H.R. 8 (112th): American Taxpayer Relief Act of 2012

Introduced:
Jul 24, 2012 (112th Congress, 2011–2013)
Sponsor:
Rep. Dave Camp [R-MI4]
Status:
Signed by the President
Slip Law:
This bill became Pub.L. 112-240.

The bill’s title was written by the bill’s sponsor. H.R. stands for House of Representatives bill.

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Status

This bill was enacted after being signed by the President on January 2, 2013.

Progress
Introduced Jul 24, 2012
Referred to Committee Jul 24, 2012
Passed House Aug 01, 2012
Passed Senate with Changes Jan 01, 2013
Passed Senate Jan 01, 2013
Signed by the President Jan 02, 2013
Votes

On Agreeing to the Amendment: Amendment 1 to H R 8 To amend title 5, United States Code, to make clear that accounts in the Thrift Savings Fund are subject to certain Federal tax levies
Aug 01, 2012 5:37 p.m.
Failed 170/257

On Motion to Recommit with Instructions: H R 8 To extend certain tax relief provisions enacted in 2001 and 2003, and for other purposes
Aug 01, 2012 6:11 p.m.
Failed 181/246

House Vote on Passage
Aug 01, 2012 6:19 p.m.
Passed 256/171

Senate Vote on Passage
Jan 01, 2013 1:39 a.m.
Bill Passed 89/8

House Vote on Passage
Jan 01, 2013 10:57 p.m.
Passed 257/167

Cosponsors
28 cosponsors (28R) (show)
Committees

House Budget

House Ways and Means

The committee chair determines whether a bill will move past the committee stage.

Full Title

An act entitled the "American Taxpayer Relief Act of 2012".

Summary

No summaries available.

Text

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Last updated Jan 02, 2013.
59 pages

Primary Source

View on THOMAS (The Library of Congress)

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GovTrack’s Bill Summary

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Library of Congress Summary

The summary below was written by the Congressional Research Service, which is a nonpartisan division of the Library of Congress.

