S. 3420Senate112th Congress (2011-2013)Introduced

Permanent Tax Relief Act

Sponsored by Mike LeeSen. Mike Lee (R-UT)
Introduced July 23, 2012

Legislative Activity

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2 earlier actions
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Read the second time. Placed on Senate Legislative Calendar under General Orders. Calendar No. 472.

July 24, 2012

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SenateIntro Referral

Introduced in Senate

July 23, 2012

SenateCalendars

Introduced in the Senate. Read the first time. Placed on Senate Legislative Calendar under Read the First Time.

July 23, 2012

SenateCalendars

Read the second time. Placed on Senate Legislative Calendar under General Orders. Calendar No. 472.

July 24, 2012

Floor Debate

13 members

What members said about S. 3420 on the floor

6 Republicans6 Democrats1 Independent
Richard J. Durbin
Sen. Richard J. DurbinD-IL · Jul 24, 2012

Mr. President, I thank my colleague from North Dakota, Senator Kent Conrad, who is the chairman of the Senate Budget Committee. He is retiring, unfortunately, for the Senate and for this country…

Lamar Alexander
Sen. Lamar AlexanderR-TN · Jul 24, 2012

Mr. President, I ask unanimous consent to enter into a colloquy with my Republican colleagues. Mr. President, the Senator from Washington said Republicans often change the subject. That is exactly…

Bernard Sanders
Sen. Bernard SandersI-VT · Jul 24, 2012

Mr. President, I rise this morning in strong support of the Middle Class Tax Cut Relief Act that would extend tax cuts for 98 percent of the American people while letting the Bush tax breaks for the…

Roy Blunt
Sen. Roy BluntR-MO · Jul 24, 2012

That is exactly right. That is the way the process is supposed to work. I think the observation the Senator made on the Budget Control Act is that is the maximum amount of money we agree to spend.…

Harry Reid
Sen. Harry ReidD-NV · Jul 24, 2012

Mr. President, I now move to proceed to Calendar No. 467, S. 3412, which is the Middle Class Tax Cut Act of 2012. Mr. President, the first hour this morning will be divided and controlled between the…

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Patty Murray
Sen. Patty MurrayD-WA · Jul 24, 2012

Mr. President, I come to the floor today to urge my colleagues to support the extension of tax cuts for 98 percent of workers and 97 percent of small business owners. This should be a no-brainer.…

Charles E. Schumer
Sen. Charles E. SchumerD-NY · Jul 24, 2012

Mr. President. I ask unanimous consent that the order for the quorum call be rescinded. Mr. President, today I wish to talk about a bill that will reduce taxes for 97 percent of all small business…

Barbara A. Mikulski
Sen. Barbara A. MikulskiD-MD · Jul 24, 2012

Good afternoon, Mr. President. Mr. President, I rise today to honor the life and legacy of a dear friend, someone whom I admire, and someone whom the whole world cheered on, Dr. Sally Ride. Dr. Ride…

Kent Conrad
Sen. Kent ConradD-ND · Jul 24, 2012

Mr. President, before I talk about the matter at hand, I would like to remember Officer Chestnut and Detective Gibson. I did not have a chance to know Detective Gibson. I did have a chance to know…

Mitch McConnell
Sen. Mitch McConnellR-KY · Jul 24, 2012

Mr. President, I would like to start this morning by remembering another deadly shooting, one that hit very close to home for most of us. It was 14 years ago today that Officer Jacob Chestnut and…

Johnny Isakson
Sen. Johnny IsaksonR-GA · Jul 24, 2012

I thank Senator Alexander for the recognition and for joining with Senator Blunt in this colloquy. As I was listening to you talk, I thought back to what happened in my family Sunday night. I want to…

Rand Paul
Sen. Rand PaulR-KY · Jul 24, 2012

Mr. President, Dr. Shakil Alfridi is a physician in Pakistan. He has been put in prison for the rest of his life for the crime, basically, of helping the United States get bin Laden. I think it is a…

Mike  Johanns
Sen. Mike Johanns R-NE · Jul 24, 2012

Mr. President, I am here to make another statement, but I do want to associate myself with what the two Senators had to say, the Senator from Missouri and the Senator from Tennessee. I look at our…

