E PL UR UM IB N U U S Congressional Record United States th of America PROCEEDINGS AND DEBATES OF THE 115 CONGRESS, FIRST SESSION

Vol. 163 WASHINGTON, FRIDAY, DECEMBER 1, 2017 No. 196 Senate The Senate met at 10 a.m. and was TAX CUTS AND JOBS ACT about how a shutdown would affect called to order by the President pro The PRESIDING OFFICER. Under him politically. It is disappointing but tempore (Mr. HATCH). the previous order, the Senate will re- maybe not surprising that President Trump appears to be putting politics f sume consideration of H.R. 1, which the clerk will report. before the well-being of the American PRAYER The senior assistant legislative clerk people. As President, the welfare of the American people should always come The Chaplain, Dr. Barry C. Black, of- read as follows: first—always. fered the following prayer: A bill (H.R. 1) to provide for reconciliation We have a lot of things to accomplish Let us pray. pursuant to titles II and V of the concurrent by the end of the year, and a govern- Eternal God, You have truly been resolution on the budget for fiscal year 2018. ment spending deal is particularly im- good to us. Even when we stumble and Pending: portant for our men and women in uni- fall, Your mercy continues to sustain McConnell (for Hatch/Murkowski) amend- form, as well as a host of programs us. ment No. 1618, of a perfecting nature. Baldwin motion to commit the bill to the that create jobs and boost the econ- Lead our lawmakers to realize that Committee on Finance, with instructions. omy. the abilities You have given them are Wyden (for Nelson) motion to commit the The President talks about defending maximized only when they are used for bill to the Committee on Finance, with in- the troops and then threatens a shut- Your purposes. Show them the best structions. down. It is a contradiction—a con- way to use their talents and opportuni- The PRESIDING OFFICER. The Sen- tradiction—and I am sure our generals ties to honor and serve You and hu- ator from Colorado. would tell him that even playing manity. ORDER FOR RECESS SUBJECT TO THE CALL OF around with the possibility of seques- May our Senators this day speak THE CHAIR ter and shutting down the government words that are constructive and help- Mr. GARDNER. Madam President, I is no good for our armed services, as ful, bringing encouragement as well as ask unanimous consent that following well as for the rest of the country. vision to their labors. Give them the the remarks of the Senator from Wis- We should all be focused on avoiding wisdom to know Your will and the consin, the Senate stand in recess sub- a government shutdown. Certainly courage to do it. Let Your presence be ject to the call of the chair. Democrats will be working with our felt in this Chamber and everywhere on The PRESIDING OFFICER. Without Republican colleagues in Congress to Earth. objection, it is so ordered. that end. I think our Republican col- We pray in Your Holy Name. Amen. RECOGNITION OF THE MINORITY LEADER leagues agree. I hope they won’t suc- f The Democratic leader is recognized. cumb to President Trump’s whim based GOVERNMENT FUNDING on a political decision and not on what PLEDGE OF ALLEGIANCE Mr. SCHUMER. Madam President, is good for America. President Trump The President pro tempore led the before I address the issue of taxes, let must change his tune—and soon—if he Pledge of Allegiance, as follows: me address the matter of the govern- wants to be a constructive partner in I pledge allegiance to the Flag of the ment funding bill. those discussions rather than the focal United States of America, and to the Repub- We are now only a week away from a point of blame. lic for which it stands, one nation under God, government shutdown, which, to re- Madam President, on taxes, my Re- indivisible, with liberty and justice for all. mind my colleagues, could cost our publican friends have stretched into economy thousands of jobs and billions day 2 of their debate on the bill, which f of dollars, as it did in 2013. I think a still lacks resolution on some critical RESERVATION OF LEADER TIME government shutdown is something we issues. After promising over the past few The PRESIDING OFFICER (Mrs. all desperately want to avoid, Demo- crats and Republicans—I talked to months that their tax bill would pay CAPITO). Under the previous order, the for itself through economic growth, the leadership time is reserved. some of my colleagues this morning— with the exception, it seems, of the Joint Committee on Taxation came out f President. with a report yesterday that showed This morning’s Washington Post re- that these promises were unfounded, CONCLUSION OF MORNING ports that President Trump has told way off the mark. Even considering BUSINESS his confidantes that a government economic growth, the Republican tax The PRESIDING OFFICER. Morning shutdown could be good for him politi- bill will add roughly $1 trillion to the business is closed. cally and that he has asked friends deficit. And many economists have said

∑ This ‘‘bullet’’ symbol identifies statements or insertions which are not spoken by a Member of the Senate on the floor.

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VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00001 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.000 S01DEPT1 S7654 CONGRESSIONAL RECORD — SENATE December 1, 2017 that this dynamic scoring doesn’t work magnitude? What might have been powerful. It makes healthcare less af- at all. Here, the JCT gave credence to snuck in? What might have been fordable and less accessible. It will de- the theory of dynamic scoring but then changed by mistake—an innocent mis- prive the government of the resources came out with a number that was not take? There are so many reasons to not needed to support the military, sci- the kind of wild exaggerations we are rush this bill through, but we know entific research, education, and infra- hearing from the Secretary of the why it is being done. We know why Re- structure. Treasury, from the President, and from publican Members will only have a few The hole it blows in the deficit will— some of our Republican colleagues, hours at most to read the draft legisla- make no mistake—endanger Social Se- particularly those of the Club for tion before voting on it. curity, Medicare, and Medicaid. Repub- Growth bent. Notching a political win, I would say licans, including President Trump, Earlier in this debate, Republicans to my colleagues, isn’t a good enough have openly admitted that they will claimed that this would be a tax cut reason to throw common sense and leg- seek changes in this program after the for everybody and that nobody in the islative responsibility out the window. tax bill. Senator SANDERS has outlined middle class is going to get a tax in- Notching a political win isn’t a good eloquently how dangerous this bill is to crease. Independent analyses show that enough reason to raise taxes and pre- the future of Social Security and Medi- these claims were not valid, and to miums on millions of middle-classes care. I know our Republican colleagues their credit, some Republicans cor- families when there is a much better who came down to argue against him rected the record. bill to be had by working in a bipar- were all on the defensive. Now Republicans have gotten the tisan way, Democrats and Republicans, All the things our President and Re- ‘‘dynamic scoring’’ they have de- across the aisle, together. My Repub- publicans say they wanted to do are manded for years. They are in charge. lican friends must know that ‘‘we need- not happening. And this bill moves in They put dynamic scoring in place. It ed to notch a political win’’ isn’t a the opposite direction—not only on is still not good enough. As recently as good enough excuse for a constituent helping the wealthy and not helping this week, the Republican leader and who asks why you voted to raise their the middle class in the way it needs to others claimed that this bill would not taxes but slash them for big corpora- but also in endangering Social Security add to the deficit. We know now that tions. and Medicare. Most insidious of all, the even under the dynamic scoring meth- Today may be the first day of the bill hides a ticking time bomb of mid- od the Republican Party asked for and new Republican Party—one that raises dle-class tax hikes at the center of our received, this bill would add $1 trillion taxes on the middle class. The one Tax Code. Who would want to vote for to the deficit. All of the claims that thing Republicans always promised the that? tax cuts for the wealthy and corpora- middle class is, we are not going to Many of my Republican friends feel tions will pay for themselves were not raise your taxes. A good number of my that the hard right—big, wealthy cor- correct. It is time for my Republican colleagues from the other side of the porate interests—will put these ads on friends to admit the error and come aisle—the junior Senator from Texas— TV saying that this bill helps the mid- clean with the American people. I heard him talk about it—said he dle class. It is not going to work. When The fact that we received the dy- doesn’t want to raise taxes on any mid- the middle class gets a tax increase, namic score only a day before a final dle-class person, but this bill does it. they are going to know why, and they vote on the bill shows just how fool- The Republican Party is abandoning are going to know whom to blame, and hardy it is to rush a bill like this its long-held principles to please its po- these ads will have faded into the air. through. litical pay masters. It is a bad move for Today, my Republican friends can From press reports, we know that the the Republicans, as well as a bad move choose to cement their party as the Republicans are making the pass- for America. party that raises taxes on the middle through provisions more generous, wid- Again, ‘‘we needed to notch a polit- class. It will be a dramatic turning ening what was already a gargantuan ical win’’ is going to be no excuse when point in a downward spiral for the Re- tax loophole for wealthy business own- your constituents complain that they publicans and something they have ers. Why should wealthy business own- are getting the short end of the stick never believed in before. But Repub- ers pay a significantly lower rate on in this tax bill and wealthy corpora- licans have an alternative. They can their personal income, because they tions, the richest people, are not. step back from the brink and work are paying no corporate tax if they use Democrats remain united against with Democrats on a bipartisan tax re- the passthrough, than the average any middle-class tax increase, and we form bill to deliver across-the-board American? That is what this bill does. will fight to reverse that. The stakes tax relief to the middle class, a bill Hedge funds, big fancy law firms, and are too high. Our economy is already that makes our businesses more com- lobbyist firms would all get a lower stacked against working men and petitive while closing egregious cor- rate than the average American be- women. Corporate profits and stocks porate loopholes and that grows our cause of the passthrough. The average have reached alltime highs. The top 1 economy without adding a penny to American who makes $100,000, $200,000 percent capture 20 percent of the na- the deficit. is already paying in the 30-percent tional income—higher than at any Bipartisan tax reform—not this cyn- range. time in our history since the roaring ical bill, not this partisan exercise, not From press reports—you would think twenties. this bill that seems to please the 1 per- that maybe Republicans would be con- Meanwhile, for too many Americans, cent but not the rest of America—is cerned by the many reports that their the American dream is slipping away. possible but only if my friends and col- bill increases taxes on 60 percent of Hard-working Americans who get up leagues will abandon this bill and reach middle-class families by the end of the every morning worried about paying out for a better kind of politics. day. No. Instead, the holdout Repub- the bills, making the mortgage pay- Mr. President, I yield the floor. licans are concerned that this bill isn’t ment, the tuition payment, the The PRESIDING OFFICER. The Sen- generous enough to corporations and healthcare bill, are not getting the ator from Wisconsin. wealthy business owners. So now the help they need in this bill. Instead, it is MOTION TO COMMIT Republican leadership is working to fix going to the wealthiest, biggest cor- Ms. BALDWIN. Madam President, I that. In the waning hours, this bill is porations on a theory of trickle-down, rise to offer motion to do something tilting even further toward business, which almost everyone accepts and that this tax plan fails to do: make even further away from families. Every rightwing economists agree has never good on President Trump’s promise to time the choice is between big corpora- made sense. close the carried interest tax loophole. tions and families, the Republicans Any moral tax bill would focus on This motion has the support of Sen- choose the big corporations. giving a leg up to middle-class Ameri- ators WHITEHOUSE, DONNELLY, and VAN And still no one knows what the final cans, to working class Americans. In- HOLLEN. bill will look like. Why on Earth stead, this bill directs the lion’s share I think we need to make our tax sys- wouldn’t you want to spend more than of its benefits to those at the very tem simpler and fairer for hard-work- a few hours looking at a bill of this top—the already wealthy, the already ing families, businesses—particularly

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00002 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.002 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7655 small businesses—and manufacturers, pay. Earlier this year, I introduced the called to order by the Presiding Officer and that is what I have been working Carried Interest Fairness Act to close (Mrs. CAPITO). for. Unfortunately, this is not the plan the carried interest tax loophole for f being presented today by Senate Re- millionaires and billionaires on Wall TAX CUTS AND JOBS ACT— publicans. Street. Let’s be honest with the American The carried interest loophole allows CONTINUED people. This bill is largely a tax give- certain investment managers to take The PRESIDING OFFICER. The Sen- away to the wealthiest few and big cor- advantage of the preferential 20 per- ator from Florida. porations, while millions of middle- cent long-term capital gains tax rates MOTION TO COMMIT class families will get a tax hike. With on the income they get for managing Mr. NELSON. Madam President, the this partisan bill from across the aisle, other people’s money, rather than the matter that is before the Senate is the big corporations get permanent tax ordinary income tax rates of up to 39.6 motion I have offered. It simply is, in breaks—permanent—while middle-class percent that American workers pay. this tax bill, the corporate rate is re- families will see tax increases. In fact, My legislation closes the carried inter- duced from 35 percent down to 20 per- most Americans earning less than est tax loophole by ensuring that in- cent, and that is permanent, but the $75,000 a year will see tax increases. come earned by managing other peo- modest, middle-class tax breaks are That is simply not fair. ple’s money is taxed at the same ordi- not permanent, and in 7 or 8 years they It is also not fair that the top 1 per- nary income tax rates as the vast ma- cease to exist. They sunset. So, in this cent will end up with over 60 percent of jority of working Americans pay. tax bill, you want to give permanent, the benefits, and in exchange, 13 mil- As a candidate, President Trump in- huge corporate cuts, from 35 down to lion more will lose health insurance. cluded closing the carried interest tax 20. By the way, if the American cor- Healthcare premiums will increase by loophole in his tax reform plan. While poration is doing business overseas, it 10 percent, and Medicare and Medicaid campaigning in Detroit last year, he is basically a zero tax rate, which is an have been put on the chopping block to said: ‘‘We will eliminate the carried in- incentive to go overseas, send jobs pay for it. terest deduction and other special in- overseas. American jobs are lost while In addition, with the Senate Repub- terest loopholes that have been so good giving those huge corporate breaks at lican plan, powerful corporations can for Wall Street investors, and for peo- the same time it is giving modest still deduct their State and local taxes, ple like me, but unfair to American breaks to the very people who need the but they completely eliminate the workers.’’ tax cuts; that is, hard-working Amer- State and local tax deduction for indi- Then this May, after being asked why ican families, the middle class. Then, vidual taxpayers. This deduction en- his tax reform outline didn’t mention oh, by the way, in 7 or 8 years, va- sures households aren’t taxed twice by carried interest after campaigning on moose, it is gone, no tax break. It goes the Federal Government on money its closure, the President responded by back up. It is a tax increase. That is they have already paid in State and saying: simply not fair. local taxes, including property taxes. It’s out. Done . . . carried interest was So this little motion simply says go But with the current Senate plan, great for me, but carried interest was unfair back to the Finance Committee and nearly one in three Wisconsinites will and it’s gone. correct this inequity. Go back to the lose their personal income, sales, and I agree that it is unfair and it should Finance Committee, make the middle- property tax deductions. A recent be eliminated. However, it is not gone class tax cuts permanent, and then get study shows that it could decrease the with this legislation. This loophole for the Finance Committee to offset those value of home ownership. The average Wall Street is still in the bill. Why? Is with revenue from someplace. Do you deduction in Wisconsin is $11,653, and it because my Republican colleagues know where that someplace should be? nearly $10 billion of Wisconsinites’ pay- on the other side of the aisle simply do It ought to be the huge corporate tax checks would be subject to a double not believe a word this President says? cuts. That is where the revenue ought tax—all to pay for a plan that favors Is it because Wall Street lobbyists, big to be taken back from to give that rev- those at the top. What is more, by the banks, and hedge funds have such a enue or tax cuts to the middle class. It latest estimation from our own con- grip on Washington? Is it because these is a simple issue of fairness. gressional scorekeeper, this plan will are the very donors that this legisla- I am delighted to be joined by my add $1 trillion—$1 trillion—to our def- tion is meant to serve with a win? colleague from Minnesota. icit, breaking our promise to the next Today I am offering a motion to close I yield the floor. generation and sticking them with the the carried interest tax loophole once The PRESIDING OFFICER. The Sen- bill. and for all. It is simply unfair for Wis- ator from Minnesota. Our Tax Code ought to reward hard consin workers to pay higher income Ms. KLOBUCHAR. Madam President, work more than it rewards wealth. It tax rates than a billionaire hedge fund I thank Senator NELSON for his leader- doesn’t do that today, and it will not on Wall Street. ship on this motion. It is a very simple do that tomorrow if this bill passes. In If you agree, you will support this motion for a very simple proposition; fact, this Republican plan’s primary motion. If you want to help President that is, that the Tax Code should be purpose is to reward Fortune 500 cor- Trump keep his promises to the Amer- simpler. That is true. We should make porations who will simply reward the ican people, you will support this mo- it more streamlined. That is true, but wealth of shareholders, not the hard tion. Let’s do right by the American our focus should be helping the people work that drives productivity and people and close this tax loophole for of America. growth across our economy. the wealthy on Wall Street. Let’s make Our problem with the bill that is on The primary promise of this legisla- sure that our Tax Code rewards hard the floor right now is that it is weight- tion makes the same promise that has work as much as it currently rewards ed much too heavily in terms of help- not been kept to workers for decades. wealth. If that isn’t simple and fair, I ing the wealthiest among us and not Trickle-down economics has not don’t know what is. the middle class. Senator NELSON’s worked in the past, and it is not going I yield the floor. amendment, which I am a proud co- to work now. American workers know f sponsor of, gets right to the meat of that. But my colleagues, rushing to this, to the bread and butter, to help- pass this legislation, don’t seem to RECESS SUBJECT TO THE CALL OF ing the middle class with their gro- care, because the only thing that mat- THE CHAIR ceries—since I used meat and bread and ters is delivering for donors, who have The PRESIDING OFFICER. Under butter—but also with their mortgages, too much power and influence in Wash- the previous order, the Senate stands with paying for college, with every- ington. in recess subject to the call of the thing they need to do. Our problem I want to see loopholes closed, like Chair. with the bill right now is that too the one that favors Wall Street hedge Thereupon, the Senate, at 10:36 a.m., much of it goes to the top. funds and allows them to pay a lower recessed subject to the call of the Chair In fact, when you look at the num- tax rate than many Wisconsin workers and reassembled at 11:34 a.m. when bers, it is quite startling. The first

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00003 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.004 S01DEPT1 S7656 CONGRESSIONAL RECORD — SENATE December 1, 2017 thing you notice for the middle class is lege, and, with this tax bill this is our Lee Risch Sullivan that $1.4 trillion in additional debt opportunity to address that. McCain Roberts Thune McConnell Rounds Tillis comes out of this bill. Now, our col- A tax bill should be the value state- Moran Rubio Toomey leagues were claiming until yesterday, ment for our government, the value Murkowski Sasse Wicker well, that is going to be offset with all statement for America. So I ask my Paul Scott Young Perdue Shelby this economic growth we are going to colleagues to come back to the table, Portman Strange see. What did we find out? Even when to come back to the table to talk about The motion was rejected. you consider that—and this is by the a bill that would bring down that cor- nonpartisan Joint Committee on Tax- porate rate. I am all in favor of that. VOTE ON MOTION TO COMMIT ation that looked at this. They are like I have 18 Fortune 500 companies. I The PRESIDING OFFICER. The the umpire. They do the scorecard. know how important they are to jobs question is on agreeing to the Baldwin They looked at this, and they said: in my State, but they don’t have to go motion to commit. Yes, it is about 1.4, $1.5 trillion in debt. down to the extreme rate that they Mr. BARRASSO. Madam President, I It does produce some economic growth, are. Instead, that money should be ask for the yeas and nays. but guess what. The net is over a tril- used to help the middle class, while The PRESIDING OFFICER. Is there a lion dollars in debt. bringing down the corporate rate, sufficient second? Now, whose shoulder is that going to while bringing in that money from There appears to be a sufficient sec- be on? That debt is going to be on the overseas and plugging some of it into ond. middle class and their kids and their this Nation’s infrastructure to literally The clerk will call the roll. grandkids, and that is the No. 1 reason help us with the roads and bridges and The bill clerk called the roll. The result was announced—yeas 48, why I am so concerned about this bill rail we have now, but that isn’t in this nays 52, as follows: and why I stood with 17 other Demo- bill. crats, including Senator NELSON, just So we tell our colleagues this is a [Rollcall Vote No. 291 Leg.] this last week and said: Come to the moment in time where you could actu- YEAS—48 table. This is your moment for our col- ally work with us on something that Baldwin Gillibrand Murray leagues on the Republican side of the makes sense for America. Don’t squan- Bennet Harris Nelson Blumenthal Hassan Peters aisle. While the White House is busy der it. Booker Heinrich Reed sending out tweets and going after this I appreciate the time from Senator Brown Heitkamp Sanders person and that person and this group NELSON and his leadership. Cantwell Hirono Schatz and that group, someone has to govern, Cardin Kaine Schumer I yield the floor. Carper King Shaheen and this is their moment to govern, to The PRESIDING OFFICER. The Sen- Casey Klobuchar Stabenow work with us on a bill that doesn’t add ator from Mississippi. Coons Leahy Tester this debt that gives the middle class Cortez Masto Manchin Udall Mr. WICKER. Madam President, on Donnelly Markey Van Hollen more than just a lump of debt in their behalf of the majority, I yield back all Duckworth McCaskill Warner stocking. time. Durbin Menendez Warren What Senator NELSON’s amendment The PRESIDING OFFICER. The Sen- Feinstein Merkley Whitehouse Franken Murphy Wyden smartly does is, it says: Let’s go back ator from Florida. and actually have hearings. Let’s go Mr. NELSON. Madam President, we NAYS—52 back and in a deficit-neutral manner yield back all time as well. Alexander Flake Perdue help the middle class. That is what we The PRESIDING OFFICER. All time Barrasso Gardner Portman Blunt Graham have to do. is yielded back. Risch Even though we appeared to be very Boozman Grassley Roberts The question is on agreeing to the Burr Hatch close to voting on this bill, we still Rounds Nelson motion to commit. Capito Heller Rubio don’t know what exactly is in the final Mr. WICKER. Madam President, I Cassidy Hoeven Sasse version of this bill. We know what isn’t Cochran Inhofe Scott ask for the yeas and nays. Collins Isakson Shelby in it. Where is this Buffett rule that Corker Johnson The PRESIDING OFFICER. Is there a Strange would make it more fair for everyone? Cornyn Kennedy sufficient second? Sullivan Cotton Lankford What are we doing about the oil give- There appears to be a sufficient sec- Thune aways? What are we doing about the Crapo Lee ond. Cruz McCain Tillis carried interest loophole? None of this Daines McConnell Toomey The clerk will call the roll. Wicker is in the bill. Instead, there is $1.4 tril- The legislative clerk called the roll. Enzi Moran lion in debt. So that is why I strongly Ernst Murkowski Young The result was announced—yeas 48, Fischer Paul support Senator NELSON’s amendment. nays 52, as follows: I would also add other amendments The motion was rejected. that should be considered that I have [Rollcall Vote No. 290 Leg.] The PRESIDING OFFICER (Mr. KEN- submitted: savings for servicemembers YEAS—48 NEDY). The Senator from Oklahoma. to help lower the out-of-pocket costs Baldwin Gillibrand Murray Mr. LANKFORD. Mr. President, I ask Bennet Harris Nelson unanimous consent that Senator for National Guard members, an Blumenthal Hassan Peters amendment that would help address Booker Heinrich Reed CARDIN be recognized to offer a motion the cost millions of people face when Brown Heitkamp Sanders to commit, which is at the desk, and they are providing elder care for loved Cantwell Hirono Schatz that the time until 2 p.m. be equally Cardin Kaine Schumer divided in the usual form on the mo- ones, an amendment that would make Carper King Shaheen it easier to use 529 education savings Casey Klobuchar Stabenow tion; further, that at 2 p.m., the Senate accounts to help workers develop the Coons Leahy Tester vote in relation to the motion with no Cortez Masto Manchin Udall intervening action or debate. I further skills they need for 21st century jobs, Donnelly Markey Van Hollen and also other ones related to agri- Duckworth McCaskill Warner ask that following disposition of the culture. Durbin Menendez Warren motion, the majority leader or his des- Senator NELSON’s amendment and all Feinstein Merkley Whitehouse ignee be recognized. these amendments are geared and fo- Franken Murphy Wyden The PRESIDING OFFICER. Is there cused on the middle class. We are liv- NAYS—52 objection? ing in a time when the wealthier have Alexander Cornyn Graham Without objection, it is so ordered. been getting wealthier and the middle Barrasso Cotton Grassley The Senator from Maryland. Blunt Crapo Hatch MOTION TO COMMIT class have been losing ground. They Boozman Cruz Heller may have jobs now because our econ- Burr Daines Hoeven Mr. CARDIN. Mr. President, I have a omy has rebounded, but the cost of Capito Enzi Inhofe motion at the desk. things has gotten so expensive, wheth- Cassidy Ernst Isakson The PRESIDING OFFICER. The Cochran Fischer Johnson er it is their cable bill, whether it is Collins Flake Kennedy clerk will report the motion. the cost of sending their kids to col- Corker Gardner Lankford The bill clerk read as follows:

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00004 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.006 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7657 The Senator from Maryland [Mr. CARDIN] but, even now, we have the so-called from the truth in order to jam this ter- moves to commit the bill H.R. 1 to the Com- dynamic score that takes into consid- rible tax bill through Congress. mittee on Finance of the Senate with in- eration predicted economic changes They said it was going to lower taxes structions to report the same back to the that try to make it more favorable, for the middle class. Well, it will not. Senate in 3 days, not counting any day on They claim it is going to create jobs. which the Senate is not in session, with and that is in excess of $1 trillion. That changes that— is unacceptable. It should be unaccept- Experts tell us the exact opposite. (1) are within the jurisdiction of such com- able to every Member of this body. They are once again telling families mittee; and This amendment will help us in doing to place their faith on tired trickle- (2) in order to fix and enhance our coun- that, in that it will take at least the down economic theories, and we have try’s infrastructure, help create jobs, and re- $300 billion, which is one-time-only seen how that works. It doesn’t. sponsibly use one-time revenue for one-time revenue, and not allow it to be used in Unfortunately, I could go on, but I spending, designate the revenue raised by the budget itself. Instead, we wall that did come to the floor this afternoon to the deemed repatriation provisions of the clear up any remaining confusion bill for infrastructure improvements. off and use it for infrastructure. I serve on the Environment and Pub- about one particular claim that Senate The PRESIDING OFFICER. The Sen- lic Works Committee, in addition to Republicans are making in order to ator from Maryland. the Senate Finance Committee. I can justify handing more tax breaks to Mr. CARDIN. Mr. President, I urge tell you that the unmet transportation massive corporations and the wealthy. my colleagues to support this motion. needs, water infrastructure needs, and The Senate Republican tax bill in- This motion will send H.R. 1 back to energy infrastructure needs in this cludes a truly devastating healthcare the Committee on Finance with in- country are well documented. We know change that is going to raise families’ structions to return it within 3 days to we need to modernize our transit sys- premiums, cause millions of people to deal with one of the principal purposes tems, our roads, our bridges, our water lose their coverage, and create even of this act, and that is to create jobs. I infrastructure, and our energy infra- more chaos and instability in our am pleased that I am joined in this ef- structure. We need to modernize them, healthcare markets. People have re- fort by Senators FEINSTEIN, particularly if we are going to be com- jected every single Republican attempt BLUMENTHAL, UDALL, CASEY, STABE- petitive. This motion will set up the this year to undermine their NOW, KLOBUCHAR, and HARRIS. right priority for modernizing Amer- healthcare, so it is worth asking, why As I explained yesterday—but I want ica’s infrastructure. are they doing it again? Why are Re- to just go over this, if I could—this What does that mean with regard to publicans doing it in this bill? The an- particular motion is based upon a bi- jobs? Speaker RYAN used the number of swer is simple. Republicans wanted to partisan recommendation in the last a little less than 1 million jobs that are spend the savings from taking away Congress that came out of the Senate created spending $1.5 trillion. That is millions of people’s healthcare on tax Finance Committee. We had working about $1.5 million per job. That is not cuts for those at the top. groups that took a look at the different very good by anyone’s standards. We Taking healthcare away from fami- aspects of our Tax Code in areas that have projections that $300 billion—far lies to pay for big corporations’ tax we need to reform, and there was gen- less than $1.5 trillion—will create 4 breaks is bad enough; what makes it eral agreement that we need to deal million great jobs here in America. even worse is how they are trying to with the fact that American companies Here is a chance to really create jobs deny what they are doing. have earned earnings overseas, and but at the same time produce a much Senate Republicans are claiming that they have parked those funds overseas more up-to-date, modern transpor- if they pass the bipartisan bill that and have not brought them back to the tation system for this country. I have Chairman ALEXANDER and I agreed on, United States because of the differen- the honor of representing Maryland in all the damage from the healthcare tial tax rates between our corporate the Senate. I can tell you that we need sabotage in their tax bill will somehow taxes and the tax rates overseas. The significant resources to update our go away. They couldn’t be more wrong. American companies were not willing transit system. The WMATA system is Our bill, the Alexander-Murray bill, to pay the taxes. So, therefore, they old and needs improvements, and needs was designed to shore up the existing leave the money overseas. To bring further investments. We are in the sec- healthcare system and deal with the that money back is called repatriation. ond worst congested area here in Wash- problems that President Trump and So the money comes back to the ington. We need investments in roads. Republicans already created, not to United States. We have done this be- Our bridges are in serious trouble. We solve the new problems in this awful fore, and we imposed a lower tax rate have a major water main break every Republican tax bill. And just yester- in order to get the money back here in day in this country—every day. We day, the nonpartisan Congressional the United States. need billions of dollars to fix our water Budget Office confirmed that. Here is The challenge with that proposal is a infrastructure. what they said will happen regardless couple things. But, first, it is not a per- Here is an opportunity for us to of whether Alexander-Murray becomes manent revenue flow. It is a one-time- speak to two major priorities. One is law as well: Premiums will go up 10 only revenue flow. We had the numbers fiscal responsibility. Let’s do this in percent each year, 13 million people on the House-passed bill, which would the right way, not spend one-time-only will lose coverage, and markets will be bring in somewhere around $300 billion money. Two, we can take care of the even more unstable, which experts of one-time-only revenue. international tax problems of Amer- have said will cause some of our com- The problem is that H.R. 1 includes ican companies that have money over- munities to lose their coverage op- provisions that use those revenues that seas. Third, we can repair our infra- tions. bring that in as repatriation but uses structure without raising the debt. There has been some discussion on the money on a permanent basis to I urge my colleagues to support this whether passing something called rein- give permanent tax relief to businesses motion so that we can really create surance, which is a program designed and that puts us deeper in a hole as it jobs and not add to the deficit and to to help with the cost of enrolling the relates to the deficit of this country. help the people of this country. sickest patients, might mitigate the This bill already is too expensive. We I yield the floor. serious damage this Republican tax bill know that. I think my Republican col- The PRESIDING OFFICER. The Sen- would do. The answer is no there as leagues know that. The American pub- ator from Washington. well. This policy is good policy on its lic knows that—that it will add to the Mrs. MURRAY. Mr. President, I come own, but it will not stop the premium deficit. We now have not only the to the floor this afternoon to speak on increases, and it will not stop the cov- scores that we traditionally use from behalf of myself, along with Senator erage losses and the chaos this Repub- the Joint Committee on Taxation as to WYDEN, about the incredible healthcare lican tax bill will cause. how much it would cost, and we know impacts that this tax bill will have on The Republicans are doing every- it is somewhere in excess of $1.5 tril- families. thing they can to avoid the facts, but lion—closer to $2 trillion if you extend It is astonishing just how far my Re- that doesn’t make them go away. all the sunsets that are in the bill— publican colleagues are willing to run While hiding behind these bipartisan

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00005 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.003 S01DEPT1 S7658 CONGRESSIONAL RECORD — SENATE December 1, 2017 bills might seem like a good talking cies, which often lack consumer pro- We should not be doing what is on point in Washington, DC, political tections and in so many instances have offer this morning. What is on offer cover doesn’t pay families’ medical been a magnet for fraud and unscrupu- this morning is turning back the clock bills or give them their coverage back. lous sales practices. on American healthcare, turning back It does not help people with preexisting For example, the paper this morning the clock to those dark days when the conditions who may get priced out of talked about how—I will read it. ‘‘Ex- insurance companies could beat the the market. It doesn’t help people in amples abound of people who are stuffing out of somebody who had a communities where markets are al- dumped from such policies’’—these preexisting condition. We are better ready unstable thanks to President short-term policies—‘‘or denied cov- than that. We still have time. As I have Trump’s year of sabotage, meaning in- erage, mired in debt and medical bills said on the floor, as the ranking Demo- surers are ready to exit if things get totaling thousands, if not hundreds of crat on the Finance Committee, we worse. thousands of dollars.’’ It documents still have time to choose a different One more point. Over the last year of the various sales tactics used to rip course. A few days ago, 17 Democratic roller coasters on healthcare, there is people off. I remember what those tac- Senators—led by Senators MANCHIN, one thing we could count on; that is, tics were like. When I was director of KAINE, DONNELLY, and HEITKAMP—came President Trump and the Republican the senior citizens, the Gray Panthers, together and said: We want to find leaders making empty promises. Re- at home, it was common for agents to common ground on taxes. I have writ- publicans who are comfortable voting sell policy after policy that was not ten two bipartisan, comprehensive Fed- for this awful tax bill because of prom- worth much more than the paper it was eral income tax bills, the most recent ises they got from President Trump— written on. It sure sounds to me as one with a member of the President’s who called his own TrumpCare bill though these short-term policies, while Cabinet. ‘‘mean’’ when it suited him—and Re- a different time, are going to encour- We don’t have to go this route. We publican leaders who have written age the same kinds of rip-off practices don’t have to go this route on taxes. check after check they couldn’t cash that are going to harm our people. We certainly don’t have to do it on on healthcare are placing a bet that is As we have touched on, we have healthcare. There are approaches that more than risky. In fact, this bet is so heard from Senators on the other side would bring us together, and I have risky, it requires House Republicans that they think that if they vote for just described several of them. What I voting in favor of supporting this bill, what they are going to be able know we shouldn’t do is turn back the ObamaCare changes they have already to do is get two other bills that some- clock to the days when healthcare in said they oppose. If you have spent 5 how will mitigate, will eliminate a lot America was for the healthy and minutes in this Congress, you should of the harm this horribly flawed bill is wealthy. That is what you get when know that getting House Republicans going to do. It is going to harm mil- you green-light discrimination against to support ObamaCare is as tough a lions of middle-class families who don’t people with preexisting conditions. If sell as it gets. get a fair shake in the marketplace and they are healthy, no problem. If they The truth is, if Republicans are seri- then inflict all this damage on are wealthy, they can take care of it. ous about not undermining families’ healthcare that I just described. We should reject this bill and espe- healthcare, there is a very easy way for I happen to think these two bills are cially the provisions that relate to them to actually do that. They can constructive bills. The Alexander-Mur- healthcare and that take America back step back from the brink right now and ray bill will make payments that will to dark days, horrible days when work with Democrats on healthcare help limit the amount low-income healthcare in America was essentially and taxes in ways that actually help, Americans pay for health insurance. for the healthy and wealthy. not hurt, the people we are supposed to Our colleagues, Senators COLLINS and I yield the floor. be here to serve. They are far down the NELSON, have another constructive The PRESIDING OFFICER. The Sen- road, I understand, but it is not too idea—reinsurance money. That helps to ator from Vermont. late. They can turn around. It is not stabilize the insurance market, which, Mr. SANDERS. Mr. President, it is too late to do the right thing. That is by the way, the President of the United no secret that I am strongly opposed to what we are asking. States has worked so hard to desta- this disastrous, unfair, and destructive Mr. President, I yield the floor. bilize. The fact is, the Congressional piece of legislation that we are debat- The PRESIDING OFFICER. The Sen- Budget Office, which is the nonpartisan ing today that will give massive tax ator from Oregon. group of experts we use, has made it breaks to the wealthiest people in our Mr. WYDEN. Mr. President, I want to clear that these two bills will not even country, to the most profitable cor- pick up where Senator MURRAY left off come close to wiping out the disastrous porations, and to billionaire campaign and emphasize to colleagues that not consequences of the health provisions contributors. only would this bill raise taxes on mil- in this bill that the Senate is about to What really concerns me is that we lions of middle-class families, but it vote for. are debating, as everybody acknowl- would also be a dagger in the heart of I want to be clear. This is not just a edges, a very complicated and con- the Affordable Care Act, causing mil- tax bill, not just a bill with handouts fusing piece of legislation that is over lions to lose their coverage and raise to multinational corporations and a 500 pages long. Here we are a few hours costs for millions more. By gutting the grab bag full of goodies for campaign before we are going to be voting on this personal responsibility portion of the supporters and powerful, well-con- legislation, and nobody has seen it. No- Affordable Care Act, this legislation is nected interests. It is not just that. It body even knows what is in this legis- going to take America back to the days is a big step backward in the cause of lation. It is probably being written as when healthcare was for the healthy making sure that all our people have we speak right now. That is not a very and wealthy because it will green-light affordable, accessible healthcare. effective or intelligent way to deal once more discriminating against What we ought to be doing is looking with legislation that impacts every those with preexisting conditions. It at ways to come together and find com- American and trillions of dollars. will say the insurance companies can mon ground on provisions that we One of the concerns I have as we look go out and beat the stuffing out of know are cost-effective, things like the at this bill is that there are provisions somebody who has a preexisting condi- children’s health bill, which if I had my in it that nobody really understands in tion. way would have been passed a long terms of whom it impacts and whom it If that is not enough, evidence this time ago, and community health cen- benefits. As one example, buried in this morning in the paper shows that this ters and other vital provisions. We legislation, on page 503, section 14504, will trigger a new wave of health insur- should be building on what we have, is a paragraph entitled ‘‘Modification ance scams and rip-offs that are going such as holding down the cost of phar- to Source Rules Involving Posses- to harm our people. This morning in maceuticals, for example, targeting the sions.’’ That is the title of that section. the paper, they talked about how this middlemen who are at the heart of the What does that mean? As best we can is going to encourage these cheap, problem. That is what we ought to be understand, it means that if you are a junk, short-term health insurance poli- doing. hedge fund manager who is a resident

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00006 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.010 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7659 of the Virgin Islands, you will be able In 2004, legislation was written that make this grotesque inequality even to get a major tax break on capital we were very much involved in that worse by giving 62 percent of the tax gains and a 90-percent reduction in tax helped eliminate the loophole by re- benefits to the top 1 percent. liability on your income. quiring U.S. citizens to be bona fide I want to get back to this one point. It has been estimated that corpora- residents of the Virgin Islands and im- I suspect that when you rush a bill of tions and the wealthy are avoiding posing U.S. tax on income effectively this magnitude through the U.S. Sen- over $100 billion each and every year by connected with the United States. ate when there have been virtually no stashing their cash in the Caribbean Now, in the dark of night, as I have in- hearings, no experts, no real ability to and other offshore tax havens. It ap- dicated, it appears that we have a pro- have significant debate and discussion pears that this provision will make a vision that is relaxing this rule. at the committee level, what you are bad situation even worse. In adding in- From our conversations, I know the going to find the day after this bill is sult to injury, it appears that this pro- Senator understands that we all want passed are absolutely outrageous provi- vision may help only a handful of to help the people of the Virgin Islands sions. wealthy hedge fund managers who have after a devastating hurricane. Are we I suspect—I don’t know, and I would claimed residency in the Virgin Is- helping people by creating a huge, new like my Republican colleagues to help lands. It has been estimated that this loophole, possibly for a handful of us here; I cannot verify because we provision alone—one provision in a 500- those people who are especially well don’t have the information—that on plus page bill—will cost over $600 mil- connected and can get to the Finance page 503, section 14504, there is a provi- lion in lost revenue in the next dec- Committee? I am convinced that if one sion that will provide $600 million in ade—$600 million in lost revenue when looks at the Paradise Papers and the tax breaks over a 10-year period that we have a $20 trillion debt and 40 mil- Panama Papers, what they were warn- will end up in the pockets of a handful lion people who are living in poverty. ing about in those papers was of all of of Wall Street hedge fund managers. Now, I see no Republican Senators on these efforts to stash money and create That is what I suspect. Maybe I am the floor, but I am sure that staff is new options for people to wheel and wrong. Therefore, I hope that some of watching this discussion. I have a ques- deal in offshore accounts. the Republicans who put this provision tion that I would like to discuss with So my colleague is right. I continue in the bill will tell us how this is going Senator WYDEN but, more importantly, to wonder why, when we want to ask to benefit the people of the United with some of our Republican col- these really important questions about States or the Virgin Islands or any- leagues. special interest favors and when we place else. What I would like to ask my Repub- look to the other side, we have this Again, I am speaking to the ranking lican colleagues is whether there has barrier between both sides of the aisle. member of the Senate Finance Com- been a hearing on the need to provide We need somebody here to explain to mittee, who knows something about tax breaks to wealthy hedge fund man- us and explain to the American people this. agers who have established residency how this has seemed to just fly out of Is this an issue, Senator WYDEN, that in the Caribbean. I would say to my friend from Oregon the sky. has been discussed for 1 minute? Mr. WYDEN. Not for a minute. that there are a lot of problems facing I am very appreciative of the Sen- The reason my colleague’s questions our country—a declining middle class, ator’s raising a question about what are so important is that this is, cer- 40 million people living in poverty, 28 looks like yet another scam that has tainly, an example of what seems to million people having no health insur- come into a process that has been one turn up every few hours, practically in ance. I am not aware that one of the big sham from the beginning. I appre- the middle of the night. great crises facing this country is the ciate my colleague’s question. My colleague raised a very good need to provide tax breaks to wealthy Mr. SANDERS. I thank the Senator point with respect to the development hedge fund managers who have estab- very much. of this bill. I mean, we are talking lished residency in the Caribbean. It I would just say, according to a num- about making $10 trillion worth of may be one of those great national cri- ber of independent studies, despite changes in tax policy on the fly—with- ses that I have missed, but I don’t what President Trump and the Repub- quite perceive it as being an issue that lican leadership are saying, the over- out a hearing. The Senator’s colleagues the American people seem to be deeply whelming bulk of the tax benefits in have said—Chairman ENZI and the concerned about. this legislation goes to the top 1 per- Budget Committee—and I have heard it I hope that my Republican col- cent. I believe the number is 62 percent several times on the other side—that leagues—maybe Senator HATCH or oth- that goes to the top 1 percent. there were 70 hearings on this bill. ers—will come to the floor and tell us Mr. WYDEN. If my colleague will There was not one on this piece of leg- who this provision benefits. Are we yield, there is no question he is correct islation. It certainly didn’t examine talking about one hedge fund manager? that in terms of stacking the deck, this this issue. It didn’t examine the ques- Are we talking about two? Are we talk- is not just stacked to the top but to the tion, for example, of what is going to ing about three hedge fund managers top 1 percent or a fraction of the 1 per- happen to people with this dagger to who are going to divvy up some $600 cent. the Affordable Care Act. million in tax breaks over the next dec- Mr. SANDERS. You have 62 percent I can tell this to my colleague be- ade? of the benefits going to the top 1 per- cause he is right to talk about how one I ask my colleague from Oregon, who cent. Meanwhile, by the end of the dec- brings parties together. I know my col- is the ranking member of the Senate ade, my good friend, Senator WYDEN league did that as part of a major bill Finance Committee, his thoughts on from Oregon, there is no question but on the Veterans’ Affairs Committee the issue. that tens of millions of middle-class with Senator MCCAIN. Our former col- Mr. WYDEN. I am very pleased that Americans will be paying more in league Bill Bradley mentioned that my colleague from Vermont is dis- taxes; is that correct? when he wrote a tax bill, he flew all cussing this issue on the floor. The Fi- Mr. WYDEN. There is absolutely no over the country to work with Repub- nance Democratic staff has been look- question about that. We are looking at licans. In this case, apropos of my col- ing into this and has been working also something like half of the middle class league’s question, not only did no one with the Senator’s staff, and I think to be paying more in taxes come 2027. do that sort of thing, but they wouldn’t that it would be fair to say that every Mr. SANDERS. So here we have a na- even walk down the corridor to talk few hours, this bill just seems to get tion today that has a grotesque level of about working with the other side. worse. I mean, we don’t know if, in the income and wealth inequality—worse Mr. SANDERS. Let me make two middle of the night, somebody will add than at any time since the late 1920s. points as I wind down here. another round of favors for the power- The top one-tenth of 1 percent now One, yesterday, I challenged my Re- ful interests, the politically well con- owns almost as much wealth as the publican colleagues, after this bill is nected. What I can tell the Senator is bottom 90 percent, and 62 percent of all passed, to tell us and tell the American what we have been able to put together new income is going to the top 1 per- people that when they rack up a deficit as of now. cent. The Republicans’ solution is to of $1.4 trillion, they are not going to

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00007 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.011 S01DEPT1 S7660 CONGRESSIONAL RECORD — SENATE December 1, 2017 come back and cut Social Security, Mr. INHOFE. Will the Senator yield serve notice right now that I am going Medicaid, Medicare, education, nutri- for a unanimous consent request? to be concerned about. One is that the tion. Mr. SANDERS. I will. bill that we have punishes trust owner- Tell the American people that you Mr. INHOFE. Mr. President, I ask ship. It doesn’t treat the trust owner- are not going to balance the budget unanimous consent that at the conclu- ship the same way it does ordinary and compensate for your huge tax sion of the remarks by the Senator ownership. I think they both should be breaks to the rich and large corpora- from Vermont, I be recognized for up to treated equally. I talked to a number tions by going after the middle class 10 minutes. of people who will be participating in and working class of this country. The PRESIDING OFFICER. Is there this on the other side of the aisle, and I challenged my Republican col- objection? I would like to kind of serve notice leagues yesterday to come to the floor Without objection. that we are going to be talking about and tell the American people that they Mr. WYDEN. Reserving the right to this, because I think it is very, very would not do that. They have not re- object, if I could, I don’t think the UC significant. sponded to that challenge. was granted. The second thing is that we hear a The second challenge today is to tell Mr. INHOFE. I have a point of in- lot of good ideas. Certainly, there is us what is in section 14504, page 503. quiry. Was the UC already granted— this idea that somehow there isn’t a This is a provision that would provide the unanimous consent request? good idea unless it emanates from this $600 million in tax breaks to my Repub- The PRESIDING OFFICER. The body. I have to tell you this. It is inter- lican colleagues. Who is going to get Chair said ‘‘without objection’’ because esting for me to be standing here be- those tax breaks? We believe—and tell the Chair did not hear objection. cause I am not on any of the commit- us if we are wrong; maybe we are—that Mr. WYDEN. Well, I would like to re- tees that have anything to do with this we are talking about a handful of hedge serve my right to object at this time. bill. I am not on the Finance Com- fund managers. Who are they? How The PRESIDING OFFICER. Is there mittee, and I am not on the Budget many of them are there? objection? Committee. If you want to talk about I would ask, respectfully, that Sen- Mr. WYDEN. Reserving my right to defending America and roads and high- ator HATCH or any other Republican object, and I will not object. I would ways, I will talk to you about that. come down to the floor and tell us who just like to make sure that our col- That is my specialty. I am on those benefits from section 14504. league from Oklahoma and our col- Mr. WYDEN. Will my colleague yield committees and have senior leadership league from Washington are both ac- for a moment? in those committees. But as a Member Mr. SANDERS. I will. commodated in this matter. not directly involved in this debate, I Mr. WYDEN. I want to ask the Sen- Senator SANDERS and I have finished. have looked at it and I have heard good ator a question because I am not sure I believe Senator CANTWELL said that ideas from the outside. I heard one a that we have really laid out the time- Senator INHOFE will go ahead. We week ago that actually came from the table of what is ahead. My colleague, of thank Senator CANTWELL for her usual Hugh Hewitt show. I heard an idea that course, who is our ranking Democrat collegiality. I tried to pick apart, and I can’t find on the Budget Committee, is very up Senator INHOFE will go first and I ask any faults with it. So I have developed on this. unanimous consent that Senator CANT- an amendment that we are going to We have all been concerned because WELL follow Senator INHOFE, and I will have that will address this idea that I we have seen it before. You pass these withdraw my reservation. am talking about. That amendment big tax cuts. You get on a sugar high I withdraw my reservation and I ask would offer an alternative to those who for a relatively short period of time. unanimous consent that Senator CANT- have retirement programs, where the Then the deficits start rolling in. What WELL follow Senator INHOFE. individual is not to pay for the income we see next are the cuts in the pro- The PRESIDING OFFICER. Is there until the withdrawal date—say, age grams that are a lifeline for millions of objection? 591⁄2. people—the anti-hunger programs, Without objection, it is so ordered. The amendment would provide that Medicaid, Medicare, Social Security. Mr. SANDERS. Mr. President, let me there would be a one-time opportunity I saw comments in the paper that conclude my remarks. to withdraw up to 25 percent of the re- what my colleague is concerned about I would urge my Republican col- tirement account for a single flat fee of has already been announced by the leagues to come down to the floor of 10 percent in lieu of paying income tax Speaker of the House. I understand the Senate and explain to the Amer- at that time. that what the Speaker of the House has ican people what section 14504 is about There are a lot of benefits that I said is that his next plan is to take up and who benefits from some $600 mil- think are pretty obvious. We are talk- the issues of what he calls entitlement lion in tax breaks over a 10-year period. ing about retirement programs where reform. They are not talking about the Is it two hedge fund managers? Is it the individual is not to pay for the in- things that the American people care five hedge fund managers? What is it? come until the withdrawal dates—let’s about and that I am going to hear That is my request, and I hope we say, at age 591⁄2. This would have the about at townhall meetings at home can get a response to that quick ques- immediate revenue of 10 percent of all this weekend—holding down the costs tion as quickly as possible. savings that are withdrawn, and this of prescription drugs. They are talking With that, I yield the floor. would actually amount to billions of about rolling back the safety net— The PRESIDING OFFICER. The Sen- dollars. We are talking about imme- Medicaid and the anti-hunger programs ator from Oklahoma. diate dollars, not dollars that may be and Social Security. Mr. INHOFE. Mr. President, let me there in the future. Is that my colleague’s under- pause in this class warfare for just a Now, you could argue that this might standing? minute to make a couple of observa- reduce some revenue at some future Mr. SANDERS. Absolutely. That is tions that I think are certainly impor- date because the individuals will have absolutely what they will do. They will tant to me. already pulled this out for a fee of 10 talk about saving Social Security; they First of all, I agree that no one has percent. So, perhaps, it would have will talk about entitlement reform. said that the underlying bill is perfect. some negative effects in the distant fu- What they mean is cutting Social Se- Incidentally, I will not respond to the ture. But when you stop to think about curity, cutting Medicare, and cutting Senator’s specific request until I have the benefits—I know a lot of people on Medicaid. time to go back and get the proper re- the other side of the aisle don’t realize As the Senator has indicated, it is sponse, and then I will be glad to do it. this—we are going to have huge bene- not some kind of an abstract, theo- But I will say this. We are going to fits. retical idea. That is what Speaker have a conference. There is going to be If you just look at what has happened RYAN is already talking about. More to opportunity for us to go and get some in this administration in the second the point, that is exactly what was in of the things ironed out—some of the and third quarter of this year, we have the budget that was passed here several things we are both concerned about. gone through years in the Obama ad- months ago. There are a couple of things I want to ministration with maybe a 1.5-percent

