H.R. 2222 – Strengthen the Earned Income Tax Credit Act of 2007

110th CONGRESS

1st Session

H. R. 2222

IN THE HOUSE OF REPRESENTATIVES

May 8, 2007

Mr. Pascrell introduced the following bill; which was referred to the Committee on Ways and Means

A BILL

To amend the Internal Revenue Code of 1986 to strengthen the earned income tax credit.

Short title

This Act may be cited as the Strengthen the Earned Income Tax Credit Act of 2007.

Strengthen the earned income tax credit

(a)

Reduction in Marriage Penalty

(1)

In general

Section 32(b)(2)(B) of the Internal Revenue Code of 1986 (relating to joint returns) is amended—

(A)

by striking , 2006, and 2007 in clause (ii) and inserting and 2006, and

(B)

by striking clause (iii) and inserting the following new clauses:

(iii)

$3,500 in the case of taxable years beginning in 2007,

(iv)

$4,000 in the case of taxable years beginning in 2008,

(v)

$4,500 in the case of taxable years beginning in 2009, and

(vi)

$5,000 in the case of taxable years beginning after 2009.

(2)

Inflation adjustment

Section 32(j)(1)(B)(ii) of such Code is amended—

(A)

by striking $3,000 amount in subsection (b)(2)(B)(iii) and inserting $5,000 amount in subsection (b)(2)(B)(vi), and

(B)

by striking 2007 and inserting 2009.

(3)

Provisions not subject to sunset

Title IX of the Economic Growth and Tax Relief Reconciliation Act of 2001 (relating to sunset provisions of such Act) shall not apply to section 303(a) of such Act.

(b)

Increase in Credit Percentage for Families With 3 or More Children

The table contained in section 32(b)(1)(A) of such Code (relating to percentages) is amended—

(1)

by striking 2 or more qualifying children in the second row and inserting 2 qualifying children, and

(2)

by inserting after the second row the following new item:

3 or more qualifying children

21.06

(c)

Credit Increase and Reduction in Phaseout for Individuals With No Children

The table contained in section 32(b)(1)(A) of such Code is amended—

(1)

by striking 7.65 in the second column of the third row and inserting 15.3, and

(2)

by striking 7.65 in the third column of the third row and inserting 15.3.

(d)

Permanent Extension of Special Rule Treating Combat Pay as Earned Income

(1)

In general

Clause (vi) of section 32(c)(2)(B) of such Code (relating to earned income) is amended to read as follows:

(iv)

a taxpayer may elect to treat amounts excluded from gross income by reason of section 112 as earned income.

(2)

Provision not subject to sunset

Section 105 of the Working Families Tax Relief Act of 2004 (relating to application of EGTRRA sunset to this title) shall not apply to section 104(b) of such Act.

(e)

Effective Date

The amendments made by this section shall apply to taxable years beginning after December 31, 2006.

Strengthen the Earned Income Tax Credit Act of 2007

Legislative Activity

Bill Text