1/2/2013--Public Law. (This measure has not been amended since it was passed by the Senate on January 1, 2013. The summary has been expanded for this version.) American Taxpayer Relief Act of 2012 -
Title I - General Extensions
Section 101 -
Makes permanent the Economic Growth and Tax Relief Reconciliation Act of 2001 for individual taxpayers whose taxable income is at or below a $400,000 threshold amount ($450,000 for married couples filing a joint return).
Amends the Internal Revenue Code to:
(1) revise income tax rates for individual taxpayers whose taxable income is at or below the $400,000 threshold amount ($450,000 for married couples filing a joint return) and increase the rate to 39.6% for taxpayers whose taxable income exceeds the threshold,
(2) set the threshold for the phaseout of personal tax exemptions and itemized deductions at $250,000 for individual taxpayers ($300,000 for married couples filing a joint return), and
(3) increase the top marginal estate tax rate from 35% to 40%.
Section 102 -
Makes permanent for individual taxpayers whose taxable income is at or below a $400,000 threshold ($450,000 for married couples filing a joint return) provisions of the Jobs and Growth Tax Relief Reconciliation Act of 2003 that reduce tax rates for capital gain and dividend income. Increases the capital gains tax rate from 15% to 20% for taxpayers whose taxable income exceeds the $400,000 threshold amount.
Section 103 -
Extends through 2017: (1) the American Opportunity tax credit, (2) the child tax credit, and (3) the increased earned income tax credit. Makes permanent the disregard of tax refunds for determining eligibility for benefits or assistance under any federal program or state or local program financed in whole or in part with federal funds.
Section 104 -
Establishes a permanent $78,750 exemption from the alternative minimum tax (AMT) for married taxpayers filing a joint tax return ($50,600 for individual taxpayers). Provides for an annual inflation adjustment to such exemption amounts for calendar years after 2012.
Title II - Individual Tax Extenders
Section 201 -
Extends through 2013 expiring tax provisions relating to individual taxpayers, including: -the tax deduction for certain expenses of elementary and secondary school teachers; -the exclusion from gross income of amounts attributable to the discharge of qualified principal residence indebtedness; -the equalization of the exclusion from gross income of employer-provided commuter transit and parking benefits; -the tax deduction for mortgage insurance premiums; - the election to deduct state and local general sales taxes in lieu of state and local income taxes; - the tax deduction for contributions of capital gain real property made for conservation purposes; - the tax deduction for qualified tuition and related expenses; and - the exemption from tax of distributions from individual retirement accounts (IRAs) made for charitable purposes.
Section 209 -
Makes permanent the authority of the Secretary of the Treasury to disclose tax returns and other information to federal and state prison officials for inmates who may have filed or facilitated the filing of false or fraudulent tax returns.
Allows disclosures of such information to contractors responsible for the operation of a federal or state prison and to the legal representatives of the Federal Bureau of Prisons, a state agency, a contractor charged with the responsibility for administration of prisons, or the incarcerated individual accused of filing the false or fraudulent return.
Title III - Business Tax Extenders
Section 301 -
Extends through 2013 expiring tax provisions relating to business taxpayers, including: -the tax credit for increasing research activities; -the 9% low-income housing tax credit rate for newly constructed non-federally subsidized buildings; -the exemption of the basic military housing allowance from the income test for programs financed by tax-exempt housing bonds; -the Indian employment tax credit; -the new markets tax credit; -the tax credit for qualified railroad track maintenance expenditures; -the tax credit for mine rescue team training expenses; -the tax credit for differential wage payments to employees who are active duty members of the Uniformed Services; -the work opportunity tax credit; -the authority for issuing qualified zone academy bonds; -accelerated depreciation for qualified leasehold, restaurant, and retail improvements, for motorsports entertainment complexes, and for business property on Indian reservations; -the deduction for contributions of food inventory by taxpayers other than C corporations; -increased expensing allowances for depreciable business property; -the election to expense advanced mine safety equipment and expensing of film and television production expenses; -the deduction for income attributable to domestic production activities in Puerto Rico; -tax rules relating to payments between related foreign corporations; -rules for the tax treatment of certain dividends of regulated investment companies (RICs); -the subpart F income exemption for income derived in the active conduct of a banking, finance, or insurance business; -the 100% exclusion from gross income of gain from the sale or exchange of certain small business stock; -the rule for adjusting stock of an S corporation making charitable contributions of property; -the reduction of the recognition period for the built-in gains of S corporations; -tax incentives for investment in empowerment zones; -the authority for issuing New York Liberty Zone bonds; -the increased limitation for payments of excise taxes on distilled spirits into the treasuries of Puerto Rico and the Virgin Islands; -the tax credit for investment in American Samoan economic development activities; and -the additional depreciation allowance (bonus depreciation) for business assets and the election to accelerate the AMT in lieu of bonus depreciation.