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00008 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.013 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7661 increase in GDP, and we have enjoyed Mr. WYDEN. Mr. President, I ask Government might try to monopolize 3 percent in the second quarter and 3.3 unanimous consent that Senator CANT- taxation to the entire exclusion and de- percent in the third quarter. That is a WELL and Senator VAN HOLLEN be al- struction of State governments.’’ huge increase. For each 1 percent in- lowed a total of 15 minutes to discuss That is right. Our Founding Fathers crease over a period of 10 years, we are some very important issues. said: Do not have double taxation. So talking about $3 trillion. So we are all The PRESIDING OFFICER. Is there for 100 years—100 years—we protected considering this. objection? the citizens of this country. Yet some- This amendment that we are talking Without objection, it is so ordered. one over there is thinking: Do you about that merely allows people to The Senator from Washington. know what? I need $1.4 trillion. Where take money out that is already their Ms. CANTWELL. Mr. President, I can I get it? Let’s do it on the backs of money is something that would have a come to the floor with my colleague middle-class families, because they great stimulation in the economy. I am from Maryland to talk about the State might not notice until 2019 when their one of the few ones who was around and local tax deduction. tax bill comes and they have a dif- here—not in this body but in the other I thank the ranking member of the ferent equation. body—and I was aware of this back Senate Finance Committee for his hard I get that my colleagues think they during the Reagan years of 1981 and work on trying to articulate what is have solved this problem by getting rid 1986. In 1981, the amount of revenue fair tax policy for Americans. Senator of the deductions and now all of a sud- den giving you a double standard de- that we had coming into the Federal WYDEN and I come from parts of the duction. I have done the math. I have coffers was $469 billion. Ten years later country with probably some of the done the math for us in Washington that was $750 billion. That was after most unique tax codes. He doesn’t have State, and over 300,000 people in Wash- the first great reduction. Let’s remem- a sales tax in Oregon. We don’t have an ington will see their taxes go up imme- ber that reduction took the top rates income tax in Washington. We are not an expensive tax State. diately, probably paying anywhere down from 70 percent to 50 percent. from $750 to $1,000 more in taxes. Is Again, in 1986, when the total revenue We are not an expensive tax State. There are other States such as Texas, that fair? They are sitting in the shad- was $569 billion, there was a further re- ow of these large companies who are duction. The top rate went down from Nevada, and Florida that also don’t have an income tax. Under this bill, making record profits and doing quite 50 percent to, I believe, 28 percent. well, asking why are they the funders Now, with all of those reductions, those States and the citizens of those of this tax break. Why are they? Why that increased 10 years later from $569 States, like many others, are going to are we getting rid of a policy that has billion to $1 trillion. Consequently, we be penalized. Middle-class Americans existed in our country for over 100 know that if we can stimulate the are going to have their taxes raised to years and penalizing them just to give economy, we are going to have more give a tax break to corporations. So while we might want to discuss this corporate break? revenue coming in. That is a fact. I I can tell you I don’t buy the notion think this will be something that I what is fair tax policy as it relates to the competitiveness of our economy, that this is going to trickle down to think a lot of people can look at. productivity and wage growth. I know the good news for the people of the I talk about when you get into the what is driving productivity and wage State of Washington is that we have conference. I will not be one of the con- growth in my State. It is a great, edu- very competitive businesses, whether it ferees, and I am aware of that, but cated, skilled workforce. It is staying is Microsoft or Amazon or Starbucks or there are a lot of good ideas out there ahead of innovation whether it is mak- Costco or Boeing. They are all working along with those on the floor today. ing software or new ways of doing busi- They will be pursuing them at that hard. They are all working in multiple ness, and, yes, it is a constant chal- time. That is assuming we pass this places, and yes, they are all doing real- lenge. Those businesses tell me all the bill, and I think we will pass it. ly, really well. time we need more infrastructure, we Additionally, tax reform will ensure The question is, Do we need to reduce need more affordable housing, we need that American families and businesses their corporate rate so significantly, a better transportation system, we see a meaningful reduction in their tax and to do so, take money out of the need better education. So they are very burden. The Senate bill provides a sub- pockets of middle-class families across concerned about the ideas in this legis- stantial tax deduction to small and the United States of America? lation. family businesses that are structured The reason I mention Senator WYDEN So you are going to tax immediately as passthrough entities. These small and the States of Oregon and Wash- about 300,000 Washingtonians with a and family businesses are household ington, is that, even though we have a higher tax rate and, according to the names such as Love’s Travel Stop, the unique tax code, our State’s economy Joint Committee on Taxation and Country Stores, Hobby Lobby. We are has grown faster than the national av- other entities, probably by the time all very familiar with Hobby Lobby. erage every year since World War II. this is done, at the end of this bill, over By the way, I will say that in the That is to say, the uniqueness of our a million Washingtonians are going to event there is anyone here who has not tax code has not hurt us, and yet in the pay more money. That is why I am so been down to see the Museum of the State of Washington we have had the concerned, along with other States Bible, that is Hobby Lobby who paid highest minimum wage for a long time that have been fighting this battle for for that. Those are the types of people in the United States. Now we are rais- so long. Why now? Why now? What is who would benefit. Unfortunately, the ing it in various parts of our State. We the urgency that you are taking away Senate does not allow tax deductions have had a unique view of where our the ability of my citizens to deduct for these companies or passthrough en- revenue should come from. their local sales tax, their property tities if they have trusts. This is not Why now? Why now? After 100 years tax, and, in the House case, other ex- right. of tax deductibility by taxpayers in penses, whether they are medical or For these companies trusts were for this country, why are you taking away education or their mortgage? It is just long-term business purposes, not to their ability to deduct only to give a beyond me, when the middle class has evade their fair share of taxes. These tax break to corporations that are suffered so much and has not recovered companies use the income to invest making record profits? After 100 years, from the downturn in the economy, capital in operations to grow their why are you doing this? that you think the best economic businesses, to hire people, and to con- Well, I think some of my colleagues strategy is to take money out of the tribute to the economic growth that we have said it best. They have called it middle-class taxpayer. need in this country. We should not pe- double-taxation. You are going ahead I ask unanimous consent to have nalize passthrough companies for their after 100 years and saying it is OK to printed in the RECORD a letter from the businesses because they are trusts. My tax the same amount that we pay to National Governors Association from amendment would fix that. the State that you also are going to Governor Sandoval from Nevada. I With that, I yield the floor. tax at the Federal level. As one article mentioned they don’t have an income The PRESIDING OFFICER. The Sen- mentioned, ‘‘Alexander Hamilton in tax. They are highly sensitive to this ator from Oregon. the Federalist Papers said the Federal issue.

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00009 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.014 S01DEPT1 S7662 CONGRESSIONAL RECORD — SENATE December 1, 2017 There being no objection, the mate- It will change your tax bracket, and order to provide huge tax breaks to the rial was ordered to be printed in the you will be in a higher tax bracket. So biggest corporations of this country, RECORD, as follows: besides giving you less deductibility, this bill will require millions and mil- NATIONAL GOVERNORS ASSOCIATION, they are changing a formula and mak- lions of middle-class families to in- September 22, 2017. ing you pay more taxes. crease their taxes, and a main vehicle Hon. RICHARD NEAL, This bill needs to slow down. It needs for doing that is by removing the de- Ranking Member, Committee on Ways & Means, to focus on what will help our economy duction for those citizens. U.S. Senate, Washington, DC. grow, and economists don’t believe this I am just going to give you some DEAR MAJORITY LEADER MCCONNELL, MI- bill is going to do much to help the quick numbers: 100 million Americans NORITY LEADER SCHUMER, SPEAKER RYAN, MI- economy grow. It is going to give those today use the deduction for State and NORITY LEADER PELOSI, CHAIRMAN HATCH, RANKING MEMBER WYDEN, CHAIRMAN BRADY, corporations money to pay for divi- local taxes. In fact, half of the families AND RANKING MEMBER NEAL: The nation’s dends. Seventy-five to eighty percent in my State of Maryland use it. Thirty- governors appreciate congressional efforts to will go to their shareholders, and those eight percent of taxpayers making be- reform and improve federal tax policy. Fed- shareholders and the stock market will tween $50,000 and $75,000 claim the eral and state tax systems are complex and do well. State and local deduction. That is 7.6 often interconnected. Therefore, as Congress What we also need to focus on is the million households. Fifty-six percent of considers reforms, we urge you to maintain investment that middle-class families taxpayers who make under $100,000 the balance between state and federal tax need to stay in their home, to make systems by preserving the income exclusion claim the State and local deduction, for municipal bond interest and the deduct- education affordable, to pay for and 86 percent of taxpayers making ibility for state and local taxes. healthcare, and to have communities under $200,000 claim the State and local The financing engine that drives U.S. in- work. The fact is, the Fraternal Order deduction. frastructure is the $3.8 trillion municipal of Police is also against this legislation It is wrong to double tax those fami- bond market. Changes to federal laws and because of taking away of this local de- lies in order to provide a huge tax regulations should not increase issuance ductibility. It is like Hamilton said: break for big corporations. Just to add costs to states for municipal bonds or dimin- Why are you doing this at a Federal insult to injury, the corporations in ish investor demand for them. If federal level? I thought the other side of the our State still get to deduct their changes make issuing municipal bonds cost- prohibitive for states and local governments, aisle was the States’ rights people? I State and local taxes. We just don’t let then fewer projects could be funded, taxes thought they were there to protect the the people in our State do the same could rise, fewer jobs created, and economic uniqueness of the Tax Code to say that thing. growth will suffer. States have rights, to say that States Let’s adopt this amendment. Governors also believe that no federal law ought to be able to decide their own fu- The PRESIDING OFFICER. The Sen- or regulation should preempt, limit, or inter- ture. Well, after 100 years, you are tak- ator from New Jersey. fere with the sovereign rights of states. A ing that away today, and you are going Mr. MENENDEZ. Mr. President, I am mark of sovereignty includes the ability to to hear from the citizens of this coun- here to support the motion offered by develop and operate revenue and tax sys- Senator CANTWELL, to speak out tems. Deductibility of state and local taxes try who are upset that they have to has contributed to the stability of state rev- pay higher taxes just to give these very against a tax bill that is nothing short enues that are essential for providing public successful companies a corporate tax of highway robbery on New Jerseyans. services. We encourage you to avoid changes break. This tax plan is about one thing. It is to the tax code that would undermine the I yield to my colleague from Mary- about cutting taxes for wealthy cor- ability of state and local governments to land. porations and asking working families meet the needs of the citizens whom we all The PRESIDING OFFICER. The Sen- to pay for it. It is especially bad for serve. ator from Maryland. middle-class families in New Jersey, Eliminating state and local tax deduct- Mr. VAN HOLLEN. Mr. President, New York, Washington, Maryland, and ibility, moreover, exposes a higher share of other high-earning States that make an itemizing taxpayer’s income to federal may I inquire how much time remains taxation because it adds back mandatory on the unanimous consent agreement bold investments in education, that payments of state and local taxes already for this amendment? drive the most innovation, that gen- paid, as taxable income. The PRESIDING OFFICER. The erate the most Federal revenue. Federal tax reform requires an intergov- Democrats have approximately 6 min- Don’t let the Republicans fool you if ernmental partnership because decisions at utes remaining. they airdrop an amendment at the last the federal level will affect state and local Mr. VAN HOLLEN. Thank you, Mr. minute that throws a few crumbs at governments profoundly. We look forward to President. New Jersey families and call it a vic- working with Congress on bipartisan tax re- I see Senator MENENDEZ from New tory. Carve-outs, caps, and exceptions form to maintain balance between our sys- tems and modernize the federal tax system Jersey has arrived. He is a cosponsor, are nothing but gimmicks meant to to meet the needs of our citizens. together with Senator CANTWELL and distract the public from what is really Sincerely, myself, on this amendment, and I want going on. No matter how you slice it, Gov. BRIAN SANDOVAL, to thank Senator CANTWELL for her gutting or even limiting the State and NGA Chair. leadership. She has covered a lot of im- local tax deduction is a direct assault Gov. STEVE BULLOCK, portant points. on middle-class families in America’s NGA Vice Chair. The main one is, from the beginning highest earning, most economically Ms. CANTWELL. Mr. President, their of our Federal Tax Code in 1913, we productive States. By gutting the letter says that the deductibility of have established a principle in the SALT deduction, Republicans will lit- State and local taxes has been a part of United States to avoid double taxation. erally force millions of middle-class their stability, and they are about It makes no sense that any citizens of families across America to pay taxes meeting the needs of their citizens. this country send a dollar of tax to on their taxes. So the notion that we have the Na- their State governments to help In 2015 alone, nearly 1.8 million New tional Governors Association, the schools or roads in their State, and Jersey households deducted a combined homebuilders, the Realtors, so many then they are turned around and taxed $32 billion in State, local, and property people concerned about this is falling on that same dollar by the Federal taxes from their Federal tax bill. These on deaf ears. I guarantee you it will Government, but that is exactly what families aren’t living large. They are not fall on deaf ears when the citizens this Republican tax plan is doing. middle-class folks who had to work have a chance to respond to this. Now, weeks and weeks ago, the Re- hard for every dollar they have. In fact, The notion that we not only are tak- publican leader, Senator MCCONNELL, IRS data shows that more than 85 per- ing away this ability to deduct, but we and the Speaker of the House, PAUL cent of taxpayers who claim the SALT are also in this legislation making a RYAN, made these public statements deduction make under $200,000 a year change to the way inflation is cal- about how these Republican tax bills and over half make under $100,000 a culated, what is called Chained CPI—I weren’t going to raise taxes on any- year. So it is wrong to ask millions of am not going to bother to explain the body. They both had to publicly re- Americans who had to fight their way details to you, but I will tell you this. verse those statements because, in into the middle class to pay more just

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00010 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.004 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7663 so big corporations can pay less, and I urge my colleagues to stop pun- many of which, I might add, are in- rubbing salt in their wounds is the fact ishing success, stop interfering in cluded in the mark we are going to be that Republicans let corporations keep State government decisions, and join voting on later today. A lot of those on deducting their State and local me in protecting the SALT deduction. ideas came from those bipartisan work- taxes on top of the huge tax cuts lav- Vote for the motion to recommit. ing groups. So there are a lot of Demo- ished on them by this tax plan. I yield the floor cratic and Republican ideas that have If deducting State and local taxes is The PRESIDING OFFICER. The Sen- been incorporated into this legislation. so important for big corporations that ator from South Dakota. I would hope, in the end, that there make billions of dollars each year, Re- Mr. THUNE. Mr. President, we are might be some Democrats who ulti- publicans should understand why it is about to embark upon a vote that I mately will vote for it. But I think it so important for middle-class families think will be historic, a once-in-a-gen- is important to note, for those who be- in cities and suburbs across America. eration opportunity, in my view. lieve that perhaps this was somehow That is why I am offering this motion The last time we did major tax re- rushed in here, that there has been a form in this country was 1986, 31 years with Senator CANTWELL to send the bill lot of thought over a long period of back to committee to fix this fatal ago. Believe it or not, I happened to be time. There were not only months but flaw and restore the SALT deduction. a staffer here back then. Although my years—literally years—of work that If it is good enough for huge corpora- boss was not on the Senate Finance has gone into bringing us to where we tions, it should be good enough for Committee, I was the tax LA in the of- are today. middle-class families. fice, and so I had the opportunity, in a When the bill was introduced—the I have heard many of my Republican very small way, to be a part of the 1986 mark was put out there by the chair- colleagues complain about the SALT Tax Reform Act, which at that point man—that put in place a process in the deduction as if it is some subsidy for was landmark legislation, very his- committee where we had a markup. So States like New Jersey, and that hy- toric, very far-reaching, and had a pro- we spent 23 hours over several days pocrisy is just amazing to me. Far from found impact in a positive way on the marking up the bill. We voted on 63 subsidizing successful States like New economy. Democratic amendments in all 69, or Well, here we are 31 years later—long Jersey or New York, the SALT deduc- thereabouts, amendments on the bill overdue, I might add, to get to the tion actually benefits the entire Na- while it was being marked up before it point where we once again can do tion, which is able to share in the eco- was reported out here to the floor. something fundamentally about a tax Since it was reported out of the com- nomic rewards created by the high- code that is completely outdated, com- mittee, there have been a number of powered economies of States like New pletely antiquated, and puts us at a changes that have been made in re- Jersey, and now Republicans want to competitive disadvantage with coun- sponse to concerns and issues that have take even more. Well, we are sick and tries around the world with whom we been raised by individual Senators on tired of it, and we want our money have to compete. So we have an oppor- both sides of the aisle. And that brings back. tunity today—and we will have an us to where we are today. I will make a deal with any Repub- amendment process here that will get I say that by way of context to let lican from a taker State. Since you are started very soon in which Members people know that this has been a long so opposed to subsiding other States, will have an opportunity to lay down process—an arduous process, I might how about you take all of the extra their amendments, to debate them, and add—and frankly one that is really Federal dollars you receive beyond to get them ultimately voted on, but overdue. I happen to believe profoundly what you pay and transfer it back to when it is all said and done, I believe that it is high time that we undertake donor States like New Jersey? Sound we will have a final product that moves the important work of readapting and like a deal? I don’t think so. us fundamentally in a different direc- readjusting our tax policies to reflect Each and every year, States like New tion when it comes to our tax policy, in an economy and a marketplace that is Jersey, New York, and Virginia gen- a direction that is good for jobs, that is very different from the last time this erate billions of dollars in Federal rev- good for growth—economic growth— was done in 1986. enue that go to Americans in less pro- and that is good for wages in this coun- So that gets us to where we are ductive, lower income States that are try for hard-working families and peo- today. In trying to figure out how to more reliant, more dependent on Fed- ple who have been living paycheck to modernize, how to update our Tax eral spending. They are America’s eco- paycheck for a really long time. Code, there are a couple of things that nomic powerhouses, America’s donor We didn’t get here overnight. There clearly needed to be dealt with. One is States, precisely because they invest in has been a lot said about how this is all that we have a tax system that has the public education, law enforcement, of a sudden rushed to the floor. I have highest rates among businesses in the mass transit, infrastructure, and eco- to tell you that I got on the Senate Fi- industrialized world. We have a 35-per- nomic opportunity for all. nance Committee in 2011, and since 2011 cent rate for corporations. When we It is no surprise that everyone from when I joined the committee, we have look at every other industrialized the Fraternal Order of Police to the had 70-plus hearings on tax reform. We country around the world—look at the American Hospital Association, to have had 70 hearings examining dif- OECD average; it is down around 22 AARP support keeping the State and ferent aspects of the tax reform, listen- percent. A number of countries have local tax deduction. Taking it away is ing to recommendations about how it gone well below that. We continue to a direct threat to the funding States might be changed, how it might be hemorrhage jobs and businesses and need to educate our kids, keep cops on modernized, how it might be updated, profits to other places around the the beat, equip first responders and and how it might be improved. It has world because our tax rate, our Tax firefighters, and provide healthcare to been a long, methodical process to get Code, frankly, isn’t competitive. the most vulnerable—all this just to us to where we are today. We operate in what is known as a give big corporations big tax cuts. Two years ago, in 2015, the chairman worldwide tax system in which not If multinational corporations get to of the committee, Senator HATCH, cre- only do you pay a tax in a country in keep deducting their State and local ated five working groups, and each of which the income is generated, but you taxes, there is no reason to stop mil- the working groups had a specific area also pay a tax when it comes back into lions of middle-class Americans from of responsibility to look at different the United States at the higher level, doing the same. Make no mistake, any elements of the Tax Code and come up at the 35-percent rate. So that also had reduction in the State and local tax de- with a series of recommendations for to be adapted, and we are moving now duction is a direct assault on Amer- how it might be improved. I was privi- more toward what is called a terri- ica’s highest earning, most innovative, leged to chair one of those working torial tax system in which the income most economically productive States. groups, along with Senator CARDIN. We is taxed in the jurisdiction in which it Guess what. All Americans will lose had both Democrats and Republicans is generated. I believe that will make out when America’s economic power- participating in that process. us a much more competitive economy house States aren’t so powerful any- At the end of it, each of the working globally and make America a much more. groups submitted recommendations, more attractive place to do business.

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00011 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.018 S01DEPT1 S7664 CONGRESSIONAL RECORD — SENATE December 1, 2017 We get the corporate rate, the busi- the other side—they consistently make tion through all the different brackets ness rate, down to 20 percent. And the argument that somehow these are in the code. when I say businesses, that is what we tax cuts for the rich, which I don’t The combination of doubling the call C corporations. There is a slightly think is any surprise. That is normally standard deduction, doubling the child different treatment for passthrough what they say anytime we have a de- tax credit, and lowering rates means businesses. Those are your partner- bate about reducing taxes. that middle-income families are going ships, LLCs, and sole proprietorships, My experience here, in the time I to pay less in taxes. things like that. But we also signifi- have been in Washington, both as a We think we have found the right cantly reduce rates on small busi- Member of the House of Representa- balance in designing a bill that delivers nesses. We believe that is important to tives and now as a Member of the Sen- tax relief to hard-working, middle-in- growth. This needs to be a pro-growth ate, has been that, generally speaking, come families in this country. At the bill. We want to grow our economy at Democrats like to grow government. same time, we are reforming the busi- a faster rate because a faster growing We like to grow the economy. We be- ness side of our Tax Code in a way that economy, an economy growing at rates lieve the best way to lift all boats—to unleashes our economy and unleashes that are more normal to historic aver- generate better paying jobs, to improve those job creators and a lot of that in- ages, means that we are creating better the quality of life and standard of liv- vestment that has been sitting on the paying jobs. That means we are lifting ing for American families—is to get a sidelines and allows our small busi- wages in this country. stronger economy that is creating nesses and our larger businesses to ex- Wages have been flat for so long. For those better paying jobs and raising pand their operations, and as they do the last decade or so, the American wages in this country. that, they will have to hire more work- people have rarely had anything that Suffice it to say that our colleagues ers and pay those workers higher could be characterize as a pay raise. on the other side have attacked this wages. That is why we needed to update our bill, as they do most bills. This is no We think the combination of those business tax rates, our business tax exception. Most of the attacks are on features of this bill makes this a bill code, so that we can get the economy reform bills for delivering too much re- that is very beneficial to middle-in- producing and growing at a faster rate lief to high-income earners. I have to come families in this country. Those to generate those good-paying jobs and say that I take issue with that because are just a few of the features of the bill provide higher wages to American fam- I think, if you look at the actual con- that lead to, as I said earlier, an aver- ilies and American workers. We believe tent, the substance of the bill, you will age tax cut for a typical family of four this bill does that. come to a very different conclusion. of $2,200 or about a 60-percent reduc- I think the changes that have been I said this before, and I mean it sin- tion over what they are currently pay- made in addition to lowering the rate— cerely: I hope people don’t take it from ing. allowing for expensing of capital in- me. Sit down and look at your own tax As we have listened to the debate vestments allows businesses to recover situation. Plug in the changes that we from the other side, they attacked it as their cost of investment faster, accel- are making here, and find out if you being a tax cut for the rich. They at- erate that cost recovery, which enables come out better or worse than you are tacked it for being rushed out here. them to get that capital they can use today. They attacked it for being a windfall to expand and grow their operations I will tell you that if you look at the for corporations. It is very predictable. and thereby, again, create those better- average family of four with a combined There is nothing new in any of these paying jobs. Those are key changes annual income of $73,000, you are going arguments. I have been around here that are fundamental to greater eco- to see that they are going to see a long enough to know in advance what nomic growth, better jobs, and higher $2,200 tax cut. A $2,200 tax cut is what the other side is going to say. But in wages in our economy. your average family of four making this case, these arguments simply There have been a lot of analyses and $73,000 in this country is going to see. don’t comport with reality. They just studies that have been done that dem- What does that represent to them? don’t fit the facts. They don’t fit the onstrate how, in fact, that might work. That is a 60-percent reduction, a 60-per- data. If you look at what the President’s cent tax cut relative to what they are With respect to the issue of who Council of Economic Advisers says, paying today under current law. pays, we pay a lot of attention—and we they suggest that lowering the rate on By reforming the Tax Code and put- businesses will generate $4,000 in addi- ting these changes in place, the aver- should—to tax burdens in this country. tional average household income on an age family of four with a combined an- One of the things this legislation we annual basis. That is an additional nual income of $73,000 will see a $2,200 will be passing today does is it main- $4,000 in the pockets of families in this tax cut or about a 60-percent reduction tains in the law the progressivity in country as a result not just of the tax in what they are paying today. Why our Tax Code. We have the most pro- reductions, which I will get to in just a does that happen? Well, it happens be- gressive Tax Code, I would argue, in all moment, but the changes we made on cause we are making some changes the world. So we paid very close atten- the business side of the code generate that provide significant relief in the tion to this to make sure that the tax an additional $4,000 annually per house- Tax Code relative to families when burden, when all is said and done, hold. There is another study out there they file their taxes. doesn’t change very much from where by Boston University. They conclude The first, of course, is we double the it is today. So people of different in- that it would increase the average standard deduction. The standard de- come groups, income categories, con- household income by $3,500, which is duction is the amount that people can tinue to pay similar burdens to what slightly less than $4,000. deduct from their income right away, they are paying today. It is safe to say that families in this from their adjusted gross income. That What this shows is that those in the country, households in this country, lowers the amount that is actually tax- $20,000 to $50,000 category today pay and people in this country are going to able to start with. Under our legisla- about 4.3 percent of the entire tax bur- benefit, because when you create a tion, the standard deduction for both den, the taxes collected in this coun- more favorable environment, favorable married couples and those who are fil- try. People who earn between $20,000 conditions for investment and creating ing single—they actually get a dou- and $50,000 pay about 4.3 percent. Under jobs, you get competition for labor. bling of the standard deduction. our legislation, that will go down to 4.1 Competition for labor raises the price The second thing we do in our bill— percent. Those in the $50,000 to $100,000 of labor. When the price of labor goes and if you are raising kids, this will category—earners in that group today up, companies have to pay higher dramatically reduce the tax burden pay about 16.9 percent of all the taxes wages. That means bigger paychecks you will have—is we double the child collected. That is their share of the tax for American workers. That is pre- tax credit, which under current law is burden. Under this legislation, that cisely what these particular studies $1,000 per child. Under this legislation, will go down to 16.7 percent. Again, have shown. that will double to $2,000 per child. that is a slight reduction in the overall Let me say, too, because I think that The other thing we do is we lower tax burden relative to what they have as I have listened to our colleagues on rates. We have a significant rate reduc- today. Those making $100,000 or more

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00012 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.019 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7665 actually will see their taxes tick up a be able to get up to that 3 to 3.5 per- critical that we provide States with little bit—not a lot but a little bit. cent growth rate. If we do, this econ- the support they need to create State- They are currently paying 78.7 percent omy will take off, American businesses based high-risk pools for their indi- of the tax burden in this country, and will start, entrepreneurs will start cre- vidual health insurance markets. In that will go up to 78.9 percent. So those ating jobs, and we will have higher September, I introduced the bipartisan at $100,000 or more are paying almost 80 wages and bigger paychecks for Amer- Lower Premiums Through Reinsurance percent of all the taxes that are paid or ican workers. Act of 2017, a bill that would allow collected in this country today, and I hope we get a ‘‘yes’’ vote later States to protect people with pre- that number is very similar to what it today on this. existing conditions while lowering pre- would be—up a little bit. But that is I yield the floor. miums through the use of these high- really the only category that is going Ms. COLLINS. Mr. President, today I risk pools. That bill would create a to pay more relative to what they are wish to join in a colloquy with the ma- menu of options States could use to de- paying today. jority leader to address concerns that I sign reinsurance programs, which in To me, that is a demonstration, have with the tax reform legislation turn would be eligible for Federal clearly, of how—when we went through that we are considering and to thank ‘‘seed money’’ grants that could lever- this process, we committed to ensuring him for the many discussions that we age section 1332 ‘‘flow-through’’ fund- that there was fairness in the code, and have had over the past months about ing to finance the programs. States we paid attention to the tax burden to this bill. may also add funds from other sources ensure that people continue to pay I have made clear that I don’t think to the mix. their fair share and that particularly that the repeal of the individual man- We know from the experience of those in the upper income categories date should have been included in the Alaska and Maine just how effective pay their fair share. tax bill. Rather, I would prefer to see such high-risk pools can be. Alaska’s Another argument that has been the mandate issue and the other flaws pool reduced a projected 40 percent rate made by our colleagues on the other in the ACA addressed through a series increase to just 7 percent this year and side—which is interesting to me be- of discrete bills that can be thought- is expected to contribute to a 20-per- cause it is a revelation to many of us fully targeted to correct specific prob- cent decline in premiums next year. that all of a sudden they are concerned lems. That said, I have long-supported Maine saw similar results in its pro- about deficits—is that somehow this is the repeal of the so-called individual gram, the Maine Guaranteed Access going to blow up the deficit. Well, we mandate because I do not believe that Reinsurance Association. did allow for a net tax cut in this. the Federal Government should force I believe that passage of legislation There is about $5.5 trillion of tax cuts any American to buy healthcare cov- to create and provide $5 billion in fund- overall, about $4 trillion of which is erage he or she either does not want or ing for high-risk pools annually over 2 offset by what we call base broadeners, cannot afford. Eighty percent of the years, together with the Bipartisan or killing and getting rid of preferences people who pay the penalty imposed by Health Care Stabilization Act, is crit- and loopholes and deductions in the the mandate make less than $50,000 a ical for helping to offset the impact on code, and the balance of which will be year. individual market premiums in 2019 made up through economic growth. Nevertheless, it appears very likely and 2020 due to repeal of the individual There are debates about how much that the individual mandate repeal will mandate. be part of this legislation. Unless we growth will occur in the economy, but Mr. MCCONNELL. I believe that I think it is fair to say that this is take action, that repeal will almost State high-risk pools are a much better going to grow the economy. certainly lead to further increases in alternative to Federal mandates. I will Even the Joint Committee on Tax- the cost of health insurance pre- also support passage of your bill and ation, which uses numbers that, to me, miums—premiums that are already too this funding to create high-risk pools, are completely inaccurate—I mean, it expensive under the ACA. Therefore, I ideally prior to the adoption of any is hard to feature that over the course believe that it is imperative that Con- final tax reform conference agreement of the next decade, our economy isn’t gress take action to mitigate this like- and certainly before the end of this going to grow at more than 1.9 percent, ly premium increase. year. but that is what they assume. Just by There are two steps we can take to Ms. COLLINS. I thank the majority way of example, over the last two quar- help remedy this situation. First, we leader. ters, it has grown to 3.3 and 3.1 percent. need to pass the Bipartisan Health The PRESIDING OFFICER. The If we can continue to build on that, we Care Stabilization Act of 2017, legisla- question is on agreeing to the Cardin will more than pay for and have lots of tion authored by HELP Chairman motion to commit. revenue left over when this is all said ALEXANDER and Ranking Member MUR- Mr. THUNE. I ask for the yeas and and done. So if you assume modest RAY. This legislation will not only give nays. amounts of economic growth—about States critical flexibility to better The PRESIDING OFFICER. Is there a two-tenths, three-tenths of 1 percent of manage their insurance markets, but sufficient second? additional growth in the economy per will also provide funding in 2019 and year—it more than covers what we are 2020 for cost-sharing reductions re- There appears to be a sufficient sec- talking about here in terms of the ceived by low-income enrollees in the ond. shortfall of forgone revenue associated ACA exchanges. The clerk will call the roll. with this tax legislation. Mr. MCCONNELL. From its incep- The senior assistant legislative clerk We have a bill that is based upon rea- tion, I have opposed the individual called the roll. sonable assumptions about growth. We mandate because it is simply wrong for The result was announced—yeas 43, have a bill that, if our economy really the Federal Government to require nays 57, as follows: does pick up—and I believe it will if we someone to purchase a particular prod- [Rollcall Vote No. 292 Leg.] put the right policies in place that en- uct, particularly one they do not want YEAS—43 courage investment, track investment and cannot afford. I agree that Alex- Baldwin Harris Nelson into this country, and provide the right ander-Murray can help provide cer- Bennet Hassan Peters incentives for businesses to expand tainty and flexibility for State insur- Blumenthal Heinrich Reed Brown Heitkamp their operations—we will see an en- Schatz ance markets in the absence of the Cantwell Hirono Schumer tirely new economy where 1.9 percent mandate and will support passage of Cardin Kaine Shaheen growth, which has become the normal the Bipartisan Health Care Stabiliza- Carper King Stabenow Casey Klobuchar Tester for too many people—there are too tion Act, ideally prior to the adoption Coons Leahy Udall many people in this country who don’t of any final tax reform conference Cortez Masto Manchin Van Hollen Donnelly Markey know anything but 1.9 percent growth. agreement and certainly before the end Warner We can do so much better than that. of this year. Duckworth McCaskill Durbin Menendez Whitehouse This is America, the greatest economy Ms. COLLINS. I thank the majority Feinstein Murphy Wyden on the face of the Earth. We ought to leader for his response. Second, it is Franken Murray

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00013 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.020 S01DEPT1 S7666 CONGRESSIONAL RECORD — SENATE December 1, 2017 NAYS—57 bill in committee with the committee of income, and one-third of those folks Alexander Flake Paul report sent out at least 2 weeks ago. I live in a household of less than $25,000. Barrasso Gardner Perdue am totally confident our friends on the Therefore, the benefit of our actions is Blunt Gillibrand Portman Booker Graham Risch other side are fully familiar with al- to set folks free from being penalized Boozman Grassley Roberts most all aspects of this. He will cer- for doing nothing. Burr Hatch Rounds tainly have an opportunity to read the Mr. WYDEN. Will my colleague con- Capito Heller Rubio final version, but he is very familiar tinue to yield? Cassidy Hoeven Sanders Cochran Inhofe Sasse with the various parts of this. There Mrs. MURRAY. Will the Senator Collins Isakson Scott was plenty of time to look at it in com- from Oregon yield? Corker Johnson Shelby mittee, and, as I said, there will be Mr. WYDEN. In just one moment. Cornyn Kennedy Strange Will my colleague yield for a ques- Cotton Lankford Sullivan plenty of time to read the final version Crapo Lee Thune of it before we vote. tion? Cruz McCain Tillis Mr. WYDEN. Further reserving my I believe I have the floor. Daines McConnell Toomey right to object, I know that on the The PRESIDING OFFICER. Is there Enzi Merkley Warren objection to—— Ernst Moran Wicker other side there has been discussion of Fischer Murkowski Young scores and scores of hearings. I would Mr. WYDEN. Reserving the right to object. The motion was rejected. say to the distinguished majority lead- The PRESIDING OFFICER (Mr. er, there was not one single hearing— Mr. SCOTT. Regular order. The PRESIDING OFFICER. Is there BOOZMAN). The majority leader is rec- not one—on the specifics with respect ognized. to this legislation. There was not one objection to the request? Mr. WYDEN. It is my intention, Mr. Mr. MCCONNELL. Mr. President, I single hearing on the health changes ask unanimous consent that there now the majority seeks to make that put a President, to come back every 30 min- be 30 minutes for debate only, with no dagger into the heart of the Affordable utes until we get an answer to the amendments or motions in order, with Care Act. question. I just asked my colleague the majority leader being recognized at So I will ask my colleague once from South Carolina if there was a the conclusion of that time. more, and if we don’t get a sense of hearing on the sweeping changes that The PRESIDING OFFICER. Is there what time we are actually going to see are being proposed in this bill, the Af- objection? this bill, I intend to object. fordable Care Act. I asked him for a Mr. WYDEN. Reserving the right to The PRESIDING OFFICER. The Sen- date. He said nothing with respect object. ator from South Carolina is recognized. to—— The PRESIDING OFFICER. The Sen- Mr. SCOTT. Mr. President, reserving Mr. TILLIS. Mr. President, regular ator from Oregon is recognized. my right to object, I am not sure what order. Mr. WYDEN. Mr. President and col- meeting I sat through for 12 hours Mr. WYDEN. Mr. President, we will leagues, the Senate is looking at mak- about 2 weeks ago, where we essen- be back in 30 minutes to continue this. ing $10 trillion of changes in tax policy tially litigated each aspect of this leg- The PRESIDING OFFICER. Without on the fly. This is the biggest change in islation. I am not sure where we have objection, it is so ordered. Federal income tax policy in more been for the last several years as we There will now be 30 minutes of de- than three decades. This is legislation have had, for the last 5 or 6 years, sev- bate. that will determine our country’s eco- eral hearings. The Senator from Colorado. nomic future for a generation, and, at The reality of this legislation is that Mr. BENNET. Mr. President, on the this time, the Senate does not have the every facet of it is something we have matter that was being discussed—I am language the Senate will be voting on. discussed. There is not a new part—not on the Finance Committee. There has My colleagues have been saying that a new part—to the legislation. Yes, we not been a hearing on this bill, not a they are out looking for it. have fused it together over time. There single hearing. A markup is not a hear- I have a couple of questions I would is no doubt about that. But to sit here ing. People might say, well, why is like to ask the distinguished majority and say that we have not had opportu- that a big deal? Why is that relevant? leader. nities in the Finance Committee to Because a hearing is an opportunity for When will the Senate be able to actu- hear the facets of the bill is just dis- the American people to say whether ally see the full text of this legislation? ingenuous. they want this bill or not. A hearing is Mr. MCCONNELL. Mr. President, I Mr. WYDEN. Will my colleague yield an opportunity for an economist to would say to my friend from Oregon for a question? come to the Senate and say whether that there will be plenty of time for Could my colleague tell me when the they want this bill. A markup is a him to read it. hearing was held on the health changes chance for Senators to say what is on Mr. WYDEN. Again, through the envisioned in this legislation? their mind, not for the American peo- Chair, we are talking about com- Mr. SCOTT. Mr. President, it is not a ple to be able to say what is on their plicated materials. We are talking secret that our party and this body mind. That is what I am thinking about extraordinarily difficult, tech- have been working on healthcare for about today. nical issues under the best of cir- about 10 years. Anyone who doesn’t un- I wanted to start my remarks with a cumstances. While I respect the major- derstand and appreciate that the indi- little bit of a history lesson because ity leader, to just be told we will have vidual mandate and its effects in our this Chamber seems to forget what it plenty of time to read it, what I can bill take nothing at all away from any- has said, where it has been, and it is say—coming on top of the fact that we one who needs a subsidy, anyone who only if you have a case of terrible am- didn’t have a single hearing on the ac- wants to continue their coverage—it nesia that you can support this legisla- tual legislation, nothing with regard to does not have a single letter in there tion. specifics—I think on this side of the about preexisting conditions or any ac- When Bill Clinton left the White aisle we have a right to some sense of tual health feature. House, he left his successor a projected when we will actually be able to see The reality is, what our plan does on surplus of $5.6 trillion. That is what this. It strikes me as a reasonable and the individual mandate is good news George Bush inherited when he became pretty straightforward request, given for the average American. Here it President. The Senate was actually the fact that the American people have is—— having hearings about what to do with been kept in the dark about this for so Mr. WYDEN. Will my colleague the surplus and whether that surplus long. yield? constituted some sort of threat to the So, again, I respectfully ask the ma- Mr. SCOTT. Here it is. Here is the economy. That is what he left behind. jority leader: When will it be possible good news for every American. They Then, George Bush, with this Congress, to see the full text of this bill? ought to hear loud and clear that 80 cut taxes in 2001. They didn’t pay for Mr. MCCONNELL. Mr. President, I percent of the folks who are punished— those tax cuts. They didn’t need to be- say to my good friend from Oregon, punished—by the individual mandate cause they would pay for themselves. there were 4 days of hearings on the live in a household of less than $50,000 That is what they said. It is exactly

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00014 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.005 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7667 what they are saying today. It is ex- No piece of legislation could illus- would have believed that something actly what they are saying today. In trate how right they are than this this cynical could happen on the floor 2003, they passed another tax cut, and piece of legislation and the mistruths of the Senate. I wouldn’t have believed they didn’t pay for it, but they said it that have been used to sell—the Presi- it. Colleagues of mine who said for would pay for itself. Incredibly, the dent going to Missouri and saying: This years that this is all just about getting 2003 tax cut came after we had invaded is a middle-class tax cut. This hurts to cuts to Medicare, Social Security, Iraq under a pretext by that adminis- the rich like me. and Medicaid, I would say: No, it is tration. Not only did we never ask the No, it doesn’t. What people are con- not. People care about this. They want American people to pay for those wars, cerned about, and what they will be to sort out our fiscal condition. I was we cut their taxes and put the burden concerned about is, their aftertax in- wrong. They were right. This is about on their children. That supply-side eco- come as a result of the changes that that. That is what they are going to nomics, which is exactly the same are being made, and this is the best come back here and do. It is going to movie we are seeing today, resulted in year. I didn’t bring out the worst year. be really hard to withstand it. the worst recession since the Great De- This is 2019. This is what you are going President Trump, after all this for pression. to be getting. It is great if you are up We had a 10-percent unemployment here, and you are making more than $1 the last 10 years around here, since we rate when Barack Obama became million—where, by the way, I have not were fighting, trying to fight out of the President of the United States. Guess met a person who says they have worst recession since the Great Depres- what else we had. We had a $1.5 trillion cashflow problems that this tax cut is sion—which we did, by the way—in the deficit, not a $5.6 trillion surplus—a going to help them with. name of fiscal responsibility, we had $1.5 trillion deficit because of two un- I know a lot of people in Colorado— fiscal cliffs; in the name of fiscal re- paid-for wars, because of two tax cuts and I will bet you in Arkansas and in sponsibility, we had government shut- that weren’t paid for that were going Pennsylvania—who are still struggling downs; in the name of fiscal responsi- to pay for themselves, and because because middle-class family incomes bility, we passed 30 temporary budgets they passed something called Medicare have been flat for 20 years, and the that no school district in Colorado Part D—the prescription drug program costs of housing, higher education, could get away with once. Have we for seniors—that they didn’t pay for. early childhood education, and managed to restore our fiscal health? The minute Barack Obama became healthcare are forcing them to make No. Have we piled on more debt for our President, they said it was his deficit. choices that their parents and grand- kids and grandkids? Yes. That is what They wouldn’t lift a finger to help parents never had to make for their is going to happen here. working people in America who had kids. It is no wonder, when we elected a lost their jobs in the worst recession What a shame to be taking President, somebody who told the since the Great Depression, brought on healthcare away from 13 million people American people—and was nominated by their own economic policies and by in this bill, instead of trying to make by the Republican Party and elected by the fecklessness of some of the largest the system better. This bill rejects all the United States of America—Presi- banks in this country. They wouldn’t the testimony we had in hearing after dent Trump promised that he would lift a finger. hearing on the Health, Education, eliminate our debt ‘‘over a period of Then-Minority Leader MITCH MCCON- Labor, and Pensions Committee. eight years’’; that he would deliver ‘‘a NELL said in 2011—this is in 2011— This is my final chart. This is the giant, beautiful, massive’’ tax cut— ‘‘Now, we’ve reached the point where math of this bill. This bill takes $34 bil- that was supposed to be for the forgot- our deficits and debts are so large lion a year—not 1 year, a year—in tax ten man. Unless the people making they’re suffocating job growth, threat- cuts and gives it to 572,000 taxpayers. over $1 million are the ‘‘forgotten ening the wider economy, and imper- You can’t even see that. I know you man,’’ he didn’t deliver on that—pass iling entitlements.’’ That is when we can’t see it on the TV. It looks like a ‘‘one of the largest increases in na- were in the depths a recession we had pencil line because that is the scale. tional defense spending in American not seen since the Great Depression. That is how few people there are in our history;’’ while saying, ‘‘I’m not going When Barack Obama left office, the economy—572,000 people getting $34 bil- to cut Social Security . . . and I’m not deficit was about $550 billion. Today, it lion. If you include the estate tax, going to cut Medicare or Medicaid.’’ is $660 billion. As a result of this plan, which I didn’t here, it is $39 billion. It J.P. Morgan was telling us, yesterday is $40 billion going to families who are There is a job that every American or the day before, that this will be the lucky enough to make more than $1 has to do for the next generation of largest nonrecession-caused deficit in million a year. These are the taxpayers Americans; that is, to leave more op- our history since World War II. What a who make $50,000 or less in our econ- portunity, not less, to the people who disgrace. And for what? To give taxes omy. There are 90 million of them, not are coming after us. This bill that has to the wealthiest people in America. 572,000. There are 90 million of them. been so falsely described and written in This is an unusual thing to do, but I They get $14 billion out of this bill. such a way that it actually denies the am putting up the Republicans’ chart. That is an average tax cut of $160— middle class in America benefits it This is their chart. The Senator from $7.50. really could use and does so by putting Pennsylvania is on the floor. This is These aren’t talking points. This is a bunch more debt on the backs of their chart, where they are telling my the math that is at the heart of the their children is something this Senate farmers and ranchers in rural Colorado deal the Republicans have said is a should reject. that they should be satisfied with these middle-class tax cut. You know what is I yield the floor. percentages they are giving them, even worse about it? Just like the 2001 The PRESIDING OFFICER. The Sen- these rate cuts they are giving them. tax cuts, just like the 2003 tax cuts, ator from Pennsylvania is recognized. You can’t eat percentages. You can’t they are not paying for it. They are feed your family on rate cuts. You borrowing the money from middle- Mr. TOOMEY. Mr. President, I am can’t run your farm or your ranch on class families all over the country, going to be brief. I am going to yield to rate cuts. from the sons and daughters of teach- my colleague from South Carolina, and Do they think they are not going to ers, firefighters, and police officers. I think my colleague from South Da- get it figured out? Colorado’s Repub- That is who is going to have to pay kota has a few comments. licans are too smart for this bill. They back that bill. And for what? To end I want to respond to some of the are too smart for this bill. So are Colo- poverty in America? No. To invest in points my colleague from Colorado rado’s Democrats and Independents. infrastructure or healthcare or to made. First, I want to thank him for Unlike us, they actually have to worry strengthen our safety net? No. To frit- bringing out our chart. What our chart about the next generation of Ameri- ter it away on $34 billion worth of tax illustrates is that every category of in- cans. That is all they do. They know cuts for the wealthiest people in Amer- come earners in America gets a tax cut our politics is not up to that. It is not ica. under our plan. If you look toward the up to the aspirations they have for I am going to close by saying this. left of the chart, you see that the big- their kids and for their grandkids. Before I got here 9 years ago, I never gest reductions go to the people in the

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00015 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.024 S01DEPT1 S7668 CONGRESSIONAL RECORD — SENATE December 1, 2017 lowest income categories in a percent- of household. The reason that we use having a spirited debate. We are dia- age term. My colleagues said percent- $73,000 is that that is the typical Amer- metrically opposed on the issue, but we ages don’t matter. I am a little bit con- ican family’s income. do have some common ground on other fused because it seems to me that I When we are talking about the bene- issues that we are working on together. think they do matter. I will give you fits, we are talking about real people— I appreciate your passion. I know you an example. people like Sherry, back in South Caro- are sincere. Under our tax plan, our tax reform, lina, a single parent with two kids, who I will tell you that there is a truth and our working-class and middle-class is trying to start a business, who is that is, perhaps, missing from the con- tax cuts, the average single head of struggling to keep her ends together, versation, and it is simply this: If you household—a single mom who, as head believing that someone, somewhere, don’t control spending, you cannot of household, has one child and earns sees her, that the decision makers in raise enough revenue to keep up. When the average income of $41,000, which Washington don’t see her as invisible you look back at the cataclysmic oc- doesn’t make her a millionaire, or not or unimportant. I am not talking about currences throughout history, one typically, with $41,000—is going to have tax philosophy. I am talking about real thing you will find very quickly is that a $1,400 tax cut. That is a 75-percent people who need their money more even with more revenue, if your spend- tax cut for her. Now, maybe our col- than the government does. ing outpaces your revenue, you are league from Colorado thinks that per- If we are going to talk about tax cuts going to find yourself in a challenging centage doesn’t matter. I think it prob- and tax revenues, let us be clear that predicament. ably matters to her. A 75-percent re- in the 1920s, during the Mellon tax I yield for Senator THUNE. duction in the taxes that she has to cuts, which slashed the high rate from The PRESIDING OFFICER. The Sen- pay probably matters to her. It is prob- 70 percent down to the twenties ator from South Dakota. ably pretty helpful. throughout the 1920s, revenues went up Mr. THUNE. Mr. President, our coun- You could take the case of a family by 61 percent. Under the Kennedy ad- try has always been about opportunity. of four who earns the median national ministration, we cut taxes, and tax The American dream is the hope that income. That is $73,000. On average, revenues went up to the government your kids and your grandkids and those they will have a $2,200 tax cut. That is from those cohorts from whom we cut who come after you will have a better a 60-percent tax cut. So I am at a loss it. life than you have had. One of the ways as to why that doesn’t matter to that So what we have is a history. Our we do that is that we get a growing, ex- family. I think it matters a lot. I think friends on the other side say that there panding economy that creates better that family can do a lot with that is no actual history. Well, there is his- paying jobs, more opportunity, and $2,200. tory that proves that. In the cohorts higher wages. When you get higher The fact is that our bill lowers taxes where the brackets are and where the wages, you improve that standard of for every category of income earner, cuts occur, we can demonstrate that living, and you improve that quality of and the proportionate share is the the revenues have increased. life. That is what Americans aspire to. greatest for the lowest income earners. I yield for the Senator from South That is what all American families— This is good for working Americans Dakota. moms and dads—aspire to for their Mr. THUNE. Mr. President, how and middle-class Americans. kids and those who are going to come I yield to my colleague from South much time is left on our side? after them. The PRESIDING OFFICER. There I would say to our colleagues on the Carolina. 1 Mr. SCOTT. Mr. President, this is are 8 ⁄2 minutes on the majority’s side. other side, who, like I said, have a new- 1 what I find astonishing. We have been There are 2 ⁄2 minutes on the Demo- found interest in deficits and debt, that talking about this for a number of crats’ side. one of the ways in which you deal with The Senator from Colorado is recog- months. Frankly, for years we have deficits and debt is to grow the econ- nized. been talking about tax reform. Actu- Mr. BENNET. Mr. President, I don’t omy. When you get an expanding econ- ally, since 1986 we have been talking want to get in the way of my friend omy that is creating better paying about tax reform. Our plan removes from South Carolina, for whom I have jobs, more people are working, more millions of low-income Americans from tremendous respect. people are investing, more people are having to pay taxes. Point 1, nothing that I said was taking realizations, and more people I think it is interesting that our about anything other than real people. are paying taxes. What history has friends’ argument on the left is sincere The real people in Colorado are going shown is that when you have a vibrant, but wrong. It misses the fact that if to be able to do this math, and they are growing economy, you get more gov- you are living in a single-parent house- going to know what it says. ernment revenue. hold, with a mother or a father who is Point 2, those 1920s that you men- Of course, the official scorekeepers, working paycheck to paycheck, getting tioned ended up with, then, the worst whether you use the Congressional another $100 a month is real money. depression since the beginning of the Budget Office or the Joint Committee Why are we not talking about the ac- country, and we had the worst income on Taxation, both agree that you are tual benefits to the specific people who inequality in 1928. Guess when the next going to get more revenue when you benefit from this tax reform? When time was that that happened. It was get more growth in the economy. There Senator TOOMEY talks about the typ- when George Bush handed over the might be a slight difference of opinion ical American family seeing its taxes keys to Barack Obama. That was the about how much. The CBO, I think, slashed by 60 percent, why is that spe- next moment in time, when he was says that for every one-tenth of 1 per- cific savings of $2,200 not a meaning- leaving, that we had that kind of in- cent increase in the GDP, you see an ful—perhaps, transformative—savings come inequality. That has not been additional $273 billion in tax revenue that allows someone now to save for fixed, and that is not being fixed by that is generated over a decade or, to college or to save for retirement? this plan. It is being made worse by put it a different way, almost $3 tril- To me, this is where the rubber this plan for all of the reasons that I lion for every percentage point in- meets the road. Yes, here on the other said. crease in gross domestic product. side of the Potomac, it is OK to talk in The final point that I will make—and If you want to get serious about deal- platitudes. I prefer to talk to individ- then I will stop and get out of the ing with America’s fiscal problems, you uals about the impact of our actions in way—is that, if you have this much have to restrain spending, which there their households and the impact of our conviction, at least you could pay for hasn’t been much appetite for around actions in their accounts. It is a very it. It would be nice for you to pay for here in the time that I have been here. simple way of doing the math. You it. You also have to get the economy don’t have to pull out a calculator for I yield the floor. growing and expanding. That is what a 75-percent savings for the average The PRESIDING OFFICER. The Sen- this exercise—what we are going single parent who makes $41,000. The ator from South Carolina is recognized. through here in reforming our Tax reason that we use $41,000 is that that Mr. SCOTT. Mr. President, I will say Code—is really all about, because 2- is the average income of a single head to my friend from Colorado that we are percent growth is not good enough.