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Kent Conrad
Sen. Kent ConradD-ND · Jul 23, 2012

Madam President, I understand there is a bill at the desk and I ask for its first reading. I now ask for a second reading, and in order to place the bill on the calendar under the provisions of rule…

Bill Text

Latest available legislative text

Reading Mode
Latest
Placed on Calendar SenateIssued July 24, 2012

II

Calendar No. 472

112th CONGRESS

2d Session

S. 3420

IN THE SENATE OF THE UNITED STATES

July 23, 2012

Mr. Lee (for himself, Mr. Rubio, Mr. Risch, Mr. DeMint, Mr. Cornyn, Mr. Vitter, and Mr. Johnson of Wisconsin) introduced the following bill; which was read the first time

July 24, 2012

Read the second time and placed on the calendar

A BILL

To permanently extend the 2001 and 2003 tax cuts, to provide for permanent alternative minimum tax relief, and to repeal the estate and generation-skipping transfer taxes, and for other purposes.

1.

Short title

This Act may be cited as the Permanent Tax Relief Act.

2.

Permanent extension of tax relief

(a)

2001 tax relief

The Economic Growth and Tax Relief Reconciliation Act of 2001 is amended by striking title IX.

(b)

2003 relief

Title III of the Jobs and Growth Tax Relief Reconciliation Act of 2003 is amended by striking section 303.

(c)

Alternative minimum tax exemption amounts

(1)

Increased exemption amounts made permanent

(A)

In general

Paragraph (1) of section 55(d) of the Internal Revenue Code of 1986 is amended—

(i)

by striking $45,000 ($72,450 in the case of taxable years beginning in 2010 and $74,450 in the case of taxable years beginning in 2011) in subparagraph (A) and inserting $74,450,

(ii)

by striking $33,750 ($47,450 in the case of taxable years beginning in 2010 and $48,450 in the case of taxable years beginning in 2011) in subparagraph (B) and inserting $48,450, and

(iii)

by striking paragraph (1)(A) in subparagraph (C) and inserting subparagraph (A).

(2)

Exemption amounts indexed for inflation

Subsection (d) of section 55 of the Internal Revenue Code of 1986 is amended by adding at the end the following new paragraph:

(4)

Inflation adjustment

(A)

In general

In the case of any taxable year beginning in a calendar year after 2011, each of the dollar amounts contained in subparagraphs (A) and (B) of paragraph (1) shall be increased by an amount equal to—

(i)

such dollar amount, multiplied by

(ii)

the cost-of-living adjustment determined under section 1(f)(3) for the calendar year in which the taxable year begins, determined by substituting calendar year 2010 for calendar year 1992 in subparagraph (B) thereof.

(B)

Rounding

Any increase determined under subparagraph (A) shall be rounded to the nearest multiple of $100.

.

(3)

Effective date

The amendments made by this subsection shall apply to taxable years beginning after December 31, 2011.

(d)

Alternative minimum tax relief for nonrefundable credits

(1)

In general

Subsection (a) of section 26 of the Internal Revenue Code of 1986 is amended to read as follows:

(a)

Limitation based on amount of tax

The aggregate amount of credits allowed by this subpart for the taxable year shall not exceed the sum of—

(1)

the taxpayer's regular tax liability for the taxable year reduced by the foreign tax credit allowable under section 27(a), and

(2)

the tax imposed by section 55(a) for the taxable year.

.

(2)

Conforming amendments

(A)

Adoption credit

(i)

Section 23(b) of the Internal Revenue Code of 1986 is amended by striking paragraph (4).

(ii)

Section 23(c) of such Code is amended by striking paragraphs (1) and (2) and inserting the following:

(1)

In general

If the credit allowable under subsection (a) for any taxable year exceeds the limitation imposed by section 26(a) for such taxable year reduced by the sum of the credits allowable under this subpart (other than this section and sections 25D and 1400C), such excess shall be carried to the succeeding taxable year and added to the credit allowable under subsection (a) for such taxable year.

.

(iii)

Section 23(c) of such Code is amended by redesignating paragraph (3) as paragraph (2).

(B)

Child tax credit

(i)

Section 24(b) of such Code is amended by striking paragraph (3).