Title IV - Energy Tax Extenders
Section 401 -
Extends through 2013 expiring energy-related tax provisions, including; -the tax credit for residential energy efficiency improvements; -the tax credit for alternative fuel vehicle refueling property expenditures; -the tax credit for two- or three-wheeled plug-in electric vehicles; -the income tax credit for biodiesel and renewable diesel used as fuel; -the tax credit for producing electricity from Indian coal production facilities; -the tax credit for energy efficient new homes; -the tax credit for energy efficient appliances; -tax rules relating to sales required to implement federal and state restructuring policy for qualified electric facilities; and -the excise tax credit for alternative fuels.
Section 404 -
Extends through 2013 the cellulosic biofuel producer tax credit. Modifies the definition of "cellulosic biofuel" for purposes of such credit to mean any liquid fuel which is derived by, or from, qualified feedstocks. Defines "qualified feedstocks" as any lignocellulosic or hemicellulosic matter that is available on a renewable or recurring basis and any cultivated algae, cyanobacteria, or lemna.
Section 407 -
Extends through 2013 placed-in-service dates for renewable energy facilities eligible for the tax credit for producing electricity from renewable resources, including wind, biomass, landfill gas, trash, hydropower, and marine and hydrokinetic renewable energy facilities.
Section 410 -
Extends through 2013 the special depreciation allowance (bonus depreciation) for cellulosic biofuel plant property. Modifies the definition of "cellulosic biofuel" for purposes of bonus depreciation to mean any liquid fuel which is derived by, or from, qualified feedstocks.
Title V - Unemployment
Section 501 -
Amends the Supplemental Appropriations Act, 2008 to extend emergency unemployment compensation (EUC) payments for eligible individuals to weeks of employment ending on or before January 1, 2014.
Section 502 -
Amends the Assistance for Unemployed Workers and Struggling Families Act to extend until December 31, 2013, requirements that federal payments to states cover 100% of EUC. Amends the Unemployment Compensation Extension Act of 2008 to exempt weeks of unemployment between enactment of this Act and June 30, 2014, from the prohibition in the Federal-State Extended Unemployment Compensation Act of 1970 (FSEUCA of 1970) against federal matching payments to a state for the first week in an individual's eligibility period for which extended compensation or sharable regular compensation is paid if the state law provides for payment of regular compensation to an individual for his or her first week of otherwise compensable unemployment.
(Thus allows temporary federal matching for the first week of extended benefits for states with no waiting period.) Amends the FSEUCA of 1970 to postpone similarly from December 31, 2012, to December 31, 2013, termination of the period during which a state may determine its "on" and "off" indicators according to specified temporary substitutions in its formula.
Section 503 -
Amends the Supplemental Appropriations Act, 2008 to appropriate funds out of the employment security administration account through FY2014 to assist states in providing reemployment and eligibility assessment activities.
Section 504 -
Amends the Railroad Unemployment Insurance Act to extend through December 31, 2013, the temporary increase in extended unemployment benefits.
Title VI - Medicare and Other Health Extensions
Subtitle A - Medicare Extensions
Section 601 -
Amends title XVIII (Medicare) of the Social Security Act (SSA) to extend for one year the Medicare physician payment rates without change. Authorizes eligible professionals to receive incentive payments under Medicare for reporting on quality measures by participating in a qualified clinical data registry. Requires the Comptroller General (GAO) to study the potential of clinical data registries to improve the quality and efficiency of care in the Medicare program.
Section 602 -
Extends through 2013 the floor at 1.0 on the work geographic index in the formula for determining relative values for physicians' services for the Medicare physician payment.
Section 603 -
Revises requirements for Medicare payments for outpatient therapy services, including to extend through December 31, 2013, the period of incurred expenses for which an enrollee may request an exception to the ceiling on such expenses.
Section 604 -
Extends: (1) the temporary increase in payment for ground ambulance services, (2) the increase in payment for certain urban air ambulance services, and (3) the increase in the assistance for rural providers furnishing (super rural ambulance) services in low-population density areas. Requires the Secretary of Health and Human Services (HHS) to study issues related to ambulance services.
Section 605 -
Extends through 2013 the additional Medicare payment for inpatient services for low-volume hospitals.
Section 606 -
Extends through FY2013 the current methodology for payment to subsection (d) hospitals for inpatient hospital services furnished to individuals under the Medicare-dependent, small rural hospital (MDH) program. (Generally, a subsection [d] hospital is an acute hospital, particularly one that receives payments under Medicare's inpatient prospective payment system [IPPS] when providing covered inpatient services to eligible beneficiaries.)
Section 607 -
Extends through December 31, 2014, Medicare Advantage plans that exclusively serve special needs individuals.
Section 608 -
Extends Medicare authorization for reasonable cost contracts through December 31, 2013.