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00016 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.025 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7669 This 2-percent growth is not and should keep more in their pockets. Let’s give Committee on Taxation had to say not be the new normal for the Amer- them bigger paychecks, and let’s let about the Republican proposal—0.8 per- ican economy. them decide how to spend the money. cent growth, $1 trillion short in spend- That is what we have had for the last That is a fundamental difference that ing—has had absolutely no effect on 8 years. During President Obama’s en- we have had around here for a long the discussion we are having from the tire time in office, we didn’t have a sin- time. We come here believing that the Republican side. gle year—not 1 year—in which the GDP way you help American families is to I see my friend the distinguished ma- was more than 3 percent—not 1 year. If start growing the economy rather than jority leader here, and I believe he will you go back historically—literally to growing the government, allowing the propound a unanimous consent request. the end of World War II, about 1948— American people to make decisions As he knows, I will have another res- and roll forward to today, the average that are in their best interests and in ervation, and we will discuss this some in the American economy has been 3 to the best interests of them and their more. 3.5 percent, but there has not been a families about how they want to save The PRESIDING OFFICER. The ma- single year in the last 8 years in which for retirement, how they want to help jority leader. we have had 3 percent growth in the their kids get college educations, how Mr. MCCONNELL. Mr. President, I economy. they want to improve their lives, rath- ask unanimous consent that there now What does that mean? er than sending the money to Wash- be 30 minutes equally divided for de- That means that, without that kind ington, DC, and letting Washington bate only, with no amendments or mo- of growth, businesses are not expand- spend it. That is, fundamentally, the tions in order and with the majority ing. They are not investing, they are difference, I think, that we are talking leader being recognized at the conclu- not hiring new workers, they are not about here. sion of that time. paying those workers more, and you As to the arguments that have been The PRESIDING OFFICER. Is there end up with flat wages. We have had, made by the other side, they just objection? literally, a decade now of flat wages, aren’t based on facts. The data tells a Mr. WYDEN. Reserving the right to where American families and individ- different story as the Senator from object. uals have not seen any growth in their Pennsylvania pointed out. Look at the Mr. MCCONNELL. I suggest the ab- incomes. chart. Look at the percentage of tax sence of a quorum. The PRESIDING OFFICER. The What we hope to accomplish through cuts. Who benefits? We have worked clerk will call the roll. all of this will be changes made to the very, very hard on this bill to maintain The legislative clerk proceeded to Tax Code that will increase investment progressivity in the Tax Code so that call the roll. through lowering rates on businesses, we have tax relief delivered to those allowing them to recover their costs of Mr. MCCONNELL. Mr. President, I hard-working American families, to ask unanimous consent that the order investment faster, and accelerating those hard-working American tax- their cost recovery. Those are for the quorum call be rescinded. payers who need a break, who are liv- The PRESIDING OFFICER. Is there changes—those are reforms in our Tax ing paycheck to paycheck. objection? Code—that will help unleash this econ- Honestly, I hope, when this is all said Without objection, it is so ordered. omy and get us back, closer to normal, and done, that not only will we be able Is there objection to the majority when we were creating those good-pay- to pass this bill but that, maybe, we leader’s unanimous consent request? ing jobs. Then, we can start doing will get a few Democrats who might de- Mr. WYDEN. Reserving the right to something, at the same time, about cide that it will be in the best interests object, Mr. President, I understand spending around here, and we will start of their constituents to help their fam- that we are going to get the proposal seeing those deficits go down. The best ilies and their States realize more in- from the majority shortly. I come back thing that can happen for the Amer- come in their pockets and bigger pay- again to the fact that there are ican economy, the best thing that can checks and, hopefully, an opportunity changes apparently worth billions and happen for the American family, and to live out their versions of the Amer- billions of dollars, like the passthrough the best thing that can happen for the ican dream for them, for their kids, provision. We need to be able to see American worker is to have a growing, and for their grandkids. That is what these. The American people have a vibrant economy. the American experience and the right to know. To my colleagues on the other side American dream are really all about. I believe the majority has indicated who consistently get up and say there When we take more and more here in that we will get this shortly, and I is no benefit to this that will be deliv- Washington, DC, that means that withdraw my reservation and will ered to middle-income families in this American families have less with point out that if we don’t get it short- country, again, I will say what has al- which to help themselves and to plan ly, I will stay at my post and keep ob- ready been said by my colleagues from for their futures. jecting because the American people South Carolina and from Pennsylvania, Our time has expired. have a right to know that tax policy is which is to look at a typical family of Mr. WYDEN. Mr. President, how being made in the dark. four with a combined annual income of much time remains on our side? The PRESIDING OFFICER. Without $73,000, who under this tax cut bill will The PRESIDING OFFICER (Mr. objection, it is so ordered. receive a tax cut of $2,200—a 60-percent CRUZ). The majority controls 1 minute, Who yields time? reduction over what they are paying and the Democrats control 11⁄2 minutes. The Senator from Colorado. today under current law. That is what Mr. WYDEN. Mr. President, I will Mr. GARDNER. Mr. President, I want that average family of four will see. take our 11⁄2 minutes. to talk about the importance of pass- Now, the Senator from Colorado said The PRESIDING OFFICER. The Sen- ing this tax reform legislation for the that he doesn’t believe that Colorado ator from Oregon. people of Colorado. What we have is an Republicans are for this. I can tell you Mr. WYDEN. We have just a minute opportunity to see real wage growth in who is going to be for this—the people, and a half. The hour is late. I want to this country—something we haven’t the families, who get the $2,200 tax cut. repeat once again that we still do not seen for far too long. Over the past dec- That is $2,200 they are going to have in have this bill. We have seen appar- ade, I think people who are on both their pockets. ently, in the last few hours, tax sides of the aisle have recognized that You heard my colleague from South changes that involve billions and bil- while there might be some economic Carolina talk about that family that lions of dollars. The American people job activity, job creation taking place, lives paycheck to paycheck or about have a right to know what is in this while we might see some low economic that single mom who wants a better fu- proposal, and certainly we on this side unemployment numbers in States like ture for her kids. How do we help of the aisle have a right to know about Colorado, what we haven’t seen is the them? One of the ways we help them is it. kind of wage growth we know we can to reduce the burden—the take—that I am struck by the comments of my create. their government takes from them colleagues on the other side that learn- Under the analysis done by non- every single year and to allow them to ing the facts about what the Joint partisan think tanks in Colorado, they

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00017 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.027 S01DEPT1 S7670 CONGRESSIONAL RECORD — SENATE December 1, 2017 estimate that wages would grow— are going to be able to spend the cent needs $34,000 in 2019. I don’t think after-tax income—by over $3,000. That money they want to in Pueblo, CO, to that should be part of our legislation. I is incredible wage growth for families put it into an investment that they would like to see all of the tax benefits who many people estimate and who want to in Brighton, CO. It will be an to the top 1 percent go to the middle other economists have said could see a investment that somebody in Craig, and those trying to get to the middle. financial hardship if they were asked CO, wants to have. That is what they But let’s do the comparison. to come up with $400. In fact, we know are focused on. They want to get the In the first year, in terms of these that if over one-third of people in money into their pockets. They earned families making $50,000 to $87,000, they America had to come up with $400 it. They should keep it, not Wash- get 1.4 percent. The folks making be- today, it would create a financial crisis ington, DC, where they make bad deci- tween $310,000 and $750,000 get 3.5 per- in their household. sions on how to spend their hard- cent—more than two full percentage We heard our colleague from Penn- earned dollars. points higher. Why is that? Why do sylvania and our colleague from South To my colleagues who oppose this people making $310,000 to $750,000 get a Dakota talking about the fact that a bill, we have talked about the opportu- much bigger percentage tax cut than family earning a median household in- nities for the American people to see people making $50,000 to $87,000? The come of $73,000 would see a 60-percent real wage growth. This bill does it. We third category is the top 1 percent, and reduction in their taxes next year. A talked about the opportunity to bring they get 2.2 percent. So I have prob- single parent with a child, earning jobs back from overseas. This bill does lems with this legislation just based $41,000 a year, would see a 75-percent it. We talked about the opportunity to upon that. Why does the top 1 percent tax cut. get businesses hiring again and expand- need one more penny? Why do very Let me read a headline from a story ing. Nonpartisan estimates show that wealthy people—maybe not quite the in Colorado. The headline of this arti- this bill would create nearly 1 million top 1 percent but the 95th to 99th per- cle is ‘‘How Tax Reform Can Empower jobs—new jobs created by this bill. It is centile, the $310,000 to $750,000 cat- This Drive-in Theater Owner to Expand a great opportunity for us, and I thank egory—why do they need a tax break? Her Business.’’ What she is talking the people who have worked so hard on Guess what. It doesn’t get any better about is the fact that if she sees lower this bill, my colleagues in South Da- down the road. And I am not talking taxes at the 88 Drive-in—that is an kota, Pennsylvania, and others. about 2027, where it is cataclysmic for iconic drive-in in Commerce City, CO. Mr. President, I yield back my time. families in the middle; let’s talk about If you see this drive-in, you will know The PRESIDING OFFICER. The Sen- 2 years before that. It is still bad. It is exactly—it is iconic on the landscape. ator from Pennsylvania. still 3 percent, by comparison, for the She believes that if her taxes are lower, Mr. CASEY. Mr. President, I rise to very wealthy, people making up to she will be able to move forward and talk about a subject matter that this $750,000. The top 1 percent are still get- buy the property next door, which will bill deals with that we are not hearing ting 2.1 percent. But the income cat- allow her to expand her business. She a lot about. I wanted to start, though, egory between $50,000 and $87,000 gets talks about the fact that she has to with the basics in terms of the overall 1.2 percent of the tax cut, so they will turn people away because so many peo- debate. be getting worse in 2025. Why is that? ple are going to it and they don’t have I have said many times in the last As my colleague, the senior Senator enough room. She wants to expand, but number of days and weeks when we from Colorado, shows in that chart, she is held back by our uncompetitive have reviewed the House proposal and why do people making more than $1 Tax Code. If we cut taxes, she will be when we reviewed the Senate proposal million need $34 billion in 1 year? I able to buy land, expand the business, that was voted on in the Senate Fi- don’t understand it. and create more jobs. It is a greater op- nance Committee before Thanks- Let me focus in particular on part of portunity for her, her family, and the giving—I described the Senate bill as a the debate about which we really people of Colorado. giveaway to the superrich and big, haven’t had much discussion. The im- This is really an opportunity to see multinational corporations. I still be- pact of this tax bill may be the only the kind of growth and wage growth lieve that. substantial effort that will be made on that we haven’t seen in this country I hope that when we see the new tax reform for years, if not decades. We for far too long. version of the bill, I won’t have to say know that the last time any kind of I have held several roundtables on that again, but I am afraid I will. I am major tax reform was done was 1986, so taxes throughout the Eastern Plains of afraid that when we look at some of three decades have passed since the Colorado, where I live. People are wor- the data on what the tax impact would last tax reform effort. So this is a criti- ried about their income because they be on certain income brackets in the cally important moment not just for haven’t seen the kind of economic United States, even starting in the taxpayers, not just for the economy, growth, the numbers in employment first year where the analysis starts, not just for families generally, but es- growth that they have in the Front 2019—I am looking at page 3 of a report pecially for children. Range, in Denver. I have held by the Tax Policy Center dated Novem- In a bill of this significance, a bill of roundtables on the Western Slope of ber 20 and based upon the Senate bill. this impact, one major question should Colorado, in Southern Colorado, North- In that year, tax year 2019, table No. 1 be asked, among many: What will be ern Colorado, and they are all very focuses on three income categories: the impact on children? What is the worried about a country that is not as folks making between $50,000 and child impact statement, if we were to competitive as it used to be. They $87,000; folks making between about draft one, if we had to articulate that? know that with a competitive tax code, $310,000 and $750,000; and others making What is the impact on children of this they would see those jobs and invest- above $750,000, so basically the top 1 legislation? ment come back into this country once percent. Here is what they find. The Well, there are a lot of organizations again. Tax Policy Center tells us that the around the country that pay attention People in Pueblo, CO, know they first group, the family making $50,000 to public policy as it relates to chil- need jobs brought back into their com- to $87,000, would receive an average tax dren. I am looking at a letter dated No- munity because while many areas of cut of about $900, or 1.4 percent of vember 28 and signed by a long list of Colorado have seen very low unemploy- after-tax income. The next group, the organizations that advocate on behalf ment rates, they haven’t seen the kind $310,000 to $750,000 income, gets a tax of children, and I will just read some of of growth other areas have. They know benefit that amounts to about $12,000, the headlines from this letter. that with a competitive tax code that or 3.5 percent. The top 1 percent— The first headline says: ‘‘The Senate brings jobs and money back from over- $750,000 and up—they get a tax break of tax plan threatens child care programs seas, that will provide real relief to a $34,000, or 2.2 percent. and funding for the future.’’ single parent with a child at home and Probably the most significant num- The second major headline says: to a family of four working hard to bers in there by way of comparison ‘‘The Senate tax bill’s proposal to cut make ends meet. They are going to pay aren’t necessarily the dollar amounts, the Affordable Care Act would harm less taxes next year as a result. They although I would ask why the top 1 per- children’s health and well-being.’’

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00018 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.028 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7671 The next headline says: ‘‘The Child nating the deduction for state and local cause there were no hearings, not a sin- Tax Credit proposal in the Senate tax taxes, and eliminating deductions for some gle hearing on the bill. There was dis- bill would not help families who strug- employment-related expenses. This would cussion, and there were questions for gle to pay for child care.’’ leave many families worse off. And the Sen- some tax policy experts, but nothing in The next headline says: ‘‘The Senate ate bill makes all of the tax benefits for fam- ilies temporary, expiring at the end of 2025, the way of hearings that could probe tax bill also takes away other tax bene- even though the proposed corporate tax cuts very deeply on what happens to kids. fits that ordinary families rely on.’’ are all permanent. I think the American people would Mr. President, I ask unanimous con- There is a better way to help families and like to know more about what will hap- sent that this letter be printed in the children and to build a strong economy now pen with the child tax credit, for exam- RECORD. and in the future. Instead of these ill-con- ple. There has been a lot of talk on the There being no objection, the mate- ceived tax cuts, Congress can help families Republican side about the child tax rial was ordered to be printed in the through the tax code by enacting the Child credit; they are allegedly making it and Dependent Care Tax Credit Enhance- RECORD, as follows: ment Act of 2017, and ensure that all chil- better. Well, the Senate Republican DEAR SENATOR: As members of the Child dren and families who need it get high qual- plan does increase the maximum tax Care/Early Learning Coalition, we urge you ity child care and early education by enact- credit for children from $1,000 to $2,000 to vote against the ‘‘Tax Cuts and Jobs Act.’’ ing the Child Care for Working Families Act. per child. That sounds pretty good so This bill would eliminate existing benefits in Sincerely, far, right—$1,000 to $2,000. But because the tax code for children and families, as Association of Asian Pacific Community the bill limits refundability, a mom well as undermine critical supports, includ- Health Organizations (AAPCHO), Center for ing those related to child care and early edu- working full-time at minimum wage American Progress, Center for Community will see only an additional $75 in the cation, in the future. Change Action, Children’s Defense Fund, The Senate tax plan threatens child care Children’s Leadership Council, CLASP, child tax credit, while a married couple programs and funding in the future. The Sen- Every Child Matters, Family Focused Treat- earning $500,000 would become newly ate tax bill, which consists largely of mas- ment Association, Generations United, eligible for the maximum $2,000-per- sive tax cuts for businesses and the wealthy, Health Care for America Now, Jumpstart, child credit. is estimated to increase the deficit by about Make it Work, Mi Familia Vota, National According to the Center on Budget $1.4 trillion over ten years. The budget Association of Family Child Care Providers, agreed upon by the House and Senate pro- and Policy Priorities, 10 million chil- National Association for Bilingual Edu- dren—10 million—live in families who vides a roadmap of how Congress will seek to cation, National Association of Social Work- offset this increase in the deficit: by cutting would get $6.25 or less per month in the ers (NASW), National Council of Jewish additional child tax credit in this bill. federal spending and, in particular, by slash- Women, National LGBTQ Task Force Action ing programs and services that provide work- Fund, National Physicians Alliance, Na- So there is not much improvement in ing families with a basic standard of living. tional Women’s Law Center, NETWORK the child tax credit on maybe the only That means this tax bill will ultimately lead Lobby for Catholic Social Justice, tax reform bill that this body will con- to cuts in programs that are integral to the SparkAction, The Institute on Taxation and sider for the next 30 years. Let’s say it wellbeing of children and their families, in- Economic Policy, United Auto Workers, is only 10 years. Wouldn’t it be nice to cluding Medicaid, SNAP, public education, Working Families Party, ZERO TO THREE. and the Child Care and Development Block have some testimony from experts Grant. Mr. CASEY. That is just one brief as- across this country who live and The Senate tax bill’s proposal to cut the sessment of the impact of this legisla- breathe the work of being advocates for Affordable Care Act would harm children’s tion on children, but I think that children, who study every bill to deter- health and well-being. The Senate bill would should be a question we ask of every mine whether it impacts on children. repeal the ACA’s individual responsibility major piece of legislation. Wouldn’t it be nice to have their testi- provision, a requirement that most people Mr. WYDEN. Mr. President, will my mony maybe on the child tax credit, enroll in coverage or pay a penalty. Esti- friend from Pennsylvania yield briefly? mates from the Congressional Budget Office maybe just on the child and dependent (CBO) show that repealing the ACA’s indi- Mr. CASEY. Yes. care tax credit, which is the only tax vidual responsibility provision would in- Mr. WYDEN. He is a very fine mem- provision in law right now that helps crease the number of uninsured by 13 million ber of the Finance Committee. people pay for childcare. over 10 years and raise insurance premiums I don’t remember any discussion in Ask any family: What is your No. 1 in the individual markets by 10 percent. our committee about how this specific concern, other than making ends meet Children’s health and well-being suffers when legislation affects children. My col- and maybe paying for higher edu- their families lack the health insurance they league is really the expert on the sub- cation? Other than a few priorities like need to see a doctor when they are sick or ject, and maybe he can tell me if he re- for preventive care. The Senate has already that, their No. 1 concern is how to pay rejected an attempt to repealing the ACA, calls such a thing with respect to this for childcare, but there is no testimony and now the bill would sneak this in in order specific legislation and what it means on that issue that relates to the bill. to fund even larger tax cuts for high-income for children. I don’t remember such a There is no testimony at all because households and corporations. discussion. there were no hearings on the bill. How The Child Tax Credit proposal in the Sen- Mr. CASEY. Mr. President, I want to can you have a child impact statement, ate tax bill would not help families who say to the senior Senator from Oregon, how can you even generalize about it struggle to pay for child care. The Senate as the ranking member of the com- without a hearing? tax bill would increase the Child Tax Credit mittee, he will remember, as I do, that Of course, we need more than gen- (CTC), but does not make this increase fully refundable. As a result, lower-income fami- in the course of that so-called markup, eralizations. We need specifics. So I lies will not receive the full benefit: for ex- which is a fancy Washington word for think we have to ask those questions ample, a single mother working full time at having some debates and offering and be focused on children in a very the federal minimum wage and earning amendments, there was no hearing—no specific way. $14,500 would only receive an additional $75 hearing for days, and there has still Here is the last thing I will say. This in CTC benefits. In addition, the tax plan been no hearing on the Senate bill opportunity to come together in a bi- bills adds a new requirement—providing a passed out of the Finance Committee partisan fashion, which has not hap- Social Security Number for each child and the new version of the bill that we pened in this case—but we have the op- claimed for the refundable portion of the CTC—which could exclude a significant num- will see right now. So, in the course of portunity, and the majority could have ber of children in immigrant families. This is that discussion, there were no hear- taken a different path. They could have not an approach targeted to help families ings. said to us months ago: Let’s have a bi- striving to make ends meet, and does noth- It would have been helpful to us and partisan process. Let’s not move to a ing to address the high cost of child care to the American people if we had the pathway that requires only 51 votes. with which so many working families strug- major organizations come in before the Let’s have a real bipartisan process on gle every day. Finance Committee and give us testi- tax reform as they did in the mid-1980s, The Senate tax bill also takes away other mony about the impact on children— resulting in the 1986 bill. They could tax benefits that ordinary families rely on. Even though the Senate tax bill proposes in- organizations that have spent decades have said: Do you know what? We have creasing the CTC (and doubling the standard advocating on behalf of children, doing a bipartisan concern about children. deduction), the bill also proposes eliminating public policy research as it relates to We like the child tax credit. We like personal and dependency exemptions, elimi- children, but we never heard that be- the child independent care tax credit.

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00019 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.029 S01DEPT1 S7672 CONGRESSIONAL RECORD — SENATE December 1, 2017 We like the earned-income tax credit. differences and the facts in question. We don’t change anything except one All of those are good policies. We want But there is no question that we are thing. We say that if you decide this to make them better. We want to have lowering taxes on middle-income fami- plan doesn’t fit your family or if you a bipartisan effort to infuse all of those lies because we are lowering taxes on decide for all the subsidies you get it is policies with even more funding, more every category of wages. still not worth it for you to have this help to make them more robust for our The people who are watching on C– plan and you opt out, you will no children, but that never happened. SPAN and the people who are listening longer be punished with this tax. That Once again, because of what the ma- in the gallery must get a little frus- is the only thing we do in this bill. jority did, the pathway they selected trated and must ask themselves: Well, Since we eliminate that coercion, to passing their bill with only Repub- who can we believe? We hear one side which forces people to buy it, our col- lican votes—and that was their say: This is lower taxes for working leagues on the other side say that choice—we will have a tax bill that will families. We have the other side say: drives a stake through the heart of not have a child impact statement, will Oh, it is higher taxes. ObamaCare. It seems to me that a not have hearings about the impact on I have a suggestion. I know there is a product or a service that people have children and families, will not have solution. You could look it up at Joint to be forced to buy and that is killed if any of that. Once again, we will prove Committee on Taxation, but that is te- they are not forced to buy it probably that Washington, DC, never misses an dious. You have to go to the website, isn’t a great deal for those people, and opportunity to miss an opportunity, es- you have to find it, and then you would I think we just got that admission. pecially as it relates to children and see in the tables—because they are un- With that, I yield to my colleague families. That is particularly insulting ambiguous—that taxes owed go down from South Carolina. to the American people and regrettable in every category. The PRESIDING OFFICER. The Sen- because we have a moment here where Do you know when people are going ator from South Carolina we are trying to do tax reform and be- to know for sure what the answer is? It Mr. SCOTT. I will say, Mr. President, cause it is not bipartisan, because is going to come in January when the that my colleague from Pennsylvania there were no hearings on the bill, the withholding in their paycheck changes did such a good job that there is little impact on children will never ever be and when their take-home pay goes up left to say. I was fumbling because I fully assessed. That is not just a trag- because the taxes they owe go down. I was just confused on what I would say, edy, but that is a real insult to our know we are still a few weeks away and I will be honest with you that families and to our children. from that, but when this passes and there is just not much to say. I yield the floor. gets signed into law, the proof is going If I were to reinforce a couple of The PRESIDING OFFICER. The Sen- to be very clear, and people are going points that the Senator did not cover, ator from Pennsylvania. to see it. they would be that at our last Finance Mr. TOOMEY. Mr. President, how Here is a quick word about the repeal hearing, which lasted—I thought it was much time is remaining on the major- of the individual mandate. My friend 12 hours; it was 23 hours—we had our ity side? and colleague from Oregon described it. friends on the other side offer 63 The PRESIDING OFFICER. Ten and I am paraphrasing, but I think I will amendments. To say that they are not a half minutes remains. get it about right. He described the re- engaged in the process is to forget the Mr. TOOMEY. OK. Thank you, Mr. peal of the individual mandate as driv- 63 amendments offered over 23 hours. President. I will be brief because I ing a stake through the heart of Senator TOOMEY did such a good job think my colleague from South Caro- ObamaCare or something equivalent to that I am just going to sit back down. lina has a comment he wants to make. that. I couldn’t help but think: What Mr. THUNE. Mr. President, Senator Let me respond just briefly to my an incredibly damming indictment of SCOTT and I and the Senator from colleague from my State of Pennsyl- ObamaCare. Think about what that Pennsylvania were all there at what we vania. Our bill increases the child tax means. call the markup. credit. Our bill lowers the tax burden Think about what they are saying if Mr. SCOTT. We were. on every category of income earners, repealing the individual mandate Mr. THUNE. My recollection is like including working families, middle-in- drives a stake through the heart of his, and, frankly, my recollection, come families—every category. ObamaCare. The individual mandate is when it comes to all the work that As my colleague from Colorado dem- the provision which says that you have went into getting us to where we are onstrated kindly, he showed in the to buy this whether you want it or not. dates back a long way. I joined the chart that the biggest proportional You have to. You are forced to. The Senate Finance Committee in 2011. I savings go to the lower-income fami- government dictates the terms, the am not sure when the Senator from lies, and the pro-growth policy is going government effectively dictates prices, South Carolina joined or the Senator to create more job opportunities at and you must buy it. If you don’t, you from Pennsylvania, but it was shortly higher wages. So let’s see: more money will get hit with a penalty, a tax pen- after that, I think. in child tax credit, less taxes owed on alty. Since I have been on the Finance the part of families, more job opportu- We don’t actually repeal the man- Committee, we have had 70-plus hear- nities, and higher wages. I think it is a date, but we eliminate that tax pen- ings—70-plus hearings on tax reform. pretty safe bet that this is good for alty, and that is going to be very help- We have looked at every facet, every kids. I think it is a pretty safe bet that ful for low- and middle-income fami- aspect, every element of the Tax Code. when families get to keep more of their lies, working-class families. In Penn- We even went so far 2 years ago, in money, that is probably good for their sylvania, 83 percent of all the people 2015, to create five working groups. We kids. I think most of my constituents who get hit with this individual man- all participated in those, along with, I would probably agree with that. date tax live in a household with in- might add, our Democratic colleagues, We have heard folks on the other side come of $50,000 or less. That is who is each of whom had a key role in helping suggest that we are actually not cut- paying this. with the final recommendations that ting taxes on the middle class. This is But what I wanted to stress for a mo- were put forward. A lot of what is in unfortunate because we have enough ment is what a damming indictment it this bill is based upon the work that areas where we disagree without hav- is of ObamaCare that it only works, ac- was done by those working groups. ing to make up areas that aren’t true. cording to its proponents, if people are There isn’t a single shred of the Tax Our friends on the other side like high- forced to buy the product. It is so badly Code that we haven’t covered and er taxes; we like lower taxes. They like designed, it is so terrible that people haven’t studied in great detail. to redistribute wealth; we like people will not buy it voluntarily, despite Then, of course, as the Senator from who earn it to keep wealth. We focus huge subsidies. South Carolina pointed out, when it on growing the economy; they want to We don’t change any of the subsidies. came time to mark the bill up, we grow government. We have honest dif- They are all available to anyone who spent several days—23 hours debating ferences in priorities, so I wish we wants to participate. We don’t change back and forth, listening to each other, would focus on where there are actual the rules. We don’t change eligibility. and in some cases arguing. In some

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00020 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.031 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7673 cases, those were very spirited argu- happen to believe that is good enough. debate only, with no amendments or ments. The Democrats offered 63 We think we can do better. That motions in order and with the majority amendments, all of which got votes in shouldn’t be the new normal. The leader being recognized at the conclu- the Senate Finance Committee. American economy is the greatest sion of that time. So for anybody to suggest that this economy on the face of the Earth. We The PRESIDING OFFICER. Is there has been anything but a transparent ought to be able to grow at 3 to 3.5 per- objection? process based upon years of work and cent. Without objection, it is so ordered. buildup and lead-up to get us to where I can tell you, ladies and gentlemen, The Senator from Oregon. we are today is absolutely misstating that the average middle-income family Mr. WYDEN. Mr. President, here we the facts. I think the work we have in this country is not only going to get are now at 4:15. We still have not seen done in advance of this has led to a a big tax cut—which means they are this bill—a $10 trillion bill, the biggest product that is the culmination of a going to get a bigger paycheck and tax bill in more than three decades, great deal of thought, a great deal of have more money in their pocket—but with changes involving billions and bil- input, and a great deal of research from they will get the benefit of the higher lions of dollars made, apparently, over- not only experts in the field but fellow wages coming with a growing, more dy- night. I have made it clear that when the Members—Democrats and Repub- namic economy that it reflects. leader, Senator MCCONNELL, comes licans—Senators and staff—who have I yield the floor. back down, we expect to see this bill. gotten us to where we are today. Mr. WYDEN. Mr. President, I would We were told essentially an hour ago I think the fact, which has been just like to respond briefly to the Sen- that we would see this in a matter of pointed out many times, that a family ator from Pennsylvania, who is baffled by why we are so opposed to the health minutes. that is living paycheck to paycheck The American people have a right to provisions of the bill. The Congres- will now get the benefit of a doubling know that even though the majority sional Budget Office says that the ma- of the standard deduction and a dou- wants to make $10 trillion worth of tax jority’s provisions will cause 13 million bling of the child tax credit, frankly, I policy changes on the fly, this side of people to lose coverage and premiums happen to believe—contrary to my col- the aisle is going to insist on knowing league from Pennsylvania—is a pretty to go up 10 percent. This morning’s what is in the bill. big deal. If you are a family who has paper makes the point that it will My colleague has been very patient, any sort of tax liability, that tax credit bring back junk insurance, which once and I wish him to be recognized on our is a dollar-for-dollar credit against again will allow discrimination against time now. that tax liability. An increased portion people with preexisting conditions. The PRESIDING OFFICER. The Sen- of that is refundable under this legisla- I will use the last 30 seconds that I ator from Minnesota. tion. have, as we await the majority leader, Mr. FRANKEN. Mr. President, I rise If you look at the lower rates we to say, once again, that the American this evening in opposition to the tax have in the bill, that middle-income people and the Congress are actually bill before us. I think the problem in family in this country stands to benefit going to find out some information our country isn’t that wealthy people significantly as a result of this to the about what is being offered. in this country aren’t wealthy enough; tune of—if you are a family of four I would just like to close my use of the problem is, the wealth gap has with a combined annual income of the minute by pointing out now an- grown to the highest levels in my life- $73,000—an additional $2,200 in your other double standard. It sure looks time. This bill would make that wealth pocket. That is $2,200 in the American like lobbyists on K Street have more gap even bigger. family’s pocket that they get to decide and better information about what is Senator Paul Wellstone often said: how to spend. about to be offered than do Democrats ‘‘We all do better when we all do bet- As the Senator of Pennsylvania in the Senate. So what we are talking ter.’’ He knew the economy does better pointed out, don’t take our word for it. about is that we have seen one double when there is a strong middle class and You can sit down, if you like to, and standard after another. The tax breaks when working families have more look at the features of the bill. Look at for the middle-class are temporary, and money to spend. Unfortunately, the your individual tax situation. Plug in the wealthy get permanent ones. Republican tax bill does the opposite of these changes, and I think you will find The PRESIDING OFFICER. The Sen- what Paul Wellstone argued for. In- you are going to see a pretty signifi- ator’s time has expired. stead of helping working families, it cant reduction in your tax liability. All time has expired. raises taxes on at least 14 million of When January rolls around when this The Senator from Pennsylvania. them, and it uses this revenue to give passes, people will get their check. Mr. TOOMEY. Mr. President, I sug- $1 trillion to the superrich, all while When they look at their withholdings, gest the absence of a quorum. adding $1.5 trillion to our national The PRESIDING OFFICER. The they will realize they have a lot more debt. This is, at its core, an awful bill. money. That paycheck is bigger. The clerk will call the roll. When President Trump took office, The legislative clerk proceeded to paycheck is going to be bigger. Why? he pledged that he would look out for call the roll. The amount taken out in terms of Fed- the ‘‘forgotten men and women,’’ not Mr. CASEY. Mr. President, I ask eral taxes is going to be significantly the wealthy. This bill is a betrayal of unanimous consent that the order for smaller. That is a good thing for the that commitment. the quorum call be rescinded. American family. I believe Congress should work on a The PRESIDING OFFICER. Is there That is why this debate and the bill bipartisan basis to make our Tax Code objection? we have before us are so important, not Mr. TOOMEY. I object. fairer and simpler for working families, only to those families who are trying The PRESIDING OFFICER. Objec- and that is what I have advocated for to build a stronger, brighter, and more tion is heard. since I joined the Senate. Democrats prosperous future for themselves and The legislative clerk continued with have made a good-faith effort to work their families but also for this Amer- the call of the roll. in a bipartisan manner on a tax reform ican economy. With the other changes Mr. SCOTT. Mr. President, I ask bill with Republicans, but Republicans that are made in the bill, it is going to unanimous consent that the order for have chosen, from the very start of this lead to better paying jobs and higher the quorum call be rescinded. Congress, to take a purely partisan ap- wages that are going to lift the boats The PRESIDING OFFICER (Mr. proach that has left Democrats en- of all Americans. STRANGE). Is there objection? tirely out of the discussion. Americans haven’t had a pay raise, Without objection, it is so ordered. We all know this bill is being rushed literally, in about the past decade. We The Senator from South Carolina is through Congress so Republicans can haven’t had a single year in the Obama recognized. claim a legislative achievement by the years of 3 percent growth, which has Mr. SCOTT. Thank you, Mr. Presi- end of the year. That is not the way been the historical average going back dent. you get a fairer, simpler Tax Code. You to the end of World War II. We are I ask unanimous consent that there get a fairer, simpler Tax Code by hav- growing at 1.5 to 2 percent. We don’t now be 30 minutes, equally divided, for ing hearings with outside witnesses.

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00021 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.032 S01DEPT1 S7674 CONGRESSIONAL RECORD — SENATE December 1, 2017 You get a fairer, simpler Tax Code by economic adviser, wrote a few weeks come, and it enables our local commu- giving Americans an opportunity to ago: nities to make investments in public weigh in as it is being drafted, to re- The Tax Reform Act of 1986 reduced the safety and education, childcare, and in- view the bill, and to share their views. top personal tax rate to just 28 percent from frastructure. According to the Tax Pol- You get a simpler, fairer Tax Code by 50 percent, and the corporate percent to 34 icy Center, 34 percent of Minnesotans doing it in a bipartisan manner, not by percent from 46 percent. Yet there was no in- claim the State and local tax deduc- excluding Democrats entirely from the crease in the rate of economic growth in sub- tion, with an average deduction of al- drafting of the bill. sequent years, and by 1990, the economy was most $13,000. Eliminating this deduc- in deep recession. The fast-track process Republicans tion means a significant tax increase are using is just like the Republicans’ Tax cuts don’t magically pay for for those families and would make it equally partisan, equally secretive, and themselves. harder for local communities in Min- equally rushed attempt to repeal and I would also like to highlight the Re- nesota to raise the revenue necessary replace ObamaCare earlier this year. publican hypocrisy on budget deficits. to make vital investments. Americans deserve better. For many years, Republicans have used I have heard outrage over the Repub- In their effort to get this bill through budget deficits as an excuse to block lican approach to tax reform from a before Americans realize just how dam- important pieces of legislation. In fact, very wide range of my constituents. I aging it is, many Republicans have even now, we are in danger of stripping have heard from Minnesota farmers made some misleading claims about it. health insurance away from 9 million about how it would undermine agricul- For example, Republicans often cite children because of difficulties finding tural cooperatives, which are really the fact that the bill would double the offsets for reauthorization of the Chil- important to Minnesota. I have heard standard deduction that families can dren’s Health Insurance Program. Yet, from Minnesota students who are con- claim on their tax return. That is true, when it comes to the tax bill, only a cerned it will force them out of grad- but they always seem to leave out the handful of Republicans have raised con- uate school. I have heard from Min- very important fact that their bill cerns about the fact that it would add nesota homebuilders and developers would also eliminate the personal ex- $1.5 trillion to our national debt. who say it would cut affordable hous- emption. The personal exemption is We know from experience that as ing construction in half. I have heard about $4,000 for each family member, so soon as the ink is dry on this bill, Re- from Realtors who say the bill could when compared with a $12,000 increase publicans will cite the rising national crater the real estate market. I have in the standard deduction, it means debt caused by this bill as a reason to heard from many ordinary Americans households with two parents and more cut key programs that millions of who say the bill is simply unfair. than one child would be worse off under Americans use every day—things like Americans deserve a fairer, simpler the Republican tax bill than under cur- Social Security, Medicare, Medicaid, Tax Code, not the debt-funded give- rent law; for example, with two chil- job training, education, infrastructure, away to the wealthy that Republicans dren. and affordable housing. In fact, under are trying to force through the Senate Sometimes they argue that doubling their budget resolution that Repub- today. That is why I oppose this bill, the child tax credit from $1,000 to $2,000 licans adopted just 2 months ago, they and I urge my colleagues to oppose it would offset the loss of the personal ex- laid out their plans for these reduc- as well. emption, but under their plan families tions, which would include over $1 tril- I yield the floor. who most need the help would get lion in Medicaid cuts and $470 billion in The PRESIDING OFFICER. The Sen- hardly anything from the increase in Medicare cuts. ator from South Carolina. the child tax credit, which is not re- This bill would also trigger auto- Mr. SCOTT. Mr. President, we have fundable. So, for instance, a family liv- matic cuts to some key programs. So heard a lot about this bill over the last ing off a minimum wage earner would in exchange for the bill’s minimum tax several hours and, frankly, several benefit by only about 75 more dollars weeks, and we have had a lot of con- cuts for some working families, start- under this bill’s revised child tax cred- versations over the last several ing in 2018, there would be an auto- it, not the full $1,000 some Republicans months, but, today, December 1, 2017, matic 4-percent reduction in Medicare promise, but the Republican bill would at 4:24 p.m.—and I hope we remember payments and a zeroing out of other also now allow people earning up to this because I have finally heard the key accounts—a zeroing out of the $500,000 a year to claim the full tax definition of ‘‘fearmongering.’’ Crime Victims Fund, farm price sup- credit of $2,000 per child. That is Someone once said that fear is an ac- $500,000 a year, up from $110,000 as it is port programs, and the social services ronym for false evidence appearing now. So that is $75 more per child for a block grant that provides funds to real. What we have heard today is that minimum wage earner and $2,000 per Meals on Wheels, youth counseling, because of the passage of this bill, the child for someone making $500,000 a and other important services for vul- Crime Victims Fund will be zeroed out. year. That is just not fair. nerable people. We heard the social services block We hear from my friends on the Re- There are many better uses for $1.5 grants will go away. We heard there publican side that tax cuts always pay trillion. President Trump said he want- will be cuts to Medicaid. I want all the for themselves. Ask the people of Kan- ed to work with Congress on a $1 tril- folks in this Chamber to remember the sas about that. When Kansas cut taxes lion infrastructure package to rebuild time so that if they ever have to go in 2012 and in 2013, State revenues our roads, our airports, our ports, and back and find it, they will know it was plummeted, Kansas slashed university to build broadband across America. I December 1 at 4:24 p.m. when it was budgets, canceled highway projects, have said I would like to work with the said. and had to borrow $1 billion to fund President and my Republican col- So here is my thought: A few months their public pension plan. Schools leagues on a comprehensive bill, but into 2018, when your takehome pay has around the State started going 4 days a this bill would make it impossible to increased because the government is week. Teachers moved across the river enact a $1 trillion infrastructure pack- taking less of your hard-earned from Kansas City, KS, to Kansas City, age the President promised and which money—punishing you less and reward- MO. From 2013 to mid-2017, the Kansas we have really heard nothing about. ing your success more—just remember economy underperformed that of near- There are too many other flaws with to check and see if there is any money ly all its neighbors and the United the Republican bill to highlight them in the Crime Victims Fund; I would States overall in economic growth, pri- all now, but I would like to raise one suggest they check and see if there are vate sector job creation, passthrough that is particularly important to Min- any dollars in the social services block business formation, and labor force nesotans. The bill before us today grant; and I hope they will check and participation. Finally, corporations would eliminate the State and local see if there has been a cut to Medicaid begged the legislature to raise their tax deduction. It is an important de- because if you cannot find those cuts, taxes, which they did, over the Gov- duction because when people deduct there is one reason: They do not exist. ernor’s veto. the taxes they pay to their State and I look forward to hopefully passing That is Kansas; take the whole coun- local governments, first of all, it pre- this bill today. I hope we do. I look for- try. Bruce Bartlett, Ronald Reagan’s vents the double taxation of their in- ward to the American people taking

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00022 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.035 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7675 the time to remember the exact time, The PRESIDING OFFICER. The Sen- deduction, doubling the child tax cred- the exact date that this was said, and ator from Oregon. it, lower rates for people in every then do the research necessary to draw Mr. MERKLEY. Mr. President, I bracket. In my home State of Ohio, we their own conclusion. The first conclu- thank my senior colleague from Oregon have the opportunity to see people who sion that will be easy to come to is for his leadership in this debate on are making $50,000 a year, with two that when you look at your pay stub these important tax provisions. There kids, see a 26-percent tax cut. That is and you see there is more money in it is so much at stake here for the future important. in 2018 than there was in 2017, just re- of our society as we have been debating My colleague just talked about his member how it got there. It is not be- what we see as one provision after an- concern about some of the provisions cause of what we do, because there are other that is designed to make the that are before us. I will say, these some folks on this side of the Potomac richest Americans richer while increas- have all been filed. That doesn’t always who believe we actually have Federal ing the taxes on some 87 million mid- happen around here, and it should. dollars. There are no Federal dollars. dle-class Americans. Then, we get this These have all been filed, and people Every penny we spend in Washington nice, little list. Republicans have given can go on rpc.senate.gov. These were comes from a taxpayer somewhere. the lobbyists a list of 30 special inter- made public. Nothing is on this list There are no Federal dollars; there are est provisions, circulated it, and said: that hasn’t been filed publicly. simply taxpayer dollars arriving in This is what we are going to put in our Just looking at it, the biggest one Washington to be used in some way. managers’ amendment for all of you. that my colleague talked about as I am only suggesting that the aver- My colleague from South Carolina being something to help rich people is age American can spend their money in was speaking a moment ago about one the deduction for property taxes. It is the way best for their family signifi- that hasn’t even been filed—life insur- capped at $10,000. There is a deduction cantly better than we can. ance provisions. What is that? Maybe for allowing people to deduct their So I hope the good people of this my colleague would like to come to the property taxes, which is incredibly im- country who are paying attention to floor and explain it and explain why portant for middle-class families this very important debate will be able this is being circulated to lobbyists, to around the country. Some people on to remember 4:24 p.m. so they can re- the swamp, instead of to the Members the other side want to go much further view the tape, review the video, the of the U.S. Senate. Thirty of these pro- and provide much larger deductions DVR—or whatever you call it now- visions—who knows what all is in this. and make those for State and local adays—and see for themselves what Isn’t there any form of transparency or taxes. was said or go someplace online and integrity left in this Chamber in terms By the way, their proposal would go figure out, at the end of 2018, the mid- of legislative debate? Have the Amer- primarily to upper income people, the dle of 2018, the beginning of 2018, has ican people had a chance to see this proposal they have. That benefit goes something actually changed other than list? It is online now. The few who primarily to those who are making that you have more money in your might be listening in might be able to higher incomes. How is it paid? It is a paycheck? see these titles, but this is not the way $10,000 deduction for property tax. It is Mr. President, I suggest the absence to do business in the U.S. Senate. This paid for by exactly the provision my of a quorum. is not the way to do the people’s busi- colleague from Oregon just complained The PRESIDING OFFICER. The ness. This is the way to do the swamp’s about because he said he wanted to be clerk will call the roll. business. sure people had to pay an alternative The senior assistant legislative clerk What happened to clearing the minimum tax, and that alternative proceeded to call the roll. swamp? What happened to that? How is minimum tax is being used to pay for Mr. PORTMAN. Mr. President, I ask it that the richest Americans are mak- this middle-class tax cut we are talk- unanimous consent that the order for ing out like bandits rather than the ing about. Anyway, that is the biggest the quorum call be rescinded. middle class doing well under this bill? item by far. The PRESIDING OFFICER. Without Why is that? Why are there billions of The second biggest item is for the objection, it is so ordered. dollars going to the richest Americans passthrough companies. These are the Mr. PORTMAN. Mr. President, I ask by eliminating the alternative min- smaller businesses in America, and it is unanimous consent that there now be imum tax? Why are there hundreds of to try to have some more parity be- 30 minutes equally divided for debate billions of dollars going in other provi- tween the passthrough companies and only, with no amendments or motions sions, including changing the upper the so-called C corporations. Again, in order and with the majority leader limit tax brackets, including the that is something that is really impor- being recognized at the conclusion of passthroughs for affluent, highly suc- tant to small businesses in my home that time. cessful LLCs? How about that? State of Ohio and around the country. The PRESIDING OFFICER. Is there What is this list, and why haven’t the I encourage him to take a look. All of objection? American people seen all of the details these have been filed. He can look at Without objection, it is so ordered. about it? This type of chicanery is in- them now or he can go online, as any The Senator from Oregon. appropriate. Take and give the list to citizen can, and take a look at these Mr. WYDEN. Mr. President, I have the Members of the Senate, not to K things. I would say that at the end of just seen an air-dropped list of provi- Street. This close partnership between the day, I know we had a difference of sions—there seem to be upwards of 30— the Republican majority and K Street, opinion on whether there should be tax and it sure looks as if the lobbyists filling them in, doing those special fa- cuts, but we think tax relief is appro- have been working overtime. They vors, and not even filling in the body priate right now. We think the middle- must have earned a holiday gift with here so we can have a conversation class families who have not seen an in- this new bonanza of goodies. about each of these items, this is abso- crease in their wages, not just for the We still await a bill that we are lutely a horrific way to do business. last few years but the last couple of going to read, although I saw some- This is the way the powerful and the decades, need a little help. Their ex- thing that might actually be a bill. So privilege want business to be done. My penses have not gone down. They have we are going to use this time so col- Republican colleagues are working gone up. Wages have been flat. That leagues can get into some of these with them hand in hand instead of middle-class squeeze is addressed questions about this array of treats working for and by the American peo- through these tax cuts—on average, that the lobbyists seem to have figured ple. about $2,375 for an Ohio median-income out how, in the last few hours—perhaps The PRESIDING OFFICER. The Sen- family. That is important. overnight—to carve out for their ben- ator from Ohio. People who are working paycheck to efit. Mr. PORTMAN. Mr. President, this is paycheck will find this to be incredibly To start our discussion for our 15 a big day because we are about to pro- important. Maybe they can put a little minutes, I believe my friend and col- vide tax relief to millions of people in more money aside for retirement. league Senator MERKLEY is going to Ohio and around the country—middle- Maybe it can help with their start. class tax cuts, doubling the standard healthcare costs, which have gone up