(ii)

Section 24(d)(1) of such Code is amended—

(I)

by striking section 26(a)(2) or subsection (b)(3), as the case may be, each place it appears in subparagraphs (A) and (B) and inserting section 26(a), and

(II)

by striking section 26(a)(2) or subsection (b)(3), as the case may be in the second last sentence and inserting section 26(a).

(C)

Credit for interest on certain home mortgages

Section 25(e)(1)(C) of such Code is amended to read as follows:

(C)

Applicable tax limit

For purposes of this paragraph, the term applicable tax limit means the limitation imposed by section 26(a) for the taxable year reduced by the sum of the credits allowable under this subpart (other than this section and sections 23, 25D, and 1400C).

.

(D)

Savers' credit

Section 25B of such Code is amended by striking subsection (g).

(E)

Residential energy efficient property

Section 25D(c) of such Code is amended to read as follows:

(c)

Carryforward of unused credit

If the credit allowable under subsection (a) exceeds the limitation imposed by section 26(a) for such taxable year reduced by the sum of the credits allowable under this subpart (other than this section), such excess shall be carried to the succeeding taxable year and added to the credit allowable under subsection (a) for such succeeding taxable year.

.

(F)

Certain plug-in electric vehicles

Section 30(c)(2) of such Code is amended to read as follows:

(2)

Personal credit

For purposes of this title, the credit allowed under subsection (a) for any taxable year (determined after application of paragraph (1)) shall be treated as a credit allowable under subpart A for such taxable year.

.

(G)

Alternative motor vehicle credit

Section 30B(g)(2) of such Code is amended to read as follows:

(2)

Personal credit

For purposes of this title, the credit allowed under subsection (a) for any taxable year (determined after application of paragraph (1)) shall be treated as a credit allowable under subpart A for such taxable year.

.

(H)

New qualified plug-in electric vehicle credit

Section 30D(c)(2) of such Code is amended to read as follows:

(2)

Personal credit

For purposes of this title, the credit allowed under subsection (a) for any taxable year (determined after application of paragraph (1)) shall be treated as a credit allowable under subpart A for such taxable year.

.

(I)

Cross references

Section 55(c)(3) of such Code is amended by striking 26(a), 30C(d)(2), and inserting 30C(d)(2).

(J)

Foreign tax credit

Section 904 of such Code is amended by striking subsection (i) and by redesignating subsections (j) , (k), and (l) as subsections (i), (j), and (k), respectively.

(K)

First-time home buyer credit for the District of Columbia

Section 1400C(d) of such Code is amended to read as follows:

(d)

Carryforward of unused credit

If the credit allowable under subsection (a) exceeds the limitation imposed by section 26(a) for such taxable year reduced by the sum of the credits allowable under subpart A of part IV of subchapter A (other than this section and section 25D), such excess shall be carried to the succeeding taxable year and added to the credit allowable under subsection (a) for such taxable year.

.

(3)

Effective date

The amendments made by this subsection shall apply to taxable years beginning after December 31, 2011.

3.

Repeal of estate and generation-skipping transfer taxes

(a)

Estate Tax Repeal

Subchapter C of chapter 11 of subtitle B of the Internal Revenue Code of 1986 is amended by adding at the end the following new section:

2210.

Termination

(a)

In general

Except as provided in subsection (b), this chapter shall not apply to the estates of decedents dying on or after the date of the enactment of the Permanent Tax Relief Act.

(b)

Certain Distributions From Qualified Domestic Trusts

In applying section 2056A with respect to the surviving spouse of a decedent dying before the date of the enactment of the Permanent Tax Relief Act

(1)

section 2056A(b)(1)(A) shall not apply to distributions made after the 10-year period beginning on such date, and

(2)

section 2056A(b)(1)(B) shall not apply on or after such date.

.

(b)

Generation-Skipping Transfer Tax Repeal

Subchapter G of chapter 13 of subtitle B of the Internal Revenue Code of 1986 is amended by adding at the end the following new section:

2664.

Termination

This chapter shall not apply to generation-skipping transfers on or after the date of the enactment of the Permanent Tax Relief Act.

.

(c)

Conforming Amendments

(1)

The table of sections for subchapter C of chapter 11 of the Internal Revenue Code of 1986 is amended by adding at the end the following new item:

Sec. 2210. Termination.