Section 609 -
Reauthorizes through FY2013 the requirements that the HHS Secretary contract with a consensus-based entity to develop health care performance measurements. Requires the Secretary to develop a strategy to provide data for performance improvement in a timely manner to applicable providers under the Medicare program. Requires the Comptroller General to study private sector and Medicare information sharing activities.
Section 610 -
Amends the Medicare Improvements for Patients and Providers Act of 2008 to extend grants for outreach to Medicare beneficiaries.
Subtitle B - Other Health Extensions
Section 621 -
Amends SSA title XIX (Medicaid) to extend for one year the Qualifying Individual (QI) Program through which the QI program pays the Medicare Part B premiums of Medicare beneficiaries with incomes between 120% and 135% of the official poverty line.
Section 622 -
Extends the program to provide continued short-term eligibility for Medicaid beneficiaries who become ineligible due to increased hours of, or increased income from, employment (transitional medical assistance program).
Section 623 -
Extends through September 30, 2014, the authority of states to base eligibility determinations for Medicaid or the Children's Health Insurance Program (CHIP) on findings by an Express Lane agency.
Section 624 -
Amends SSA title V (Maternal and Child Health Services Block Grant) to extend the program for the development and support of family-to-family health information centers for children with disabilities or special health care needs.
Section 625 -
Amends the Public Health Service Act to reauthorize for FY2014: (1) a research program for the prevention and cure of Type I diabetes, and (2) a program to provide services through Indian health facilities for the prevention and treatment of diabetes.
Subtitle C - Other Health Provisions
Section 631 -
Directs the HHS Secretary to apply certain prospective documentation and coding adjustments (made in response to the implementation of the Medicare Severity Diagnosis Related Group [MS-DRG] system under the Medicare IPPS) for discharges occurring during FY2008, FY2009, and FY2010. Directs the Secretary to make an additional adjustment to the standardized amounts for inpatient hospital services based upon the Secretary's estimates for discharges occurring only during FY2014-FY2017 to offset $11 billion (which represents the amount of the increase in aggregate payments from FY2008-FY2013 for which an adjustment was not previously applied).
Section 632 -
Requires the Secretary to make reductions in Medicare payments for renal dialysis services. Directs GAO to update its report to Congress on the impact on Medicare beneficiary access to high-quality dialysis services of including specified oral drugs furnished for the treatment of end stage renal disease in the related bundled prospective payment system.
Section 633 -
Makes reductions to Medicare payments for multiple therapy services provided to the same patient on the same day.
Section 634 -
Reduces payments for certain hospital outpatient department services (stereotactic radiosurgery).
Section 635 -
Revises utilization rates for purposes of Medicare payment for the use of expensive diagnostic imaging equipment.
Section 636 -
Makes Medicare reimbursement for diabetic supplies that are non-mail order equal to the single payment amounts established under the national mail order competition for diabetic supplies.
Section 637 -
Reduces Medicare payment by 10% for ambulance services consisting of non-emergency basic life support services involving transport of an individual with end-stage renal disease (ESRD) for renal dialysis services furnished other than on an emergency basis by a provider of services or a renal dialysis facility.
Section 638 -
Extends from three years to five years the length of time the Secretary has to collect Medicare overpayments.
Section 639 -
Revises the coding adjustment factor for health status under Medicare Advantage plans.
Section 640 -
Eliminates funding for the Medicare Improvement Fund starting in FY2014.
Section 641 -
Revises state disproportionate share hospital (DSH) allotments under Medicaid.
Section 642 -
Repeals the Community Living Assistance Services and Supports Act or the CLASS Act, as added to the Public Health Service Act by the Patient Protection and Affordable Care Act, which establishes a national, voluntary insurance program for purchasing community living assistance services and supports in order to provide individuals with functional limitations with tools that will allow them to maintain their personal and financial independence and live in the community.
Amends the Deficit Reduction Act of 2005 to repeal appropriations through FY2015 for the National Clearinghouse for Long-Term Care Information.
Section 643 -
Establishes the Commission on Long-Term Care to develop a plan for a system to ensure the availability of long-term services and supports for individuals in need of such services.
Section 644 -
Requires the Secretary to establish a fund to be used to provide assistance and oversight to qualified nonprofit health insurance issuers that have been awarded loans or grants under the Consumer Operated and Oriented Plan (CO-OP) program to offer qualified health plans in the individual and small group markets. Transfers to this new fund 10% of the appropriations to the CO-OP program. Rescinds all other unobligated funds appropriated to the CO-OP program.
Title VII - Extension of Agricultural Programs
Section 701 -
Extends programs under the Food, Conservation, and Energy Act of 2008 through September 30, 2013, with specified exceptions including Pigford claim discrimination determinations.
Extends:
(1) the dairy product price support program through December 31, 2013, and
(2) the milk income loss contract program.
Extends specified commodity programs to crop year 2013, including programs for sugar cane, sugar beets, and peanuts.
Suspends price support authorities for:
(1) covered commodities, peanuts, sugarcane, and sugar through the 2013 crop or production year; and
(2) milk through December 31, 2013.
Amends the Food Security Act of 1985 to extend the conservation reserve program through FY2013. Authorizes appropriations through FY2013 for the voluntary public access and habitat incentive program.
Amends the Food and Nutrition Act of 2008 to reduce FY2013 funding for the supplemental nutrition assistance program (SNAP, formerly the food stamp program) employment and training.
Revises FY2012 through FY2015 funding for the nutrition education and obesity prevention grant program.
Amends the Food, Agriculture, Conservation, and Trade Act of 1990 to authorize FY2013 appropriations for:
(1) the organic agriculture research and extension initiative, and
(2) the specialty crop research initiative.
Amends the Farm Security and Rural Investment Act of 2002 to authorize FY2013 appropriations for:
(1) the beginning farmer and rancher development program,
(2) the biobased markets program,
(3) biorefinery assistance,
(4) repowering assistance,
(5) the bioenergy program for advanced biofuels,
(6) the biodiesel fuel education program,
(7) the rural energy for America program,
(8) biomass research and development,
(9) the rural energy self-sufficiency initiative,
(10) the biomass crop assistance program,
(11) the forest biomass for energy program, and
(12) the community wood energy program.
Authorizes the feedstock flexibility program for energy producers through FY2013. Amends the Farmer-to-Consumer Direct Marketing Act of 1976 to authorize FY2013 appropriations for the farmers market promotion program.
Amends the Food, Conservation, and Energy Act of 2008 to authorize FY2013 appropriations for the national clean plant network.
Amends the Farm Security and Rural Investment Act of 2002 regarding the national organic certification cost-share program to:
(1) make specified Commodity Credit Corporation (CCC) funds available for FY2008 through FY2012, and
(2) authorize FY2013 appropriations.
Authorizes FY2013 appropriations for organic production and market data initiatives.
Amends the Food, Agriculture, Conservation, and Trade Act of 1990 to authorize FY2013 appropriations for outreach and technical assistance for socially disadvantaged farmers or ranchers.
Section 702 -
Amends the Federal Crop Insurance Act to authorize FY2012-FY2013 appropriations for payments to eligible producers for:
(1) livestock death losses in excess of the normal mortality due to adverse weather, including losses from hurricanes, floods, blizzards, disease, wildfires, and extreme heat or cold;
(2) grazing losses for covered livestock due to drought or fire;
(3) emergency relief to eligible producers of livestock, honey bees, and farm-raised fish for losses due to disease, adverse weather, or other conditions such as blizzards and wildfires; and
(4) orchardists and nursery tree growers for commercial losses caused by natural disasters.
Title VIII - Miscellaneous Provisions
Section 801 -
Amends the National Defense Authorization Act for Fiscal Year 2013 to modify requirements concerning presidential notification of any reduction of strategic delivery systems to state that the President shall certify whether the Russian Federation is in compliance (currently, “that” it is in compliance) with its strategic arms control obligations (currently, “arms control obligations”) with the United States and is not violating or acting inconsistently with such obligations.
Section 802 -
Prohibits any cost-of-living adjustment to the rate of pay for Members of Congress during FY2013.
Title IX - Budget Provisions
Subtitle A - Modifications of Sequestration
Section 901 -
Amends the Balanced Budget and Emergency Deficit Control Act of 1985 to reduce the required amount of deficit reduction calculated for FY2013 by $24 billion.
Implements the FY2013 spending reductions required by the Balanced Budget and Emergency Deficit Control Act of 1985 on March 27, 2013 (current law requires a sequestration to eliminate a budget-year breach within 15 calendar days after Congress adjourns).
Postpones from January 2, 2013, until March 1, 2013, the sequestration required under the Budget Control Act of 2011 if a joint committee bill achieving a deficit reduction greater than $1.2 trillion was not enacted by January 15, 2012.
Reduces FY2013 discretionary spending limits to those applicable for FY2012. Reduces FY2014 limits from $1.066 trillion to $1.058 trillion.
Section 902 -
Amends the Internal Revenue Code to permit an applicable tax-deferred retirement plan that includes a qualified Roth contribution (a program under which an employee may elect to make designated Roth contributions in lieu of all or a portion of elective deferrals the employee is otherwise eligible to make under the plan) to allow an individual to elect to have the plan transfer any amount not otherwise distributable to a designated Roth account maintained for the individual's benefit.
Treats such a transfer as a taxable rollover distribution to the account.
(Roth account contributions are made with after-tax funds.) Exempts such a plan, including the federal Thrift Savings Plan, from certain normally applicable restrictions because of such a transfer.
Subtitle B - Budgetary Effects
Section 911 -
Exempts the budgetary effects of this Act from the PAYGO scorecard requirements of the Statutory Pay-As-You-Go Act of 2010 and S.Con.Res. 21, 110th Congress (setting forth the congressional budget for the government for FY2008).