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00023 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.036 S01DEPT1 S7676 CONGRESSIONAL RECORD — SENATE December 1, 2017 dramatically as wages have been flat. ing about the American people, the and families over the years in public Maybe they can help people be able to hard-working group of individuals who service and here in the Senate, and I buy a car or to make a car payment if find themselves too often at the end of want to do that; close tax loopholes they already have a car. These are real too many weeks with too little left in that are taking jobs overseas, not in- tax cuts. They are going to help mid- their pockets. crease new ones, which, by the way, dle-class families. Again, I hope my We are not asking the American peo- this bill does, a new $4 billion tax loop- colleagues will look at some of these ple to just believe us. What we are say- hole for oil companies—not closing tax changes, like the $10,000 deduction for ing with great clarity is, starting in loopholes. If folks really believe this, if property taxes paid for with the alter- paychecks in 2018, because of our tax they really believe the numbers, let’s native minimum tax changes and help cuts targeted toward the typical Amer- lock it down. The proof is in your pay- us be able to make this legislation even ican family, you will see in your pay- check. That is what families in Michi- more generous for folks in the middle check more of your hard-earned gan are saying. They want to know it class, as they say they are for. money. This is how we say there is is in their paycheck. They want to With that, I would like to ask my proof in the pudding. It is simply to know it is a guarantee. You know colleague from South Carolina, who take a look and see how much of that what, they are very skeptical. Because has been very involved in the child tax money is left. the truth is, in the past, supply-side ec- credit, ensuring we have a reduction of To my good friend from Ohio, my onomics/trickle-down economics has the brackets, if he would have a few friends on the other side of the aisle not worked. You say that it is going to comments on those. are starting to overcook my grits just trickle down. People in Michigan are Mr. SCOTT. Mr. President, I thank a little bit. I don’t mind having a vig- still waiting. They are still waiting to my good friend from Ohio. orous debate on facts, but to sell fear— catch it. It is not trickling down. We I say to Senator PORTMAN, may I see as I said a few minutes ago, fear being do have examples. What are the facts? that list? I have been on the floor and, false evidence appearing real is just With the tax cut in 1986, 10 years unfortunately, I have not been able to turning the heat up on my grits. I have after that, the wages of working people get a copy of the list. Obviously, you to tell you, this leads to an unhealthy in this country were flat. They did not have been able to have your staff get it outcome for the American people be- go up. That is a fact. or go online and get a copy of this list. cause at the end of the day, the goal is With President Bill Clinton in his ef- I think my good friend from Oregon not for us to be right and for them to fort to balance the budget in 1997, I was said they needed their good friends who be wrong. I don’t think their goal is for pleased. I had only been in the House are lobbyists to supply them with a them to be right and for us to be for 6 months and went in and had the list. wrong. It is kind of simple. The goal is, opportunity to balance the budget, I am not sure what the other side is and always should be, for the people we which we did for the first time in 30 years. missing. They had control of the represent to be better off because of House, the Senate, and the White What happened during that process? our decisions in Washington. I can tell Actually, taxes on wealthy people were House for a couple of years, and they you, passing this tax reform bill will increased spending without doing any- raised a little bit to give a middle-class leave the typical American family with tax cut and invest in education, which thing about revenues, other than try- 60 percent—60 percent—of a tax cut. ing to have a tax increase a few years I know our distinguished Presiding Of- I yield back. ficer cares deeply about, and innova- ago, $630 billion of tax increases, and Mr. PORTMAN. I thank my col- tion. What happened? There were 22 somehow they have missed the correla- league. tion between higher taxes and lower million jobs that were created. I yield back. Then we went into 2001, 2002 with revenues. We have gotten it right that The PRESIDING OFFICER. The Sen- President George W. Bush, and there oftentimes lower taxes actually in- ator from Michigan. was a big tax cut in 2001, a supply-side/ crease revenue, which has been proven Ms. STABENOW. Mr. President, my trickle-down tax cut. We were told that from the twenties, sixties and eighties. friend from South Carolina said the it was going to put money in people’s It is good news that my friends on proof is in the pudding. I would suggest pockets. It didn’t. It created debt. In the left are finally thinking about the the proof is in your paycheck. That is 2003, we had another supply-side tax national debt. We had a couple hundred what I suggest. cut that was going to put money in years of life in America that produced We had a chance yesterday with my people’s pockets. It didn’t. It created a about $10 trillion of national debt. amendment to absolutely guarantee huge debt. We had wars that weren’t Eight years after Democratic leader- that my friends on the other side of the paid for. Then it went into the biggest ship, we have a national debt of $20 aisle believe what they are saying; that recession that we have seen outside of trillion. I find it a tad disingenuous people are going to get a minimum of the Great Depression with the financial that my friends on the left are going to $4,000 in increased wages. I offered an crisis, and 8 million people lost their counsel us about debt when, in fact, amendment to simply say that in a jobs. People lost the equity in their their record is so clearly obvious. When couple years from now—2 years from homes and their pension values. It was it comes to the benefits this bill has for now, 2020, we can make it 2021 or 2025, terrible. those folks who are working paycheck just pick a day when folks are going to President Obama came in in 2009 and to paycheck, as the country saw its get $4,000 in their wages, and we will had to try to begin to dig out of the debt double in the last 8 years, what put that in an amendment and pass it. hole. That is a fact. He began to dig they did not see double were their The truth is, there is no guarantee in out of that hole and put things back to- wages. As a matter of fact, their wages this bill. If my friends on the other side gether for folks. It was a big hole, and were stagnant. Why? Because when you of the aisle believed that there would a lot of families are still feeling that take money out of the private sector be $4,000 more in wages in middle-class hole. I know that is true in Michigan. economy and place it into the hands of families’ pockets with this supply-side So part of me may feel a little skep- the government, you do not grow the trickle-down economics tax cut, they tical when I am hearing: Have I got a private sector economy. It is a simple would have voted for my amendment deal for you. Let’s try supply-side eco- formula. yesterday, which simply says that if nomics one more time, and this time it While wages were flat, the economy there is a $4,000 increase in wages, the really is going to create jobs and really grew at an anemic 1.9 percent, even tax cut continues. If it doesn’t, if they is going to put money in your pockets. though they doubled the national debt don’t have $4,000 more in people’s pock- There is no proof of that. There is no from $10 trillion to $20 trillion. It is ets, then the tax giveaway stops be- proof that this grows the economy to fascinating that my friends on the left, cause all it means is it is adding to the be able to cover the costs of the tax looking for ways to create lobbyist national debt. giveaways whether you look at supply- loopholes, are on this floor lecturing I am all for anything that puts side economics, whether you look at anybody about debt. We, on the other money in people’s pockets. I have spon- new dynamic scoring—the new ways of hand, aren’t thinking about lobbyists sored and voted for tax cuts for small scoring on things—to make it look bet- or our friends on the left. We are think- businesses, manufacturers, farmers, ter. That didn’t even show up. What I

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00024 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.038 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7677 would say is that the proof is in your we would actually get to see this legis- $200,000 a year. That is what the docu- paychecks, for the people who are lation. ment tells us. watching. Ms. STABENOW. Right. That is the under-$200,000 category There is a lot going back and forth, Mr. WYDEN. This pile of papers, for and 13 million families just in 2019. If and it is very confusing because we all practical purposes, is what we have you break it down further in terms of hear one thing from one side, and we been waiting for for days. folks making between, say, $50,000 and hear the exact opposite from the other. Ms. STABENOW. I hope you are a $75,000 and then $75,000 and $100,000, al- I understand how confusing this is, but speed reader. most 20 percent of Americans earning I would just ask this: Mr. WYDEN. I am going to try to do between $50,000 and $75,000 a year will Why weren’t my friends willing to some, but as far as I can tell, it sure see a tax increase or a tax cut of less support my amendment that would say looks like a lobbyist’s wish list. There than $100. That works out to be about that if folks really get the $4,000 min- are going to be a lot of folks happy on $9 a month. Those individuals will have imum amount being promised in in- K Street as they try to shop for the that tax consequence in 2019. So be- creased wages, then this goes on, and if holidays because of the fees they have tween $50,000 and $75,000 will see either they don’t, then the tax giveaway put together in working to get these a tax increase or a tax cut of $100 or stops? Why didn’t they support that? changes into the Republican proposal. less. Mr. WYDEN. Will the Senator yield? I appreciate my colleague for giving The PRESIDING OFFICER. The Sen- Ms. STABENOW. Yes. me the opportunity to make sure that ator’s time has expired. Mr. WYDEN. I think my colleague— the public knows now that, at this late Mr. CASEY. Then you take the cat- my seatmate—is making a very impor- hour, we are finally getting, after days, egory of $75,000 to $100,000, and almost tant point. Of course, people always the opportunity to see the bill that is 17 percent of Americans in that income wonder, well, is this kind of a Demo- actually the bill. category will see a tax cut of less than cratic position or a Republican posi- Ms. STABENOW. Before turning this $9 a month. tion? I want to make it clear that I be- to my friend and colleague from Penn- In the grand total between $50,000 and lieve that Tom Barthold, the head of sylvania, I do want to mention just one $100,000, 7.7 million Americans will ei- the Joint Committee on Taxation, thing that I understand is in there. ther see a tax increase or a tax cut of which is our independent tax umpire, There may be things that I am sup- $100 or less. I don’t call that tax cuts essentially agreed with you. In com- portive of in there. We don’t know. We for the middle class. mittee, I believe we asked him whether are trying to figure it out. I yield the floor. he thought this huge reduction in the One thing that I don’t understand, The PRESIDING OFFICER. The Sen- corporate tax rate would translate into with all of the talk about supporting ator from Ohio. $4,000 in the pockets of working fami- workers and middle-class workers, is Mr. PORTMAN. Mr. President, I wish lies in Michigan and Oregon. Is that that there is a provision in the bill I could convince my friend from Michi- my colleague’s understanding? that reads ‘‘prohibit cash or gift cards gan—and she is my friend—about the Ms. STABENOW. Absolutely. We as employee achievement awards.’’ So $4,000 per family that would come from asked that question, as you know, and if somebody works very hard and is the pro-growth policies here, many of he indicated that that was not the getting some kind of achievement which she supports. She wants her case. I continue to hear it over and award, does that mean he would not be businesses to be competitive, and they over again. We have heard it from the allowed to get a bonus? I mean, I don’t are not now. It is an outrage that our President of the United States and the know why in the world we would be companies have to use a tax code that Secretary of the Treasury. We have going after people’s employee achieve- puts the workers in those companies in heard it from folks on the floor. Just ment awards. That doesn’t sound like a disadvantageous position every day. today, we have seen it in charts on the help for the middle class to me. It is not just about inversions, and it is floor. That is great. If that could really I now yield to my friend from Penn- not just about companies getting taken happen, I would support that. It has sylvania and thank him for his leader- over. never happened, and my colleagues will ship. By the way, last year, three times as not support guaranteeing that it will The PRESIDING OFFICER (Mr. many American companies were taken happen. ALEXANDER). The Senator from Penn- over by foreign companies as the other This is about putting up or shutting sylvania. way around. Over the last 13 years, up, in my opinion. That is what we Mr. CASEY. Mr. President, I thank 4,700 companies became foreign compa- would say in Michigan. It is about my colleague from Michigan for focus- nies that would today be U.S. compa- whether we are going to guarantee ing on the issue of wages because that nies if this tax bill had been in place. I folks that this time around, it is not was the promise—right?—that if you mean, it is happening. They are taking just a sales job, that it is actually give corporations a tax cut of more their jobs and investments with them going to end up in their pockets. than $1.3 trillion—with a ‘‘t’’—all of a when they go overseas. I see my friend and colleague from sudden, you are going to see wages go We have to fix that problem. It has Pennsylvania, who offered this amend- up, and workers are going to do a lot been bipartisan. There has never been a ment in committee. I was pleased to better. We know that hasn’t happened partisan issue about that. That is join him in committee, and he knows, in recent history. We will see if the Re- where a lot of that $4,000 comes from. in Pennsylvania, like I do, that we publican argument is correct. It comes from the fact that you are have gone through some rough and I want to put a few facts on the going to have more investment and tumble times, and we still have folks record in light of the debate this after- therefore higher productivity, and who are working too hard at not just noon. Many people in both parties have workers are going to have a chance to one job but two jobs, trying to hold it been referring to the documents of the see higher wages. together, having not seen the pay Joint Committee on Taxation, the The Congressional Budget Office did raises they deserve and have worked JCT. I am looking at one of the docu- a study in which they showed that 70 for. They want to know that this time ments right now to go through some percent of the benefit of lowering the around is not going to be voodoo eco- data. This is dated November 27. It is business rate goes to workers in terms nomics and that it is actually going to D–17–54 for the Joint Committee on of higher wages and higher benefits. increase their paychecks. Taxation. Here is some basic data. Others say it is less than that. Others Mr. WYDEN. Will my colleague yield The Joint Committee on Taxation, say it is more than that. Kevin for a question? which is, of course, Congress’s official Hassett, who is the Chairman of the Ms. STABENOW. Yes. scorekeeper, finds that in 2019—right Council of Economic Advisers, says Mr. WYDEN. My understanding is away, early in the implementation of that it is more than that. But that is that you and Senator CASEY in par- the bill, if this bill is to pass and if the where the $4,000 comes from. I hope it ticular have been out here—and we are version we just received is to pass—the is a lot more than that, but it is on top so glad to have our colleague from Con- Senate plan increases taxes on nearly of the middle-class tax cuts that are necticut—wondering when in the world 13 million families earning under very direct.

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00025 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.040 S01DEPT1 S7678 CONGRESSIONAL RECORD — SENATE December 1, 2017 In other words, that is not just say- necticut is here and would like to legislation unless Members have been ing that we are going to have a better speak, and others, I am sure, are going able to see it for 72 hours. We need a 72- economy, which I believe we will—and to want to speak. minute rule. I don’t think we are going I strongly believe we can improve a I would ask my colleague from Or- to be able to look at this legislation for broken tax code, as I think everybody egon if he would be willing to have an- more than 72 minutes—a multitrillion- does, to make it better for American other unanimous consent that there be dollar reform of the U.S. Tax Code—be- workers—but beyond that, you have additional time equally divided. fore we are asked to vote on it. the immediate tax relief, and that is Mr. WYDEN. I think 30 minutes is Senator WYDEN and others have been what we have been talking about. what we have been talking about and waving around this list of lobbyist This is the doubling of the standard that it is appropriate. asked-for amendments that fill up an deduction, the doubling of the child tax Mr. PORTMAN. Mr. President, I ask entire page. We are not going to get 72 credit, the lowering of the tax rates. unanimous consent that there now be minutes to look at this, never mind My friend from Pennsylvania just 30 minutes, equally divided, for debate have a single conversation with our talked about the fact that 20 percent of only, with no amendments or motions constituents. It is dark out. The bill is the people between $50,000 and $75,000— in order and with the majority leader going to be introduced on a Friday I am not sure where his data was com- or his designee being recognized at the night. We are going to vote on it over- ing from, but let’s take it as true— conclusion of that time. night. This is supposed to be the have a small tax cut or a tax increase, The PRESIDING OFFICER. Without world’s greatest deliberative body. It is and 17 percent between $75,000 and objection, it is so ordered. not supposed to work like this. $100,000 are in that category. That Mr. PORTMAN. I yield the floor. It is not a middle-class tax cut. I am means 80 percent of the people in that The PRESIDING OFFICER. The Sen- not going to deny that there are some category have a big tax cut, in the one ator from Connecticut. people in the middle class who are category, and 83 percent in the other Mr. MURPHY. Thank you very much, going to get their taxes lowered by this category have a big tax cut. So, yes, a Mr. President. bill, but the middle-class tax cuts here small tax cut—I don’t know how many I was paying attention to my social are temporary and they are very selec- have a small tax cut and how many media feed, and I have seen that Sen- tive. They are selective in a way that have a tax increase, but the vast ma- ators on the Republican side are start- very peculiarly seems to discriminate jority of middle-class families, accord- ing to announce which way they are against Democratic States. So the ing to what my colleague from Penn- voting. I saw that CORKER is a no and States that are represented by Demo- sylvania just said, are going to get a COLLINS is a yes. I don’t know what crats don’t get as big a tax cut out of big tax cut. I don’t know what is wrong they are a no or a yes on. How can you this because it has been crafted in a with that. That is $2,375, on average, declare which way you are going to way that hurts States like mine that for a median-income family in Ohio. vote on a bill that you haven’t read, on utilize the State and local tax deduc- By the way, economists say that it a bill that your constituents haven’t tions more than other States, those not only creates the opportunity for seen? that happen to be represented by Re- people to have a little better family Senator WYDEN just piled up what publicans. budget through the direct tax cuts but looked to be about 6 inches’ worth of It is not a middle-class tax cut be- also, of course, more jobs. text in front of the Senate floor. There cause the middle-class tax cuts are Here is something interesting. Over is no possible way that any Member of temporary. They go away after 7 years. the past couple of days, a letter came this body has read all of that. There is The corporate tax cuts, the inheritance in from 137 economists—many of them no way that in the time between when tax cuts for billionaires, are perma- nationally known—who support this it is released to Senators and when we nent. Those go through the full 10-year legislation. This is what they say: Eco- vote, anyone—even from the very close timeframe. But middle-class families nomic growth will accelerate if this States—is going to be able to get back don’t get permanence. After 7 years, 6 legislation passes, leading to more to their constituents and ask them out of 10 middle-class families will jobs, higher wages, and a better stand- what they think about this piece of have their taxes go up, not down. ard of living for the American people. legislation. I guess I would say I have That 7-year timeframe is an impor- They say that there will be signifi- never seen anything like it, but we just tant one because by repealing the indi- cantly more resources coming into the went through it earlier this year when vidual mandate, premiums go up by 10 Federal Government because of this, we were given about an hour to look at percent a year. Republicans have been because of the growth. They think that a complete reform of one-sixth of the screaming about premiums going up, there will be $1 trillion more revenue American economy, the healthcare sys- and they decided intentionally to put a coming in because of this, because of tem. provision in this bill that will guar- the growth. They also think that there We are now being asked to vote this antee premiums will continue to go up will be additional jobs—the Tax Foun- evening on a multitrillion-dollar re- at 10 percent per year. Guess what hap- dation says 1 million new jobs. form of our Tax Code, and not a single pens at year 7. Year 7 is when that 10 So, yes, I do believe it will be $4,000 U.S. Senator will have read it. There is percent increase year-by-year com- per family, but on top of that, I believe no way you will have read it. I just saw pounds such that premiums will dou- that they are going to have a very di- how big it is. Maybe Republicans have ble. So in year 7—this is a great deal if rect benefit. I know they will because read it because they have seen it in you are a middle-class taxpayer—your the statistics are there—my colleague these secret negotiations, but I can tax cut to the extent it exists in this from Pennsylvania just acknowledged guarantee you that Senate Democrats bill disappears and your healthcare it—that the vast majority of middle- will not have read this because we have premium is doubled. class families are going to see a sub- been kept out of the loop on all of What it is, is a big tax cut for the stantial tax cut. these negotiations designed to get to 50 wealthy. I am stealing Senator BEN- Let me give you a number. For a votes—not to 60 votes, not to 70 votes, NET’s chart, but he did it very well. We family with two kids, making $50,000 a not a consensus product that can get have 572,000 taxpayers—the richest year, it is a 36-percent tax cut, on aver- Republican and Democratic support. 500,000 Americans—getting $34 billion age. That matters. That helps people I got here in 2007 when Democrats in tax cuts, and then we have 90 mil- who are trying to make ends meet. It is took control of the House and the Sen- lion taxpayers who are making under real both in terms of the direct tax ate. I remember during those 2 years $50,000 a year getting $14 billion in tax cuts and in terms of the economic all sorts of consternation from Repub- cuts. growth and the higher wages that are licans about how bills were being I get it. If you are going to structure going to come with that, and that is so rushed through the process. In reaction a tax cut that covers everybody, natu- important to all of the families we rep- to that, when Republicans took back rally people who make more are going resent. control of the House, they instituted to get more. But why does it make We have had a good discussion here. something called a 72-hour rule that sense to borrow $34 billion to help the I see that my colleague from Con- said that we couldn’t vote on a piece of wealthiest 500,000 Americans? This

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00026 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.041 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7679 doesn’t even count the inheritance tax, ranking Democrat on the committee, hearing in the Finance Committee. which is going to help an even smaller the storied committee, as my col- Now we are going to be asked, I under- percentage of those people even more. leagues know, that works in a bipar- stand, maybe later tonight to vote on Come on, this idea that you could tisan way. those changes. Quite frankly, I don’t deficit-finance a tax cut for the rich Bill Bradley tells this story about know what those changes are, and I am and it will just trickle down and magi- how he flew all over the country to not going to have an opportunity to go cally result in economic growth—that meet with Republicans to talk about over those with my constituents. That is just not true. It is fiction. We have how you could find common ground to is wrong. That is not the process we decades of economic experience to tell deal with tax reform. At this time, we use to change the Tax Code of this us that when we cut taxes for the rich, haven’t been able to get the majority country, a major tax reform bill. That it does not magically result in enough to even walk down the corridor in an is an outrageous process, to say that economic growth to make up for the effort to try to get a bipartisan bill. As we are going to vote on a new bill with- deficit, especially deficits that are I told my colleagues, I have written out an opportunity to understand it, going to be in the neighborhood of $2 two of them. without any hearings, without an op- trillion. You might as well claim that My question to my friend is, when portunity for constituents to give their unicorns are real. You want to believe you have your community meeting, views on it, and I must state that I find that Tupac is still alive, go for it—that how do you think people in Con- that very offensive. is just as plausible as deficit-financed necticut are going to react to the idea I want to talk about one provision in tax cuts for the rich resulting in that we had maybe an hour or so to try particular, and I hope we will have a enough economic growth to wipe out to make our way through a bill that is chance to do something about it during the deficit. It is fiction. It is a fantasy actually the biggest tax bill in 31 the amendment process. As I under- from the beginning. years? I know my colleague tries very stand it, the revised provisions in re- I think we should take our time, read hard to be straightforward with his gard to State and local tax deduction the bill, and have a real conversation constituents, and he will tell them: I still restrict what taxpayers can de- about what we are about to do. If our got it with insufficient time to get into duct on their Federal tax returns in re- goal is to provide a middle-class tax it. How will they react to that? gard to State and local taxes that they cut, we could do a much better job if Mr. MURPHY. I say to Senator pay. I admit, this could have been we worked together. This is not a mid- WYDEN, I don’t want to be too heavy modified, but what I understand is that dle-class tax cut for everybody, and about this, but everybody shouldn’t as- the modification is that taxpayers will after 7 years, the majority of people in sume that the way in which we run our be able to deduct up to $10,000 of prop- the middle class lose that tax cut. country just continues on forever. De- erty taxes but will not be able to de- There is no reason to borrow this mocracy is unnatural. We don’t run duct any of their State taxes, whether much money for the richest 500,000 other parts of our lives by democratic they are income taxes or sales taxes, in Americans. As a Senator with two vote. We decided to run our country in regard to the Federal taxes. young kids, I just don’t know why you a way that allows everybody to partici- In my State, we have county income would ask my kids and so many others pate. And, you know, let’s be honest— taxes that will not be deductible, if I to pay back the loans necessary to de- people have been asking some ques- understand correctly, under the pro- liver this tax cut, especially when it tions recently about the health of our posal we will be voting on. If that is, in isn’t going to magically result in the democracy, and maybe that was a big fact, correct, that is absolutely wrong, kind of economic growth that trickle- part of the subtext of the 2016 election. and I want to tell you why. Many of us down economists have claimed for This doesn’t help win people’s faith spent years in the State legislature. years and years. back in the democratic experiment Our distinguished Presiding Officer was It is not impossible to get a bipar- when they see this casualness afforded Governor of his State. We respect State tisan tax bill. I know my Republican to a debate that affects millions of and local governments. It is the same friends claim, as they did on Americans. It hurts us all when a bill taxpayers that pay the taxes to the healthcare, that there is no good will this big, this important, gets rammed counties, to the State, and to the Fed- on the Democratic side to try to craft through under the cover of night. It eral Government. a bipartisan proposal. The tragedy is starts to atrophy people’s faith in the We believe in federalism. Our Nation that they didn’t even try. There was no entire way that we go about running was founded on federalism. I was proud attempt to try to find common ground our government. of my record as speaker of the Mary- here, just as there was no attempt to I understand that Congress is not land House of Delegates and of working try to find common ground on that popular. It would be hard to get on a federalism task force set up by healthcare until the bill failed. I credit less popular than we are today. If we President Reagan to look at the proper Senator ALEXANDER and Senator MUR- ever want to start to climb our way way to respect the rights of the States RAY for trying to find that common back to legitimacy, then we have to and local governments. Now we are ground after the healthcare bill failed, trust the people to be part of the proc- saying we are not going to respect but the order switched—try to find ess of drafting and passing legislation their ability to finance their oper- common ground first, and if that fails, rather than being afraid of the people ations. I say that because we are going do it in a partisan fashion, instead of and burying a bill in the dead of the to tax the tax. We are not going to re- doing it in a partisan fashion, and night, as is happening now. spect that the same taxpayer is paying when that fails, trying to find common I yield back. the State of Maryland’s taxes or the ground. The PRESIDING OFFICER. Who State of Tennessee’s taxes. That is This is a really bad deal, a really bad yields time? wrong. That is an affront, I believe, to piece of legislation for my constitu- The Senator from Maryland. the Constitution of this country, but it ents—I think, because I will not have Mr. CARDIN. Mr. President, I under- has an impact. read it by the time I am forced to vote stand we now have a new bill. I am It is going to be much, much more on it, and neither will any of the other looking at Senator WYDEN hold up that difficult for our States to be able to 99 Members of this body. new bill. I got a sheet that looked as if raise the revenues they need to support I will yield the floor. it came from K Street that gave us a our schools and for public safety and The PRESIDING OFFICER. The Sen- list of changes that will be included in health. All those services are going to ator from Oregon. the managers’ package. I looked at the be much more difficult for our States Mr. WYDEN. Mr. President, will my list, and somewhere around 50 or 60 new to be able to finance because of this colleague yield for a question before he provisions were on that list. Many of change that is included in the Senate yields? those were not bills that had been filed, bill. It is going to be more difficult for Mr. MURPHY. I will. so we had no idea what was going to be local governments. The cap on prop- Mr. WYDEN. I am just curious. I am included in it. erty taxes is real and will affect local heading home for townhall meetings in None of those issues—in fact, nothing government’s ability to raise property Oregon over the weekend. I am the in this bill has been subject to an open taxes. But in Maryland and other

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00027 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.042 S01DEPT1 S7680 CONGRESSIONAL RECORD — SENATE December 1, 2017 States, our local governments have cut. A family who makes $85,000 a year business tax rate in the industrialized other sources, including income taxes, and has two kids gets a 20-percent tax world, and we have an international that no longer are going to be deduct- cut. If you make $165,000 a year and system that encourages people to go ible. have two kids, you get an 8-percent tax overseas and keep their money over- That is going to affect my State’s cut. So the benefit is focused more on seas. That is crazy. This proposal ability to adequately fund public serv- those who are at the lower end of the changes all of that. It says: Let’s get ices. Whether it is education, whether economic scale, and I think that is ap- our rate down below the average of the it is transportation, whether it is propriate. other industrialized countries, and healthcare, all of that is going to be So it is middle-class tax relief, but then let’s have an international system negatively impacted and it is wrong. here is how it works. As to the share of that actually encourages them to bring I will give you a number, because I Federal taxes paid in 2019, which is a the money back and create more jobs know the number in Maryland. Almost year after this is implemented—it here. 50 percent of Maryland taxpayers de- starts right away, by the way, so mid- In fact, Mr. President, I will say duct State and local taxes as an dle-class families are going to get that something else. I know you are inter- itemized deduction. They are going to relief right away—the current is in the ested in this. It also encourages foreign be disadvantaged by the provision that red, and then our proposal is in the investment in this country, because if is included in the Senate bill, and it is blue. you are a foreign auto company—and wrong. It also has unintended con- So if you make zero to $20,000, it is you have a bunch in your State of Ten- sequences, but it is going to have other very unlikely that you have income nessee—and your decision is that am I consequences. tax liability, but some families do and going to invest in Japan, where they The PRESIDING OFFICER. The Sen- the average is 0.1 percent. If you make might be headquartered, or am I going ator’s time has expired. $20,000 to $50,000 a year, your share of to invest in China, where they might Mr. CARDIN. Mr. President, later I the Federal taxes goes down in our bill have a factory, or am I going to invest will come back and speak on some of from 4.3 percent to 4.1 percent. If you in Germany, where they might a fac- these other issues, but I yield the floor. make $50,000 to $100,000 a year, your tory, or am I going to invest in the The PRESIDING OFFICER. The Sen- share of the Federal taxes goes from United States of America and maybe in Tennessee, this bill will make it more ator from Ohio. 16.9 percent to 16.7 percent. If you advantageous for them to make their Mr. PORTMAN. Mr. President, again, make $100,000 or above, your share goes investment here and to create the jobs we have had some interesting dialogue not down but up, from 78.7 percent to here because of the lower tax rate and back and forth. Earlier, my colleague 78.9 percent. The top percent of wage because of the expensing when they go from Connecticut was talking about earners in this country, the top 10 per- out to buy new equipment and tech- how this isn’t real middle-class tax re- cent, pay approximately 70 percent of nology to make their workers more lief, and then he lamented the fact that the income taxes right now. After our because of the arcane budget rules we productive. bill is passed and implemented, they So this is going to help American have around here, after 10 years, all will pay more than 70 percent. So it is companies a lot to be able to compete these great tax cuts expire. So you a progressive tax cut in the sense that globally. It levels the playing field, kind of have it both ways there, and I the benefit is focused more on middle- which is very important. It has been bi- don’t think you can do that, which is class families who really need the help. partisan up to now—very bipartisan. that there aren’t real tax cuts but That is what the legislation does. We had a working group on this, among then, when they expire, it is the great- Then, in addition to that, in respond- five bipartisan working groups that est shame because they are great tax ing to my colleagues who were talking were established 2 years ago, that stud- cuts. whether there is any economic growth ied this issue. We came up with the so- Here is the reality. There are signifi- that comes from this, yes, there is a lot lution that you have to get the rate cant tax cuts here for the middle class. of economic growth because the cur- below the average and you have to go This legislation doubles the standard rent code is so bad. It is broken. My through the kind of system we are deduction. Probably about two-thirds colleague from Oregon, who is the talking about. It was totally bipar- of the people I am talking to tonight ranking member, agrees with that. He tisan. Democrats and Republicans already take the standard deduction. has a different solution as to how you alike agreed to it because it just makes Now we will have about 95 percent of get there, but he has been a leader on so much sense for the American work- people who will take it, and everyone tax reform for that very reason. The er. They are the ones getting the short who takes it will be able to, instead of current code is actually putting our end of the stick right now. They are getting $12,000 a family, get $24,000 a workers at a disadvantage, making our the ones who are told: You go out there family, greatly expanding that. By the families have to go through a great and compete, but do it with one hand way, there is a zero tax bracket, mean- complicated process even to file their tied behind your back. ing people who don’t have any income taxes. More than half of taxpayers now We need to give them the tools to be tax liability. That means a lot to peo- have to use a tax preparer. That is ter- able to succeed, and that is what this ple I represent who are living paycheck rible. legislation does. Yes, that is going to to paycheck, having a tough time mak- So this legislation does also provide result in middle-class families getting ing ends meet. economic growth by taking that Tax benefits well beyond, in my view, the Also, as a result of this, and the Code, which has this perverse effect of direct tax cuts we talked about earlier other tax relief, about 3 million Ameri- actually telling U.S. companies that it because it is going to enable them to be cans who now pay income tax are going is better that they have workers over- able to get the higher wages and the to fall off the tax rolls. They are no seas and take their investment over- better jobs, and that is why some longer going to have income tax liabil- seas or even become a foreign com- economists have said it is $4,000 a fam- ity. That is really meaningful to peo- pany—the 4,700 companies that are for- ily. Some have said it is more. Many ple. It also doubles the child tax credit. eign companies today became foreign Democrats think it is less. But there We talked a little bit about that today. companies over the last 13 years be- will be a benefit to these families. Re- It also increases the refundability a lit- cause we didn’t have this Tax Code in member, these companies we are talk- tle. But importantly, it helps to ensure place. That is based on an Ernst & ing about, the C corporations, they em- that families have the ability to help Young study. I encourage folks to take ploy more than half of the American make ends meet when they are trying a look at it. It basically makes the private workforce. They are competing to raise kids—the most important point that because of a broken Tax every day in these global market- thing you can do—and it lowers tax Code, it is advantageous for U.S. com- places. We want them to win. We want rates. That combination means that panies to take their jobs and invest- our workers to win because we want you have the kind of tax relief we are ment overseas. That makes no sense. them to be able to have those higher talking about. Foreign companies can pay a pre- wages and better benefits. So a family who makes $50,000 a year mium for U.S. companies because of We have spent 2 decades with rel- and has two kids gets a 36-percent tax our Tax Code. We have the highest atively weak economic growth and,

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00028 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.044 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7681 therefore, relatively flat wages. In fact, Members have to file an amendment I don’t imagine too many folks in on an inflation-adjusted basis, if you and make it public. People can go on coffee shops are up on what territorial look back over the last 15 years, there rpc.senate.gov and see all of those taxation is, but it is an express lane for hasn’t been any wage growth. There amendments, and I think that is appro- shipping jobs overseas. The fact is, a have been higher expenses, especially priate. number of the proposals earlier from healthcare, and those healthcare costs I would hope that, as we go through the other side have made it more at- and tuition costs for those who want to this process tonight and we talk about tractive to do business overseas than in send their kids to school, or other this legislation, we can express our dif- the United States. costs—food and energy—have all gone ferences, which we will, but that we Here are a couple of other points. My up. Wages have been flat. That is a can also stick to the facts, which is colleague said that 70 percent of the middle-class squeeze, and that is what that this does provide middle-class tax corporate tax reduction would go to this middle-class tax relief helps to ad- cuts. Again, as to those who have said the workers. That is not what Tom dress. Importantly, that is what this earlier that there are no real tax cuts, Barthold, the head of the Joint Com- pro-growth part helps to address be- but then when it expires in 10 years mittee on Taxation, said. He said spe- cause you are going to see higher say: Well, gosh, these big tax cuts are cifically that he didn’t see anything re- wages, and you are going to see better gone, you can’t have it both ways. sembling that kind of benefit going di- benefits if you give this kind of tax re- There are tax cuts. Maybe people think rectly to workers. He speaks a special lief to the American worker because there should be different kinds of tax language known as economics, but he you are going to see more investment, cuts, but they are there. has made it clear he didn’t envision you are going to see more productivity Second, there is the economic growth anything like that. that comes from that, and you are element of this, which to me is so im- Two other points, and then I have a going to see higher wages. portant. We are not going to be able to question for my colleague from Mary- I believe that, but what I believe have a growing economy and have op- land. isn’t as important as what others be- portunity and, frankly, be in a position We still do not have an analysis in lieve. So 137 economists, many of these as a country to be able to address some two areas: No. 1, the cost of the bill, are nationally known economists, have of our broader problems unless we have and No. 2, what is going to be the fate looked at the pro-growth parts of this the growth and the optimism that of middle-class families with respect to legislation—the parts I am talking comes with that, and that is why I this new proposal? What is it going to about that make us competitive think the economic growth parts of mean for their taxes, and by what again—and they have said that eco- this are equally important. Again, that amounts? nomic growth will accelerate if this has been bipartisan in the past, and I If I can engage my colleague from legislation passes, leading to more hope it can be bipartisan in the future. Ohio on this—what can we be told at jobs, higher wages, and a better stand- I hope we will be able, as a Senate to- this point we are going to get, if any- ard of living for the American people. night, to pass this legislation and then thing, with respect to an analysis of They say there will be a million new continue to work on these issues, not this particular bill, the 500-plus pages? jobs in this country just because of just in terms of tax reform but making Will we be getting anything tonight be- this. I think that is really important, our economy and our workers more fore we vote? as important as the tax cuts are for the competitive because that, in the end, is The PRESIDING OFFICER. The Sen- middle class—and they are important. going to be the ability to give people ator from Ohio. Again, those tax cuts primarily go to the chance for themselves and their Mr. PORTMAN. Mr. President, first folks who are in the middle class and kids and grandkids to have a better of all, I was referring specifically to a that is appropriate. Equally important life. CBO report earlier, and the Senator I see my colleague from Pennsyl- to me is to get this economy moving in talked about the Joint Committee on vania is on the floor, and I know my a way that people can have the oppor- Taxation. We may have different views colleague from Oregon may have an- tunity to get those higher wages and on that. It wasn’t my belief I was ex- other speaker. pressing; it was me talking about the better benefits. I yield the floor at this time. The Congressional Budget Office did The PRESIDING OFFICER. The Sen- Congressional Budget Office’s report. a study. It showed that 70 percent of ator from Ohio. My understanding is that tonight the the benefit of getting that corporate Mr. PORTMAN. Mr. President, I see entire bill will be online, No. 1. tax rate down is going to go to workers my colleague from Oregon has some Second, the analysis is necessary to in terms of salaries and benefits. Some other speakers. I know he would like to ensure that it fits into the reconcili- say it is less than that. Some say it is speak, I am sure. ation instructions. more than that. Kevin Hassett, who is I ask unanimous consent that there Mr. WYDEN. What analysis would it the chairman of the Council of Eco- now be 30 minutes, equally divided, for be, for example, with respect to what nomic Advisers, says it is more than debate only, with no amendments or the new bill—the bill we are actually that. The point is that it is going to motions in order, and with the major- going to vote on—means for middle- help these workers, and it is about ity leader being recognized at the con- class families? We have millions of time that we help them. clusion of that time. middle-class folks who are trying to There has been a lot of discussion The PRESIDING OFFICER. Without sort out what this means for them. about the process here tonight, and I objection, it is so ordered. We have just gotten a brand new bill. understand the frustration. As a Mem- The Senator from Oregon. We would like to know what the new ber of the Senate, sometimes I feel that Mr. WYDEN. Mr. President, I am bill means with respect to the taxes frustration as well. But I will say that going to yield to my colleagues in a paid by middle-class folks. Are they this legislation, H.R. 1, which is the minute. going to get ahead or, as we have seen vast majority of the papers that were I just think it is important to make in so many of the previous iterations, held up a moment ago—this is the leg- sure that the public understands ex- fall behind, particularly after 2027? islation that came out of committee; it actly what some of the facts are behind Will we get a new analysis on this is the vast majority of the pages—has the Republican proposals. new proposal that we will actually vote been on this website called budg- My colleague from Ohio just talked on with respect to what it means for et.senate.gov and has been public since about how the Republican proposal is middle-class families? Saturday, November 26. So it has been going to create many more jobs in the Mr. PORTMAN. Will the Senator out there awhile for Members to look United States and certainly isn’t going yield? at. to keep the system that makes it at- Mr. WYDEN. Of course. Every single one of these amend- tractive to do business overseas. Yet Mr. PORTMAN. Good news—you will ments that are part of the manager’s my understanding is, all the previous be glad to hear those tax cuts continue. amendment that was talked about to- versions—and we are going through the If your family is making $50,000, two night has been publicly filed, and I 500-plus pages now—are based on terri- kids, you will see a 36-percent tax cut. think that is good. We required that torial taxation. If you are making $165,000 a year, two

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00029 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.045 S01DEPT1 S7682 CONGRESSIONAL RECORD — SENATE December 1, 2017 kids, you will get less of a percent—an been respect for State and local tax- I want to put this in perspective. I 8-percent tax cut. That is all included ation as a deduction from the Federal don’t think there is a person more bi- in the legislation. income tax. partisan than I am. I don’t think there The big change, as we talked about This is not a special interest; this is is a person who has signed more bills in earlier—and I know you have it in how we finance government. We fi- a bipartisan way with my Republican front of you—is that there is now this nance government at the Federal level, friends than I have—who has voted on deduction for property taxes. It is a the State level, and the local level. If more Republican bills or more Repub- $10,000 cap on that deduction. As you this bill becomes law, we are violating lican amendments than I have as a know, if you look at the entire SALT, it. Democrat. which are the State and local taxes and Mr. President, I will ask my col- I am really so frustrated. I thought property taxes, about 50 percent of that league from Oregon to let me have a that we could make this place work. benefit goes to families making over minute more for two or three more That was my purpose in being here. I $200,000 a year. In this one, the prop- points on this that I think are impor- truly have done everything I possibly erty taxes capped at $10,000 will be tant; that is, there are effects that are could. I reached out. The White House much more targeted to the middle going to take place as a result of the was kind enough to reach out to me. I class. limitation of State and local taxes. We sat down and I talked to all of the peo- I think it is fair to say to my col- are going to see effects on property val- ple who are in charge of writing this league from Oregon that he will see ues. The Realtors and real estate in- legislation from the White House. I sat more middle-class tax relief from that, dustries have made that clear. It is down with my colleagues. I gave them and that will be something that will going to affect the tax base of local some suggestions and ideas. We help middle-class families. government. brought people together, thinking we There is no change in terms of those This bill is going to affect charitable could find a bipartisan way. tax cuts because those brackets—the giving. Why do I say that charitable I will tell you, as I see it unfold to- reduction of the tax rates, doubling of giving is part of this? Because I was night, this has been designed not to the standard deduction, the doubling of talking to the mayor of Baltimore, have even me, as one Democrat, on the the child credit—are all in the legisla- Catherine Pugh, earlier today. She has bill, and I want to be. I want to be part tion. serious problems with law enforcement of a reform for the first time in 30 Mr. WYDEN. What I would say to my in Baltimore. She is depending upon years. I look back at Ronald Reagan. colleague is, we don’t have any evi- private groups and their generosity to He was a hero to all of us. He had 97 dence of that. My colleague has cer- help deal with the problems of Balti- votes; 97 Senators voted for the legisla- tainly made laudatory claims about his more. It is going to be much more dif- tion that he crafted. There were adjust- bill, but we don’t have any evidence of ficult for private groups to be able to ments—a give-and-take. But every them. In fact, the comment made by get charitable contributions if this bill time, I would think, well, if I have my colleague highlights my concern. becomes law. So there will be impact some ideas, shouldn’t you at least lis- What we have seen thus far for middle- on this that will affect our State and ten to me; listen to what we think? class families after 2027 is that upward local governments, in addition to the Two days ago, we did a press con- of half of them would pay more in elimination of the State and local tax ference. I invited all of my colleagues. taxes. deduction. I thought: Well, I and Senator I think, rather than continue this, I Here is one last point, if I might HEITKAMP from North Dakota and Sen- will just ask my colleague to see if his make it, in regard to middle-income ator DONNELLY from Indiana—I knew side can produce an actual document— taxpayers. I respect greatly my col- the three of us would show up. I had 14 even a summary—of what this new bill leagues on the other side of the aisle other colleagues who were craving to is actually going to mean for middle- and the charge that they show, but be involved; they wanted to be in- class families who are concerned, based these charges don’t include the effect volved. I saw my good friend, BOB on the earlier versions, about seeing of the increase of the estate tax be- CORKER, Senator CORKER from Ten- their taxes go up, particularly after cause that has not been made part of nessee. I asked him: Can we have a few 2027. the calculations. It does not take into more days to look at this? That was de- I have one question for my colleague consideration 13 million people who no nied. from Maryland because he has been longer are going to have health insur- I don’t know what it is going to take. talking about the State and local de- ance. That has not been taken into Maybe we have hit the proverbial wall. duction, which is enormously impor- consideration in the charge they are This is the first time I know of, in the tant to folks in my State and in my showing. history of the United States of Amer- colleague’s as well. It doesn’t take into consideration, in ica, that we have ever done this type of My question is, when the first income the charge, that the corporation profits major reform without having a bipar- tax was enacted in 1861, it was to fi- they are going to make as a result of tisan objective for it. There is not one nance the cost of the Civil War. It in- these tax cuts are going to most likely bipartisan vote on this piece of legisla- cluded only one deduction at that time go to stock buyouts, rather than help- tion, and I am looking; I have been for State and local taxes, and that was ing the workers. That is not reflected. looking and trying. really composed to respect the States’ So when you take a look at all of it— People have called me today from my ability to make their own fiscal deci- and we do have some analysis that has home, asking: What have you seen? Do sions. It was the first deduction more been done that is objective—middle-in- you like something? I said: I haven’t than a century ago. So does that seem come taxpayers are at a disadvantage seen that much. I am still trying to like a special interest tax break com- under this tax bill. find the bill. I promised them: I will pared to this list of more than 30 I thank my friend from Oregon for see something before I vote on it. I breaks that we have managed to exca- yielding me that time. won’t be able to read it, but I am going vate from various corners of K Street? The PRESIDING OFFICER. The Sen- to see it. I want to see something. Mr. CARDIN. If my colleague will ator from Oregon. I would love for us to take the time yield—— Mr. WYDEN. Mr. President, I thank to sit down and work on this and see it. Mr. WYDEN. I will. my friend, and I know the Senator I think you would be surprised. I think The PRESIDING OFFICER. The Sen- from West Virginia and the Senator not only could we get to 60, we could ator from Maryland. from Connecticut have both been pa- get above 60 votes on this, and that is Mr. CARDIN. In going over the his- tient. Why don’t we yield time to the what it should be. tory as to how the income tax came Senator from West Virginia now. In 2010, I thought my Democratic col- about, it really was part of Federalism. The PRESIDING OFFICER. The Sen- leagues who voted for the Affordable They needed the consent of the States ator from West Virginia. Care Act with not one Republican on it to change the Constitution. It was a Mr. MANCHIN. Mr. President, I were wrong. I thought that was wrong. partnership with our States, and that thank my good friend, the Senator I understand from the history—I wasn’t is why, from its inception, there has from Oregon. here; I was a Governor at that time—

