 12182, or
12203).
``(17) Any provision of Federal law (popularly known as
whistleblower protection provisions) prohibiting the discharge
of an employee, the discrimination against an employee, or any
other form of retaliation or reprisal against an employee for
asserting rights or taking other actions permitted under
Federal law.
``(18) Any provision of State or local law, or common law
claims permitted under Federal, State, or local law--
``(A) providing for the enforcement of civil
rights, or
``(B) regulating any aspect of the employment
relationship, including prohibiting the discharge of an
employee, the discrimination against an employee, or
any other form of retaliation or reprisal against an
employee for asserting rights or taking other actions
permitted by law.''.
(b) Clerical Amendment.--The table of sections for part III of
subchapter B of chapter 1 of such Code is amended by striking the last
item and inserting the following:

``Sec. 140. Amounts received on account
of certain unlawful
discrimination.
``Sec. 140. Cross references to other
Acts.''
(c) Effective Date.--The amendments made by this section shall
apply to damages received in taxable years beginning after December 31,
2000.

SEC. 3. LIMITATION ON TAX BASED ON INCOME AVERAGING FOR BACKPAY AND
FRONTPAY RECEIVED ON ACCOUNT OF CERTAIN UNLAWFUL
EMPLOYMENT DISCRIMINATION.

(a) In General.--Part I of subchapter Q of chapter 1 of the
Internal Revenue Code of 1986 (relating to income averaging) is amended
by adding at the end the following new section:

``SEC. 1302. INCOME FROM BACKPAY AND FRONTPAY RECEIVED ON ACCOUNT OF
CERTAIN UNLAWFUL EMPLOYMENT DISCRIMINATION.

``(a) General Rule.--If employment discrimination backpay or
frontpay is received by a taxpayer during a taxable year, the tax
imposed by this chapter for such taxable year shall not exceed the sum
of--
``(1) the tax which would be so imposed if--
``(A) no amount of such backpay or frontpay were
included in gross income for such year, and
``(B) no deduction were allowed for such year for
expenses (otherwise allowable as a deduction to the
taxpayer for such year) in connection with making or
prosecuting any claim of unlawful employment
discrimination by or on behalf of the taxpayer, plus
``(2) the product of--
``(A) the number of years in the backpay period and
frontpay period, and
``(B) the amount by which the tax determined under
paragraph (1) would increase if the amount on which
such tax is determined were increased by the average
annual net backpay and frontpay amount.
``(b) Definitions.--For purposes of this section--
``(1) Employment discrimination backpay or frontpay.--The
term `employment discrimination backpay or frontpay' means
backpay or frontpay receivable (whether as lump sums or
periodic payments) on account of a claim of unlawful employment
discrimination.
``(2) Unlawful employment discrimination.--The term
`unlawful employment discrimination' has the meaning provided
the term `unlawful discrimination' in section 140(b).
``(3) Backpay and frontpay.--The terms `backpay' and
`frontpay' mean amounts includible in gross income in the
taxable year--
``(A) as compensation which is attributable--
``(i) in the case of backpay, to services
performed, or that would have been performed
but for a claimed violation of law, as an
employee, former employee, or prospective
employee before such taxable year for the
taxpayer's employer, former employer, or
prospective employer; and
``(ii) in the case of frontpay, to
employment that would have been performed but
for a claimed violation of law, in a taxable
year or taxable years following the taxable
year; and
``(B) which are--
``(i) ordered, recommended, or approved by
any governmental entity to satisfy a claim for
a violation of law, or
``(ii) received from the settlement of such
a claim.
``(4) Backpay period.--The term `backpay period' means the
period during which services are performed (or would have been
performed) to which backpay is attributable. If such period is
not equal to a whole number of taxable years, such period shall
be increased to the next highest number of whole taxable years.
``(5) Frontpay period.--The term `frontpay period' means
the period of foregone employment to which frontpay is
attributable. If such period is not equal to a whole number of
taxable years, such period shall be increased to the next
highest number of whole taxable years.
``(6) Average annual net backpay and frontpay amount.--The
term `average annual net backpay and frontpay amount' means the
amount equal to--
``(A) the excess of--
``(i) employment discrimination backpay and
frontpay, over
``(ii) the amount of deductions that would
have been allowable but for subsection
(a)(1)(B), divided by
``(B) the number of years in the backpay period and
frontpay period.''.
(b) Clerical Amendment.--The table of sections for part I of
subchapter Q of chapter 1 of such Code is amended by inserting after
section 1301 the following new item:

``Sec. 1302. Income from backpay or
frontpay received on account of
certain unlawful employment
discrimination.''
(c) Effective Date.--The amendments made by this section shall
apply to amounts received in taxable years beginning after December 31,
2000.

SEC. 3. INCOME AVERAGING FOR BACKPAY AND FRONTPAY RECEIVED ON ACCOUNT
OF CERTAIN UNLAWFUL EMPLOYMENT DISCRIMINATION NOT TO
INCREASE ALTERNATIVE MINIMUM TAX LIABILITY.

(a) In General.--Section 55(c) of the Internal Revenue Code of 1986
(defining regular tax) is amended by redesignating paragraph (2) as
paragraph (3) and by inserting after paragraph (1) the following:
``(2) Coordination with income averaging for amounts
received on account of employment discrimination.--Solely for
purposes of this section, section 1302 (relating to averaging
of income from backpay or frontpay received on account of
certain unlawful employment discrimination) shall not apply in
computing the regular tax.''.
(b) Effective Date.--The amendment made by this section shall apply
to taxable years beginning after December 31, 2000.
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