House Republican Conference Summary

The summary below was written by the House Republican Conference, which is the caucus of Republicans in the House of Representatives.

This summary can be found at http://www.gop.gov/bill/112/2/hr8.

Summary

H.R. 8 would provide a one year extension of all current individual tax rates, as well as the 15 percent top rate on capital gains and dividends. The proposal would also extend for one year the estate tax rates at their current levels, the $1,000 child tax credit, marriage penalty relief and certain educational tax credits. The bill would also provide higher small business expensing limits for one year and would repeal the personal exemption phase-out and the “Pease” limitations in 2013. Finally, the bill would provide a two-year AMT patch which would be adjusted for inflation. Coupled with H.R. 6169, H.R. 8 will ensure that individual tax rates will not increase while comprehensive, pro-growth tax reform is crafter under expedited procedures in 2013.

In total, the bill would prevent a tax increase of $383.6 billion, according to the Joint Committee on Taxation (JCT). A summary of the bill’s provisions follows below. For a side-by-side comparison of H.R. 8 and the Democrat substitute amendment, please see the attached document, prepared by the Ways and Means Committee staff.

Individual Income Rates: The bill would extend through December 31, 2013, the current individual income tax brackets of 10 percent, 25 percent, 28 percent, 33 percent, and 35 percent, which are set to expire at the end of calendar year 2012. The following table, prepared by the tax staff of the Ways and Means Committee, shows how tax rates would increase if H.R. 8 is not enacted.

 

Taxable Income of Individuals / Small Businesses (2012 amounts; unless otherwise indicated, amounts will be indexed for inflation in 2013)

Lower Statutory Rates Extended Through 2013 Under Proposal

Higher Statutory Rates Scheduled to Take Effect in 2013 Under Current Law

Up to $8,700 for single filers and Up to $17,400 for joint returns

10 percent

15 percent

Between $8,700 and $35,350 for single filers and
Between $17,400 and $70,700 ($60,350 for 2013) for joint returns

15 percent

15 percent

Between $35,350 and $85,650 for single filers and
Between $70,700 ($60,350 for 2013) and $142,700 for joint returns

25 percent

28 percent

Between $85,650 and $178,650 for single filers and
Between $142,700 and $217,450 for joint returns

28 percent

31 percent

Between $178,650 and $388,350 for single filers and
Between $217,450 and $388,350 for joint returns

33 percent

36 percent

Over $388,350 for both single filers and joint returns

35 percent

39.6 percent

 

Marriage Penalty Relief: The bill would preserve the 2001 tax relief provisions that prevented a marriage penalty by increasing the standard deduction for joint filers to twice the amount available to single filers and the exit point for the 15 percent rate tax bracket. The bill would extend marriage penalty relief through December 31, 2013.

Child Tax Credit: H.R. 8 would provide a one-year extension of the $1,000 child tax credit for children under the age of 17. The 2001 tax relief provision increased the child tax credit from $500 to $1,000. H.R. 8 would extend the $1,000 child credit through December 31, 2013.

Repeal of PEP and Pease:  H.R. 8 would repeal the personal exemption phase-out and the “Pease” limitations in 2013. Since 2010, a provision of law known as the Personal Exemption Phase-out (“PEP”), which had previously phased out the value of the personal exemptions of certain taxpayers, has been repealed. Similarly, since 2010, another provision of law known as the Pease Limitation, which had previously reduced the value of the overall itemized deductions of certain taxpayers, has been repealed. When PEP and the Pease Limitation were in effect prior to 2010, they each created additional, hidden marginal rate increases that applied to ordinary income, capital gains, and dividends, as well as significant compliance burdens. Under current law, both PEP and the Pease Limitation are scheduled to be reinstated in 2013. Under H.R. 8, each of these provisions would be extended through 2013, preventing the additional, hidden marginal rate increases they create from taking effect.