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00030 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.046 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7683 that at least they tried. They went legislation has gone through the reg- Now I would like to address the issue through the markups. They went ular order. It has gone through the my colleague from Maryland raised, through the hearings. They had an committee. It was extensively debated which is the deductibility of State and awful lot of input. I understand that. in the committee. It was marked up in local taxes. I just want to say, for me, Still, I don’t think any major legisla- the committee. There were many doz- disallowing the deductibility of State tion that affects every American ens of amendments debated and voted and local taxes and offsetting that with should go through without a bipartisan on in the committee. The committee lower income tax rates for everyone— buy-in, without bipartisan votes, with- document, which is very similar to the which is what we do in our bill, among out bipartisan support. If this is de- final document we are going to vote on other things—it is a matter of fairness. signed to be a political ploy—to basi- tonight, has been available for weeks. It is just a simple matter of fairness. cally have one side, and one side only, Here is one of the problems we faced Under our current policy, which our not wanting one Democratic vote—this from the onset in this. Very early on in Democratic colleagues would prefer we will fail, and it is a shame for our coun- this process, the vast majority of our keep, the current policy of allowing try and for my colleagues. Democratic colleagues announced they people to deduct their State and local I have made it a point that what I wanted to leave the room with respect taxes and requiring higher Federal in- thought was broken in this place—I to a tax reform discussion. Now, as it come taxes for all Americans as a re- have never, ever campaigned against a happens, Senator MANCHIN was not sult, that amounts to a subsidy that is sitting colleague. I have never cam- among them, but 45 of the 48 Demo- paid by people in low-tax jurisdictions paigned against a fellow Republican. I cratic Senators sent a public letter, that gets sent to people in high-tax ju- have never made a phone call against a and they stipulated the terms under risdictions. fellow Republican. I have never raised which they would be willing to work For the life of me, I don’t understand money to be spent to try to defeat a with us on tax reform. One of the terms why my constituents in Dauphin Coun- fellow Republican, my friends, because was that we had to use a process that ty, PA—a relatively lower tax place— I don’t think I could face them if I am could allow them to kill it by a fili- should have to pay higher Federal in- trying to defeat them and then ask buster, if they wanted to. That was one come taxes so a very wealthy guy who them to work with me. I have never of their terms. owns a penthouse on the Upper West done that nor will I ever do that. That If they were going to participate in Side of Manhattan can deduct the very is not my purpose for being here. the process, they were demanding that substantial taxes he chooses to pay be- All I have asked for is to have the we would have to empower them to kill cause he lives in a very high-tax juris- chance to work with my colleagues. the final product by a filibuster, if they diction. That is all I have wanted to do. I want wanted to. How is that fair that a person of to be part of this. I ask, if there is any Well, I just think that tax reform, much more modest means should have way possible, slow this down to allow tax relief for low- and middle-income to subsidize a person of great means me to be involved. I would appreciate families like we provide in this bill and through the Tax Code? I don’t think that. the pro-growth policies through the re- that is fair, but it is also unfair not I yield the floor. forms in this bill are too important to just from one State to another but The PRESIDING OFFICER. The Sen- allow the minority to kill it by fili- even within a State it is really not fair. ator from Oregon. buster. It would have been malpractice Let me illustrate my point with an Mr. WYDEN. Mr. President, before on our part to allow that possibility, example. Let’s imagine you have two we go to Senator BLUMENTHAL—— and so we didn’t. families who have the same financial The PRESIDING OFFICER. There All that means is one thing. All it circumstances. They are neighbors, but are 36 seconds left. means is, the final passage on this leg- Mr. WYDEN. I thank my colleague islation is not 60 votes, but it is 51. they happen to live on either side of a from West Virginia. I believe we are That is all. Any Democrat can offer municipal boundary. One family lives going to propound another 30-minute any amendment. Any Democrat can on the side of a town that provides a unanimous consent request. join us in supporting this legislation. lot of services and has high property The PRESIDING OFFICER. First, That was also true in committee, and taxes, which pays for the services. the other side has 15 minutes. it will be true right through the end of Maybe they pick up the trash. Maybe Mr. WYDEN. Oh, they have 15 min- this process. the town picks up the leaves. They pro- utes. Our Democratic colleagues also had vide lots of services. They have a nice We will let Senator TOOMEY start the other stipulations in their letter. They community center. So the family has 15-minute time allotment for Repub- said there can be no savings in the tax higher property taxes to pay for all of licans. Then, when our turn is next, we reform package for the people who pay that. will go to Senator BLUMENTHAL. 40 percent of all the taxes. It is actu- Then the other family on the other The PRESIDING OFFICER. The Sen- ally really hard to do pro-growth, side, in a different township right next ator from Pennsylvania. meaningful tax reform if you say the door, they don’t get their leaves picked Mr. TOOMEY. Mr. President, two people who pay 40 percent of all the up, they don’t get the trash hauled points I would like to address, and then taxes must not be allowed to get any away, they don’t have a nice commu- we have other Republican colleagues benefit whatsoever. nity center, but they have lower prop- who would like to use our time as well. Another feature in their letter was erty taxes. One, I want to address the comments that there could be no savings for the Now, the family who doesn’t have all made by my friend—and he is a friend very substantial category of American those services, they have to privately of mine—the Senator from West Vir- businesses organized as what we call contract for those services. They have ginia. I have worked closely with Sen- passthroughs—these are partnerships to go hire a company to take away ator MANCHIN on a variety of pieces of and subchapter S corporations—be- their trash barrels. They have to hire a legislation, some relatively ordinary cause under the stipulations in their company to take away their leaves. and noncontroversial and others quite public letter, there couldn’t be any They have to pay to join a gym or a controversial. We have been through benefit at all to anyone whose income recreational facility, and they don’t some battles together, Senator was in the top 1 percent. Well, there get to deduct any of those expenses. MANCHIN and I, and I enjoy working are a lot of passthroughs that have They don’t get to deduct the cost of with him. some ownership on the part of people paying someone to take their trash I hope he is going to support this who are in that income category. away or leaf removal or their member- product in the end. I am not sure he My point is, they were systemati- ship at a local gym or facility like will, but he might—I don’t know—and cally taking themselves out of the dis- that. he probably has some good ideas he cussion from the very beginning. De- So how is it fair that one person gets could bring to this. spite that, we had an open process. We all of those services and gets to deduct Let me be very clear about the proc- had unlimited amendments, and they the costs in the form of deducting the ess we have used here. First of all, this participated in that process. property taxes that pay for it, and the

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00031 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.047 S01DEPT1 S7684 CONGRESSIONAL RECORD — SENATE December 1, 2017 other person, otherwise identically sit- paid, which most States have, for the mom with two children? I think she uated, does not get to deduct the cost? clothes that you are wearing. Well, needs a break. Let’s give working That just does not strike me as fair. then you might leave your home, walk moms, working dads with a couple of So all we are doing is saying: Let’s be across your driveway to get in an auto- kids an extra couple thousand dollars fair about this. Let’s just be fair. Let’s mobile, perhaps, and you realize you to help make ends meet and reduce the disallow that deduction. For the most are paying significant property tax on tax burden on small businesses—not part, we do preserve a portion of that, that property you own—if you are a corporations. We will talk about that but the principle is to reduce the abil- homeowner—and you get in your auto- in a minute. That is important to do, ity to deduct these taxes because it is mobile. Oh, by the way, you have paid but these small businesses that are not more fair, and then what we can do as a significant tax on that car too. You corporations are paying as much as 40 a result is we can lower the income tax have paid a sales tax, most likely. You percent of their income in Federal in- rates paid by everyone. may be paying hundreds of dollars a come taxes. We are going to take that I think that is a step in the direction year to put license plates on it. Then down to less than 30 percent. of fairness, and it is one of the things you want to drive on to work, and you What does that do? It creates jobs. It that I think is a good feature in the might want to stop at that coffee shop. puts pressure on wages, higher wages, bill. You might want to get that nice cup of because we need to direct these tax I see my colleague the Senator from coffee there to get you going for the cuts to those who provide jobs. By the way, those smaller businesses, Montana is here so I will yield the floor day. What do you do? Well, you pay a 55 percent of the private sector jobs in to him. sales tax, most likely, as you get your The PRESIDING OFFICER (Mr. this country are from smaller busi- cup of coffee. nesses. Two-thirds of the new jobs cre- HELLER). The Senator from Montana. Perhaps on the way to work, you ated since the recession of 2007, 2008 are Mr. DAINES. Thank you, Mr. Presi- need to fill up your gas tank. Now, in dent. I am thankful for my colleague from these smaller businesses. We are Montana, we drive pickups. I could tell targeting significant tax relief for from Pennsylvania, Senator TOOMEY, you, when you fill up your pickup, it for his remarks and for his leadership those small businesses. Who are these? costs you a chunk of change. These are farmers. These are ranchers. in getting us to this point tonight for You are paying 18.4 cents per gallon These are locally owned Montana busi- this most historic moment in the U.S. just in federal taxes, and then you pay nesses. It could be our community Senate. your State taxes on top of that. That bankers. It could be a baking company. I spent 28 years in the private sector ranges from 12 cents a gallon in Alaska It could be a construction company. I before I came back to Washington, DC. to 58 cents a gallon in Pennsylvania, grew up in a construction company. My In fact, the last election I won before I and then you go to work. mom and dad were the CEO and the won election to serve in Congress was I was just speaking with one of my COO of the family business. In Mon- student body president in my high young staffers here tonight. She told tana, that is 68 percent of the jobs in school. me, when she got that first paycheck— my State. They are getting significant I spent many years working in busi- I guess her first job out of college—she tax relief. Working with my colleagues, nesses, growing businesses, creating called her dad, and she said: They have we have had some great conversations, jobs, sending a lot of money to Wash- made a mistake. They have screwed up and we have provided some additional ington, DC, in taxes. You are not going my paycheck. And she talked him tax relief for those smaller businesses. to find a single Republican here who through the difference between the We have a historic, once-in-a-genera- says taxes are bad. What we are saying gross pay and what you really put in tion opportunity today. This only here is that we are an overtaxed Na- the bank, the dollars of your Federal, comes every 20 or 30 years. It goes back tion. State, local taxes, Social Security, to 1986, 31 years ago—the same year my In fact, if I were to ask you where are Medicare. wife and I were married. We need to the most affluent counties in the Your day is finished. Perhaps you put more money back into the hands of United States, where are they, you want to go home and grab something American workers. Let’s cut their might guess, well, Beverly Hills, per- to drink, whether it is a glass of wine, taxes. Let’s open the doors for the cre- haps Silicon Valley, New York City. perhaps a beer, perhaps a soda. Well, ation of more high-paying jobs. We The answer is, the most affluent coun- the government is there too. You have start that by transferring the wealth of ties in America are suburbs of Wash- paid an excise tax somewhere on those this city back to the families and busi- ington, DC. beverages. All I am saying here is it is nesses that sent us here in the first The American people have watched time to give some of that back. It is place and that keep our country mov- this city increase in power, increase in time to give some of that back to the ing forward. wealth, and I think this city has for- single mom in Kalispell, to give it back We have been hearing a lot of things gotten something; that the dollars that to that small business owner in Helena, about this bill. The Washington Post are sent here by hard-working Ameri- to give it back to the families, the even claimed four Pinocchios on some cans do not belong to the government, businesses, working-class Montanans. of these claims that somehow this plan they belong to the American people. It You know what, they need a pay raise. will raise taxes for most working-class is their money. So how do we start that? How about families. Look at the facts. That is not I will tell you what. I don’t think we right here with this bill tonight. Let’s true. realize how much taxes we pay. We are lower tax rates on middle income Let me conclude by saying this, focused right now on Federal income Americans. Let’s allow them to keep quoting a President: taxes, Federal corporate taxes. How- more of their hard-earned dollars. How It is a paradoxical truth that tax rates are ever, imagine you wake up in the about we increase the standard deduc- too high today and tax revenues are too low morning—if you are like me, my cell tion? Let’s take it from $12,000 to and the soundest way to raise revenues in phone is now my alarm clock—and you $24,000. How about we eliminate the the long term is to cut the rates now. The grab your cell phone. You reach for it. poverty tax? That is eliminating experience of a number of European coun- The first thing you do is maybe look at ObamaCare’s poverty tax. As Justice tries and Japan have borne this out. The pur- pose of cutting taxes now is not to incur a what inbound emails you have, maybe Roberts said, it is a tax. It has cost the budget deficit, but to achieve a more pros- you look at the Twitter feed, but you American people so far over $5 billion, perous, expanding economy which can bring realize, as you are grabbing the cell 42 percent of those making less than a budget surplus. phone, on average, a U.S. wireless con- $25,000 a year, 82 percent make less That was John F. Kennedy in Decem- sumer pays about 17 percent—of that than $50,000 a year. That is a poverty ber of 1962. bill you pay for your cell phone, there tax. We are going to repeal that as part Let’s not miss this opportunity that are Federal, State, and local taxes for of this bill that we are going to pass to- we have now. that cell phone. That is how the day night. The PRESIDING OFFICER. The Sen- starts. Families need a break. How about we ator’s time has expired. So then I go, and I get dressed. I double the child tax credit? We are par- Mr. DAINES. Mr. President, I ask think about how much sales tax was ents of four. How about that single unanimous consent that there now be

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00032 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.049 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7685 30 minutes, equally divided, for debate complex hardware that we do without part of his organization that will ben- only, with no amendments or motions that skilled training. We know that in efit from this passthrough provision. in order, and that the majority leader Connecticut because we produce sub- So the President may be celebrating, be recognized at the conclusion of that marines and jet engines and heli- but most Americans will rue this day. time. copters. We are proud of that, but we We will remember this day, all of us The PRESIDING OFFICER. Without need more people with those skills. who are here, but we in this Chamber objection, it is so ordered. Yet this measure will enhance the di- will rue it as well. We will remember it The Senator from Oregon. visions in our society. It will divide us because of the black mark on our de- Mr. WYDEN. Mr. President, to start from each other as Americans. It will mocracy that resulted from a guilty our portion of the 30 minutes, Senator diminish the mobility—social and eco- plea from a former National Security BLUMENTHAL has been very patient, so nomic mobility—in our great Nation, Advisor—a guilty plea for lying to the I wish to start with the Senator from and it will increase economic insecu- FBI. It is a black mark on our democ- Connecticut. rity. It will not make Americans more racy, a sad day for our Nation, and a The PRESIDING OFFICER. The Sen- sure about their society, more con- shadowy moment for this administra- ator from Connecticut. fident in its equality and justice; it tion, the Trump Presidency. Mr. BLUMENTHAL. Mr. President, I will create more anxiety and anger be- But we will remember it also as a am honored to be here tonight. Even in cause at its core, this measure is about self-inflicted wound for our democracy moments of sadness and anger—and I benefits to a tiny, minute fraction of when the actions of the U.S. Senate feel both here—I am honored to be a America. Most of the benefits of this drove deeper divisions within our soci- Member of this body. I am particularly measure go there. And it is about hit- ety, created more insecurity, enlarged honored to be a Member of the U.S. ting the rest of Americans—particu- the anger and angst and anxiety that Senate with JOE MANCHIN, whose bipar- larly middle-class families—with ini- people feel about themselves, and when tisanship and willingness to listen and tial benefits that may even look good we added $1.5 trillion to the national to compromise and be reasonable is al- at first but are a classic bait-and- debt that our children and our grand- most legendary. All of us, including switch because most of those middle- children will pay and thereby when we Ranking Member WYDEN of the Fi- class families will be worse off over the diminished our national security. The nance Committee, have been more than next 10 years. Anybody earning be- national debt may not be the greatest eager to be reasonable and compromise tween $50,000 and $75,000 will see their threat to our national security, but it and seek bipartisan solutions. I truly taxes increase over those years. is one of the largest of the dangers to want to thank Senator WYDEN for his For all the reasons that my col- our national security, and we have leadership on this issue, as well as his leagues have so powerfully and compel- done nothing to alleviate it. On the insight and his great commitment to lingly outlined in this Chamber, with contrary, we are adding to it, and that the public interest. statistics that I don’t even have time is a shame and a disgrace. We had a hearing earlier this week to repeat here, this measure is essen- I yield the floor. before the Armed Services Committee tially rotten at the core in its claim to The PRESIDING OFFICER. The Sen- about future threats to our Nation and fairness. ator from Oregon. national security, with a panel of ex- Tax reform should be about making Mr. MERKLEY. Mr. President, I perts who testified that more than $1 our Tax Code simpler and fairer. This thank my colleague from Oregon. I trillion dollars—maybe trillions— measure does just the opposite. My col- would like him to know that I will only would be necessary for us to invest in leagues may say there were hearings, take about 5 minutes because I want to the future of our Nation’s defense. So but compared to the mid-1980s when make sure my colleagues can speak many of us asked them whether they the last major tax reform was passed, during this period. thought it would be possible to make there have been no hearings and there I am rising now to ask the senior that investment at the same time that has been no real markup. Senator from Texas to come and ex- our Nation is about to incur an addi- We are now considering an amend- plain his amendment that has been in- tional $1.5 trillion in debt as a result of ment that was deposited on the floor of corporated in the package. This, I be- this misguided, maligned scam, this this Chamber just minutes ago—barely lieve, earlier was his amendment No. tax bill, and when we asked that ques- an hour—and will receive no serious 1715, and we are hearing that 1712 was tion, they shook their heads no. scrutiny or oversight. It will harm our included as well. This is something The former Chairman of the Joint teachers and first responders, our po- that might be characterized as the Chiefs of Staff, Mike Mullen, once lice and our firefighters, who will have Wall Street welfare amendment. We said—famously now—‘‘The greatest less support for their vital services. It are not sure exactly how it works. We threat to our national security is our will harm the job creators who need are not sure exactly how much it costs. national debt.’’ The reason our na- more resources to invest in infrastruc- But that is not the point. If you are tional debt is a threat to our national ture. It will harm our educators and going to stick something into the un- security is very simply that it prevents the skilled trades. It will harm middle- derlying bill to benefit very powerful us from the kind of commitment and class America. groups like Apollo and Carlisle and investment in our national defense It will hit Connecticut as hard or Blackstone, you don’t just airdrop it in that we on the Armed Services Com- harder than any other State because of at the last second, this provision for mittee and we in this body and we the the nondeductibility of State and local the most powerful. Come to the floor, people of America know we have to taxes and because of the nondeduct- lay out the details, and defend your make to secure our national defense. ibility of casualty losses. The home- amendment and why it should be in- Our national defense is about more owners whose foundations are crum- cluded in this bill. than just hardware and even the great bling will lose the ability to deduct the Our basic understanding is that it en- troops that we deploy—our service men cost of repairs that they must make. ables publicly traded partnerships to be and women who serve and sacrifice That is so fundamentally unfair that it able to have their funds pass through with such incredible bravery and dedi- belies the promises that have been so there is no corporate tax since they cation and patriotism—it is also about made even this day on this floor. benefit from a lower rate for those the quality of our society. It is about We are adopting this measure lit- passthroughs. But we have only had a whether we are equal, whether we give erally in the dark of night—a Friday few seconds to look at it. What does it people the mobility to move and make night when few Americans may be really do? What does it really cost? I of themselves what their aspirations aware of what is happening here—com- ask the Senator to come to the floor are and make the American dream real paratively few. and explain all of the details. The in their lives and develop those skills On the passthrough provision that American people have a right to know through education and skill training has been added to this bill, unquestion- what you are sticking in this bill. Ex- that are so necessary to us as a nation. ably, some Americans will be aware, plain your Wall Street welfare amend- We can’t produce the submarines and including the President of the United ment and why we should support it or the F–35s and all of the extraordinary, States. He has more than 500 LLCs as not.

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00033 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.050 S01DEPT1 S7686 CONGRESSIONAL RECORD — SENATE December 1, 2017 We have $4 trillion going to the rich- So the poor are paying in while the 2,000 acres is not a whole lot of land, est Americans. Four trillion? We keep rich are taking out. You call this mid- But on those 2,000 acres, there is a lot hearing about a $1.5 trillion deficit. Oh, dle-class tax relief? I call this a tax of oil beneath. yes, but there is lot more here, so let’s scam. Why is that important? We as a coun- just see what it is. The PRESIDING OFFICER. The time try can make a decision to be energy There is the reduction in the cor- has expired. secure or not. If we are going to be en- porate tax rate, which we all know Mr. MERKLEY. It is outrageous and ergy secure, it means we are going to goes to the richest Americans who hold unacceptable. produce our own energy. This is not to all the stocks. That is $1.3 trillion. The PRESIDING OFFICER. The Sen- rule out renewables, but for the mo- We have repeal of the alternative ator from Louisiana. ment we are going to continue as a minimum tax. That is $770 billion. Mr. CASSIDY. Mr. President, I would country to consume natural gas and We have the passthrough for high-end like to comment on the positive as- oil. We can buy it from countries such LLCs—not for low-end LLCs but for pects of the bill we are about to vote as in the Middle East where environ- high-end LLCs—$362 billion. on. mental standards are not as strict as We have three provisions for multi- The most positive thing I can say ours, but when we do that, not only are nationals, a deduction for foreign divi- about this is that working families and we sending our jobs and revenue over- dends, a deduction for foreign intangi- middle-income families across the Na- seas, but we are also, in effect, endors- bles, and the transfers for intellectual tion will be better off. Families who ing their lower environmental stand- properties, totaling $313 billion. over the last 8 years have not done well ards, and that overall pollutes the en- We have an elimination of the estate will begin to do better. vironment. tax to benefit the richest 0.2 percent. Now, we have already discussed some On the other hand, if we buy from Out of a total of 1,000 people in Amer- of the things that others have dis- ourselves—using American workers, ica, the richest two—that is the equiv- cussed. Let me just comment briefly: creating American jobs, using Amer- alent. That 0.2 percent would get $83 We have doubled the standard deduc- ican environmental standards—not billion. tion to make filing of income taxes only do we get the benefits to the fam- Then we have a change in the tax simpler. For most Americans, that will ily and the benefits to the environ- brackets, which added another over $1 be a tax cut by doubling that standard ment, but we have the national secu- trillion there. And probably most of deduction. rity benefit of being able to be energy We have provisions in there to stimu- that—we have been trying to get a secure. breakout. We can’t even get a breakout late the economy, to create competi- Now, this is powerful. I first became of where this will go because it is being tion for workers so workers will now aware of it, I think, in middle or maybe rushed through. have a choice of one job or another. elementary school. I went to St. Luke’s If we take those provisions and add When that happens, of course, their Episcopal Church. There was a guy them up, it is $4 trillion. I am just tak- wages rise, and their benefits get bet- there named Thor. What a great name, ing the big ones off the list of all of the ter. details. We incentivize companies that are, Thor. Thor told me his father was a Little public exposure. Why is this right now, moving overseas—because pipefitter and was at that moment in being done in a few hours here, just the taxes are so much lower else- Alaska working on the Alaska Pipe- after the Thanksgiving holiday, before where—to stay in the United States, to line. That was 40 years ago, so maybe Christmas? Because my Republican create American jobs, and to pay more my memory is a little fuzzy on every- colleagues are sticking it to the Amer- American taxes. thing but Thor’s name. The point is, a ican people, and they don’t want you to Those are all good things my col- fellow from Louisiana was going to know. leagues have discussed. Let me discuss Alaska, making great money, being So, again, an example—out of this some other ways perhaps that this bill able to provide for his family back list of 30 amendments that are being benefits working families and middle- home. That is a good thing. stuffed in at the last second that no class families. As we develop our energy resources one has had the ability to analyze—30 I am from an energy State. Louisiana on the North Slope of Alaska, using amendments—let’s have the senior produces so much oil and gas. The American environmental standards, Senator from Texas come to the floor thing about energy jobs is it creates creating American jobs, we are chang- and defend his Wall Street welfare jobs for good families. They may not ing the life of families like my family amendment that he is sticking in here have a college education, but they are and for perhaps the family of the man for the most powerful publicly traded good people. They care about their I remember going to middle school partnerships. That is just one of 30. children. In these jobs, they can earn with long ago. So I am calling for transparency. I over $100,000 a year in certain aspects I mentioned Thor’s father was a pipe- am calling this process for what it is, of it, and they employ Americans in a fitter. Now, it is not just on those 2,000 and that is using the argument that way that Americans have kind of for- acres. There will be a way of trans- you are doing something for the middle gotten that it can be that way. porting that oil that is produced else- class in order to cover up these tril- It is meaningful to me. We were in Il- where. In South Louisiana, we make lions of dollars going to the very rich- linois when I was born. My family boats—boats that actually work off est. Let’s see how misplaced this is. moved to Louisiana because someone rigs and can create jobs both in the In the next year, 9 million taxpayers called my father and said: You know, boatyard and in the maritime industry. together at the bottom would get Jim, if you move to Louisiana, you can Thor’s father was a pipefitter. You about 50 cents a day in tax relief—two sell to the people working at Esso, and pipe out your oil, and you create jobs quarters. That is what you do for the 90 you can make a good living. in that way. That comes to mind be- million taxpayers who are most in need So even though my father didn’t cause when I was first elected to the in America, two quarters a day. What work in the energy industry, he was Senate, I was going to a committee does this bill do for those who earn one of those who benefited and made a hearing, and some union fellows from more than $1 million? It gives them living, which allowed me to go to med- Ohio came up to me to ask that I en- over $1,000 a week. So $1,000 a week for ical school. I was the first generation dorse the construction of the Keystone the rich and mighty; two thin quarters in our family to go to college and go to XL Pipeline. Of course, I have always a day for the folks at the bottom. medical school, and now I am a U.S. been in favor of it so they had my vote, It even gets worse than that. By the Senator. What an incredible privilege, but they made the point: We are union end of the tax period, what are those all created by energy jobs. laborers. We work on the job. When we people earning less than $50,000 doing? One thing this bill does is it opens up say there is $40,000 created in the build- They are paying $23 billion into the a little more of Alaska for energy de- ing of a pipeline—sure, we may only be Federal Treasury, but what are those velopment—2,000 acres. One of my col- on the job for 6 weeks, but then we go who are earning more than $1 million leagues said smaller than the airport in to another job for 6 more weeks and an- doing? They are taking out $5 billion. Fargo, ND. I have never been there, but other job for 6 more weeks.

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00034 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.051 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7687 I was struck that these working fam- tive effects on Social Security and ury, but also creating American jobs ilies benefit not from the actual pro- Medicare. I am a doctor. I have been will create that prosperity, that eco- duction of America’s natural resources working in the public hospital system nomic growth, so that instead of the 2- but from the transportation of Amer- of Louisiana for 25 years. I understand percent growth that we have had for ica’s natural resources. So the eco- the importance of safety net programs, the last 8 years, we have the 3.5-per- nomic benefit to working and middle- if you will, like Medicare that allow cent growth that we historically have income families doesn’t just stop with our senior citizens to have the had. That is a promise of this legisla- those who are perhaps doing the drill- healthcare they need. tion. That will restore funding for So- ing, but it continues downstream and, The dirty little secret is that, accord- cial Security and Medicare. That is the as I mentioned earlier, even extends to ing to the people who run Medicare and answer that has eluded the other side. a family like mine. Social Security, those trust funds are Mr. President, before I yield back, I Now, let me mention another aspect going bankrupt—bankrupt. Under the ask unanimous consent that there now of this that brings benefits to our Obama administration, they tried to be 30 minutes, equally divided, for de- working families and to our middle- address it by raising taxes, so they put bate only, with no amendments or mo- class families. One thing I was helpful a higher income tax on people, and the tions in order, and with the majority with was the restoration of the historic trust funds are still going bankrupt. leader being recognized at the conclu- tax credit. The historic tax credit is a Under ObamaCare, there were different sion of that time. Federal tax credit first made perma- things to try to save money within the The PRESIDING OFFICER. Is there nent by President Ronald Reagan that system, delivery system reforms, and objection? allows somebody to go to an older some are, frankly, good ideas—al- Without objection, it is so ordered. building in a community and to restore though I opposed ObamaCare, in gen- Mr. CASSIDY. I yield back. it, returning it to commerce. So in- eral, some of these were good ideas, The PRESIDING OFFICER. The Sen- stead of a portion of our architectural and I continue to endorse them—and ator from Oregon. heritage being destroyed, it is refur- the trust funds are still going bank- Mr. WYDEN. Mr. President, for this bished and is there for future genera- rupt. So it raised taxes, we are trying tranche, I believe we will have Senator tions to enjoy. More than the kind of to save money, and the trust funds are DURBIN lead off for us and then Senator aesthetics of seeing an older building still going bankrupt. What can we do NELSON and Senator BENNET. Each is become beautiful once more, it creates to try and rescue these programs that going to try to take around 5 minutes. jobs. are so significant, so important to sen- Senator DURBIN. Now, let’s go back to this legislation, ior citizens, to all of us in this coun- The PRESIDING OFFICER. Senator creating better jobs for working and try—Social Security and Medicare in DURBIN. middle-income families. First, it af- particular. Mr. DURBIN. Mr. President, what fects everybody. More than 40 percent What about economic growth? I did happens when you decide to write a tax of the projects under the historic tax an analysis once with another man bill that changes the economy of the credit program in the last 15 years which shows that if we just return to United States of America, you don’t have been in towns of less than 25,000 the economic growth that is common have adequate hearings to gauge what people. In my State, since 2002, the his- in our country—about 3.5 percent GDP is going to happen, you don’t bring in toric tax credit has contributed to 782 growth per year—we will fully fund our the experts to try to tell you what the projects being built, bringing $2.2 bil- trust funds for Medicare and Social Se- impact will be on individual families lion worth of investment into these cit- curity. and businesses, and you stick around ies and towns across my State. Keep in mind, although we are cut- until 5 o’clock on a Friday night and Now, when you have that much ting rates for corporations, the rates you hand out the work product for all money, you create lots of jobs. It is for funding Medicare and Social Secu- of the Members of the Senate to take a thought, nationwide, according to the rity are staying where they are. So if look at before they vote on changes in study by the National Park Service, our economy is doing better year over the Tax Code that will affect the people the historic tax credit has encouraged year, there will be more money going they represent? more than $131 billion in private in- into these trust funds, not because the This is what happens: 479 pages were vestment, rehabbing 42,000 buildings, rates are higher—the rates remain the handed to us. They tell us that some of creating more than 2.4 million trade same—but because there is more this has been around for a while, and jobs, returning a net positive to the money to apply the rates to. some of it is new. They don’t tell us U.S. Treasury. Is it reasonable to have that kind of which part is new and which part is Since fiscal year 2002, in Louisiana growth? Absolutely. From 1946 to the old. Lucky for us, on K Street—and alone, it has, again, fostered more than beginning of President Obama’s admin- there is nothing wrong with lobbyists— $2.5 billion in private investment, cre- istration, through 10.5 recessions—in- where the Federal lobbyists live, they ating more than 38,000 jobs. These are cluding one-half of the great reces- are following this really closely, and jobs—construction jobs, rehabilitation sion—we averaged over 3 percent they have given us basically a cheat jobs—that allow a family to live with a growth as a country. Now, under Presi- sheet, a scorecard, so we can figure good living wage. That is part of this dent Obama’s Presidency, it was about out, at least generally speaking, how legislation. 2 percent growth, and 2 percent versus many changes have been made in the I should mention one thing in par- 3.5 is all the difference in the world be- 479 pages since the last time we saw ticular very topical on the historic tax cause it compounds. It goes like this if this proposed bill. credit. The World Trade Center of New it is 2 percent, it goes like this if it is I defy any Member of the Senate to Orleans is currently being refurbished. 3.5 percent, and at the end of 10, 15, or stand here and take an oath that they It was built in the 1960s and is being 20 years, those differences are remark- have read this and understand what in transformed into a world-class hotel able. the world it means to businesses, fami- condominium complex. It brings the I will say, under President Trump, lies, and individuals. If they want to city of New Orleans $400 million in in- for the last two quarters we have had take that oath, and maybe some will, frastructure spending, 1,600 jobs in con- over 3 percent GDP growth. Repub- then I refer them, ladies and gentlemen struction trades, as well as more than licans take over, and the economy be- of the American jury, to exhibit A, 450 permanent, full-time jobs. Instead gins to do better. In the next quarter, page 257 out of the 479. of a crumbling eyesore, you have a it is estimated that it will be over 3 Why do I pick this page? Because jewel, but more than a jewel, you have percent. With this legislation, increas- they didn’t have time to type it. They 1,600 jobs created and 450 permanent ing the amount of money families have wrote it out in longhand. We are not jobs. in their pockets, building out our en- even teaching cursive in a lot of Let me mention the last thing that ergy resources as we are in Alaska, cre- schools anymore, but someone on the benefits working and middle-class fam- ating jobs for Americans across the staff knew it enough to try. The prob- ilies. My friends on the other side of way, using things like the historic tax lem is, they wrote it in cursive along the aisle talked about supposed nega- credit, returning money to the Treas- the margin here. It is about subchapter

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00035 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.053 S01DEPT1 S7688 CONGRESSIONAL RECORD — SENATE December 1, 2017 S corporations and how much tax they Shouldn’t we be focused on doing what child tax credit, let’s see what the ma- paid and what they don’t pay. I defy is necessary so that middle-income jority of our friends who are trying to anybody to read it because the problem families have a fighting chance to pay ram this through in the dead of night was, when they copied it, they chopped their bills and put some money away do. Let’s see what happens, because, off lines so there aren’t full sentences for their kids and their future? clearly, their tax bill does not do here. They are like little phrases and Shouldn’t we be working on helping enough. words. small and medium-sized corporations This Senator has long supported in- This is your Senate at work. This is instead of the big boys? creasing the child tax credit, including what happens when you push through a That is what I think we should focus cosponsoring Senator BROWN’s amend- bill late at night, desperate to pass it, on. I don’t know for sure that this bill ment to increase the credit and make without really stopping to ask your- doesn’t do that. In fact, nobody does. it easier for those who are in a low-in- self: Will this make us a stronger na- Nobody knows what is in here—479 come situation to claim that credit. I tion? Will this help legitimate busi- pages. If they tell you they do, then am going to continue to support in- nesses that want to expand and create ask them to explain page 257. Ask them creases for this tax credit for the mid- jobs? Is this good for American fami- to try to read this. I have tried. This is dle class, as long as it is done in a fis- lies? going to change the tax law of America cally responsible and thoughtful way. The Joint Committee on Taxation in ways that we can’t even explain. We It doesn’t make any difference who is told us yesterday—that is our score- have to get this done because the Sen- proposing it. Let’s see how the votes keeper; they are the ones who we hired ate has done little or nothing this year, come out here on these two amend- to be our scorekeeper; they are non- and so they are desperate to get some- ments. partisan—what they learned about this thing done before the end of the year. Unfortunately, the bill that is before bill before we got the new version, with Sadly, it is a tax bill that we have just us does it backward because it actually the new amendments. Our friends on K been handed 1 hour and 50 minutes ago. increases those who have a number of Street were happy to tell us what the I yield the floor. children. We should be doing the oppo- listings were. They told us that this Mr. WYDEN. Mr. President, I want to site. I hope that we will find a way to starting bill will add $1 trillion to the thank my colleague from Illinois for a drastically change this bill. Instead of national debt—so our kids and very insightful analysis, and his skills limiting the child tax credit, let’s go in grandkids can pay it off—to pay for the as a handwriting expert may be nec- and make the corporate income tax not tax cuts. They also told us that the essary as the Senate Finance Com- at 20 percent but at 22 percent or 25 predicted economic growth that is sup- mittee tries to divine what that par- percent in order to fund the child tax posed to come out of these pages of 4, ticular page actually means. I thank credit to help those on the bottom line 5 percent a year is 0.8 percent. Is it my colleague for trying to unpack a of the economic ladder. not? Am I right? byzantine area of subchapter S tax law. We should be coming together in a bi- Mr. WYDEN. Correct. Mr. DURBIN. If the Senator from Or- Mr. DURBIN. They also told us that partisan manner to flip the priorities the biggest beneficiaries under this Tax egon would yield for just a moment, I in this bill and to significantly in- Code—this Joint Committee on Tax- would like to ask consent that this in- crease the child tax credit. Obviously, ation—happen to be the wealthiest peo- famous page 257 be made a part of the that is what the American people want, ple in America—surprise—and the big- RECORD after my speech, but I am real- but that is not the bill of goods that gest corporations. They told us that, at ly sorry for the members of the staff you are getting sold here tonight. By least in the second 10 years—maybe be- who have to try to write this out—type saying something is something, that fore—regular middle-income families it out. doesn’t make it so. It is what the facts are going to pay higher taxes because Mr. WYDEN. Their eyes are being are. of this. They let us know, and we knew strained as we speak. I yield the floor. already, what is going to happen to The PRESIDING OFFICER. Without Mr. WYDEN. Mr. President, my col- programs like Social Security, Medi- objection. league has a parliamentary inquiry, Mr. WYDEN. I yield to the Senator care, and Medicaid. You see, when you and then we will go to Senator BENNET. run up the national debt and you want from Florida. Mr. DURBIN. Mr. President, par- Mr. NELSON. Mr. President, this is, to try to balance the books—our Re- liamentary inquiry. in effect, a massive transfer of wealth publican friends have been very open The PRESIDING OFFICER. The under the guise of tax reform and about this. They want to cut the bene- Democratic whip. fits under Social Security, Medicare, under repeating the statement: It will Mr. DURBIN. I submitted page 257 of and Medicaid to try to balance the help the middle class. You can repeat a the amendment to be placed in the books. statement, but that doesn’t mean it is RECORD and you gave unanimous con- America, are you ready for this? Are true. You have to look at what the sent for that to happen. I have now you ready for senior citizens who are facts are. I think you have heard a been instructed that the personnel at counting on that Social Security check number of the speeches that will refute the Senate cannot read this page the to get a cut in benefits to pay for a tax this—that it is not middle-class tax re- way it is currently written. Could I cut, a tax giveaway to the wealthiest lief. It certainly isn’t when a lot of have this entered in the RECORD just as people in America? Are you ready to those so-called tax cuts for the middle written with the handwritten notations see Medicare cut—that is, reimburse- class will evaporate; they will cease to on the side? Could I enter it as a graph- ment for seniors for medical expenses— exist after 7 or 8 years. ic or artwork or something like that? in order to make sure that the biggest Let’s take another part of this tax I ask the Presiding Officer, does that corporations in America get a tax bill, the child tax credit. We are going mean if the amendment has this page break? Are you ready to see Medicaid, to have a couple of amendments out of in it, that the amendment cannot be which has as its major expense taking here on the floor tonight. We are going filed? care of seniors in nursing homes—bene- to have one that is going to increase The PRESIDING OFFICER. The fits cut in order to give an incentive the tax credit substantially, like $3,000 amendment can be filed with hand- for businesses to move jobs overseas? per child. When you compare that to written changes, but the staff will have That is what this is all about. the current existing Republican bill, to change those later or correct them. Here is the reality. As a percentage they have a tax credit that, in fact, if Mr. DURBIN. I would like to ask a of gross domestic product, American you have more than three children, if further parliamentary inquiry. Why corporations have never been more you have a large family, you are going didn’t they accept page 257 after I re- profitable—never. As a percentage of to be penalized. That is what the facts ceived consent to put it in the RECORD? gross domestic product, American cor- are. The PRESIDING OFFICER. The porations have never paid less in Fed- Let’s see how the votes come later amendment has not been filed yet. Con- eral taxes. this evening on two amendments. One sent was accidentally—— What is the Republican response to is a Democratic amendment, and one is Mr. DURBIN. Parliamentary inquiry. that? Cut corporate taxes. Why? a Republican amendment. As to the This page, which is part of the tax bill,

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00036 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.055 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7689 257, as written, cannot be filed in the even if we could read them, we next generation that they were willing Senate because no one can read it; is wouldn’t be able to. It just doesn’t to make in us. that correct? make any sense. I yield the floor. The PRESIDING OFFICER. The I will tell you something else that Mr. WYDEN. Mr. President, just be- amendment has not yet been filed. It doesn’t make any sense. It doesn’t fore we wrap up, I have heard Repub- can be filed in that form. make any sense that, in our economy, licans talk constantly about how this Mr. DURBIN. Parliamentary inquiry. 90 percent of our folks—the bottom 90 process is being conducted by regular Why can’t this page be filed in that percent—earned the same amount of order. I have never seen in my time in form? income as the top 10 percent. The top public service, when talking about $10 The PRESIDING OFFICER. The 10 percent earned 50 percent of the in- trillion worth of tax policy changes amendment as shown with the hand- come in this country, and the bottom and the biggest tax bill in three dec- written text cannot be printed in that 90 percent earned the other 50 percent. ades, something along the lines of the graphic form. You can see the direction that these flimflam that we have been talking Mr. WYDEN. Mr. President, par- lines have headed over a number of about, with handwritten changes in the liamentary inquiry. years. margins about something that conceiv- The PRESIDING OFFICER. The Sen- That is the issue that we confront in ably will affect vast sums of taxpayer ator from Oregon. our economy. That is what we all money. Mr. WYDEN. When this is filed, we should be working on in a bipartisan I yield the floor. want the American people to know way to try to address. Unfortunately, The PRESIDING OFFICER. Who what has actually been written on the instead of improving the circumstances yields time? side. for people in the bottom 90 percent of The Senator from Florida. Will it be possible, as part of Senator earners, the decision has been made, Mr. RUBIO. Mr. President, as most of DURBIN’s statement, to add this ‘‘writ- because of an economic philosophy my colleagues know by now, we have ten on the side’’ portion as part of his that has to do with trickle-down eco- been working for I believe about a year statement so that the American people nomics, to give the benefits to the peo- and a half—certainly throughout this will actually know how outrageous this ple who are doing pretty well—and not tax reform process—to address the process is and that it at least states, as just pretty well but better than they issue of the child tax credit in an effort part of his speech, what is written in have done since 1928, and we stated ear- to increase it. I am grateful that in the margin? Can that be stated as part lier today on this floor what a miracle this process, we have been able to in- of his statement? the tax policies were in the early 1920s. crease the child tax credit to $2,000. Would the Chair answer the ques- The PRESIDING OFFICER (Mr. That will help a lot of people. tion? PERDUE). The Democrats’ time has ex- I have been asked by some people: My question is, when the amendment pired. Why isn’t that enough? Why aren’t you is filed, I would like to ensure that the Mr. BENNET. Mr. President, I ask happy with that? The answer is that important point my colleague has unanimous consent for an additional 2 the people we most want to help are made about what is written in the mar- minutes. not going to be able to fully use it, and gin could be included as part of his The PRESIDING OFFICER. Is there here is why. For them, for people who written statement that will be entered objection? are making $30,000 or $40,000 or $50,000— into the RECORD so that the American Without objection, it is so ordered. you are a construction worker; you are people can get some sense of what kind Mr. BENNET. I thank my colleague a teacher; you are a firefighter; you are of flimflam is actually taking place from Pennsylvania. a welder; you are a bus driver—the here. In addition, we cannot afford to do backbone of America’s workers—their The PRESIDING OFFICER. When the this. Right now, we are collecting, be- main tax liability is their payroll tax. amendment is filed—— fore this tax cut goes into effect, 18 Unless you allow the tax credit to Mr. WYDEN. Thank you. percent of our gross domestic product apply fully not just to their income The PRESIDING OFFICER. The text in taxes and revenue. We are spending tax—many of whom don’t have a high will appear in linear format with any 21 percent of our gross domestic prod- income tax liability but a payroll tax— errors that may be in it. uct, and that leaves us with a deficit. they are not going to enjoy the full Mr. DURBIN. Mr. President, I have Because this place lacks the courage benefit. The result is kind of absurd if the greatest respect for the Senate to deal with the issues that we must you do one without the other. The re- staff, and I am not trying to say any- confront, unlike our parents and grand- sult is, if you make $500,000 a year and thing negative about them. I was hop- parents, we have hollowed out discre- you have enough kids, you can use the ing that this could be entered into the tionary spending. We are spending 35 whole credit, but if you don’t make RECORD, and I asked for unanimous percent less than we were in 1980 as a that much money—if you make, say, consent to enter it, believing that the percentage of our GDP. $25,000 a year—you won’t get nearly as handwritten portion would show up in Yesterday, we had testimony in the much of the credit even though you the RECORD. I have since been advised Armed Services Committee that we have paid the taxes. It kind of doesn’t that there will have to be translators need a trillion additional dollars to make any sense, right? and interpreters who will have to de- modernize our defense. We know how We are trying to help people with the cide exactly what this says before it is dangerous this world is with what is cost of raising children by allowing actually part of the CONGRESSIONAL happening on the Korean Peninsula them to keep more of their own money. RECORD. I think that I have made my and with what is happening in the Mid- It is the people who make less who point as to where we stand in prepara- dle East. need it the most, and when you only do tion of tax reform for America. Why was it OK for our parents and half of it, which is the $2,000 increase, Thank you. grandparents to invest in us, but we you only get it half right. So it is good, Mr. WYDEN. Mr. President, I yield to are unwilling to invest in the next gen- and there are people who are going to the Senator from Colorado. eration of Americans? Not only are we be helped by that, but we could have Mr. BENNET. Mr. President, talk unwilling to invest in them, but we are helped so much more. about the swamp. All of the folks who saddling them with the debt that has The bill we have today, which is be- voted in this election do not have the arisen from our inability to make prop- fore us here and will be before us in a swamp in Washington, DC—they are er decisions. We are doing it now in few minutes when there is a substitute watching this happen right in front of plain sight of budget projections that provided, cuts the corporate tax rate their eyes tonight. We have a bunch of show that the money is just not here. from 35 percent to 20 percent. A reduc- amendments that were dropped in by I think we have a decision to make as tion in the corporate tax rate is some- lobbyists here last night that we to whether we want to live up to the thing that I strongly support because I haven’t seen, except that we received a example our parents and grandparents think it makes America more competi- list from them, and we have illegible set for us and whether we are willing to tive and, in the process, is going to amendments now at the desk that, make the kinds of investments in the help a lot of these same people whom

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00037 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.056 S01DEPT1 S7690 CONGRESSIONAL RECORD — SENATE December 1, 2017 we are trying to help. I know that But somehow, through some political which is worth more than this tax sounds countercyclical, but it does be- jiujitsu or some sort of magical for- credit—that you are eligible for if you cause when these corporations are able mula, $260 billion appeared to provide don’t work. to save money in taxes, many of them even further cuts, and that is fine. I I want you to tell the worker at a will use some of that money to create just wish that some of that jiujitsu and Head Start facility—think about this. new jobs and hire more people. That political magic had been employed on You are a teacher at a Head Start pre- money—some of it will be reinvested behalf of the millions of Americans K, and you make too much money for and perhaps even flow toward workers making between $20,000, $50,000, and your children to go to Head Start, but in the form of higher wages over time. $60,000 a year because they need our you don’t make enough to be able to These are positive things, so I am not help. afford child care for your own kids. against a reduction of the corporate What has been the opposition to this? That is happening all over this coun- tax rate. In fact, I ran for President, Frankly, some of it is untrue. Some of try, and somehow there are black holes for the Senate, and for reelection to it is offensive. Some of the opposition I that we can’t even find $86.9 billion to the Senate on the promise of reducing have heard is that the people who help them just a little bit more. the corporate tax rate to 25 percent. So would benefit from this tax cut don’t The second argument we have heard 20 percent goes well beyond that. How- pay taxes. They don’t pay income tax is that we can’t cut the corporate tax ever, in order to be able to pass some- or a lot of income tax, but they pay rate because it is going to hurt growth. thing that pays for it, because you tax. If at 5 o’clock today you left your OK. You are telling me that if we have have to—and people don’t know this job as a construction worker and you a corporate tax rate that goes from 35 back home, so I will just kind of ex- received your paycheck, they took percent to 20.94 percent, that is going plain it—this bill allows us roughly money out of your paycheck. When to hurt growth. Twenty percent is the about $1.5 trillion over the next 10 they take $200 out of your paycheck, it most phenomenal thing we have ever years of spending over revenue. Now, doesn’t matter if it says FICA or if it done for growth, but if you add 0.94 per- we think that the growth in the econ- says income tax withholding; it is $200. cent to that, it is a catastrophe. We are omy is going to more than offset that, It is the same money, and you have going to lose thousands of jobs. Come but for purposes of the rules of the Sen- $200 less of it. That is a tax. Anytime on—especially when you add that to ate, it has to be within those param- the government takes your money, it the fact that they are going to be able eters. is a tax. to immediately expense their invest- In order for us to offer an amendment I have had people tell me, including ments, when you add that to the fact that provides an increase in the child people in the administration, that they that they are going to repatriate tax credit at a rate that we want to do don’t pay taxes. I have had people say money abroad to the United States it—about $86.9 billion—we have to find that they don’t generate economic with the lower tax rates. When you add $86.9 billion somewhere in order to be growth, which is, in my mind, No. 1, all the things that we have done, argue able to do it. Initially, instead of cut- not true, and No. 2, the wrong way to all you want, but don’t please don’t tell ting the corporate tax rate from 35 to think about it. You see, our economy me that 0.94 percent is going to some- 20, we proposed cutting it from 35 to 22. should be working for our people, not how lead to less economic growth be- It is still a massive cut. It is still well our people for our economy, and when cause it is just not true. below the international average of 23. you talk that way, you have it wrong. We are going to have a vote later It still puts us in third place among the I also disagree that they don’t gen- today. I don’t know how many votes seven largest economies in the world. erate growth because when you make they are going to make us have in But that was met with significant re- $50,000, you spend every penny that you order to pass this; there are all kinds of sistance. make. I know these people. I live in procedural things that happen here. We have always said that we would West Miami, FL, and West Miami is a But I can tell you that this is about a be open to an additional way or a dif- small, little city. It is three-quarters of lot more than just tax reform. We have ferent way of doing it, so today when a square mile. I have lived there since a big problem that perhaps this tax re- the substitute amendment is offered, 1985. The average income is $38,000 a form debate has revealed; that is, the we are going to offer an amendment, year. If you make $38,000 a year, you only way forward in this country is one Senator LEE and I. Instead of 22 per- spend every penny, especially if you that is pro-worker and pro-growth, and cent, it is going to propose that we re- are raising children. you cannot have one without the other. duce the corporate tax from 35 to 20.94 I do not care how much people tell I can tell you that in this country percent. Basically, instead of a 15-per- you to put some money aside and save today, there are millions and millions cent reduction, it will be a 14.06-per- it for the future; you cannot because of people who have been hurt by the cent reduction, OK? The difference be- everything costs more and there are new economy. The new economy is tween what is in the bill and what we unexpected costs. You bought great. There is nothing we can do to are proposing is less than 1 percentage brandnew shoes in September for turn it back. The future is here, and point of reduction in the corporate tax school, and by November they either you cannot go back to the past. rate—0.94 percent. With less than that have a hole or they no longer fit. You We should embrace the new economy. 1 percent difference, we can make a bought them a backpack in August for It has created extraordinary wealth for huge difference in the lives of millions back-to-school, and by November or people who are innovators or people of Americans making between $20,000 December, it has a hole in it or some- who have the right careers or right and $50,000, as an example. That would thing broken and you have to pay for jobs. I don’t begrudge it. I am glad that generate about $87.4 billion, and we it. Costs constantly come up that you it is happening. But when you have a could use $86.9 billion of it to allow haven’t anticipated. new economy, just as when we had the working families with children to keep Where do they spend this money? In Industrial Revolution, there are some more of their own money to pay for the our economy. So, yes, maybe they people who are going to be hurt and we costs of raising their children. I will re- don’t generate as much growth as a have to help them in that transition mind you of who these people are. Fortune 500 company, but they have to because if we don’t help them, we are These are teachers, firefighters, weld- spend every penny of it, so they do gen- going to break the social compact that ers, construction workers, truck driv- erate growth. holds our Nation together. I am not ers—the working class. I have even heard terms used like ‘‘It claiming that the child tax credit will We didn’t even have to do that, to be is a black hole’’ and ‘‘It is welfare.’’ It solve that problem by itself. I am tell- frank. From last night to today, the is not welfare; it is their money. I ing you that if we aren’t even willing leadership and those working on this— heard one newspaper editorial say that to do another $86 billion of allowing and they have worked very hard—found it is anti-work. How could a tax credit people to keep their own money—not an additional approximately $260 bil- that you can’t get unless you are work- even willing to do something as small lion to cut even more taxes for busi- ing be anti-work? I will tell you what as this—we are not willing to do any- nesses. I have no problem with that. I is anti-work: a package of benefits thing for working people in this coun- want America to be super competitive. from the government that you get— try, and that is a big problem. That is