.

(2)

The table of sections for subchapter G of chapter 13 of such Code is amended by adding at the end the following new item:

Sec. 2664. Termination.

.

(d)

Restoration of pre-EGTRRA provisions not applicable

(1)

In general

Section 301 of the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 shall not apply to estates of decedents dying, and transfers made, on or after the date of the enactment of this Act.

(2)

Exception for stepped-up basis

Paragraph (1) shall not apply to the provisions of law amended by subtitle E of title V of the Economic Growth and Tax Relief Reconciliation Act of 2001 (relating to carryover basis at death; other changes taking effect with repeal).

(e)

Sunset not applicable

Section 304 of the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 is hereby repealed.

(f)

Effective Date

The amendments made by this section shall apply to the estates of decedents dying, and generation-skipping transfers, after the date of the enactment of this Act.

4.

Modifications of gift tax

(a)

Computation of gift tax

Subsection (a) of section 2502 of the Internal Revenue Code of 1986 is amended to read as follows:

(a)

Computation of tax

(1)

In general

The tax imposed by section 2501 for each calendar year shall be an amount equal to the excess of—

(A)

a tentative tax, computed under paragraph (2), on the aggregate sum of the taxable gifts for such calendar year and for each of the preceding calendar periods, over

(B)

a tentative tax, computed under paragraph (2), on the aggregate sum of the taxable gifts for each of the preceding calendar periods.

(2)

Rate schedule

If the amount with respect to which the tentative tax to be computed is:The tentative
 tax is:
Not over $10,00018% of such amount.
Over $10,000 but not over $20,000$1,800, plus 20% of the excess over $10,000.
Over $20,000 but not over $40,000$3,800, plus 22% of the excess over $20,000.
Over $40,000 but not over $60,000$8,200, plus 24% of the excess over $40,000.
Over $60,000 but not over $80,000$13,000, plus 26% of the excess over $60,000.
Over $80,000 but not over $100,000$18,200, plus 28% of the excess over $80,000.
Over $100,000 but not over $150,000$23,800, plus 30% of the excess over $100,000.
Over $150,000 but not over $250,000$38,800, plus 32% of the excess of $150,000.
Over $250,000 but not over $500,000$70,800, plus 34% of the excess over $250,000.
Over $500,000$155,800, plus 35% of the excess of $500,000.

.

(b)

Treatment of Certain Transfers in Trust

Section 2511 of the Internal Revenue Code of 1986 is amended by adding at the end the following new subsection:

(c)

Treatment of Certain Transfers in Trust

Notwithstanding any other provision of this section and except as provided in regulations, a transfer in trust shall be treated as a taxable gift under section 2503, unless the trust is treated as wholly owned by the donor or the donor’s spouse under subpart E of part I of subchapter J of chapter 1.

.

(c)

Lifetime gift exemption

Paragraph (1) of section 2505(a) of the Internal Revenue Code of 1986 is amended to read as follows:

(1)

the amount of the tentative tax which would be determined under the rate schedule set forth in section 2502(a)(2) if the amount with respect to which such tentative tax is to be computed were $5,000,000, reduced by

.

(d)

Conforming amendments

(1)

Section 2505(a) of the Internal Revenue Code of 1986 is amended by striking the last sentence.

(2)

The heading for section 2505 of such Code is amended by striking Unified.

(3)

The item in the table of sections for subchapter A of chapter 12 of such Code relating to section 2505 is amended to read as follows:

Sec. 2505. Credit against gift tax.

.

(e)

Effective date

The amendments made by this section shall apply to gifts made on or after the date of the enactment of this Act.

(f)

Transition rule

(1)

In general

For purposes of applying sections 1015(d), 2502, and 2505 of the Internal Revenue Code of 1986, the calendar year in which this title is enacted shall be treated as 2 separate calendar years one of which ends on the day before the date of the enactment of this Act and the other of which begins on such date of enactment.

(2)

Application of section 2504(b)

For purposes of applying section 2504(b) of the Internal Revenue Code of 1986, the calendar year in which this title is enacted shall be treated as one preceding calendar period.

July 24, 2012

Read the second time and placed on the calendar