Estate Tax: Currently, the estate tax is set to increase to a tax rate of 55 percent and an exemption amount of $1 million. This bill would extend the current tax rate at 35 percent with an exemption amount of $5 million for the estate, gift, and generation skipping transfer taxes. These amounts would be indexed for inflation. The bill would extend the current estate tax levels through December 31, 2013.  

Education Tax Credits: The bill would extend certain educational tax incentives originally adopted in the 2001 tax relief bill,  including the deduction of student loan interest (maximum of $2,500) for single filers with incomes up to $75,000 and married couples of up to $150,000. H.R. 8 would also extend exclusions for certain employer-provided educational assistance and an expansion of the student loan interest deduction. The bill would extend these education tax benefits through December 31, 2013.

Capital Gains and Dividends: H.R. 8 would temporarily preserve both the capital gains and dividend tax rates at the 15 percent level through December 31, 2013. Without this legislation, capital gains would increase from 15 percent to 20 percent and dividend rates would increase from 15 percent to being taxed as ordinary income, with a top rate of 39.6 percent.

Alternative Minimum Tax Relief:  The bill would provide a two year alternative minimum tax (AMT) patch, which includes the ability to claim nonrefundable personal credits against the tax. For 2011, the most recent year for which an AMT patch was in place, the exemption amount was $48,450 for singles and $74,450 for joint returns. Under current law in effect for 2012 and subsequent years, however, the AMT exemption amount reverts to its pre-2001 level of $33,750 for singles and $45,000 for joint filers, and non-refundable personal credits would no longer be taken against the AMT.  Under H.R. 8, for 2012, the AMT exemption amount would be increased to $50,600 for singles and $78,750 for joint returns; for 2013, the exemption amount would be increased to $51,150 for singles and $79,850 for joint returns. For both 2012 and 2013, non-refundable personal credits would be allowed against the AMT. According to JCT, this two year patch would prevent a $192.7 billion tax increase.

Temporary Extension of Increased Small Business Expensing: Under current law, small businesses may “expense” (immediately deduct, rather than recover over time through annual depreciation deductions) the cost of certain property in the year in which it is placed in service, up to certain limits. Under current law, the amount of qualifying property placed in service that may be expensed is limited to $125,000, with that amount reduced (but not below zero) by the amount by which the cost of such property exceeds $500,000, with both of those amounts adjusted for inflation. For 2012, those inflation-adjusted amounts are $139,000 and $560,000, respectively. However, in 2013, those parameters are scheduled to revert to $25,000 and $200,000, respectively.

Under H.R. 8, the small business expensing parameters that were originally put in place in 2003 as part tax relief legislation ($100,000 and $400,000, respectively) would be extended and adjusted for inflation through December 31, 2013. JCT estimates that, for 2013, the inflation-adjusted amounts provided under the proposal would be $127,000 and $510,000, respectively. According to JCT, the one-year extension of increased small business expensing would prevent a $0.6 billion tax increase over 2013-2022.

Cost

In total, the bill would prevent a tax increase of $383.6 billion, according to the Joint Committee on Taxation (JCT).

House Democratic Caucus Summary

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So, yes, we display the House Republican Conference’s summaries when available even if we do not have a Democratic summary available. That’s because we feel it is better to give you as much information as possible, even if we cannot provide every viewpoint.

We’ll be looking for a source of summaries from the other side in the meanwhile.

The bill contains the following citations to other parts of U.S. law:

Slip Laws

Slip laws refer to enacted bills and joint resolutions in their original form as enacted by Congress, that is, before other laws amend them. Slip laws are cited as “Public Law XXX-YYY”, where XXX is the number of the Congress in which the bill or resolution was introduced.

United States Code

The United States Code is the compilation of permanent laws enacted by Congress. Temporary and other non-permanent laws do not appear in the United States Code. (About half of the United States Code is the law itself, called positive law. The other half is merely a compilation of the laws but has no legal significance.)

Statutes at Large

The United States Statutes at Large is the compilation of all laws enacted by Congress.

  • 121 Stat. 986
  • 122 Stat. 1651
  • 122 Stat. 1893
  • 122 Stat. 1955
  • 122 Stat. 2112
  • 122 Stat. 2209
  • 122 Stat. 2246
  • 124 Stat. 119
  • 124 Stat. 974
  • 125 Stat. 582