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00038 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.058 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7691 an enormous challenge for our Nation. won’t make this bill perfect. It doesn’t manding a government that does not These people have felt neglected and go far enough for some, but it will simply work for corporate lobbyists disrespected for a long time. make it better. but works for the middle class. They I want to be very careful, but I want I yield the floor. are demanding a tax system that says to be clear about what I am saying. The PRESIDING OFFICER. The Sen- to the wealthy and large corporations: The political debate in America today ator from Pennsylvania. You are going to start paying your fair is either all about helping the very Mr. TOOMEY. Mr. President, I ask share of taxes, and, no, we are not poor—and I support the safety net. I unanimous consent that there now be going to cut Social Security; we are don’t think free enterprise works with- 30 minutes, equally divided, for debate going to expand Social Security. We out a safety net. It should be there to only, with no amendments or motions are not going to cut Medicare; we are help people who cannot help them- in order, and the majority leader be going to move to a ‘‘Medicare for all’’ selves, to help people stand back up on recognized at the conclusion of that healthcare system. The American peo- their feet and try again. The political time. ple are catching on. debate is also all about helping the The PRESIDING OFFICER. Is there While Republicans may get away business community, and I support objection? with this act of looting tonight, his- that because we need vibrant economic Without objection, it is so ordered. tory is not on their side. The day will growth to create jobs and opportunity. The Senator from Oregon. come, and it will come sooner rather But what about everyone else? What Mr. WYDEN. Mr. President, we are than later, when we are going to have about the people who make $50,000 a going to have several of our colleagues a government here that represents all year? They make too much money for on our side, and we will start with Sen- of us, not just the Koch brothers, not CHIP, for pre-K paid for them by the ator SANDERS. just the billionaire class, not just government through Head Start, for Mr. SANDERS. Mr. President, as I wealthy campaign contributors. ObamaCare subsidies, too much for think about what is going on here I yield. government benefits, but they don’t today, I think this is in many ways a The PRESIDING OFFICER. The Sen- make nearly enough to afford the cost historic day, a day that historians will ator from Pennsylvania. of living. What about them? What is in look back on—December 1, 2017—and Mr. TOOMEY. Mr. President, I want it for them? they will conclude that today is the to talk about one of the truly pro- Yes, there is going to be economic day of one of the great robberies, of growth features in this tax reform that growth and there are going to be wage criminal activities, if you like, in the is going to encourage investment in increases, but not for everyone, not in modern history of this country. The the United States, new business cre- this new economy in which the haves Federal Treasury is being looted to- ation, startup, expansion, and hiring and have-nots are largely divided be- night. As we speak, there are lobbyists that will be associated with that. That tween those who have the right skills all over Capitol Hill, writing down in means new jobs, more demand for and right degrees and those who do not, handwriting, amendments to this bill workers, and higher wages. and that has gone unaddressed for a to give hundreds of millions, if not bil- What am I referring to? I am refer- very long time. I am telling you, if we lions, of dollars in tax breaks to large ring to one of the things we do on the do not address it, we leave our Nation corporations. As we speak, they are business side of this tax reform. The vulnerable to two dangerous political probably still writing those amend- way I think about it, there are several extremes—radical socialism on the left ments. big features that are going to drive and ethnic nationalism on the right— Meanwhile, this Senate, this Repub- economic growth on the business side and neither of them are true to the lican-led Senate has been unable to re- of the Tax Code. One is certainly low- American principles that created the authorize the CHIP program, the ering the top rate from the 35 percent greatest Nation on Earth. health insurance program for low-in- Again, I am not here to tell you that that makes us uncompetitive in the come children. They didn’t have the child tax credit solves that prob- global economy to 20 percent, which enough time to do that. We have been lem. I am here to tell you that if we puts us pretty close to dead even unable to reauthorize the Community can’t even do that, it is evidence of our among our competitors. That is one. unwillingness to do beyond it the tasks Health Center Program, providing 27 That is an important part. that need to be done. We have a major million people with health insurance. The second one that I think is even challenge in this Nation. All we are We don’t have the time to do that. But more powerful is simply allowing busi- asking for and all I implore my col- tonight we are presumably going to nesses to recognize, for tax purposes, leagues to vote for—I know that for pass legislation when, at a time of mas- expenses when they actually occur. people on the other side of the aisle, sive income and wealth inequality, 62 Allow businesses, when they buy equip- this doesn’t go far enough. I under- percent of the tax benefits go to the ment and put that equipment to work stand it; I do. I know you want to get top 1 percent, and 10 years from now, in a factory or when buying earth-mov- to a higher number; I know you want it millions and millions of middle-class ing equipment or new machinery, to to apply to more people. I promise you, Americans will be paying more in recognize that cost when it occurs. By I did too. I wanted it to be $2,500. I am taxes. allowing them to recognize that cost trying to figure out in this constitu- I have not the slightest doubt, as I when it occurs, they can afford to pur- tional Republic, which cannot be a have said before, that after the Repub- chase more of that equipment. zero-sum game, how we can make licans pass this huge tax giveaway to Why is that important? things better if we do not make them the wealthy and large corporations, That is important because that is the perfect. they will be back on the floor of the source of enhanced worker produc- And on the other side of the aisle, I Senate, and when they come back, they tivity. Workers are more productive implore my colleagues to believe that will say: Oh, my goodness, the deficit is when they have machinery and equip- this is not a black hole, and this is not too high. We have to cut Social Secu- ment to work with. This is why capital welfare. These are the teachers, fire- rity, Medicare, Medicaid, education, drives productivity growth. It is the in- fighters, neighbors, and friends who are and nutritional programs. In other vestment in that new equipment that struggling because everything costs so words, in order to give tax breaks to creates demand for workers but also much more. Why can’t we just help billionaires and to launch profitable makes the worker more productive. them keep a little bit more of their corporations, they are going to cut pro- The example I like to use that I think own money? Really, is a 20.94 percent grams for the elderly, the children, the illustrates it reasonably well is this: If corporate tax rate going to hurt working families of this country, and you go to a construction site and you growth, especially if it will help us pro- the poor. This legislation will go down have two guys working on that site and vide a little bit more assistance for the in history as one of the worst, most un- one of them is operating a backhoe and people who, today, desperately need fair pieces of legislation ever passed. the other is using a shovel, they are our help? I say to my Republican colleagues, as both digging a hole; they are both mov- I hope I can earn the support of as you saw on November 7, the American ing dirt. Which one do you think gets many of my colleagues as possible. It people are catching on. They are de- paid more? It is not a close call. The

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00039 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.059 S01DEPT1 S7692 CONGRESSIONAL RECORD — SENATE December 1, 2017 guy who is operating the backhoe is company or a company somewhere else Mr. THUNE. Mr. President, I thank getting paid more on every such job in the world, there is no additional tax the Senator from Pennsylvania for out- site in America, not because there is a layer. lining and highlighting what are, I law that requires it but because he is a So which country do you think has a should say, some of the many reforms more productive worker. He has a skill competitive advantage doing business that are included in this legislation. set, and he is using major equipment in England? Anyone other than the Now, what he talked about is critically that allows him to be much, much United States. This has been the very important. more productive than any human being reason that you have seen these inver- If America is going to be competitive can be with a simple hand tool. That is sions, these American companies get- in the global marketplace, we have to an illustration of how it is that when a ting acquired by other companies. In change our Tax Code because it is com- company is able to put that equipment many cases, it is not about the eco- pletely outdated, completely anti- to work, the worker benefits. nomics, it is not about synergies, it is quated relative to any of the countries That worker operator is not the only because there is a tax advantage to with whom we compete. So, as the Sen- one who benefits, because somebody having a multinational headquartered ator from Pennsylvania pointed out, has to make the backhoe. Someone has almost anywhere other than the United the reforms we make in this bill allow to work at the factory that builds the States. There are a lot of good jobs at American companies to compete and backhoe that was bought. So what we a corporate headquarters. There is win against those other countries are doing when we allow this expensing management and sales and finance and around the world—the Chinas of the to occur—when we allow businesses, for planning and all kinds of really good world, the Russias of the world. Those tax purposes, to recognize the expense jobs. We are losing these systemati- countries in which America has to when it occurs rather than gradually cally because we have this system that compete on a daily basis have a huge advantage over American companies over time, we simply make it more af- nobody else in the world has—almost today simply because we have a tax fordable for business to put capital to nobody else has—that punishes compa- code that doesn’t recognize and reflect work, to buy the kind of equipment to nies when they bring that money back what is happening in the global econ- help them grow and help them help home. omy, and that is why modernizing and their workers become more productive. So what are we going to do? We are updating our tax code was such a crit- That is why this is a very constructive, going to change our system from one of ical part of our tax reform effort. pro-growth feature in our tax reform the worst in the world to what I think I was listening to my colleague from that is going to be very, very helpful to is going to be one of the best. What we Vermont, and I think this is a really workers. are going to do is we are going to say: great day in the U.S. Senate. We are But there is a third feature in our Well, a company operating overseas getting close to the finish line on this business tax reform that is also going has to pay that local tax, but we are tax bill. Over the past 24 hours, I think to be great for America, and that is not going to punish that company with we have made a really great bill even going to be our change from the cur- another layer of tax when they bring better with more middle-class tax re- rent global tax system that we apply that money back home to America and lief and more relief for small busi- on the subsidiaries and affiliates of invest here. Most estimates of how nesses. We have moved our bill closer multinational companies—the change much money—I should point out, you to the House’s bill in key areas, which away from a global system to a terri- only get hit with that tax penalty if I think will help us get this bill to the torial system. So what does that mean? you bring that money home and rein- President’s desk in the very near fu- So a global system is the system we vest it in America. That is how crazy ture. I am excited about what this tax have today, and America is unfortu- this is. It is called the deferral system. bill is going to do for the American nately almost unique in the world in The common popular estimates by people. having this very counterproductive the economists who looked at this is America has always been about op- system. that there are somewhere between $2 portunity, a place where you could Here is how it works. If a subsidiary trillion, maybe even more than $3 tril- start from nothing and become any- of an American company goes over- lion of earnings by the subsidiaries of thing. Generations of people have come seas—say they go to England—and they American-based multinationals, where to this country to build a better life for open a business there because they they have paid the tax overseas, as themselves and an even better one for want to serve the English population they must, but they refuse to bring the their children. My grandparents were and they want to sell a product in Eng- money back home because they don’t those people. They came here from land. So they go to England, they open want to get hit with this huge tax. So Norway back in 1906, started a small their business, they make a profit, and think about all this money that is merchandising company after they had they have to pay a tax to the English overseas somewhere else and not being learned the language and worked for a Government. That is normal. That is invested in America. while on the railroads that were being what any company operating there has I have had conversations with CEOs built across this country. It later be- to do. who have told me they want to invest came a hardware store, and to this day What America does, what we do in in the United States, but the tax in Mitchell, SD, there is still a store our Tax Code that almost no one else makes it prohibitively expensive to that goes by the name of Thune Hard- does is, we say: After you have paid bring it home, and therefore they are ware. The family is not associated with that tax to the English Government, if looking for opportunities overseas it, but it is an example of the millions you would like to dividend that money where they will not have this tax. of Americans or millions of people who back to your parent company so it can We have to end this and we are going came to this country, came to America be invested back home in America, we to end this in this bill and that is going in search of opportunity. are going to charge you another layer to put an end to the tax incentive for Unfortunately, in recent years, those of tax. We are going to make sure the these inversions—the movement over- vast horizons that so many people combination of what you pay there and seas of corporate headquarters. It is came to this country for seemed to what you bring back home hits 35 per- going to make America a great place to shrink. The American dream has grown cent, which is our current rate. It is invest and to headquarter a multi- dim. Getting ahead has been replaced completely uncompetitive. national company, and it is going to by getting by. We have watched idly as So, if you think about it, the rest of encourage that kind of growth. It is our jobs get shipped overseas, as other the world has a different system. They one of the central pillars of our busi- countries drop their business tax rates have the system which we know as a ness tax reform that is very construc- to better compete in the global mar- territorial system, and the idea there tive and very important. ketplace, as emerging economies and is the subsidiary in England pays its I see my colleague from South Da- developed nations grow faster than the tax to the English Government and kota is with us, and I will yield the United States. Americans now fre- then whatever aftertax profit they floor now to him. quently spend more time worrying choose to send home to their parent, if The PRESIDING OFFICER. The Sen- about their future than looking for- it is a French company or German ator from South Dakota. ward to it.

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00040 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.060 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7693 We are turning that around starting couple of points. I have a response to worldwide bear approximately the full bur- today with this tax bill. I am reminded my colleagues who continually say this den of the domestic corporate income tax. of Ronald Reagan’s Presidential ad corporate tax cut is going to raise Foreign workers benefit because an in- noting that ‘‘It’s morning again in workers’ wages by $4,000. creased foreign stock of capital raises their America.’’ Well, it may not be morning productivity and their wages. Domestic Now, I asked the head of the Joint workers lose because their productivity falls yet, but the dawn is peeking over the Committee on Taxation whether that and they cannot emigrate to take advantage horizon. was the case. He essentially said, no, of higher foreign wages. Under basic assump- The tax bill before us today is going he did not believe it was the case and tions of the numerical application, the out- to provide immediate relief to hard- referred us to tables that document it. come is also similar to the implications of working Americans. It is going to im- Perhaps even more egregious is to- the simpler model of Bradford in that the mediately lower their tax bills. It is night we heard our colleague from Ohio full worldwide burden falls on domestic own- going to immediately mean more say that a Congressional Budget Office ers of productive inputs. That outcome changes, however, under alternative assump- money in their pockets, but this bill is report claims that workers are going to about much more than that. This bill tions. get 70 percent of the benefits from a Burdens are measured in a numerical ex- isn’t just about helping Americans corporate tax cut so it was raised even ample by substituting factor shares and out- today, although it is most certainly higher. put shares that are reasonable for the U.S. going to do that. This bill is about Mr. President, I ask unanimous con- economy. Given those values, domestic labor helping Americans for the long term. It sent to have printed in the RECORD a bears slightly more than 70 percent of the is about restoring the American dream. portion of the report from the Congres- burden of the corporate income tax. The do- mestic owners of capital bear slightly more It is about giving Americans access to sional Budget Office, making it clear the kinds of wages, jobs, and opportu- than 30 percent of the burden. Domestic on the cover where it says the analysis landowners receive a small benefit. At the nities that will set them up for a se- and conclusions expressed there should cure and more prosperous future, and it same time, the foreign owners of capital bear not be interpreted as those of the Con- slightly more than 70 percent of the burden, is about sending a message to the gressional Budget Office. It directly but their burden is exactly offset by the ben- world that America is finally serious contradicts the comments made by the efits received by foreign workers and land- about competing for 21st century jobs Senator from Ohio on wages and cor- owners. To the extent that capital is less and innovation. porate tax cuts. mobile internationally, domestic labor’s bur- For years, our tax laws have kept den would be lower and domestic capital’s There being no objection, the mate- American businesses at a disadvantage burden would be higher. Burdens can also be rial was ordered to be printed in the in the global economy. As other na- affected by the domestic country’s ability to RECORD, as follows: tions have changed their Tax Codes to influence the world prices of some traded strengthen their businesses, our Tax Working Paper Series, Congressional Budget corporate outputs. But the signs and mag- Office, Washington, D.C. nitudes of those effects on burden depend Code has kept American businesses upon the relative capital intensities of pro- struggling, but that ends now. This leg- INTERNATIONAL BURDENS OF THE CORPORATE INCOME TAX duction in the corporate sectors that islation makes a tremendous invest- produce internationally tradable goods. William C. Randolph, Congressional Budget ment in American businesses and Mr. WYDEN. Mr. President, if I could American workers. Under this bill, Office, Washington, D.C., August, 2006, 2006–09 have the attention of my colleague American businesses will no longer from Pennsylvania, I would like to face the double taxation that has kept Working papers in this series are prelimi- nary and are circulated to stimulate discus- pose a question to him on a matter. them at a disadvantage next to their sion and critical comment. These papers are We, as we have indicated, have been foreign counterparts and has pushed not subject to CBO’s formal review and edit- digging through the amendments. As them to keep jobs and investment over- ing processes. The analysis and conclusions far as I can tell, what we have is the seas. They will no longer face the high- expressed in them are those of the authors earlier language that imposes a new ex- est corporate tax rate in the industri- and should not be interpreted as those of the cise tax on the investment income of alized world. They will no longer be Congressional Budget Office. References in large university endowments. That has playing catchup with their foreign publications should be cleared with the au- thors. Papers in this series can be obtained been in the bill, so be it. competitors. Instead, American busi- Now, there seems to be a new excep- ness will have money to invest in at www.cbo.gov (select Publications and then Working Papers). tion on page 289. The bill says that the American workers. They will be able to new tax does not apply to a university expand their domestic operations, and ABSTRACT otherwise subject to the tax if it is de- they will be able to compete with and This study applies a simple two-country, scribed in the first section, which is beat their competitors around the five-sector, general equilibrium model based 511(a)(2)(B), and which does not receive globe. What is the result of that? It on Harberger (1995, 2006) to examine the long- run incidence of a corporate income tax in Federal funds. means more growth here at home, an open economy. In equilibrium, capital is This is new, and I am trying to figure more jobs, more opportunities, higher assumed to be perfectly mobile internation- out why there is this special exemp- wages, and an America that can lead ally in the sense that the country in which a tion. I can’t seem to find other people the world in innovation, job creation, real investment is located does not matter to who are getting it or whom it benefits. and economic growth. the marginal investor. In addition, each America may have been through a country is assumed to produce at least some I thought perhaps my colleague from rough patch lately, but she is coming tradable corporate goods for which the coun- Pennsylvania could enlighten me on back stronger than ever. America led try cannot affect world output prices. Like this. the world in the 20th century, and this the original Harberger (1962) model, the The PRESIDING OFFICER. The Sen- worldwide stock of capital and the supply of tax bill makes it clear that she is going ator from Pennsylvania. labor in each country are fixed. Under those Mr. TOOMEY. Mr. President, I would to do the same in the 21st century. assumptions, the model provides closed form I hope our colleagues, when it comes be happy to enlighten the Senator from solutions and easily understood predictions Oregon. What my provision does is it time to vote on this tonight, will vote about its comparative static equilibria. As in favor of tax relief for middle-income with any simplified model, the analysis is si- applies to any college that chooses not families, vote for a stronger, growing, lent about some potentially important to receive Federal funds under title IV, vibrant, robust economy that is cre- issues—such as the effect of the corporate which is a very big category of funding ating better paying jobs, raising wages tax on savings, growth and other dynamics— for higher education. It is the provision for American workers and American that may also have important effects on cor- that authorizes Federal financial stu- families, and a brighter, better, and porate tax incidence. dent loan programs, for instance. The analysis shows how the domestic own- So the theory is, which you may or more prosperous future for future gen- ers of capital can escape most of the cor- erations of Americans. may not agree with, but the view is, if porate income tax burden when capital is re- a college chooses to forgo Federal I yield the floor. allocated abroad in response to the tax. But, The PRESIDING OFFICER. The Sen- as in Bradford (1978), capital owners world- money and the students that attend ator from Oregon. wide cannot escape the tax. Reallocation of have to find their own way to get Mr. WYDEN. Mr. President, I would capital abroad drives down the personal re- there, it is diminishing the burden that just like to set the record straight on a turn to investment so that capital owners college would otherwise impose on the

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00041 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.062 S01DEPT1 S7694 CONGRESSIONAL RECORD — SENATE December 1, 2017 taxpayers, and so it is perfectly reason- is fine. We can have our different opin- Mr. TOOMEY. It is a universal provi- able, in my view, to exempt such a col- ions on this. But my view is, a college sion available to any school that lege from the tax on endowments that that chooses to say ‘‘We don’t want to chooses to take it. we are applying generally. That is the take any Federal taxpayer dollars’’ and Mr. MERKLEY. Will my colleague answer to your question. therefore saves the taxpayer I don’t from Pennsylvania yield for a ques- Mr. WYDEN. Mr. President, if my know how many millions altogether— tion? colleague would yield further, what is usually thousands per student—I think Mr. TOOMEY. Yes. your analysis of how many colleges it is quite reasonable that a college Mr. MERKLEY. Is this Hillsdale Col- would benefit from this? The reason I that chooses to not put that imposition lege the same one that was sued for ask is, in my view, there are a lot of on the Federal taxpayers ought to be discrimination in the 1980s? deserving Oregon schools—and I seem able to be exempt from this tax. It Mr. TOOMEY. I don’t know the his- to remember quite a few colleges in would be available to any college that tory of litigation against most col- Pennsylvania—that also are very de- made that choice. Several colleges in leges, including Hillsdale. serving, they would not benefit from America make this choice, and any Mr. MERKLEY. You said you intro- this, and I would like my colleague’s others that choose to would be able to duced this provision, and so I assumed assessment of how many colleges would participate. you probably researched this. Isn’t the benefit from this particular provision. Mrs. MCCASKILL. So the rationale reason this college has not taken Fed- Mr. TOOMEY. Mr. President, I think is, if you choose not to take Federal eral funds is because it was sued for there are very few probably who choose money, then your endowment is no discrimination? now to forgo all of this taxpayer longer subject to any tax even though Mr. TOOMEY. This is not my under- money, but any college in America the endowment money comes from peo- standing. I do understand that my col- that wanted to could do so. So any col- ple who get a deduction for the money leagues on the far left do not have a lege that decided to adopt the policy I they give, correct? The endowment fond opinion of Hillsdale, but I do. I ac- am alluding to here would choose to comes from donors. I thought the rea- tually think it is a wonderful institu- forgo the taxpayer money subsidizing son we were taxing the endowments is tion, and I commend them for their their students and, if they choose to do because the people who were giving the choice, as other colleges, of forgoing that, then they wouldn’t have to pay money were getting a tax deduction taxpayer money that they could be tax on their endowment. It would apply when they put it there. taking, the burden they could be im- to any college that made the choice. Mr. TOOMEY. The point is, the col- posing on taxpayers, but they choose Mr. WYDEN. So is this Hillsdale Col- lege that is qualifying for this is choos- not to. I think any college in that cat- lege—because that is what I have been ing not to impose a tax burden on the egory, whether it is Hillsdale or any led to believe—and I would like my col- American taxpayer. They are not al- other college, ought not to have to pay league’s analysis of whether they lowing their students to take the Fed- the tax on the endowment. would benefit. eral taxpayer benefits that are avail- Mr. MERKLEY. You make the point Mr. TOOMEY. I believe that Hillsdale able to them. They choose not to. They that your colleagues on the left don’t College would qualify for this, as would save taxpayers a tremendous amount have a fond opinion of this particular any other college that chooses to forgo of money when they make that choice. college, but my point is, we don’t have title IV funding. I think it is reasonable to allow them a fond opinion of discrimination and of Mr. WYDEN. I am just not aware of not to also have to pay this tax on giving a tax provision for just one col- any. their endowment. lege that happens to be funded by one Mr. TOOMEY. There are other col- of the wealthiest families in America Mrs. MCCASKILL. Are the people leges that choose to forgo the funding. who are giving to the endowment still because they happen to be a Repub- I am not sure how many of them also allowed to take a tax deduction? lican donor. Why would that be a good have an endowment large enough at provision in terms of the United States Mr. TOOMEY. I think people who the moment that it would have an im- of America, to subsidize a college that give to the endowments are treated the pact on them. I have no idea how long quit taking Federal funds because of same as people who give to any other it might take them to develop an en- discrimination? endowment. dowment. But the point is, anybody Mr. TOOMEY. Why would you choose Mrs. MCCASKILL. So it doesn’t mat- who is in this category would have this to mischaracterize this provision the ter, in terms of the people giving to the same treatment. way you just did? You said it is for one endowments, whether they get a tax Mrs. MCCASKILL. Mr. President, college, and you know that is not true. would the Senator answer a question deduction, just whether the school This is criteria available to any college about this provision? takes money from the Federal govern- in America, and any college that takes Do you know who the biggest donor ment? it will get that benefit. was to the Hillsdale College endow- Mr. TOOMEY. The criteria is, if the Mr. MERKLEY. Would my colleague ment? school chooses to save Federal tax- provide a list of all the colleges that Mr. TOOMEY. I do not. payers very substantial amounts of qualify, because our understanding is Mrs. MCCASKILL. Would that be the money by forgoing the title IV funds, that only one—this was written for one DeVos family, by any chance? then the school would not have to pay to qualify. And that is why this Mr. TOOMEY. The answer to your the tax. shouldn’t be done at the last minute question is, I have no idea, and it Mrs. MCCASKILL. My point, Sen- and just stuffed into a tax bill. doesn’t matter. ator, is that the people who are giving Mr. TOOMEY. If my colleague Mrs. MCCASKILL. Do you know who to the endowment get the exact same doesn’t like that provision, he can offer added this provision in here? tax benefit as people who give to any an amendment to strike it. This is a Mr. TOOMEY. I advocated this provi- endowment in the country. wide-open process. sion. Mr. TOOMEY. And it is a completely Mr. WYDEN. I am reclaiming my Mrs. MCCASKILL. What does it have irrelevant point. The fact is, the school time. to do with taking title IV money as to is choosing to save the taxpayers a lot The PRESIDING OFFICER. The whether or not your endowment will be of money by forgoing money that Democratic time has expired. taxed? How is that apples and apples? would be available to its students. So Mr. WYDEN. I ask unanimous con- It sounds like apples and oranges. What it is very reasonable to have this mod- sent for 3 additional minutes to com- in the world do those two have in rela- est savings that is available to a school plete this one question. tion to each other? that makes that choice and saves the The PRESIDING OFFICER. Without Mr. TOOMEY. Are you finished with taxpayers this money. objection, it is so ordered. your question? Mrs. MCCASKILL. It doesn’t feel that Mr. WYDEN. I thank the Chair. Mrs. MCCASKILL. Yes. way to us. It feels as if this is a very I was concerned at the beginning be- Mr. TOOMEY. I will answer it again. limited provision written for a very cause there are so many deserving You may choose to disagree, and that special person. schools in Oregon and Pennsylvania

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00042 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.063 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7695 and elsewhere that don’t get this spe- come tax system on the one hand and of this tax reform package. This tax re- cial treatment, and obviously you have our Federal senior entitlement pro- form package does, in fact, increase heard my colleagues express their con- grams, on the other—Social Security the child tax credit to $2,000 per child. cern, and I think it transcends some- and Medicare. What I would like to see, and what I body’s politics. Here is how it works. Imagine two have been working on with Senator So my question now would be—the hypothetical couples, couple A and RUBIO, is also to increase the perfecting amendment has not yet been couple B. Couple A and couple B are refundability of the child tax credit, to filed. Would my colleague be willing to identical in every respect but one, and move that refundability all the way up take his provision out of the perfecting that is that they are identical in their to $2,000 per child and make it refund- amendment and offer it as a separate income patterns, charitable contribu- able up to the amount of taxes paid, in- amendment so we can actually have an tions, mortgage interests, so on and so cluding payroll taxes—in other words, up-or-down vote? And perhaps by that forth, except for one characteristic. up to 15.3 percent of earnings. time, we will know how many colleges, Couple A has four children, and couple What this would do is it would result if any other than this one, benefit. B chooses to remain childless. in an effective cut in the payroll tax li- Mr. TOOMEY. Mr. President, the Over the course of their lifetimes and ability of middle-class, hard-working Senator from Oregon referred to many while raising their children, couple A American moms and dads, some of other deserving schools. I don’t know will, on average—according to what whom might see their payroll tax li- which of them choose to forgo this tax- some have described as lowball esti- ability exceed their income tax liabil- payer money, and if any of them do, mates produced by the U.S. Depart- ity. They are still paying taxes. then they qualify. ment of Agriculture—incur around $1 Tell a construction worker or a sec- If you do not like the provision, you million in childrearing expenses, just retary or a police officer that he or she are free to offer an amendment to the cost of raising their children. Cou- is not paying Federal taxes simply be- strike the provision. That would be my ple B, of course, being childless, will cause their biggest tax liability is recommendation. not incur those same expenses. At the found in the payroll tax. In this cir- Mr. WYDEN. The answer is no. same time, they are paying more or cumstance, this amendment is needed Mr. TOOMEY. I made my rec- less at the same tax rate. There are a in order to give these people signifi- ommendation. If you dislike the provi- few differences in the existing Tax cant tax benefits under this bill. sion, you can offer an amendment. Code, but nothing to offset the dis- It is important to remember that Mr. WYDEN. Let the record show parity between the two couples in the some 70 percent of the benefits under that my colleague has said no. And I sense that couple A, while incurring this bill go to America’s corporations can’t find anybody else in America who this $1 million in childrearing expenses and 30 percent to individuals. It is our benefits from this particular provision, while they are raising their children, is desire to help spread out some of the and that doesn’t strike me as right, to also paying into Social Security and benefits of this and to help spread it have it airdropped at the last minute Medicare. They are also paying taxes, out, in particular, to America’s hard- into a bill. and they are not having their contribu- working middle-class moms and dads. Mr. President, I believe I am out of tions to this solvency of Social Secu- Now, the Rubio-Lee amendment, in time on my consent request. rity and Medicare adequately taken its current formulation, would involve The PRESIDING OFFICER. The Sen- into account. a very slight adjustment to the cor- In other words, because Social Secu- ator from Pennsylvania. porate tax rate, taking it from 20 per- rity and Medicare are funded on a pay- Mr. TOOMEY. Mr. President, I ask cent to 20.94 percent. This is not an as-you-go basis, we have to remember unanimous consent that there now be enormous difference. that it is today’s workers who are pay- 30 minutes, equally divided, for debate This reminds me a little bit of a ing the retirement benefits of today’s only, with no amendments or motions story that I first heard told by Emo retirees. It is today’s children who will in order, and that the majority leader Philips. Emo Philips described himself be tomorrow’s workers who will be be recognized at the conclusion of that as walking across the Golden Gate funding the requirement benefits under time. Bridge one night very late. He was Social Security and Medicare of to- The PRESIDING OFFICER. Without alone on the bridge, or so he thought, day’s workers and tomorrow’s retirees. objection, it is so ordered. until he got to about halfway across This is what the parent tax penalty is the bridge when he discovered he was Who yields time? all about. You see, the Federal Tax If no one yields time, time will be not alone. He found somebody else Code doesn’t adequately take into ac- standing on the outside of the guard- equally charged to each side. count the enormous contribution of The Senator from Utah. rail of the Golden Gate Bridge. working parents and contributing to- Emo said: I could tell right away Mr. LEE. Mr. President, I stand in ward the solvency and sustainability of support of the child tax credit. It is that this man was in trouble, and the Social Security and Medicare. thought occurred to me that maybe something that this bill goes a long This is why a little over 4 years ago, this man is thinking about taking the way toward promoting. back in 2013, I started pushing this idea unfortunate step of ending his life by This is a great day in the sense that of the need to increase the child tax the Senate is moving forward with pro- jumping off the bridge. credit to help soften the impact of the Emo said: I stopped and asked the moting the interests of the American parent tax penalty. This is not, to be family, doing something to weaken, to man the first thing that came to mind: sure, something that is intended to Do you believe in God? soften the impact of a little known fea- incentivize or compel parenthood. That ture called the parent tax penalty. The man said: Yes. is not our purpose at all. This is not so- Emo said: Me too. Are you a Chris- A lot of people are familiar with the cial engineering. marriage tax penalty in the Tax Code. tian? It is one thing for the government to The man said: Yes. It is a pernicious feature, one that pun- tell people they have to do something Emo said: Me too. What denomina- ishes people for getting married, one or to incentivize them to do another. It tion are you? that can produce a series of adverse ef- is quite another thing to simply tell The man said: I am a Baptist. fects simply by saying ‘‘I do.’’ That is people: We are going to punish you less Emo said: Me too. Are you a northern wrong. Most Americans acknowledge for bringing about the possibility of Baptist or a southern Baptist? that it is wrong. This bill goes a long sustaining Medicare and Social Secu- The man said: I am a northern Bap- way toward undoing that. rity, for bringing children into this tist. There is a different thing called the world, and raising tomorrow’s genera- Emo said: Me too. Are you a northern parent tax penalty that, like I say, is tion of workers who will pay for the fundamentalist Baptist or a northern less understood, less frequently dis- Social Security and Medicare benefits reformed Baptist? cussed than it should be. of today’s workers and tomorrow’s re- The man said: I am a northern fun- Here is how the parent tax penalty tirees. damentalist Baptist. works. It is a basic function of the This is important, and this is some- Emo said: Me too. Are you a northern interaction between the Federal in- thing that I am thrilled to see as part fundamentalist Baptist, conference of

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00043 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.065 S01DEPT1 S7696 CONGRESSIONAL RECORD — SENATE December 1, 2017 1857 or a northern fundamentalist Bap- toward offsetting the parent tax pen- That is where we start because, right tist, conference of 1812? alty. now, this bill is not a tax cut for work- The man said: Northern fundamen- It is my hope and my humble request ing families. Everybody on this side of talist conference of 1857. that my colleagues will heed this call the aisle knows it. Every single person Emo said: Die, you heretic. And he to make it even more meaningful by knows it. Whether they were person- pushed him off the bridge. making the child tax credit refundable ally a CEO, whether they were an ac- The point here is that sometimes we up to the amount of taxes paid, includ- countant, whether they were a lawyer have to acknowledge that very minor ing payroll taxes. in a small town, they all know this is differences between us do not make us Thank you, Mr. President. not a cut for middle-class families. heretics. I yield the floor. Right now this bill is a massive give- There is a very minor difference be- Mr. WYDEN. Mr. President, how away to multinational corporations tween a corporate tax rate of 20 per- much time remains on our side in the that outsource American jobs. We cent and a corporate tax rate of 20.94 tranche? know the companies shut down in percent. But that minor difference The PRESIDING OFFICER. Eleven Mansfield, OH, in Zanesville, in Lima, would make all the difference in the minutes. and in Chillicothe, they get a tax world to America’s hard-working moms Mr. WYDEN. I would like to yield 5 break, they move overseas, build a new and dads, many of whom are on the minutes of my time to the Senator factory, and sell those products back very cusp of where many parents find from Ohio, Mr. BROWN. into the United States. We know that themselves, especially while their chil- Mr. BROWN. Mr. President, I thank is what has been happening. We choose dren are young. Senator WYDEN. not to fix that and instead we do more Imagine the construction worker, po- Mr. President, if we want to cut of the same. lice officer, or school teacher who are taxes for the middle class, as my col- Even before we take into account the just making ends meet and who realize leagues keep saying, then let’s cut loss of healthcare coverage for tens of that if they were to take themselves taxes for the middle class. Instead of millions of Americans, a full 62 percent out of the workforce, they might be giving the money to the corporations of these tax cuts will go to the top 1 able to receive government benefits and hoping it trickles down, let’s cut percent of households by the end of the that they are currently not receiving. out the middleman. Let’s put the decade. Sixty-two percent of these tax They might, in some ways, find their money directly in the pockets of work- cuts go to the top 1 percent of house- quality of life going up, at least in the ing families. holds. Even with the Bush tax cuts, sense that they wouldn’t have to go to I will say that again. Instead of giv- which were clearly weighted way too work. We don’t want them to have to ing the money to corporations and hop- much to the wealthiest people in our do that, you see, because when they get ing it trickles down, cut out the mid- country—the most privileged—that into that circumstance, they might dleman and put the money directly in was only 27 percent of those tax cuts, forgo other career opportunities. the pockets of working families. I will those benefits that went to the Without that job, there will not be keep saying this, because tax reform wealthiest 1 percent. the next job, the next promotion, and should be that simple. So let’s end the charade that this bill the next promotion after that. They I spent the last 2 weeks, and in par- is a tax cut for ordinary Americans. It might find themselves trapped in a web ticular the past 2 days, working with is simply not. of poverty, held down by the very gov- Senators RUBIO and LEE on a good- Their CEO pals have let the cat out ernment programs that are there to faith effort to bring the child tax credit of the bag. Bloomberg said this morn- help them. into this conversation. ing: ‘‘Instead of hiring more workers. That, in turn, might contribute to I don’t believe their proposal goes far . . .’’ My friends on the other side of this growing expanse of the Federal enough because it fails to index the the aisle say, if we cut taxes on cor- Government and might inhibit eco- CTC for inflation. For inflation, it is porations, it will raise wages, and they nomic growth. temporary. Remember, the tax cuts for will hire more workers. You see, sometimes we have to re- individuals are temporary; the tax cuts Bloomberg said: ‘‘Instead of hiring member that America’s ultimate and for corporations are permanent. It con- more workers or raising their pay, most important investor class is not tinues to be tied only to payroll taxes. companies say they will first increase necessarily just those people gathered It ignores the burdens we place on dividends or buy back their own around the boardroom. They are often working families. shares.’’ in maternity wards or at the altar in a We can find trillions—trillions—for That is what they always do. They church saying ‘‘I do.’’ Sometimes the corporations. This is all we can do for take the money for themselves. They most important investments we make working families? take the money for stockholders and are in those children whom we rock to Unfortunately, while Senators LEE stock buybacks and more executive sleep at night, whom we raise to be the and RUBIO were making a real effort at compensation. The corporate CEOs next generation of taxpayers, the next middle-class tax cuts, and I thought we couldn’t be clearer: They are keeping generation of contributors to our great were close to a bipartisan bill that the money for themselves. It is not society. could save this bill, it didn’t happen. going into the pockets of workers. This is why making sure that the Republican leadership—coming down Again, take out the middleman. If child tax credit is there for them, is the hall from Senator MCCONNELL’s of- you want to do tax cuts for the middle available to them, and is refundable up fice—swooped in and made it clear that class, then do tax cuts for the middle to the amount of taxes paid is so im- this bill is being written to benefit one class. If my colleagues mean what they portant. class of people: corporations that shift say—if they want to cut taxes for the These are not freeloaders. These are jobs overseas and their CEOs. middle class—work with us not people who would be seeking a wel- While Senators’ sons and daughters bipartisanly on a good child tax credit fare benefit, because the only benefit will do just fine under this proposal— that will really work for working fami- available to them under this child tax they will get the full tax cut for their lies and cut taxes directly for the mid- credit would be there for them only to children—working families will pay the dle class. the extent that they have been work- price. I yield the floor. ing and paying taxes, paying into the What we should do—frankly, what we Mr. ENZI. Mr. President, today I system. This is an imminently reason- must do—is vote this bill down and wish to speak about the important leg- able request. start over. islation we are now considering. In any event, this is a great moment Senators RUBIO and LEE and I could Earlier this week, I explained some in the very sense that we are having work together, along with our col- of the reasons the Senate needs to con- this conversation, in the very sense league, Senator BENNET, to pass real sider tax reform legislation and gave a that we are poised right now to in- middle-class tax cuts built around a general overview of the bill. Today I crease the child tax credit to $2,000 per compromise that begins with our want to talk about some of the specific child. This would go a significant way shared goals on the child tax credit. provisions of the bill.

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00044 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.066 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7697 First, I want to talk about the relief With these provisions in law, families tax issues, especially since he joined this bill provides to hard-working would hear fewer stories about how this committee. I look forward to con- Americans. The Tax Cuts and Jobs Act U.S. companies are moving their prof- tinuing to work with him on these im- reduces tax rates for individuals, al- its to tax haven countries and avoiding portant issues. most doubles the standard deduction, U.S. tax on those earnings. Families Mr. PORTMAN. I thank the chair- and doubles the child tax credit. This would hear fewer stories about how man for that clarification and appre- will allow families to keep more of the U.S. multinational companies set up ciate his outstanding leadership and money they earn in their pockets. The post office boxes in the Cayman Islands work on this historic tax reform meas- independent Tax Foundation estimates and Switzerland without an employee ure. that this will amount to about $2,500 or officer of the company anywhere in Mr. CARPER. Mr. President, I want- more in after-tax income for a middle- sight and attribute a significant por- ed to take an opportunity to clarify income family in Wyoming. tion of their foreign earnings to these the implications of title II in the rec- This bill also will provide relief to jurisdictions. Instead, families would onciliation bill before us pertaining to small, family-owned businesses that hear more stories about how U.S. com- the development of oil and gas re- currently employ the majority of the panies are generating the ideas and in- sources along the coastal plain of the private sector in Wyoming. The bill ventions of tomorrow right here in Arctic National Wildlife Refuge. cuts taxes for these businesses while America. As our colleagues recall, the Senate enhancing deductions that are impor- The international tax rules are not instructed the Energy and Natural Re- tant to them, like the section 179 de- easy or simple, and a lot of work went sources Committee to report legisla- duction that promotes business invest- into these provisions. I want to again tion that reduces the deficit by $1 bil- ment. The Tax Foundation believes thank Senator PORTMAN and Chairman lion between 2018 and 2027. In response changes like this will add more than HATCH for their work with me in this to those instructions, the committee 1,700 full time jobs in my home State. area. I look forward to continuing to reported recommendations to open the While these individual Tax Code pro- work with them and the rest of my col- refuge’s coastal plain, otherwise known visions are important to so many Wyo- leagues to pass this bill that our coun- as the 1002 Area, to oil and gas develop- mingites and small businesses in my try desperately needs. ment. home State, I am also especially proud Thank you. In the process of considering and ul- of the international tax provisions in Mr. PORTMAN. Mr. President, I rise timately reporting this legislation, the this bill, which I worked on with Sen- today to engage in a colloquy with the chair of the Energy and Natural Re- ator PORTMAN and Chairman HATCh. distinguished chairman of the Senate sources Committee, the senior Senator Right now, our tax rules are written Finance Committee, Senator HATCH. from Alaska, Ms. MURKOWSKI, assured so that many businesses could be bet- Mr. Chairman, I would like to clarify members of the committee that, if the ter off if they are headquartered out- a point in connection with the applica- legislation became law, it would re- side of the United States. Those rules, tion of the base erosion anti-abuse tax quire such development be subject to which were written in the 1960s, are in the Tax Cuts and Jobs act to serv- the full scope of environmental review completely outdated. Many of the U.S. ices companies. The act provides an ex- required by the National Environ- ception from the base erosion anti- major trading partners, including Can- mental Policy Act, or NEPA, as well as abuse tax for services. The act limits ada, Japan, and the U.K., have moved other environmental laws. to what are called ‘‘territorial’’ tax the exception to the ‘‘total services Indeed, earlier in this floor debate, systems. Those systems tax the income cost with no markup.’’ As a practical the Senator from Alaska reiterated an generated within their borders and ex- matter, companies account for assurance that the environment and empt foreign earnings from tax. amounts paid or accrued for services in local wildlife will always be a concern The United States, on the other a variety of ways. I would like to clar- and a priority and that this legislation hand, taxes the worldwide income of ify that, if in a transaction a company does not waive NEPA or any other en- U.S. companies and provides deferral of used one account for services cost with vironmental laws. I take my colleague U.S. tax until the foreign earnings are no markup and another account for at her word and thank her for her com- brought home. Deferring the tax any additional amounts paid or ac- mitment. incentivizes companies to leave their crued, that the first account would be After the Energy Committee reported money abroad and invest it there. That subject to the exception under the bill. its recommendations to the Senate is certainly not a recipe for U.S. The act also excludes an amount paid Budget Committee, the Parliamen- growth and U.S. job creation. or incurred for services if those serv- The dominance of U.S.-headquartered ices meet the requirements for the tarian advised that the committee-re- companies in the global marketplace is services cost method under Internal ported language directing the Sec- waning. In 2000, 36 percent of the For- Revenue Code section 482, excluding retary of the Interior to manage the oil tune Global 500 companies were the requirement that the services not and gas program on the coastal plain headquartered in the United States. In contribute significantly to funda- ‘‘in accordance with’’ the Naval Petro- 2009, that number dropped to 28 per- mental risks of business success or fail- leum Reserves Production Act of 1976 cent. In 2017, we are down to 26 percent. ure. and its supporting regulations set up a Clearly, America is losing ground, and Is it the intent that, for this purpose, clear conflict of law with NEPA, which our international tax rules are part of that the business judgment rule under is the jurisdiction of the EPW Com- the problem. current law and regulations will not mittee. Because any changes to NEPA I have been working to change that prevent an amount from being excluded applicability, scope, and the content of since the 112th Congress, when I intro- under the act? environmental reviews conducted duced the United States Job Creation Mr. HATCH. The Senator is correct. under the law, especially those within and International Tax Reform Act. My The intent of the provision is to ex- a National Wildlife Refuge, lie exclu- goal then was to incentivize American clude all amounts paid or accrued for sively within the jurisdiction of the companies to create jobs in the United services costs with no markup. Thus Environment and Public Works Com- States while leveling the playing field amounts paid or accrued in that ac- mittee, the language in section for U.S. companies in the global mar- count would be excluded from the base 20001(b)(3) was found to be extraneous ketplace. I believe the Tax Cuts and erosion anti-abuse tax. Other accounts under the definition in section Jobs Act achieves that goal. related to the same transaction may or 313(b)(1)(C) of the Congressional Budget This bill would reform and modernize may not be excepted from this tax. Act. the rules for taxing the global oper- Similarly, it is the intent that for It appears that this effect may have ations of American companies. These purposes of the base erosion anti-abuse been inadvertent, given the assurance reforms, along with reducing our cor- tax that the business judgment rule we have received from the Senator porate tax rate, would help make will not prevent an amount from being from Alaska, chair of the Energy Com- America a more attractive location to excluded under the act. mittee, that ‘‘we did not waive NEPA base a business that serves customers I would like to thank my friend from or any other environmental law.’’ In around the world. Ohio for his leadership on international any event, as a result, the substitute

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00045 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.072 S01DEPT1 S7698 CONGRESSIONAL RECORD — SENATE December 1, 2017 amendment if adopted, would modify mental laws will apply to potential insurance carriers so those companies section 20001(b)(3) in an effort to elimi- leasing activities and related explo- can provide cost-effective solutions to nate extraneous language. It does this ration and development on the coastal consumers and businesses. A robust re- by directing the Secretary of the Inte- plain of the Arctic Refuge. insurance market helps ensure that rior to manage the oil and gas oper- Mr. CASSIDY. Mr. President, today I policyholders are getting the best rates ations in the coastal plain in a manner wish to discuss the historic rehabilita- possible on insurance for their homes ‘‘similar’’ to the requirements of the tion tax credit. During the Finance and businesses. Many of the largest re- Naval Petroleum Reserves Product Act Committee markup of the Tax Cuts insurers in the world were founded in of 1976. This modification, while it and Jobs Act, the committee adopted Europe 100 years ago or more, and a might appear to be small, is a signifi- my amendment to return the historic number of them do business in the cant change. rehabilitation tax credit to the 20 per- United States through U.S. subsidi- The Parliamentarian has advised cent level, with the credit now claimed aries. that the language in the substitute is over 5 years, as well as a transition My concern is the potential impact of in order, meaning that it no longer rule to grandfather approved and un- the bill’s base erosion provision on the runs afoul of section 313(b)(1)(C) of the derway projects under the prior law reinsurance market and policyholders Congressional Budget Act. The new and regulations. along the gulf coast. The base erosion language appears to achieve the stated The historic rehabilitation tax credit provision has the rightful intent of tar- intent of the chair of the Energy Com- program provides jobs and investment geting bad actors who implement strat- mittee to not repeal, modify or other- in communities across the country. egies to avoid U.S. taxes; yet the provi- wise limit in any way the application More than 40 percent of projects over sion may have an unintended con- of NEPA, the Endangered Species Act, the past 15 years have been located in sequence of negatively impacting the Marine Mammal Protection Act, communities with populations less cross-border reinsurers conducting nor- the Alaska National Interest Lands than 25,000 people. Since 2002, the his- mal transactions, which could affect Conservation Act, or any other envi- toric rehabilitation tax credit has fa- the market and premiums. ronmental or land management stat- cilitated 782 projects in Louisiana, Reinsurance is critical to families ute. Importantly, the requirement that bringing more than $2.2 billion of in- and businesses in Louisiana, particu- oil and gas activities must be deter- vestment into cities and towns across larly after a natural disaster, and I mined to be ‘‘compatible with the the State. I am pleased this important hope to work with my Senate and major purposes for which such areas provision will be preserved in tax re- House colleagues on this matter as we are established,’’ as required by 16 form. work to get the bill to the President’s For purposes of the transition rule in U.S.C. 668dd(d)(1)(A), still applies. desk. The Senate should be fully aware of my amendment, ‘‘taxpayer’’ refers to Mr. KENNEDY. Mr. President, today the substantive difference produced by the person who undertakes the reha- I rise to discuss the historic rehabilita- the perfecting amendment offered by bilitation of a building. In the case tion tax credit. The historic rehabilita- where a person makes an election tion tax credit is a vital component of the majority leader, Mr. MCCONNELL. under section 48(d), the term ‘‘tax- The change in the management regime pro-growth tax reform and a shot in payer’’ means the lessor, since the les- the arm for communities across the as required by this amendment signifi- sor is the person who undertook the re- country. For instance, in my State of cantly reduces the receipts generated habilitation. It is intended that the Louisiana, the credit has encouraged by lease sales that are mandated on the historic rehabilitation tax credits be 782 restoration projects since 2002. This coastal plain, as shown in the amend- available during the transition period amounts to more than $2.2 billion in in- ment’s score produced by the Congres- only to the extent such credits would vestment into cities and towns across sional Budget Office. While the Energy and Natural Re- have been available under the prior law the State. Many of these private in- and regulations. sources Committee rightly exercises vestment dollars are flowing into small Mr. President, I am proud of the prime responsibility to determine the and rural communities with popu- work we have done in the Senate to de- scope and nature of oil and gas leasing lations less than 25,000 people. velop a bill that delivers tax cuts to I am pleased that the Finance Com- activities broadly, these activities are working families and significantly im- mittee restored the historic rehabilita- subject to a variety of aforementioned proves the competitiveness of our Tax tion tax credit to the 20-percent level environmental and natural resource Code. This will lead to greater invest- and ensured a smooth transition for ap- statutes and associated regulations ment, more jobs and opportunity, and proved and underway projects by that fall within the Environment and an increase in economic growth. grandfathering them in under the prior Public Works Committee’s jurisdic- I would like to take a moment to law and regulations. tion. That is particularly true of ac- highlight an important, unresolved For purposes of the historic rehabili- tivities in National Wildlife Refuges issue that we should consider as we tation tax credit’s transition rule, and most certainly true of the refuge’s work toward putting a bill on the ‘‘taxpayer’’ refers to the person who coastal plain. President’s desk. undertakes the rehabilitation of a Indeed, NEPA assessments for Fed- Families in Louisiana are particu- building. In the case where a person eral oil and gas activities in Alaska’s larly prone to the negative impacts of makes an election under section 48(d), Kenai National Wildlife Refuge are natural disasters. From Hurricane the term ‘‘taxpayer’’ means the lessor, conducted in accordance with the same Katrina in 2005 to historic flooding in since the lessor is the person who un- standards applied to oil and gas leasing multiple parts of the state during 2016, dertook the rehabilitation. It is in- in all other refuges. The Bureau of we have unfortunately seen some sig- tended that the historic rehabilitation Land Management, in coordination nificant losses in our State; yet as we tax credits be available during the with the Fish and Wildlife Service, will saw once again with the recent Hurri- transition period only to the extent continue to apply the provisions of the canes Harvey and Irma, Louisianans such credits would have been available Mineral Leasing Act and the associated are resilient and watchful of neighbors under the prior law and regulations. regulations, memorialized in 43 CFR through the tragedy and the recovery. Mr. WYDEN. Mr. President, I ask part 3100, which specify that leases One aspect of recovery that many unanimous consent that my motions to shall be issued subject to stipulations people don’t see is the enormous commit be printed in the RECORD. prescribed by the Fish and Wildlife amount of capital that flows into the There being no objection, the mate- Service. storm zone from the reinsurance indus- rial was ordered to be printed in the In summary, I would just say that try. In simple terms, reinsurance is in- RECORD, as follows: my colleague from Alaska, as chair of surance for insurance companies, and MOTION TO COMMIT WITH INSTRUCTIONS the Energy Committee, and I, serving it helps Louisianans rebuild their Mr. Wyden moves to commit the bill H.R. as the ranking member of the Environ- homes, their businesses, and their 1 to the Committee on Finance with instruc- ment and Public Works Committee, lives. tions to report the same back to the Senate share a common understanding that Reinsurance transfers risk from the in 3 days, not counting any day on which the NEPA and other seminal environ- balance sheets of property and casualty Senate is not in session, with changes that—

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00046 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.074 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7699 (1) are within the jurisdiction of such com- MOTION TO COMMIT WITH INSTRUCTIONS suited for the conditions of the coun- mittee; and Mr. Menendez moves to commit the bill try, so removed from the reality of (2) make permanent the tax cuts for indi- H.R. 1 to the Committee on Finance with in- what the American people need. Work- viduals and small businesses and eliminate structions to report the same back to the ing people in this country are strug- middle class tax increases, including rein- Senate in 3 days, not counting any day on stating the full State and Local tax deduc- gling. Corporations and the very which the Senate is not in session, with wealthy are doing great. tion, paid for by sun-setting tax cuts for do- changes that— mestic and multinational corporations. (1) are within the jurisdiction of such com- There is no reason for rushing Mr. UDALL. Mr. President, I ask mittee; and through a tax break for millionaires unanimous consent, with the support (2) would eliminate the repeal of the State and billionaires, paid for by pilfering the pockets and the healthcare of mid- of Senators WYDEN, BENNET, FEINSTEIN, and local tax deduction if State and local spending on investments in Medicaid and dle-class Americans. Millions of mid- and KLOBUCHAR, that the text of my other health care, infrastructure, or services motion to commit be printed in the dle-class families will get a tax hike for children or seniors, education, or law en- next year and millions more thereafter RECORD. forcement is reduced or taxes on the middle because of this bill. That is why this There being no objection, the mate- class are increased. bill is such a monstrosity, such a dan- rial was ordered to be printed in the Mr. SCOTT. Mr. President, I suggest RECORD, as follows: ger to the country, and the American the absence of a quorum. people know it. That is why they op- MOTION TO COMMIT WITH INSTRUCTIONS The PRESIDING OFFICER. The pose the bill in large majorities. Mr. Udall moves to commit the bill H.R. 1 clerk will call the roll. My Republican friends will ulti- to the Committee on Energy and Natural Re- The bill clerk proceeded to call the mately pay consequences for this bill sources with instructions to report the same roll. back to the Senate in 3 days, not counting in 2018 and beyond. The Republican Mr. MCCONNELL. Mr. President, I any day on which the Senate is not in ses- Party will never again be the party of sion, with changes that— ask unanimous consent that the order tax cuts for middle-class people. With (1) are within the jurisdiction of such com- for the quorum call be rescinded. the passage of this tax bill today, it mittee; The PRESIDING OFFICER (Mr. SUL- will be the first day of the new Repub- (2) provide for full, permanent, and manda- LIVAN). Without objection, it is so or- lican Party—one that raises taxes on tory funding for the payment in lieu of taxes dered. the middle class, abandoning its prin- program under chapter 69 of title 31, United The minority leader. States Code; and ciples for its political paymasters. Mr. SCHUMER. Mr. President, in just With respect to the process, the bill (3) provide for the permanent authoriza- a short time, we will proceed to a final tion of the Secure Rural Schools and Com- my Republican friends hope to pass so munity Self-Determination Act of 2000 (16 vote on the Republican tax bill. We un- soon was received by Members of this U.S.C. 7101 et seq.). derstand they have the votes to pass body only a few hours ago. Not a single their bill, despite a process and a prod- Mr. REED. Mr. President, I ask unan- Member of this Chamber has read the uct that no one can be proud of, and ev- imous consent that the following mo- bill. It would be impossible. Some of eryone should be ashamed of. Histo- tion to H.R. 1, the Tax Reconciliation the pages were completely crossed off, rians will mark today as one of the Act, be printed in the RECORD. and text had been replaced by hand- There being no objection, the mate- darkest black-letter days in the long written notes. When we got the bill, rial was ordered to be printed in the history of this Senate. this is what it looked like. This is what Once hailed as the greatest delibera- RECORD, as follows: it looked like. tive body, as a beacon of American de- UR MOTION TO COMMIT WITH INSTRUCTIONS When asked before by Senator D - mocracy, and the envy of representa- BIN, the Senate clerk said she couldn’t Mr. Reed moves to commit the bill, H.R. 1, tive governments around the world, the to the committee on Finance with instruc- even read it, and this section is one of tions to report the same back to the Senate Senate seems to have abandoned those the most complicated sections of the in three days, not counting any day on which qualities in a rush to pass a bill that no bill, dealing with passthroughs. Law- the Senate is not in session, with changes one is proud of. Substantively, the Re- yers are paid thousands of dollars an that— publicans have managed to take a bad hour to find ways for their wealthy pa- (1) are within the jurisdiction of such com- bill and make it worse. It was chockful trons to avoid sections just like this, mittee; and of special interest giveaways before to- and my Republican friends don’t have (2) preserve the value of the low income night, but now, under the cover of the decency, the honor to let us debate housing tax credit and increase further the darkness and with the aid of haste, a small State minimum allocation. it. flurry of last-minute changes will stuff Senator MCCASKILL was the first to Mr. BOOKER. Mr. President, I intend even more money into the pockets of discover that a list of proposed amend- to offer the following motion to H.R. 1, the wealthy and the biggest corpora- ments was circulating among lobby- and I ask unanimous consent that it be tions while raising taxes on millions in ists. My Republican friends allowed printed in the RECORD. the middle class. lobbyists to see amendments, and like- There being no objection, the mate- One provision may be a metaphor for ly the text of this bill, before their fel- rial was ordered to be printed in the the whole bill. One college, Hillsdale low U.S. Senators. RECORD, as follows: College, has been exempted from taxes There is no score of this bill by the MOTION TO COMMIT WITH INSTRUCTIONS on colleges with large endowments. Joint Committee on Taxation. There Mr. Booker moves to commit the bill H.R. Hillsdale College is supported by the will be no analysis of how American 1 to the Committee on Finance with instruc- DeVos family, one of the largest con- businesses and taxpayers fare under tions to report the same back to the Senate tributors to the Republican Party. A this bill, how high taxes go up or go in 3 days, not counting any day on which the Senate is not in session, with changes that— specific provision, just like an ear- down, whether the economy grows or (1) are within the jurisdiction of such com- mark, was slipped into the bill, added shrinks, whether it creates jobs or mittee; and by a Senator who fought to remove loses them. Who knows? Certainly no (2) would ensure that the bill would not re- earmarks from Congress several years one here. No one could know because it sult in cuts to the Medicare program under ago. A single wealthy college—the pet hasn’t even been read, let alone title XVIII of the Social Security Act. project of a billionaire campaign con- thoughtfully considered. Mr. MENENDEZ. Mr. President, I in- tributor to the Republican Party—was I remember a few years back when tend to offer the following motion to exempted from a tax by a Senator who my Republican colleagues gleefully H.R. 1, and I ask unanimous consent fought to get rid of earmarks. This, un- scolded us to ‘‘read the bill’’ because that it be printed in the RECORD. The fortunately, is the metaphor for this the Affordable Care Act was a lengthy motion is supported by Senators CANT- bill and how high the stench is rising piece of legislation, and that bill was WELL, VAN HOLLEN, CARDIN, and BOOK- in this Chamber as we debate the bill available for days before anyone had to ER. tonight. vote on it. With this stunning decep- There being no objection, the mate- In my long career in politics, I have tion, with this reckless ramrodding of rial was ordered to be printed in the not seen a more regressive piece of leg- a bill, Republicans are reaching here- RECORD, as follows: islation so devoid of rationale, so ill- tofore unreached heights of hypocrisy,

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00047 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.079 S01DEPT1 S7700 CONGRESSIONAL RECORD — SENATE December 1, 2017 and the Senate is descending to a new MOTION TO ADJOURN lowing amendments be called up en low of chicanery. Mr. President, I move that the Sen- bloc and reported by number: Sanders Read the bill? They are still writing ate adjourn until Monday, December 4, No. 1720, Brown. No 1854, and Rubio No. it by hand, mere hours before voting on 2017, at 12 noon, and I ask for the yeas 1850. I further ask consent that the it. Is this really how Republicans are and nays. Senate now vote in relation to the going to rewrite the Tax Code, The PRESIDING OFFICER. Is there a Sanders amendment and that following scrawled like something on the back of sufficient second? disposition of the amendment, the Sen- a napkin behind closed doors with the There is a sufficient second. ate vote in relation to the above help of K Street lobbyists? If that is The question is on agreeing to the amendments in the order listed; fi- not a recipe for swindling the middle motion. nally, that there be 2 minutes equally class and loosening loopholes for the The clerk will call the roll. divided between the managers or their wealthy, I don’t know what is. I don’t The legislative clerk called the roll. designees prior to all further votes to- know if it is possible for a Senate ma- The result was announced—yeas 48, night and that they be 10 minutes in jority leader to depart further from re- nays 52, as follows: length. sponsible legislating than the process [Rollcall Vote No. 293 Leg.] The PRESIDING OFFICER. Is there we witnessed with this tax bill. YEAS—48 objection? Tonight, Mr. President, I feel mostly Baldwin Gillibrand Murray Without objection, it is so ordered. regret at what could have been. What a Bennet Harris Nelson The clerk will report the amend- grave shame it is that we weren’t able Blumenthal Hassan Peters ments en bloc by number. to work together on this bill. Tax re- Booker Heinrich Reed Brown Heitkamp Sanders The senior assistant legislative clerk form is an issue that is ripe for bipar- Cantwell Hirono Schatz read as follows: tisan compromise. Democrats have Cardin Kaine Schumer The Senator from Kentucky [Mr. MCCON- spent many long hours with our Repub- Carper King Shaheen Casey Klobuchar Stabenow NELL], for others, proposes amendments lican colleagues talking about our tax Coons Leahy Tester numbered 1720, 1854, and 1850 en bloc to reform ideas. There is a sincere desire Cortez Masto Manchin Udall amendment No. 1618. on this side of the aisle to work with Donnelly Markey Van Hollen The amendments are as follows: our colleagues, particularly on tax re- Duckworth McCaskill Warner Durbin Menendez Warren AMENDMENT NO. 1720 form, but we have been rebuffed time Feinstein Merkley Whitehouse and time again. Even under these dif- (Purpose: To create a point of order against Franken Murphy Wyden legislation that cuts Social Security, ficult circumstances, Senators COONS, NAYS—52 Medicare, or Medicaid benefits) WARNER, BENNET, MANCHIN, HEITKAMP, Alexander Flake Perdue At the appropriate place, insert the fol- DONNELLY, and MCCASKILL have tried Barrasso Gardner Portman lowing: in good faith to convince our Repub- Blunt Graham Risch SEC. ll. POINT OF ORDER AGAINST LEGISLA- lican colleagues to sit down and talk to Boozman Grassley Roberts TION THAT CUTS SOCIAL SECURITY, us. We have tried to convince you all Burr Hatch Rounds MEDICARE, OR MEDICAID BENEFITS. Capito Heller Rubio (a) POINT OF ORDER.—It shall not be in that we want to join you in tax reform, Cassidy Hoeven Sasse order in the Senate to consider any bill, to have a real debate befitting this au- Cochran Inhofe Scott Collins Isakson joint resolution, motion, amendment, gust body. Shelby Corker Johnson amendment between the Houses, or con- It is an expression of the brokenness Strange Cornyn Kennedy ference report that would— Sullivan of our politics that the influence of Cotton Lankford Thune (1) result in a reduction of guaranteed ben- moneyed interests and the political Crapo Lee efits scheduled under title II of the Social right was so great that it overcame Cruz McCain Tillis Toomey Security Act; even the best of intentions of my Re- Daines McConnell Enzi Moran Wicker (2) increase either the early or full retire- publican colleagues, so many of whom Ernst Murkowski Young ment age for the benefits described in para- I admire, so many of whom I know, be- Fischer Paul graph (1); cause they have said it to me, lament The motion was rejected. (3) privatize Social Security; (4) result in a reduction of guaranteed ben- the steady erosion of bipartisanship in The PRESIDING OFFICER (Ms. MUR- the one institution in our government efits for individuals entitled to, or enrolled KOWSKI). The majority leader. for, benefits under the Medicare program designed by nature to foster it. AMENDMENT NO. 1855 TO AMENDMENT NO. 1618 under title XVIII of such Act; or I salute my friend the Senator from (5) result in a reduction of benefits or eligi- Tennessee for standing fast by his prin- (Purpose: To provide a perfecting amend- ment.) bility for individuals enrolled in, or eligible ciples and having the courage of his to receive medical assistance through, a convictions. I only regret that there Mr. MCCONNELL. Madam President, State Medicaid plan or waiver under title were not more who followed his admi- I ask unanimous consent to call up XIX of such Act. rable example. amendment No. 1855; that the amend- (b) WAIVER AND APPEAL.—Subsection (a) After a divisive and draining battle ment be agreed to; that Senate amend- may be waived or suspended in the Senate over the future of healthcare, we could ment No. 1618, as amended, be consid- only by an affirmative vote of two-thirds of have moved the Senate back toward ered original text for the purpose of the Members, duly chosen and sworn. An af- sanity, bipartisanship, compromise. We further amendment; and that all points firmative vote of two-thirds of the Members of order be preserved. I further ask of the Senate, duly chosen and sworn, shall could have accomplished something be required to sustain an appeal of the ruling great for the country and for this body that all time be yielded back. of the Chair on a point of order raised under at the same time. The PRESIDING OFFICER. Is there subsection (a). Although time is running short, objection? AMENDMENT NO. 1854 Without objection, it is so ordered. there is still time, and I will make one (Purpose: To amend the Internal Revenue final plea. Because this bill is so slant- The clerk will report the amendment Code of 1986 to increase the Child Tax Cred- ed toward the wealthy and powerful by number. it, and for other purposes) and rains tax increases upon millions The senior assistant legislative clerk Strike section 11022 and insert the fol- of middle-class citizens; because the read as follows: lowing: bill is laden with special interest provi- The Senator from Kentucky [Mr. MCCON- SEC. 11022. INCREASE IN AND MODIFICATION OF sions, some recently found and many NELL], for Mr. HATCH, proposes an amend- CHILD TAX CREDIT. not yet seen; because the bill was given ment numbered 1855 to amendment No. 1618. (a) IN GENERAL.—Section 24 is amended— to lobbyists to read and change before (The amendment is printed in today’s (1) by striking subsections (a) and (b) and Senators saw it; and because the bill RECORD under ‘‘Text of Amendments.’’) inserting the following: was given to us on few hours’ notice The amendment (No. 1855) was agreed ‘‘(a) ALLOWANCE OF CREDIT.—There shall be to. allowed as a credit against the tax imposed and has not been read fully or consid- by this chapter for the taxable year an ered fully by a single Senator, I move AMENDMENTS NOS. 1720, 1854, AND 1850 TO amount equal to the sum of— that we adjourn until Monday so we AMENDMENT NO. 1618 ‘‘(1) with respect to each qualifying child can first read and then clean up this Mr. MCCONNELL. Madam President, of the taxpayer who has attained 6 years of awful piece of legislation. I ask unanimous consent that the fol- age before the close of such taxable year and

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for which the taxpayer is allowed a deduc- such tax was computed under subsection (b) ‘‘(3) LIMITATION.—In lieu of the amount de- tion under section 151, an amount equal to (as in effect on the day before the date of the termined under subsection (b)(2), the thresh- $2,000, and enactment of the Tax Cuts and Jobs Act), old amount shall be— ‘‘(2) with respect to each qualifying child and ‘‘(A) in the case of a joint return, $500,000, of the taxpayer who has not attained 6 years ‘‘(2) this title shall be applied and adminis- and of age before the close of such taxable year tered as if the amendments made by section ‘‘(B) in the case of an individual who is not and for which the taxpayer is allowed a de- 13002 of such Act had not been enacted.’’. married or a married individual filing a sepa- duction under section 151, an amount equal (2) ADJUSTMENT OF HIGHEST RATE BRACK- rate return, $250,000. to $2,500. ET.— ‘‘(4) DEFINITION OF QUALIFYING CHILD.— ‘‘(b) LIMITATION.— (A) JOINT RETURNS.—The last row of the Paragraph (1) of subsection (c) shall be ap- ‘‘(1) IN GENERAL.—The amount of the credit table contained in section 1(j)(2)(A), as added plied by substituting ‘18’ for ‘17’. allowable under subsection (a) (including by section 11001(a), is amended to read as fol- ‘‘(5) PARTIAL CREDIT ALLOWED FOR CERTAIN any increase pursuant to subsection (h)) lows: OTHER DEPENDENTS.— shall be reduced (but not below zero) by an ‘‘(A) IN GENERAL.—The credit determined amount equal to 5 percent of the taxpayer’s ‘‘Over $1,000,000 ...... $301,479, plus 39.6% of the under subsection (a) (after the application of adjusted gross income which is in excess of excess over $1,000,000.’’. paragraph (2)) shall be increased by $500 for the threshold amount. (B) HEADS OF HOUSEHOLDS.—The last row of each dependent of the taxpayer (as defined in ‘‘(2) THRESHOLD AMOUNT.— the table contained in section 1(j)(2)(B), as section 152) other than a qualifying child de- ‘‘(A) IN GENERAL.—For purposes of para- added by section 11001(a), is amended to read scribed in subsection (c) (after the applica- graph (1), the term ‘threshold amount’ as follows: tion of paragraph (4)). means— ‘‘(B) EXCEPTION FOR CERTAIN NONCITIZENS.— ‘‘(i) $250,000 in the case of a joint return, ‘‘Over $500,000 ...... $149,348, plus 39.6% of the Subparagraph (A) shall not apply with re- ‘‘(ii) $200,000 in the case of an individual excess over $500,000.’’. spect to any individual who would not be a who is not married, and (C) UNMARRIED INDIVIDUALS.—The last row dependent if subparagraph (A) of section ‘‘(iii) $125,000 in the case of a married indi- 152(b)(3) were applied without regard to all vidual filing a separate return. of the table contained in section 1(j)(2)(C), as added by section 11001(a), is amended to read that follows ‘resident of the United States’. ‘‘(B) MARITAL STATUS.—For purposes of as follows: ‘‘(6) PORTION OF CREDIT REFUNDABLE.—In this paragraph, marital status shall be deter- lieu of subsection (d), the following provi- mined under section 7703.’’, ‘‘Over $500,000 ...... $150,739.50, plus 39.6% of sions shall apply for purposes of the credit (2) in subsection (d)(1)— the excess over allowable under this section: (A) in subparagraph (A), by inserting ‘‘, $500,000.’’. ‘‘(A) IN GENERAL.—The aggregate credits subsection (h),’’ after ‘‘this subsection’’, and allowed to a taxpayer under subpart C shall (D) MARRIED INDIVIDUALS FILING SEPARATE (B) in subparagraph (B)(i)— be increased by the lesser of— RETURNS.—The last row of the table con- (i) by striking ‘‘15 percent’’ and inserting ‘‘(i) the credit which would be allowed ‘‘45 percent’’, and tained in section 1(j)(2)(D), as added by sec- tion 11001(a), is amended to read as follows: under this section without regard to this (ii) by striking ‘‘as exceeds $3,000’’, and paragraph and the limitation under section (3) by adding at the end the following new 26(a), or subsections: ‘‘Over $500,000 ...... $150,739.50, plus 39.6% of the excess over ‘‘(ii) the amount by which the aggregate ‘‘(h) ADDITIONAL CREDIT FOR CERTAIN $500,000.’’. amount of credits allowed by this subpart OTHER DEPENDENTS.— (determined without regard to this para- ‘‘(1) IN GENERAL.—In the case of a taxable (E) EFFECTIVE DATE.—The amendments graph) would increase if the limitation im- year beginning after December 31, 2017, and made by this paragraph shall apply to tax- posed by section 26(a) were increased by an before January 1, 2026, the credit determined able years beginning after December 31, 2017. amount equal to the sum of the taxpayer’s under subsection (a) shall be increased by (3) GLOBAL INTANGIBLE LOW-TAXED INCOME payroll taxes for the taxable year. $500 for each dependent of the taxpayer (as ON A COUNTRY-BY-COUNTRY BASIS.— ‘‘(B) PAYROLL TAXES.— defined in section 152) other than a quali- (A) IN GENERAL.—Section 951(a), as added ‘‘(i) IN GENERAL.—For purposes of subpara- fying child described in subsection (c). by section 14201 of this Act, is amended by graph (A), the term ‘payroll taxes’ means, ‘‘(2) EXCEPTION FOR CERTAIN NON-CITIZENS.— adding at the end the following: with respect to any taxpayer for any taxable Paragraph (1) shall not apply with respect to ‘‘(g) DETERMINATION OF GLOBAL INTANGIBLE year, the amount of the taxes imposed by— any individual who would not be a dependent LOW-TAXED INCOME ON A COUNTRY-BY-COUN- ‘‘(I) section 1401 on the self-employment in- if subparagraph (A) of section 152(b)(3) were TRY RATHER THAN AGGREGATE BASIS.— come of the taxpayer for the taxable year, applied without regard to all that follows ‘‘(1) IN GENERAL.—Notwithstanding any ‘‘(II) section 3101 on wages received by the ‘resident of the United States’. other provision of this section, the global in- taxpayer during the calendar year in which ‘‘(i) DEFINITION OF QUALIFYING CHILD.—In tangible low-taxed income of any United the taxable year begins, the case of a taxable year beginning before States shareholder for any taxable year shall January 1, 2025, paragraph (1) of subsection ‘‘(III) section 3111 on wages paid by an em- be determined separately with respect to ployer with respect to employment of the (c) shall be applied by substituting ‘18’ for each foreign country by taking into account ‘17’. taxpayer during the calendar year in which such shareholder’s pro rata share of net CFC the taxable year begins, ‘‘(j) INFLATION ADJUSTMENT.— tested income and net deemed tangible in- ‘‘(1) IN GENERAL.—In the case of any tax- ‘‘(IV) sections 3201(a) and 3211(a) on com- come return which is properly allocable to pensation received by the taxpayer during able year beginning after 2018, each of the such foreign country. dollar amounts in subsection (a) shall be in- the calendar year in which the taxable year ‘‘(2) APPLICATION.—The Secretary shall begins, and creased by an amount equal to— take such actions as are necessary to provide ‘‘(A) such dollar amount, multiplied by ‘‘(V) section 3221(a) on compensation paid for the application of this section, and any by an employer with respect to services ren- ‘‘(B) the cost-of-living adjustment deter- provision of this title to which this section mined under section 1(f)(3) for the calendar dered by the taxpayer during the calendar relates, on a country-by-country rather than year in which the taxable year begins. year in which the taxable year begins, deter- an aggregate basis.’’. mined by substituting ‘2017’ for ‘2016’ in sub- ‘‘(ii) COORDINATION WITH SPECIAL REFUND OF (B) EFFECTIVE DATE.—The amendment PAYROLL TAXES.—The term ‘payroll taxes’ paragraph (A)(ii) thereof. made by this subsection shall take effect as ‘‘(2) ROUNDING.—If any increase determined shall not include any taxes to the extent the if included in the amendments made by sec- taxpayer is entitled to a special refund of under paragraph (1) is not a multiple of $100, tion 14201 of this Act. such increase shall be rounded to the next such taxes under section 6413(c). lowest multiple of $100.’’. AMENDMENT NO. 1850 ‘‘(iii) SPECIAL RULE.—Any amounts paid pursuant to an agreement under section (b) EFFECTIVE DATE.—The amendments (Purpose: To increase the refundability of 3121(l) (relating to agreements entered into made by subsection (a) shall apply to taxable the child tax credit, and for other purposes) years beginning after December 31, 2017. by American employers with respect to for- (c) OFFSETS.— Beginning on page 46, strike line 5 and all eign affiliates) which are equivalent to the (1) ADJUSTMENT AND TERMINATION OF COR- that follows through page 48, line 21, and in- taxes referred to in subclause (II) or (III) of PORATE RATE.—Section 11, as amended by sert the following: clause (i) shall be treated as taxes referred to section 13001 of this Act, is amended— ‘‘(h) SPECIAL RULES FOR TAXABLE YEARS in such clause. (A) in subsection (b), by striking ‘‘20 per- 2018 THROUGH 2025.— ‘‘(C) EXCEPTION FOR TAXPAYERS EXCLUDING cent’’ and inserting ‘‘25 percent’’ ‘‘(1) IN GENERAL.—In the case of a taxable FOREIGN EARNED INCOME.—Subparagraph (A) (B) by adding at the end the following: year beginning after December 31, 2017, and shall not apply to any taxpayer for any tax- ‘‘(e) TERMINATION OF 25 PERCENT RATE.—In before January 1, 2026, this section shall be able year if such taxpayer elects to exclude the case of any taxable year beginning after applied as provided in paragraphs (2) through any amount from gross income under section December 31, 2027— (7). 911 for such taxable year. ‘‘(1) the tax computed under subsection (a) ‘‘(2) CREDIT AMOUNT.—Subsection (a) shall ‘‘(7) SOCIAL SECURITY NUMBER REQUIRED.— shall be computed in the same manner as be applied by substituting ‘$2,000’ for ‘$1,000’. No credit shall be allowed under subsection

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00049 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.010 S01DEPT1 S7702 CONGRESSIONAL RECORD — SENATE December 1, 2017 (d) to a taxpayer with respect to any quali- neous to the instruction in H. Con. Res. Brown-Bennet provides more for fying child unless the taxpayer includes the 71, the concurrent resolution on the small children at the most important social security number of such child on the budget for fiscal year 2018. Therefore, I time in their young lives. return of tax for the taxable year. For pur- raise a point of order against this My wife and I live in Cleveland, OH, poses of the preceding sentence, the term ‘so- cial security number’ means a social secu- measure pursuant to section in ZIP Code 44105. Our ZIP Code had rity number issued to an individual by the 313(b)(1)(A) of the Congressional Budget more foreclosures in 2007 than any ZIP Social Security Administration, but only if Act of 1974. Code in the United States of America. the social security number is issued to a cit- The PRESIDING OFFICER. The Sen- This amendment helps to answer that. izen of the United States or is issued pursu- ator from Vermont. ZIP Codes should not be the deter- ant to subclause (I) (or that portion of sub- Mr. SANDERS. Pursuant to section mining factor for the future of a child. clause (III) that relates to subclause (I)) of 904 of the Congressional Budget Act of The PRESIDING OFFICER. The Sen- section 205(c)(2)(B)(i) of the Social Security 1974, I move to waive all applicable sec- ator from Wyoming. Act.’’. tions of that act for purposes of the (b) INCREASE IN CORPORATE TAX RATE.— Mr. ENZI. Madam President, while Subsection (b) of section 11, as amended by pending amendment, and I ask for the this amendment expands the child tax section 13001 of this Act, is amended by yeas and nays. credit provisions, it makes the credit striking ‘‘20 percent’’ and inserting ‘‘20.94 The PRESIDING OFFICER. Is there a available to fewer taxpayers. It also percent’’. sufficient second? raises the corporate tax rate to 25 per- (c) EFFECTIVE DATE.—The amendments There appears to be a sufficient sec- cent. The underlying bill already pro- made by ond. vides for a generous enhanced child tax Mr. MCCONNELL. Madam President, The question is on agreeing to the credit with increased refundability the next three votes will be in relation motion. that reaches far up into the middle to Sanders amendment No. 1720, Brown The clerk will call the roll. class, giving relief to millions of fami- amendment No. 1854, and Rubio amend- The legislative clerk called the roll. lies. ment No. 1850. The yeas and nays resulted—yeas 46, This amendment would undermine AMENDMENT NO. 1720 nays 54, as follows: the balance struck in the drafting of The PRESIDING OFFICER. There is [Rollcall Vote No. 294 Leg.] this bill and diminish its potential to now 2 minutes of debate equally di- YEAS—46 generate growth. vided prior to a vote on the Sanders Baldwin Harris Nelson Has all time expired? amendment. Bennet Hassan Peters The PRESIDING OFFICER. All time Mr. SANDERS. Madam President, Blumenthal Heinrich Reed Booker Heitkamp Sanders has not expired. The Senator has 20 could we have order, please? Brown Hirono Schatz seconds. The PRESIDING OFFICER. The Sen- Cantwell Kaine Schumer Mr. ENZI. The pending amendment Cardin King ate will be in order. Shaheen No. 1854 would cause the underlying Casey Klobuchar Stabenow The Senator from Vermont. Collins Leahy Tester legislation to exceed the Finance Com- Mr. SANDERS. Thank you. Coons Manchin Udall mittee’s section 302(a) allocation of Madam President, tonight is chapter Cortez Masto Markey Van Hollen new budget authority or outlays. 1 of the Republican Party Koch broth- Donnelly McCaskill Warren Therefore, I raise a point of order ers plan. Duckworth Menendez Feinstein Merkley Whitehouse against this measure pursuant to sec- Tonight, the Republicans provide $1 Wyden Franken Murphy tion 302(f) of the Congressional Budget trillion in tax breaks to the wealthiest Gillibrand Murray Act of 1974. people in this country and to the larg- NAYS—54 The PRESIDING OFFICER. The Sen- est corporations, while raising the def- Alexander Fischer Paul ator from Ohio. icit by over $1.4 trillion. Barrasso Flake Perdue Mr. BROWN. Madam President, pur- Part 2 of their plan—probably coming Blunt Gardner Portman in a few months—will be to call for Boozman Graham Risch suant to section 904 of the Congres- Burr Grassley Roberts massive cuts to Social Security, Medi- sional Budget Act of 1974, I move to Capito Hatch Rounds waive all applicable sections of that care, and Medicaid in order to pay for Carper Heller Rubio their tax breaks to the rich. For those Cassidy Hoeven Sasse act for purposes of the pending amend- of us who don’t want to cut these vi- Cochran Inhofe Scott ment, and I ask for the yeas and nays. Corker Isakson Shelby The PRESIDING OFFICER. Is there a tally important programs that the Cornyn Johnson Strange American people have paid for, this Cotton Kennedy Sullivan sufficient second? amendment establishes a 67-vote Crapo Lankford Thune There is a sufficient second. Cruz Lee Tillis The question is on agreeing to the threshold to make those cuts. Daines McCain Toomey If you don’t want to cut Social Secu- Durbin McConnell Warner motion. rity, Medicare, and Medicaid to give Enzi Moran Wicker The clerk will call the roll. tax breaks to millionaires, support this Ernst Murkowski Young The senior assistant legislative clerk amendment. The PRESIDING OFFICER. On this called the roll. The PRESIDING OFFICER. The Sen- vote, the yeas are 46, the nays are 54. The yeas and nays resulted—yeas 48, ator from Wyoming. Three-fifths of the Senators duly cho- nays 52, as follows: Mr. ENZI. Madam President, the sen and sworn not having voted in the [Rollcall Vote No. 295 Leg.] Sanders amendment is nongermane and affirmative, the motion is rejected. YEAS—48 The point of order is sustained and would gut this legislation. The bill be- Baldwin Gillibrand Murray fore us does not cut Social Security. It the amendment falls. Bennet Harris Nelson does not cut Medicare. It does not cut AMENDMENT NO. 1854 Blumenthal Hassan Peters Booker Heinrich Reed Medicaid benefits. So I encourage my There will now be 2 minutes of de- Brown Heitkamp Sanders colleagues to oppose the Sanders bate, equally divided, prior to a vote on Cantwell Hirono Schatz amendment and—does the Senator the Brown amendment No. 1854. Cardin Kaine Schumer have any time remaining? The Senator from Ohio. Carper King Shaheen Casey Klobuchar Stabenow Mr. SANDERS. I would just say that Mr. BROWN. Madam President, with- Coons Leahy Tester I would be delighted to gut and destroy out the Brown-Bennet amendment, a Cortez Masto Manchin Udall this legislation, but pursuant to sec- Senator’s kid gets more tax relief than Donnelly Markey Van Hollen tion 904 of the Congressional Budget the daughter of a family in Garfield Duckworth McCaskill Warner Durbin Menendez Warren Act of 1974—I am sorry. Heights, OH, who makes $40,000 a year. Feinstein Merkley Whitehouse Mr. ENZI. I yield back the remainder I will say that again. A Senator’s kid Franken Murphy Wyden of my time. gets more tax relief than the daughter NAYS—52 The pending amendment No. 1720 of a family earning $30,000 or $40,000. Alexander Boozman Cassidy does not produce a change in outlays or Brown-Bennet is permanent; Rubio- Barrasso Burr Cochran a change in revenues, and this is extra- Lee isn’t. Blunt Capito Collins

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00050 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.012 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7703 Corker Hoeven Roberts permanent help that America’s strug- MOTION TO COMMIT Cornyn Inhofe Rounds gling families richly deserve. Mr. MENENDEZ. Mr. President, I Cotton Isakson Rubio Crapo Johnson Sasse Madam President, I make a point of have a motion to commit at the desk. Cruz Kennedy Scott order that the pending amendment vio- The PRESIDING OFFICER. The Daines Lankford Shelby lates section 302(f) of the Congressional clerk will report the motion. Enzi Lee Strange Budget Act of 1974. The senior assistant legislative clerk Ernst McCain Sullivan Fischer McConnell The PRESIDING OFFICER. The Sen- read as follows: Thune Flake Moran Tillis ator from Florida. The Senator from New Jersey [Mr. Gardner Murkowski Toomey Mr. RUBIO. Madam President, pursu- MENENDEZ] moves to commit the bill H.R. Graham Paul Grassley Perdue Wicker ant to section 904 of the Congressional 1 to the Committee on Finance with instruc- Hatch Portman Young Budget Act of 1974 and the waiver pro- tions to report the same back to the Senate Heller Risch visions of applicable budget resolu- in 3 days, not counting any day on which the The PRESIDING OFFICER. On this tions, I move to waive all applicable Senate is not in session, with changes that— (1) are within the jurisdiction of such com- vote, the yeas are 48, the nays are 52. sections of that act and applicable mittee; and Three-fifths of the Senators duly cho- budget resolutions for purposes of this (2) would eliminate the repeal of the State sen and sworn not having voted in the amendment, and I ask for the yeas and and local tax deduction if State and local affirmative, the motion is rejected. nays. spending on investments in Medicaid and The point of order is sustained and The PRESIDING OFFICER. Is there a other health care, infrastructure, or services the amendment falls. sufficient second? for children or seniors, education, or law en- AMENDMENT NO. 1850 There appears to be a sufficient sec- forcement is reduced or taxes on the middle There will now be 2 minutes of debate ond. class are increased. equally divided prior to a vote on The question is on agreeing to the Mr. MENENDEZ. Mr. President, I Rubio amendment No. 1850. motion. rise once again to stand up for the good The Senator from Florida is recog- The clerk will call the roll. people of New Jersey and other States nized. The bill clerk called the roll. to offer a motion to restore the State Mr. RUBIO. Madam President, this The yeas and nays resulted—yeas 29, and local tax, or SALT, deduction. amendment would allow people making nays 71, as follows: Ending the SALT deduction will sub- primarily between $20,000, $50,000, [Rollcall Vote No. 296 Leg.] ject millions of middle-class families $60,000 a year—workers, firefighters, YEAS—29 to double taxation, but that is not all. It will also set the stage for huge cuts police officers—to keep more of their Blunt Gardner Moran own payroll tax liabilities. In a mo- Capito Heitkamp Murkowski to education, law enforcement, infra- ment, there will be a point of order, Cassidy Heller Nelson structure, public health, and other and the objection to this has been Collins Hoeven Peters critical services. But don’t take my Cotton Kennedy budgetary. This is paid for. Instead of Risch word for it. Listen to the teachers and Crapo King Rubio cutting the corporate rate to 20 per- Cruz Klobuchar Sasse police officers, the doctors and nurses cent, it cuts it to 20.94 percent. Instead Donnelly Lee Stabenow and firefighters. Ernst Manchin Sullivan The National Education Association of a 15-point cut, we are asking for a Fischer McCaskill 14.06 cut. Apparently, American cor- opposes it because it will hurt our pub- porations at 20 percent, America will NAYS—71 lic schools. The Fraternal Order of Po- be a corporate utopia, but at 20.94, it is Alexander Franken Portman lice and the National Sheriffs’ Associa- a catastrophe. That is ridiculous. Vot- Baldwin Gillibrand Reed tion oppose it because it will make our Barrasso Graham Roberts ing against this today you are basi- Bennet Grassley Rounds streets less safe. The American Medical cally arguing that a 0.94 cut is some- Blumenthal Harris Sanders Association and the American Hospital thing corporations can’t afford, and Booker Hassan Schatz Association oppose it because people Boozman Hatch Schumer that is more important to keep in place Brown Heinrich will lose access to healthcare. The Scott AARP opposes it because it will lead to than giving American families an $800 Burr Hirono Shaheen Cantwell Inhofe child tax credit. That is ridiculous. Shelby cuts in Medicare and Medicaid and hurt Cardin Isakson Strange our seniors. Even the New Jersey Apparently, American companies are Carper Johnson Tester allowed to immediately invest their in- Casey Kaine Chamber of Commerce opposes it be- vestment in equipment and in land, but Cochran Lankford Thune cause it will hinder investments in the Tillis American parents should not be al- Coons Leahy infrastructure that businesses need in Corker Markey Toomey lowed to immediately invest their Cornyn McCain Udall order to compete. hard-earned money in our children and Cortez Masto McConnell Van Hollen My motion to commit would restore in our future. I ask all of you to fight Daines Menendez Warner the SALT deduction if these all too Duckworth Merkley Warren predictable consequences happen. A for the American worker. This isn’t Durbin Murphy Whitehouse perfect, but it is better than what we Enzi Murray Wicker corporate tax cut cannot build a road, have now, and I ask everyone for your Feinstein Paul Wyden care for a senior, teach a child, or help vote. Flake Perdue Young keep our streets safe. If corporations The PRESIDING OFFICER. The Sen- The PRESIDING OFFICER (Mr. can keep the State and local tax deduc- ator from Oregon. BOOZMAN). On this vote, the yeas are tion, so should middle-class families. Mr. WYDEN. Madam President, with 29, the nays are 71. We cannot afford to roll the dice and this amendment, Senators RUBIO and Three-fifths of the Senators duly cho- risk these investments in the middle LEE stopped far short of meaningful re- sen and sworn not having voted in the class. lief for millions of vulnerable Amer- affirmative, the motion is rejected. I urge the adoption of the motion to ican families and leave out altogether The point of order is sustained and commit, and I ask for the yeas and so many deserving children like the the amendment falls. nays. Dreamers. The majority leader is recognized. The PRESIDING OFFICER. Is there a After 2025, Rubio-Lee offers a double Mr. MCCONNELL. Mr. President, I sufficient second? standard. Their child tax credit ex- ask unanimous consent that Senator There appears to be a sufficient sec- pires, even while multinational cor- MENENDEZ be recognized to offer a mo- ond. porations get permanent tax breaks for tion to commit and that there be 2 The yeas and nays were ordered. shipping jobs overseas. Democrats minutes of debate, equally divided, The PRESIDING OFFICER. Does any want to provide strong, permanent pro- prior to a vote on the motion. Senator seek time in opposition? tection for all working families, rather The PRESIDING OFFICER. Is there The Senator from South Dakota is than temporary protection for some objection? recognized. like Rubio-Lee. The best way to pro- Without objection, it is so ordered. Mr. THUNE. Mr. President, let’s keep tect these families is not through a The Senator from New Jersey is rec- in mind that the State and local tax, or puny bandaid approach but through ognized. SALT, deduction disproportionately

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00051 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.017 S01DEPT1 S7704 CONGRESSIONAL RECORD — SENATE December 1, 2017 benefits wealthy taxpayers in high tax The clerk will report the amend- ‘‘(IV) subject to the provisions of para- States. More than 70 percent of Amer- ments en bloc by number. graph (14), upon hardship of the employee, ican families currently take the stand- The senior assistant legislative clerk or″.’’. ard deduction, so they will not even be read as follows: (3) EFFECTIVE DATE.—The amendments made by this subsection shall apply to plan impacted at all by this bill’s treatment The Senator from Texas [Mr. CORNYN], for years beginning after December 31, 2017. of SALT. Let’s also keep in mind that others, proposes amendments numbered 1852 AMENDMENT NO. 1846 and 1846 en bloc to amendment No. 1618. our improving amendment strikes a (Purpose: To provide middle class tax relief) compromise on SALT. It includes, as The amendments are as follows: Beginning on page 95, strike line 7 and all does the House bill, a deduction of up AMENDMENT NO. 1852 that follows through page 97, line 14 and in- to $10,000 for property tax paid to State (Purpose: To allow limited 529 account funds sert the following: and local governments. to be used for elementary and secondary Subtitle B—Permanent Individual Income Democrats insisting on keeping the education, including homeschool) Tax Relief for Middle Class entire SALT deduction in place should At the end of part IV of subtitle A of title SEC. 12001. AMENDMENT OF INCOME TAX BRACK- explain why they have prioritized a tax I, insert the following: ETS. (a) MARRIED INDIVIDUALS FILING JOINT RE- deduction for wealthy taxpayers over SEC. 11033. 529 ACCOUNT FUNDING FOR ELEMEN- middle-class tax relief. Our bill ad- TARY AND SECONDARY EDUCATION. TURNS AND SURVIVING SPOUSES.—The table contained in subsection (a) of section 1 is (a) IN GENERAL.— dresses this issue in an appropriate amended to read as follows: way, and I urge my colleagues to vote (1) IN GENERAL.—Section 529(c) is amended by adding at the end the following new para- against this motion. If taxable income is: The tax is: I yield the floor. graph: The PRESIDING OFFICER. The ‘‘(7) TREATMENT OF ELEMENTARY AND SEC- Not over $19,050 ...... 10% of taxable income. ONDARY TUITION.—Any reference in this sub- Over $19,050 but not over question is on agreeing to the motion. $77,400 ...... $1,905, plus 12% of the ex- section to the term ‘qualified higher edu- cess over $19,050. The yeas and nays were previously cation expense’ shall include a reference to— Over $77,400 but not over ordered. ‘‘(A) expenses for tuition in connection $140,000 ...... $8,907, plus 22% of the ex- cess over $77,400. The clerk will call the roll. with enrollment or attendance at an elemen- Over $140,000 but not over The senior assistant legislative clerk tary or secondary public, private, or reli- $320,000 ...... $22,679, plus 24% of the gious school, and excess over $140,000. called the roll. Over $320,000 but not over The result was announced—yeas 48, ‘‘(B) expenses for— $400,000 ...... $65,879, plus 32% of the nays 52, as follows: ‘‘(i) curriculum and curricular materials, excess over $320,000. ‘‘(ii) books or other instructional mate- Over $400,000 but not over [Rollcall Vote No. 297 Leg.] $480,050 ...... $91,479, plus 35% of the rials, excess over $400,000. YEAS—48 ‘‘(iii) online educational materials, Over $480,050 ...... $119,496.50, plus 39.6% of Baldwin Gillibrand Murray ‘‘(iv) tuition for tutoring or educational the excess over $480,050. Bennet Harris Nelson classes outside of the home (but only if the Blumenthal Hassan Peters tutor or instructor is not related to the stu- (b) HEADS OF HOUSEHOLDS.—The table con- Booker Heinrich Reed dent), tained in subsection (b) of section 1 is Brown Heitkamp Sanders amended to read as follows: Cantwell Hirono Schatz ‘‘(v) dual enrollment in an institution of Cardin Kaine Schumer higher education, and Carper King Shaheen ‘‘(vi) educational therapies for students If taxable income is: The tax is: Casey Klobuchar Stabenow with disabilities, Not over $13,600 ...... 10% of taxable income. Coons Leahy Tester in connection with a homeschool (whether Over $13,600 but not over Cortez Masto Manchin Udall $51,800 ...... $1,360, plus 12% of the ex- Donnelly Markey Van Hollen treated as a homeschool or a private school cess over $13,600. Duckworth McCaskill Warner for purposes of applicable State law).’’. Over $51,800 but not over Durbin Menendez Warren (2) LIMITATION.—Section 529(e)(3)(A) is $70,000 ...... $5,944, plus 22% of the ex- cess over $51,800. Feinstein Merkley Whitehouse amended by adding at the end the following: Over $70,000 but not over Franken Murphy Wyden ‘‘The amount of cash distributions from all $160,000 ...... $9,948, plus 24% of the ex- cess over $70,000. NAYS—52 qualified tuition programs described in sub- section (b)(1)(A)(ii) with respect to a bene- Over $160,000 but not over Alexander Flake Perdue $200,000 ...... $31,548, plus 32% of the ficiary during any taxable year shall, in the excess over $160,000. Barrasso Gardner Portman aggregate, include not more than $10,000 in Over $200,000 but not over Blunt Graham Risch $453,350 ...... $44,348, plus 35% of the Boozman Grassley Roberts expenses described in subsection (c)(7) in- excess over $200,000. Burr Hatch Rounds curred during the taxable year.’’. Over $453,350 ...... $133,020.50, plus 39.6% of Capito Heller (b) EFFECTIVE DATE.—The amendments the excess over Rubio $453,350. Cassidy Hoeven Sasse made by subsection (a) shall apply to con- Cochran Inhofe Scott tributions made after December 31, 2017. (c) UNMARRIED INDIVIDUALS OTHER THAN Collins Isakson Shelby (c) OFFSET.— SURVIVING SPOUSES AND HEADS OF HOUSE- Corker Johnson Strange HOLDS.—The table contained in subsection Cornyn Kennedy (1) MODIFICATION OF RULES RELATING TO Sullivan Cotton Lankford HARDSHIP WITHDRAWALS FROM CASH OR DE- (c) of section 1 is amended to read as follows: Crapo Lee Thune FERRED ARRANGEMENTS.—Section 401(k) is Cruz McCain Tillis amended by adding at the end the following: If taxable income is: The tax is: Toomey Daines McConnell ‘‘(14) SPECIAL RULES RELATING TO HARDSHIP Wicker Not over $9,525 ...... 10% of taxable income. Enzi Moran WITHDRAWALS.—For purposes of paragraph Young Over $9,525 but not over Ernst Murkowski (2)(B)(i)(IV)— $38,700 ...... $952.50, plus 12% of the Fischer Paul ‘‘(A) AMOUNTS WHICH MAY BE WITHDRAWN.— excess over $9,525. Over $38,700 but not over The motion was rejected. The following amounts may be distributed $70,000 ...... $4,453.50, plus 22% of the The PRESIDING OFFICER. The Sen- upon hardship of the employee: excess over $38,700. ‘‘(i) Contributions to a profit-sharing or Over $70,000 but not over ator from Texas. $160,000 ...... $11,339.50, plus 24% of the AMENDMENTS NOS. 1852 AND 1846 TO AMENDMENT stock bonus plan to which section 402(e)(3) excess over $70,000. Over $160,000 but not over NO. 1618 applies. ‘‘(ii) Qualified nonelective contributions $200,000 ...... $32,939.50, plus 32% of the Mr. CORNYN. Mr. President, I ask excess over $160,000. (as defined in subsection (m)(4)(C)). Over $200,000 but not over unanimous consent that the following ‘‘(iii) Qualified matching contributions de- $426,700 ...... $45,739.50, plus 35% of the amendments be called up and reported scribed in paragraph (3)(D)(ii)(I). excess over $200,000. Over $426,700 ...... $125,084.50, plus 39.6% of by number: Cruz No. 1852, Kaine No. ‘‘(iv) Earnings on any contributions de- the excess over 1846; further, that following disposition scribed in clause (i), (ii), or (iii). $426,700. of the Kaine amendment, Senator ‘‘(B) NO REQUIREMENT TO TAKE AVAILABLE (d) MARRIED INDIVIDUALS FILING SEPARATE MANCHIN be recognized to offer a mo- LOAN.—A distribution shall not be treated as RETURNS.—The table contained in subsection tion to commit and that there be 2 failing to be made upon the hardship of an (d) of section 1 is amended to read as follows: employee solely because the employee does minutes of debate, equally divided, not take any available loan under the If taxable income is: The tax is: prior to a vote on the motion. plan.″.’’. The PRESIDING OFFICER. Is there (2) CONFORMING AMENDMENT.—Section Not over $9,525 ...... 10% of taxable income. Over $9,525 but not over objection? 401(k)(2)(B)(i)(IV) is amended to read as fol- $38,700 ...... $952.50, plus 12% of the Without objection, it is so ordered. lows: excess over $9,525.

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If taxable income is: The tax is: to be to take more and more children where it is under current law instead of Over $38,700 but not over from the public schools and put them scaling it back. Second, while making $70,000 ...... $4,453.50, plus 22% of the into private schools and shrink the middle-income tax cuts permanent, it excess over $38,700. Over $70,000 but not over funds that would be available to the provides no individual tax relief to $160,000 ...... $11,339.50, plus 24% of the public schools that give all of Amer- those Americans currently in the top excess over $70,000. Over $160,000 but not over ica’s children the chance to get ahead. bracket. Third, it cuts the corporate $200,000 ...... $32,939.50, plus 32% of the Members should oppose the amend- tax rate from 35 to 25, rather than 20. excess over $160,000. Over $200,000 but not over ment because it undermines America’s If you care about deficit reduction, $240,026 ...... $45,739.50, plus 35% of the public education system. support this amendment. If you care excess over $200,000. I ask for the yeas and nays. Over $240,026 ...... $59,748.60, plus 39.6% of about permanent middle-class tax cuts, the excess over The PRESIDING OFFICER. Is there a support this amendment. If you believe $240,026. sufficient second? a reasonable corporate tax cut could (e) ESTATES AND TRUSTS.—The table con- There appears to be a sufficient sec- help grow the economy, support the tained in subsection (e) of section 1 is ond. amendment. Finally, if you believe tax amended to read as follows: The question is on agreeing to the reform should be bipartisan, support amendment. this amendment. If taxable income is: The tax is: The clerk will call the roll. Thank you, Mr. President. Not over $2,550 ...... 10% of taxable income. The bill clerk called the roll. The PRESIDING OFFICER. The Sen- Over $2,550 but not over The yeas and nays resulted—yeas 50, $9,150 ...... $255, plus 24% of the ex- ator from Pennsylvania. cess over $2,550. nays 50, as follows: Mr. TOOMEY. Mr. President, taking Over $9,150 but not over $12,700 ...... $1,839, plus 35% of the ex- [Rollcall Vote No. 298 Leg.] the time in opposition, first, I want to cess over $9,150. YEAS—50 acknowledge that we share the goal of Over $12,700 ...... $3,081.50, plus 39.6% of the excess over $12,700. Alexander Flake Perdue making the individual tax rates perma- Barrasso Gardner Portman nent, and I hope we will have an oppor- (f) INFLATION ADJUSTMENT.—Section Blunt Graham Risch tunity to do that, but, more impor- 1(f)(2)(A), as amended by this Act, is amend- Boozman Grassley Roberts tantly, I want to thank the Senator ed by striking ‘‘1992’’ and inserting ‘‘2017’’. Burr Hatch Rounds (g) EFFECTIVE DATE.—The amendments Capito Heller Rubio from Virginia for acknowledging and made by this section shall apply to taxable Cassidy Hoeven Sasse complimenting our work, acknowl- Cochran Inhofe Scott years beginning after December 31, 2025. Corker Isakson edging that we have cut taxes for Shelby SEC. 12002. CORPORATE TAX RATE. Cornyn Johnson working-class and middle-income fami- Strange (a) IN GENERAL.—Section 11(b), as amended Cotton Kennedy Sullivan lies. Crapo Lankford by this Act, is amended by striking ‘‘20 per- Thune There are people who came down here cent’’ and inserting ‘‘25 percent’’. Cruz Lee Daines McCain Tillis during the course of the last couple of (b) EFFECTIVE DATE.—The amendment Enzi McConnell Toomey days suggesting that somehow wasn’t made by this section shall apply to taxable Ernst Moran Wicker true. I appreciate your honesty in ac- years beginning after December 31, 2018. Fischer Paul Young knowledging that we did, in fact, cut The PRESIDING OFFICER. Who NAYS—50 taxes for middle-income families, for yields time? Baldwin Gillibrand Murray working-class families, so much so, in The Senator from Texas is recog- Bennet Harris Nelson fact, that you want to make our policy nized. Blumenthal Hassan Peters Booker Heinrich permanent, and I commend you for AMENDMENT NO. 1852 Reed Brown Heitkamp Sanders that. Unfortunately, you also added a Mr. CRUZ. Mr. President, tonight I Cantwell Hirono Schatz huge tax increase on the very busi- ask your support for this commonsense Cardin Kaine Schumer nesses that are going to help drive our amendment, which will expand the al- Carper King Shaheen Casey Klobuchar growth. Stabenow ready immensely popular 529 college Collins Leahy By lowering our rate to 20 percent, Tester savings plan so that parents can also Coons Manchin Udall which is what we do in our bill and save for K–12 elementary and sec- Cortez Masto Markey which you would undermine, we would Donnelly McCaskill Van Hollen ondary school tuition, including edu- Duckworth Menendez Warner lose the opportunity to create new cational expenses for homeschool stu- Durbin Merkley Warren businesses, existing business growth, dents. Feinstein Murkowski Whitehouse and the wage and job growth we want Wyden This change will have real and sig- Franken Murphy to drive. nificant effects. Your vote will expand The VICE PRESIDENT. On this vote, I would suggest we work together on options for parents and children spend- the yeas are 50, the nays are 50. The making our individual tax cuts perma- ing their own money and will prioritize Senate being equally divided, the Vice nent in the future, but I would urge my the education of the next generation of President votes in the affirmative, and colleague to oppose this amendment in Americans. By expanding 529s, which the amendment, No. 1852, is agreed to. the current form. Americans already value greatly, we AMENDMENT NO. 1846 Mr. KAINE. Mr. President, do I have will help ensure that each child can re- The PRESIDING OFFICER (Mr. any remaining time? ceive an education that meets his or LANKFORD). There will now be 2 min- Mr. SCHUMER. Mr. President, I ask her individualized needs, and this rea- utes of debate, equally divided, prior to unanimous consent that he be given a sonable expansion will enable hard- a vote on Kaine amendment No. 1846. minute. working parents to better save for the The Senator from Virginia. The PRESIDING OFFICER. Is there educational future of their kids. Mr. KAINE. Mr. President, may I ask objection? This amendment was in the House that amendment No. 1846 be called up? Without objection, it is so ordered. bill, and it is fully paid for, and I urge The PRESIDING OFFICER. It is al- Mr. KAINE. Mr. President, I don’t your support. ready called up. need a full minute. I am just here to The PRESIDING OFFICER. The Sen- Mr. KAINE. Thank you, Mr. Presi- say that permanent middle-class tax ator from Oregon is recognized. dent. cuts is more important than 25 to 20 Mr. WYDEN. Mr. President, Senator It is impossible to fix all the prob- percent for corporations. CRUZ’s amendment expands tax sub- lems with this bill in a 1-minute The problem with the Republican bill sidies for upper income households to amendment, but my amendment fixes is the priority. It prioritizes the cor- aid private or parochial schools by al- two problems. It makes the middle- porate tax cuts over individual tax cuts lowing 529 account balances to spend class tax cuts permanent, and it takes for middle-class people and that is why up to $10,000 a year on private or paro- nearly $1 trillion away from the mas- we oppose it and that is why everyone chial school tuition and supplies. sive deficit caused by this big give- should support this amendment. People Colleagues, this is nothing less than away. come first. a backdoor assault on the public K–12 How does the amendment do these The PRESIDING OFFICER. The Sen- education system. The real goal seems two things? First, it leaves the AMT ator from Pennsylvania.

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00053 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.032 S01DEPT1 S7706 CONGRESSIONAL RECORD — SENATE December 1, 2017 Mr. TOOMEY. Mr. President, the The majority leader. positions this country to thrive for fu- pending amendment No. 1846 offered by Mr. MCCONNELL. Mr. President, I ture generations. Senator KAINE has unknown budgetary ask unanimous consent that following The PRESIDING OFFICER. The Sen- effects. Therefore, I raise a point of the disposition of the motion to com- ator from Texas. order against this measure pursuant to mit, the Cantwell amendment No. 1717 Mr. CORNYN. Mr. President, what section 4105 of H. Con. Res. 71, the con- be called up and reported by number. our friend from West Virginia is pro- current resolution on the budget for The PRESIDING OFFICER. Is there posing is to make the United States fiscal year 2018. objection? uncompetitive in a global economy. The PRESIDING OFFICER. The Sen- Without objection, it is so ordered. Right now, we have the highest tax ator from Virginia. MOTION TO COMMIT rate in the industrialized world, and Mr. KAINE. Mr. President, I am Mr. MANCHIN. Mr. President, I have what we are doing is lowering that tax shocked to learn that at 10 after 12 we a motion to commit at the desk. rate to make us competitive and in so are actually following a procedure that The PRESIDING OFFICER. The doing, taking the advice of Barack is a normal budget procedure, but since clerk will report the motion. Obama in his 2011 State of the Union that has been raised, pursuant to sec- The senior assistant legislative clerk message; advice from the Democratic tion 904 of the Congressional Budget read as follows: leader, Senator SCHUMER; and Senator Act of 1974 and the waiver provisions of The Senator from West Virginia [Mr. WYDEN, the ranking member of the Fi- applicable budget resolutions, I move MANCHIN] moves to commit the bill H.R. 1 nance Committee, who has rec- to waive all applicable sections of that to the Committee on Finance with instruc- ommended a lower rate than that con- act and applicable budget resolutions tions to report the same back to the Senate tained in this motion to recommit. for purposes of the pending amend- in 3 days, not counting any day on which the ment, and I ask for the yeas and nays. Senate is not in session, with changes that— We think we should take the advice (1) are within the jurisdiction of such com- The PRESIDING OFFICER. Is there a of President Obama, President Clinton, mittee; Senator WYDEN, Minority Leader SCHU- sufficient second? (2) make the reductions to individual tax MER, and other prominent Democrats— There appears to be a sufficient sec- rates for middle class and working people ond. permanent; the advice they have given us over the The question is on agreeing to the (3) would maintain at existing levels— last few years to lower these corporate motion. (A) the medical expense deduction; rates and make us more competitive so The clerk will call the roll. (B) the student loan interest deduction; we can bring jobs back home, improve The legislative clerk called the roll. (C) retirement savings incentives; wages, and get the economy growing Mr. DURBIN. I announce that the (D) homeownership incentives; and again so people can pursue their Amer- Senator from North Dakota (Ms. (E) the historic tax credit; ican dreams. (4) provide small businesses with perma- HEITKAMP) is necessarily absent. nent maximum tax relief; and I would encourage our colleagues to The PRESIDING OFFICER. Are there (5) fully offset the changes described in defeat this motion to commit. any other Senators in the Chamber de- paragraphs (2) through (4) by setting the cor- The PRESIDING OFFICER. The Sen- siring to vote? porate tax rate at 25 percent. ator from West Virginia. The yeas and nays resulted—yeas 34, Mr. MANCHIN. Mr. President, I want Mr. MANCHIN. If I could just say— nays 65, as follows: to thank Senator HEITKAMP for her The PRESIDING OFFICER. There is [Rollcall Vote No. 299 Leg.] support of this motion. no time remaining. YEAS—34 Our motion would simply send this Mr. MANCHIN. I ask unanimous con- legislation back to the Senate Finance Baldwin Franken Nelson sent for an additional 30 seconds. Bennet Hassan Peters Committee with instructions to change Blumenthal Heinrich Schatz provisions important to West Vir- The PRESIDING OFFICER. Is there Brown Kaine Shaheen objection? Cantwell King ginians. Stabenow Without objection, it is so ordered. Cardin Klobuchar Udall First, it would call for the reductions Carper Leahy Van Hollen on individual tax rates for middle-class Mr. MANCHIN. Mr. President, a 33- Casey Manchin Warner percent decrease from 35 percent to 25 Coons McCaskill and working people to be made perma- Whitehouse Donnelly Menendez nent. Currently, individuals receive percent is quite substantial. I have not Wyden Duckworth Merkley temporary relief, while corporate had a corporation yet, if you have spo- Feinstein Murray changes are made permanent—a gim- ken to any of them, that wouldn’t be NAYS—65 mick that provides uncertainty for tickled to death with 25 percent. That Alexander Gardner Perdue West Virginia taxpayers and North Da- basically sustains that we can help Barrasso Gillibrand Portman kotans. more people. I think it would be great Blunt Graham Reed Next, it directs the committee to for the economy of the United States of Booker Grassley Risch America, and I ask everyone to con- Boozman Harris Roberts maintain important priorities, such as Burr Hatch Rounds the medical expense deduction, student sider that. It is a most reasonable re- Capito Heller Rubio loan interest deduction, retirement quest. Cassidy Hirono Sanders Cochran Hoeven savings incentives, homeownership in- The PRESIDING OFFICER. The Sasse Collins Inhofe centives, and the historic tax credit. question is on agreeing to the Manchin Schumer Corker Isakson Scott It is important that we provide this motion to commit. Cornyn Johnson permanent relief to American tax- Cortez Masto Kennedy Shelby Mr. LEAHY. I ask for the yeas and Cotton Lankford Strange payers who are slated to see higher nays. Sullivan Crapo Lee taxes as rates go up in the later years The PRESIDING OFFICER. Is there a Cruz Markey Tester of this bill. In my State alone, 79 per- Daines McCain Thune sufficient second? Durbin McConnell Tillis cent of West Virginians make under There appears to be a sufficient sec- Enzi Moran Toomey $75,000 and will see their taxes spike as ond. Ernst Murkowski Warren their tax relief expires. The clerk will call the roll. Fischer Murphy Wicker Finally, the amendment calls for Flake Paul Young small businesses to receive much need- The senior assistant legislative clerk NOT VOTING—1 ed relief and for the corporate tax rate called the roll. Heitkamp to be set at 25 percent. In my State, Mr. DURBIN. I announce that the The PRESIDING OFFICER. On this 95.6 percent of businesses are small Senator from Rhode Island (Mr. WHITE- vote, the yeas are 34, the nays 65. businesses and employ over 50 percent HOUSE) is necessarily absent. Three-fifths of the Senators duly cho- of West Virginians. The PRESIDING OFFICER. Are there sen and sworn not having voted in the I urge my colleagues to support send- any other Senators in the Chamber de- affirmative, the motion is rejected. ing this bill back to committee and to siring to vote? The point of order is sustained and work in a bipartisan way to pass a fis- The result was announced—yeas 38, the amendment falls. cally responsible tax reform bill that nays 61, as follows:

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00054 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.082 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7707 [Rollcall Vote No. 300 Leg.] has everything to do with evading reg- in fact, laws like the National Environ- YEAS—38 ular order to pass something that could mental Policy Act will ‘‘fully apply.’’ Baldwin Hassan Nelson never be enacted on its own. Given the assurances that environ- Bennet Heinrich Peters In addition to drilling in the Arctic mental and wildlife refuge laws will Blumenthal Heitkamp Reed refuge, this bill would sell 7 million continue to apply, I do not understand Brown Kaine Schatz barrels of oil from our Nation’s stra- Cantwell King Schumer why their bill adds oil development as Cardin Klobuchar Shaheen tegic petroleum reserve. a purpose of the Arctic National Wild- Carper Leahy Stabenow A portion of that sale is necessary life Refuge. Casey Manchin Tester Coons McCaskill simply to meet the committee’s rec- Adding oil development as a purpose Udall Donnelly Menendez onciliation instructions. The sale of oil of the refuge seems contrary to its pri- Van Hollen Duckworth Merkley Warner from the reserve would also provide for mary purpose, which is to protect wild- Feinstein Murphy a $300 million windfall to four States: life. Franken Murray Wyden Texas, Louisiana, Mississippi, and Ala- What a no-brainer: The purpose of a NAYS—61 bama. wildlife refuge is to protect wildlife. Alexander Flake Paul So this bill is selling off oil from our Refuges must be managed that way. Barrasso Gardner Perdue strategic petroleum reserve in order to At every other national wildlife ref- Blunt Gillibrand Portman Booker Graham Risch pay for oil drilling in the Arctic Na- uge in the country, development within Boozman Grassley Roberts tional Wildlife Refuge. the refuge is only permitted to the ex- Burr Harris Rounds It doesn’t make any sense. tent it is compatible with the primary Capito Hatch Rubio The Arctic National Wildlife Refuge purpose of the refuge: protecting wild- Cassidy Heller Sanders Cochran Hirono is one of the crown jewels of the na- life. Sasse Collins Hoeven Scott tional wildlife refuge system. But because the bill makes oil and Corker Inhofe The U.S. Fish and Wildlife Service, gas development a refuge purpose, oil Cornyn Isakson Shelby Cortez Masto Johnson Strange which manages the refuge, describes it drilling in the refuge will no longer be Cotton Kennedy Sullivan as ‘‘the only conservation system unit subject to a meaningful ‘‘compatibility Crapo Lankford Thune that protects, in an undisturbed condi- Tillis determination.’’ Cruz Lee tion, a complete spectrum of the arctic Daines Markey Toomey This bill essentially waives one of the Durbin McCain Warren ecosystems in North America.’’ most important management protec- Enzi McConnell Wicker It is home to an incredible diversity tions that applies to every other na- Ernst Moran Young of wildlife: 47 different species of mam- tional wildlife refuge. Fischer Murkowski mals, including polar bears, grizzly They have to do this because they NOT VOTING—1 bears, wolves, Dall’s sheep, moose, know that oil and gas isn’t compatible Whitehouse musk-ox, and the Porcupine caribou with protecting wildlife—it is just the The motion was rejected. herd. opposite. AMENDMENT NO. 1717 TO AMENDMENT NO. 1618 The refuge provides important habi- This bill does not provide energy se- The PRESIDING OFFICER. The tat for over 40 species of fish and more curity. There is no prohibition in the clerk will report the Cantwell amend- than 200 species of migratory birds bill against exporting oil from the Arc- ment by number. whose lives depend on the Arctic ref- tic refuge. In all likelihood, much of The legislative clerk read as follows: uge. this oil will end up being exported. The Senator from Washington [Ms. CANT- The refuge was first established by The Republican majority agreed to WELL] proposes an amendment numbered 1717 the Eisenhower administration. Con- include only one amendment during to amendment No. 1618. gress later protected this amazing Arc- the Energy Committee’s consideration The amendment is as follows: tic ecosystem in 1980. It did so specifi- of this issue, and that amendment re- (Purpose: To strike title II) cally to protect wildlife and wildlife quired the sale of 5 million barrels of Strike title II. habitat in its natural diversity. oil from the strategic petroleum re- The PRESIDING OFFICER. There The Arctic National Wildlife Refuge serve to give $300 million to the States will be 2 minutes of debate, equally di- is known as the Last Great Wilderness of Texas, Louisiana, Mississippi, and vided. and is truly one of our last great wild Alabama. The Senator from Washington. places. The bill has now been amended to re- Ms. CANTWELL. Mr. President, my But the provisions of this bill turn quire the sale of 7 million barrels from amendment strikes the title requiring the purpose of the Arctic refuge on its our strategic petroleum reserve. oil development in the Arctic National head. So at the same time as we are being Wildlife Refuge. This refuge is the larg- It would make oil and gas develop- told we need to ruin a pristine national est refuge in our Nation and the last ment on the refuge’s coastal plain one wildlife refuge to drill for more oil, the pristine ecosystem for the Arctic in of the statutory purposes of the wild- very same bill is selling off millions of North America. life refuge. barrels out of our strategic oil reserve, Requiring oil development in the Under this bill, our Nation’s most which was used most recently during heart of the Arctic National Wildlife pristine national wildlife refuge will this hurricane season to protect Ameri- Refuge should not be in this bill. become the only refuge where oil and cans from gas price spikes. Although the bill text has been gas development is required by law. The impact of oil and gas exploration changed to address Byrd Rule viola- It opens up the entire 1.5-million-acre in the Arctic National Wildlife Refuge tions, the Congressional Budget Office coastal plain for oil and gas explo- and the danger to its wildlife cannot be continues to estimate that it will raise ration and requires leasing of at least overstated. The importance of the ref- less than $1 billion over 10 years. 800,000 acres. uge for wildlife such as polar bears and Opening the Arctic National Wildlife It requires leasing of areas with the caribou have been documented in let- Refuge to oil drilling doesn’t even meet highest oil and gas potential, no mat- ters I have received from biologists and the $1 billion reconciliation instruc- ter the consequences for wildlife or the other scientists who have worked in tion. environment. the Arctic. It certainly doesn’t represent a seri- The bill requires that the Arctic Na- I ask unanimous consent that the ous offset to huge deficits in the Re- tional Wildlife Refuge be managed as a letters be printed in the RECORD. publican bill. petroleum reserve, which is unprece- There being no objection, the mate- To put this in perspective, this rep- dented and undercuts managing the rial was ordered to be printed in the resents less than seven one-hundredths refuge for wildlife. RECORD, as follows: of 1 percent of the $1.5-trillion-dollar The bill includes no clear require- THE JANE GOODALL INSTITUTE, increase in the national debt that the ments to comply with environmental November 14, 2017. Republican tax policies will cause. laws or to protect wildlife. Its spon- DEAR UNITED STATES SENATOR: It seems Drilling in the Arctic has nothing to sors, however, say they are not pre- that each day brings ever more dire news do with serious budgetary policy, but it empting environmental laws, and that, about what we humans are doing to harm

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00055 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.087 S01DEPT1 S7708 CONGRESSIONAL RECORD — SENATE December 1, 2017 our planet, the animals that share it with us so narrow that even a small footprint for oil end, than they are now. Such high tempera- and, by doing so, harming ourselves also. and gas activities may be too much for the tures would assure ice-free summers in the You have an important opportunity to make caribou already trying to adapt to a chang- Arctic, with devastating impacts on polar a difference both now, and for future genera- ing climate. bears and other Arctic wildlife. And, of tions, by voting to oppose oil development in The Porcupine herd is jointly managed be- course, ramifications reach the rest of life on one of the world’s most spectacular wilder- tween the Alaska Department of Fish and Earth—including humans. ness areas—the Arctic National Wildlife Ref- Game (ADFG), the US Fish and Wildlife With ‘‘on the ground’’ drilling activities uge. Service (USFWS), and the Yukon, NWT and posing a threat to polar bear denning sites, This Refuge is a truly wonderful place— Canadian governments. Collaboration on and prolonged reliance on fossil fuels con- nearly 20 million acres of pristine and eco- monitoring and research has been coordi- tinuing to melt the sea ice polar bears need logically significant habitat. There is com- nated by the Porcupine Caribou Technical to catch their prey, oil and gas development pelling scientific evidence as to why it is Committee, a group recognized in the Inter- in the ANWR would serve a double whammy. truly important to protect this place. For national Porcupine Caribou Agreement Opening the ANWR to drilling, therefore, is one thing, it provides key breeding habitat signed by Canada and the US in 1987. a path we should avoid—for the sake of polar for the millions-upon-millions of birds that The question is not just what would devel- bears, our children, and our grandchildren. migrate there from six of our planet’s seven opment in 1002 lands mean to caribou but it Respectfully, continents. It is also a calving ground for the is what it means to the people in USA and STEVEN C. AMSTRUP, 200,000–strong Porcupine caribou herd. And it Canada who depend on the caribou. Faced Chief Scientist, is one of the most important denning habi- with uncertainty about the caribou, the cau- Polar Bears International. tats on earth for polar bears. Moreover it tionary approach is to do no harm until we plays a significant role in helping to protect have a better understanding. The oil and gas NOVEMBER 9, 2017. us from the onslaught of climate change. is secure in the ground; the caribou and the Hon. LISA MURKOWSKI, Chair. But the Arctic National Wildlife Refuge is people are not. Hon. MARIA CANTWELL, Ranking Member more than that. Its very wildness speaks to ANNE GUNN, Committee on Energy and Natural Resources, our deeply rooted spiritual connection to na- Retired GNWT biolo- U.S. Senate, Washington, DC. ture, a necessary element of the human psy- gist, CircumArctic DEAR SENATORS MURKOWSKI AND CANT- che. The Gwich’in people understand this Rangifer Monitoring WELL: As scientists who have either con- and call the area ‘‘The Sacred Place Where and Assessment ducted research in Arctic Alaska or traveled Life Begins’’. (CARMA) Network. in the Arctic National Wildlife Refuge, we are writing to highlight for you the funda- If we violate the Arctic Refuge by extract- DON RUSSELL, ing the oil beneath the land, this will have Retired Canadian mental importance of fully protecting its devastating impact for the Gwich’in people Wildlife Service Biol- 1.5–million acre coastal plain. Based on our for they depend upon the caribou herds to ogist, Past Co-Chair experience in the Arctic, we oppose oil explo- sustain their traditional way of life. Around International Porcu- ration, development and production in the Arctic Refuge. Such activity would be in- the globe so many indigenous people have pine Caribou Board, compatible with the purposes for which the been harmed in the name of ‘progress’—let CircumArctic refuge was established, including ‘‘to con- us not add one more tragedy to the list. We Rangifer Monitoring serve fish and wildlife populations and habi- have other sources of energy. and Assessment tats in their natural diversity.’’ And so I beg you: Please use your voice and (CARMA) Network. your vote as a U.S. Senator to protect the When the original Arctic National Wildlife Range was established in 1960 by the Eisen- Gwich’in people and the American treasure POLAR BEARS INTERNATIONAL, hower Administration, it was done with the that is the Arctic National Wildlife Refuge. November 28, 2017. foresight and wisdom to protect an entire America has helped lead the world in the Hon. MARIA CANTWELL, conservation of wildlife and your voice has ecosystem, both south and north of the Ranking Member, Committee on Energy and Brooks Range, including the rich coastal been so meaningful in this regard, your ex- Natural Resources, U.S. Senate, Wash- ample so powerful. Please take this oppor- plain. Decades of biological study and sci- ington, DC. entific research within the Arctic Refuge tunity to demonstrate your commitment to DEAR SENATOR CANTWELL: I’ve studied have confirmed that the coastal plain spe- the natural world and to future generations polar bears for 37 years—solving many of the cifically is vital to the biological diversity of and stand with me to protect the Arctic Na- mysteries about their life cycle. I led polar the entire refuge. Within the narrow (15–40 tional Wildlife Refuge. bear research in Alaska for 30 years, and my Please vote against oil development in the miles) coastal plain, there is a unique com- research team at the USGS provided the in- pression of habitats which concentrates a Arctic National Wildlife Refuge. formation that led Interior Secretary Kemp- Sincerely, wide array of wildlife native to the Arctic, thorne to list polar bears as a threatened including polar bears, grizzly bears, wolves, JANE GOODALL, DBE, Ph.D., species. I am currently the chief scientist at wolverines, caribou, musk oxen, Dolly Founder—the Jane Goodall Institute, Polar Bears International. Varden char, Arctic grayling, and many spe- & UN Messenger of Peace. I am reaching out today because I’m con- cies of migratory birds. In fact, according to cerned about the likely impacts on Alaska’s the U.S. Fish and Wildlife Service, the Arctic NOVEMBER 26, 2017. polar bears should the Arctic National Wild- Refuge coastal plain contains the greatest Hon. MARIA CANTWELL, life Refuge be opened to oil and gas develop- wildlife diversity of any protected area Ranking Member, Committee on Energy and ment. above the Arctic Circle. Natural Resources, U.S. Senate, Wash- The ANWR coastal plain is vitally impor- In 2003, the National Research Council ington, DC. tant to polar bears. Pregnant female polar (NRC) published a report on the ‘‘Cumulative DEAR SENATOR CANTWELL: Research across bears head to this area every fall to create Environmental Effects of Oil and Gas Activi- North America including Alaska has re- snow dens where they give birth to their ties on Alaska’s North Slope.’’ Led by Dr. vealed much about how we can monitor and young. In fact, the region has higher con- Gordon Orians, University of Washington, mitigate the effects of industrial activities centrations of polar bear maternal denning this report was prepared by a panel of promi- on migratory tundra caribou. We have learnt habitat than other coastal areas on Alaska’s nent scientists following an extensive review that, although the Prudhoe Bay oilfield dis- North Slope. In recent years, the ANWR has of the literature and consultations with ex- placed calving and post-calving caribou of become even more important as a polar bear perts. It remains the best, most comprehen- the Central Arctic herd, the effects were off- denning site because the deterioration of his- sive synthesis of the effects of oil develop- set by reduced hunting. Consequently the torically stable sea ice in the Beaufort Sea ment on wildlife and the landscape of Arctic herd increased but between 2010 and 2016 the has forced more polar bears to den onshore, Alaska. Among the report’s ‘‘major findings’’ herd is declining at the rate of halving every rather than risk giving birth on unstable ice. (Chapter 11) are the following: 4 years. We have also learnt that industrial In addition to the ANWR’s importance as a Three-dimensional seismic surveys require activities including roads can displace car- critical denning area for polar bears, the re- a high spatial density of trails. ‘‘Seismic ex- ibou by larger distances than previously re- gion faces profound impacts from climate ploration can damage vegetation and cause alized. change unless we transition away from fossil erosion, especially along stream banks.’’ Caribou across North America are part of a fuels. Warmer temperatures mean less sea The effects of roads, pads, pipelines, and global decline. The Porcupine herd is the ice habitat, which polar bears rely on to other infrastructure extend far beyond the only herd of migratory tundra caribou in catch their seal prey. In addition, encour- physical footprint itself, and the distances at North America that is not currently declin- aging more fossil fuel usage, as opening the which impacts occur vary with the environ- ing. It has the diversity of ranges and habi- ANWR would do, will only add to ongoing mental component affected. ‘‘Effects on hy- tats that allow the caribou to respond to the global warming. drology, vegetation, and animal populations changing climate by choosing the best habi- If we continue to follow a ‘‘business as occur at distances up to several kilometers tats for their survival. This is true for usual’’ reliance on fossil fuels, average an- . . .’’ calving as the PCH calves in the 1002 area nual temperatures in Alaska’s Arctic are ‘‘Roads have had effects as far-reaching and the western Canadian coastal plain de- projected to be more than 10 degrees Celsius and complex as any physical component of pending on weather. The coastal plains are (18 degrees Fahrenheit) higher, at century’s the North Slope oil fields.’’

VerDate Sep 11 2014 10:42 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00056 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.107 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7709 Denning polar bears are among the ani- Service (retired), Anchorage, Alaska; These caribou are an important food mals that ‘‘have been affected by industrial David R. Klein, Ph.D., Professor Emer- source for many Alaska Natives, but in activities on the North Slope.’’ itus, Wildlife Management, University particular the Gwich’in people, who Readily available food supplies in the oil of Alaska Fairbanks, Fairbanks, Alas- live south of the refuge. Wildlife biolo- fields attract higher-than-normal densities ka. of predators, which then prey on birds and John Coady, Ph.D., Alaska Dept. of Fish gists argue that the risk to the caribou their eggs and young. The reproductive suc- & Game (retired), Fairbanks, Alaska; herd—and those who rely on this herd— cess rate of some bird species in the devel- Jack Lentfer, M.Sc., U.S. Marine Mam- could be quite significant. oped parts of oil fields ‘‘has been reduced to mal Commission (retired), Alaska Do you know what Webster’s defini- the extent that it is insufficient to balance Dept. of Fish & Game (retired), Gusta- tion of stewardship is? The careful and mortality.’’ vus, Alaska; Peter G. Connors, Ph.D., responsible management of something The spread of industrial activity, espe- Bodega Marine Lab (retired), Univer- entrusted to one’s care. Since 1960, cially to the east where the coastal plain is sity of California—Davis, Bodega Bay, under President Eisenhower, this narrower than elsewhere [i.e., the Arctic Ref- California; Joe Liebezeit, M.Sc., Audu- uge], ‘‘would likely result in reductions in iconic refuge has been protected. To- bon Society of Portland, Portland, Or- night, unless you help strike this, you reproductive success’’ for caribou. egon; Joseph Cook, Ph.D., Professor of Although oilfield technologies continue to Biology, University of New Mexico, Al- will be joining the ranks of those that improve, the NRC’s findings are still of con- buquerque, New Mexico; Lloyd Lowery, believe in polluting a wildlife refuge, cern today. Indeed, proposals that would M.Sc., Alaska Dept. of Fish & Game and you will be joining an administra- limit the ‘‘footprint’’ of oil development to (retired), Kailua Kona, Hawaii. tion that I guarantee you is going to go 2,000 acres on the coastal plain within the Rosa H. Meehan, Ph.D., U.S. Fish & Wild- down in history as getting an F in Arctic Refuge are of little value, since those life Service (retired), Anchorage, Alas- acres may be spread over much of the coastal stewardship. ka; Stanley Senner, M.Sc., National plain. This would be especially true if oil re- The Arctic National Wildlife Refuge Audubon Society, Missoula, Montana; serves are scattered in multiple pockets is too special and important; it is one Sterling Miller, Ph.D., Alaska Dept. of across the refuge, as is suggested by the U.S. of the crown jewels of the National Fish & Game (retired), National Wild- Geological Survey (Fact Sheet 0028–01). life Federation (retired), Missoula, Wildlife Refuge System. Since the effects of industrial activities, Montana; David W. Shaw, M.Sc., Biolo- We should not destroy this pristine starting with seismic surveys, are not lim- gist-guide, Fairbanks, Alaska; Russell landscape and allow it to be turned ited to the footprint of a structure or to its M. Oates, M.Sc., Former Refuge Biolo- into an oil field. immediate vicinity, it is highly likely that gist, Arctic NWR, U.S. Fish & Wildlife I want to remind my colleagues of such activities would result in significant Service (retired), Burnsville, North the words of the great environmental impacts on a variety of wildlife in the ref- Carolina; E. LaVerne Smith, M.Sc., uge’s narrow coastal plain. steward Olaus Murie. U.S. Fish & Wildlife Service (retired), Development of yet another oilfield would After decades of scientific explo- Anchorage, Alaska. further set back efforts to limit the carbon ration in Alaska, Olaus testified in the Gordon Orians, Ph.D., Professor Emer- emissions that are fueling the dramatic Senate in 1959 in support of creating itus, Biology, University of Wash- changes in climate now affecting Alaska. the Arctic refuge. ington, Seattle, Washington; Dan Tay- Polar bears—listed as ‘‘threatened’’ under lor, M.Sc., Audubon California (re- He said, ‘‘We long for something the Endangered Species Act—are already tired), Sacramento, California; Martha more, something that has a mental, a struggling with deteriorating sea ice and in- Raynolds, Ph.D., Arctic Plant Ecolo- spiritual impact on us. This idealism, creasingly are forced to den on land on the gist, Fairbanks, Alaska; Nils Warnock, more than anything else, will set us eastern Beaufort Sea coast, including the Ph.D., Audubon Alaska, Anchorage, coastal plain of the Arctic Refuge. In fact, apart as a nation striving for some- Alaska. three-fourths of the refuge coastal plain is thing worthwhile in the universe.’’ Martin Robards, Ph.D., Arctic Beringia designated as critical habitat for polar bears, What is setting us apart today, col- Program, Wildlife Conservation Soci- which are highly vulnerable to disturbance leagues, is just the opposite. We are ety, Fairbanks, Alaska; Robert G. due to oil and gas activities. striving for short-term gains. The NRC report and subsequent work done White, Ph.D., Professor Emeritus, In a hundred years, when the eco- Zoophysiology, University of Alaska in Arctic Alaska strongly indicate that the nomic effects of this tax bill are long cumulative impact of many seemingly small Fairbanks, Fairbanks, Alaska; George Schaller, Ph.D., Wildlife Conservation forgotten, we will still bear the blame changes is significant. New development on for letting go of ‘‘something worth- the coastal plain of the Arctic Refuge, one of Society, West Lebanon, New Hamp- the nation’s and planet’s premier protected shire; Kenneth R. Whitten, M.Sc., Alas- while in the universe.’’ areas, will only contribute to these harmful ka Dept. of Fish & Game (retired), We didn’t create the Arctic coastal impacts on wildlife. For all these reasons, we Fairbanks, Alaska. plain, and we cannot recreate, but we oppose oil and gas exploration, development Scott Schliebe, Ph.D., U.S. Fish & Wild- can surely destroy it. and production on the coastal plain of the life Service (retired), Anchorage, Alas- I urge my colleagues to oppose sacri- Arctic Refuge. ka; John W. Schoen, Ph.D., Alaska ficing the Arctic National Wildlife Ref- Thank you for your consideration. Dept. of Fish & Game (retired), Audu- uge, and to support removing this pro- bon Alaska (retired), Anchorage, Alas- Sincerely, vision from the bill. R. Terry Bowyer, Ph.D., Professor Emer- ka; Nathan Senner, Ph.D., University of Montana, Missoula, Montana; Steve I yield the floor. itus, Wildlife Ecology University of Mr. SANDERS. Mr. President, I Alaska Fairbanks, Fairbanks, Alaska; Zack, Ph.D., Wildlife Conservation So- Jim Dau, M.Sc., Alaska Dept. of Fish & ciety (retired) Portland, Oregon. would like to enter into the CONGRES- SIONAL RECORD the scores produced by Game (retired), Kotzebue, Alaska; Mike Ms. CANTWELL. The Arctic Refuge’s the Congressional Budget Office for Boylan, M.Sc., National Wildlife Ref- coastal plain and nearby waters are uges Association, Anchorage, Alaska; section 20001 as it appears in Senate designated as critical habitat for polar Anthony R. DeGange, M.Sc., U.S. Geo- amendment 1618; and the score of sec- bears, which were designated as a logical Survey (retired), Anchorage, tion 20001 as it appears in Senate threatened species under the Endan- Alaska; Jedediah Brodie, Ph.D., amendment 1855. Craighead Chair, Wildlife Conserva- gered Species Act in 2008. Female polar In Senate amendment 1618, CBO esti- tion, University of Montana, Missoula, bears head to this area every fall to mates that opening the coastal plain Montana; Jeff Fair, M.Sc., Fairwinds create snow dens where they give birth for oil and gas leasing and managing Wildlife Services, Palmer, Alaska. to their young. Stephen Brown, Ph.D., Shorebird Biolo- ‘‘it in accordance with requirements of gist, Saxtons River, Vermont; Kathy The Arctic National Wildlife Refuge the Naval Petroleum Reserves Produc- Frost, M.Sc., Alaska Dept. of Fish & is also famously known as the summer tion Act of 1976 (including regula- Game (retired), Kailua Kona, Hawaii; calving grounds for the Porcupine car- tions)’’ will result in net Federal re- F. Stuart Chapin III, Ph.D., Professor ibou herd. The herd’s range extends ceipts of $1092 million from 2018 Emeritus, Ecology, University of Alas- into Canada. A treaty between our through 2027. ka Fairbanks, Fairbanks, Alaska; H. countries protects the herd and its In Senate amendment 1855, CBO esti- River Gates, M.Sc., Shorebird Biolo- habitat. mates that managing lease sales ‘‘in a gist, Anchorage, Alaska; Dave Cline, M.Sc., National Audubon Society (re- The almost 200,000-member herd has manner similar to the administration tired), U.S. Fish & Wildlife Service (re- an annual migration of hundreds of of leases under the Naval Petroleum tired), North Bend, Washington; Mary miles—and in some cases thousands of Reserves Production Act of 1976 (in- E. Hogan, M.Sc., U.S. Fish & Wildlife miles—wintering south of the refuge. cluding regulations)’’ will result in net

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00057 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.109 S01DEPT1 S7710 CONGRESSIONAL RECORD — SENATE December 1, 2017 Federal receipts of $910 million from If you wish further details on this esti- which are treated as reductions in direct 2018 through 2027, a decrease of $182 mate, we will be pleased to provide them. spending, by about $1.1 billion over the 2018– million compared to the language in The CBO staff contact is Jeff LaFave. 2027 period. Sincerely, Senate amendment 1618. Because enacting the legislation would af- KEITH HALL, Director. fect direct spending pay-as-you-go proce- I ask unanimous consent that the fol- Enclosure. dures apply. Enacting the legislation would lowing CBO tables be printed in the A LEGISLATIVE PROPOSAL RELATED TO THE not affect revenues. RECORD. ARCTIC NATIONAL WILDLIFE REFUGE CBO estimates that enacting legislation There being no objection, the mate- As posted on the website of the Senate Com- would not increase net direct spending or on- rial was ordered to be printed in the mittee on Energy and Natural Resources budget deficits in any of the four consecutive (FLO17783) on November 8, 2017 10-year periods beginning in 2028. RECORD, as follows: SUMMARY The legislation contains no intergovern- CONGRESSIONAL BUDGET OFFICE, The legislation would direct the Secretary mental or private-sector mandates as defined U.S. CONGRESS, of the Interior to implement an oil and gas in the Unfunded Mandates Reform Act Washington, DC, November 8, 2017. leasing program for the coastal plain of the (UMRA). HON. LISA MURKOWSKI, Arctic National Wildlife Refuge (ANWR). ESTIMATED COST TO THE FEDERAL GOVERNMENT Chairman, Committee on Energy, Based on information provided by the De- U.S. Senate, Washington, DC. partment of the Interior (DOI), the Energy The estimated budgetary impact of the leg- DEAR MADAM CHAIRMAN: The Congressional Information Administration (EIA), and indi- islation is shown in the following table. The Budget Office has prepared the enclosed cost viduals working in the oil and gas industry, costs of this legislation fall within budget estimate for a Legislative Proposal Related CBO estimates that implementing the legis- functions 300 (natural resources and environ- to the Arctic National Wildlife Refuge. lation would increase net offsetting receipts, ment) and 800 (general government).

By fiscal year, in millions of dollars— 2018– 2018– 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2022 2027

DECREASES IN DIRECT SPENDING a Estimated Budget Authority ...... 0 0 0 0 ¥725 * * ¥366 ¥1 ¥1 ¥725 ¥1,092 Estimated Outlays ...... 0 0 0 0 ¥725 * * ¥366 ¥1 ¥1 ¥725 ¥1,092 Components may not sum to totals because of rounding; * = between ¥$500,000 and zero. a CBO estimates that implementing the legislation also would cost about $10 million over the 2018–2022 period, assuming the availability of appropriated funds, for environmental reviews and the administrative costs of conducting the lease sales.

BASIS OF ESTIMATE 2018.2022 period for environmental reviews and alternative investment opportunities. In For this estimate, CBO assumes that the and administrative costs associated with the particular, oil companies have other domes- legislation will be enacted near the end of leasing program subject to the availability tic and overseas investment options that 2017 and that the funds necessary to imple- of appropriated funds. Based on information they would evaluate and compare with po- ment the legislation would be available. provided by the Government Accountability tential investments in ANWR. The potential Description of the Legislation Office, we estimate that completing the en- profitability for a wide range of such global vironmental reviews required under the Na- investment options would probably be a sig- The legislation would direct the Secretary tional Environmental Policy Act would cost nificant factor in prospective bidders’ ulti- of the Interior to implement an oil and gas $2 million. In addition, CBO estimates that mate choices of how much to bid for ANWR leasing program for lands located within the other implementation costs would total be- leases. The number of factors that affect coastal plain of ANWR, which includes about tween $1 million and $2 million per year over companies’ investment decisions result in a 1.5 million acres of federal land on the north- that period. wide range of estimates for bonus bids. CBO’s east coast of Alaska. Under current law, ac- estimate reflects our best estimate of the tivities related to oil and gas leasing in Direct Spending midpoint of that range. ANWR are prohibited. CBO estimates that implementing the leg- The legislation would require the Sec- islation would increase net offsetting re- Other Receipts. In addition to receipts retary to hold two lease sales over a seven- ceipts by about $1.1 billion over the 2018–2027 from bonus bids, CBO estimates that the fed- year period following enactment and to offer period. eral government would collect net receipts at least 400,000 acres of land in ANWR for Bonus Bids. CBO estimates that gross pro- from rental payments totaling about $2 mil- lease at each sale. Any lease sales in ANWR ceeds from bonus bids paid for the right to lion over the 2022–2027 period. (Lease holders would be carried out in accordance with pro- develop leases in ANWR would total $2.2 bil- make an annual rental payment until pro- cedures used to conduct oil and gas leasing lion over the 2018–2027 period. That estimate duction begins.) CBO also estimates that the within the National Petroleum Reserve in is based on historical information about oil federal government would receive royalty Alaska. For each lease awarded, lessees and gas leasing in the United States and on payments on oil produced from ANWR information from DOI, EIA, and individuals would pay the federal government bonus bids leases; however, based on information from working in the oil and gas industry about to acquire the leases, annual rent to retain EIA regarding the typical amount of time factors that affect the amounts that compa- the leases, and royalties based on the value necessary to drill exploratory wells, com- nies are willing to pay to acquire oil and gas of any oil or gas production from the leases. plete production plans, and build the nec- leases. In addition, CBO relied on estimates The legislation would establish a 16.67 per- essary infrastructure to produce and trans- prepared by the United States Geological cent royalty on oil and gas produced in port any oil produced in ANWR, CBO expects Survey of the amount of oil that might be ANWR. (Under current law, the federal gov- that no significant royalty payments would produced from the coastal plain of ANWR. As ernment charges royalties of 12.5 percent for be made until after 2027. specified in the legislation, one-half of all re- oil and gas produced onshore and 18.75 per- ceipts from leases in ANWR would be paid to cent for oil and gas produced in the Outer PAY-AS-YOU-GO CONSIDERATIONS Alaska, leaving net federal receipts totaling Continental Shelf.) Finally, under the legis- $1.1 billion over the 2018–2027 period. The Statutory Pay-As-You-Go Act of 2010 lation, Alaska would receive one-half of the Estimates of bonus bids for leases in establishes budget-reporting and enforce- gross proceeds generated from the leasing ANWR are uncertain. Potential bidders ment procedures for legislation affecting di- program. might make assumptions that are different rect spending or revenues. The net changes Spending Subject to Appropriation from CBO’s, including assumptions about in outlays that are subject to those pay-as- CBO estimates that implementing the leg- long-term oil prices, production costs, the you-go procedures are shown in the following islation would cost $10 million over the amount of oil and gas resources in ANWR, table. CBO ESTIMATE OF PAY-AS-YOU-GO EFFECTS FOR THE LEGISLATIVE PROPOSAL RELATED TO THE ARCTIC NATIONAL WILDLIFE REFUGE

By fiscal year, in millions of dollars— 2018– 2018– 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2022 2027

Statutory Pay-As-You-Go Impact ...... 0 0 0 0 ¥725 0 0 ¥366 ¥1 ¥1 ¥725 ¥1,092

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00058 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.092 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7711

MANDATES mulas specified by the legislation and under or on-budget deficits in any of the four con- The legislation contains no intergovern- federal laws governing oil and gas produc- secutive 10-year periods beginning in 2028. mental or private-sector mandates as defined tion. Over the 2018–2027 period, CBO esti- ESTIMATE PREPARED BY in UMRA, mates that Alaska would receive a total of about $1.1 billion in royalties. Federal Costs: Jeff LaFave; Mandates: The legislation would benefit the State of Zachary Bynum. Alaska by increasing the generation of roy- INCREASE IN LONG-TERM DIRECT SPENDING AND alties from oil and gas production on public DEFICITS ESTIMATE APPROVED BY lands in ANWR. Portions of the royalties CBO estimates that enacting the legisla- H. Samuel Papenfuss, Deputy Assistant Di- would be shared with the state under for- tion would not increase net direct spending rector for Budget Analysis. PRELIMINARY ESTIMATE OF DIRECT SPENDING EFFECTS OF TITLE II OF RECONCILIATION RECOMMENDATIONS AS PROVIDED BY THE SENATE COMMITTEE ON THE BUDGET ON NOVEMBER 30, 2017 (MCG17C35)

By fiscal year, in millions of dollars— 2018– 2018– 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2022 2027

ESTIMATED INCREASES FOR DECREASES (¥) IN DIRECT SPENDING Sec. 20001—Oil and Gas Program Estimated Budget Authority ...... 0 0 0 0 ¥605 * * ¥304 * * ¥605 ¥910 Estimated Outlays ...... 0 0 0 0 ¥605 * * ¥304 * * ¥605 ¥910 Sec. 20002—Limitation on Amount Distributed Qualified Outer Continental Shelf Revenue Estimated Budget Authority ...... 0 0 0 150 150 0 0 0 0 0 300 300 Estimated Outlays ...... 0 0 0 150 150 0 0 0 0 0 300 300 Sec. 20003—Strategic Petroleum Reserve Drawdown & Sale Estimated Budget Authority ...... 0 0 0 0 0 0 0 0 ¥235 ¥240 0 ¥475 Estimated Budget Authority ...... 0 0 0 0 0 0 0 0 ¥235 ¥240 0 ¥475 Total Estimated Budget Authority ...... 0 0 0 150 ¥455 * * ¥304 ¥235 ¥240 ¥305 ¥1085 Total Estimated Outlays ...... 0 0 0 150 ¥455 * * ¥304 ¥235 ¥240 ¥305 ¥1085 Notes: Components may not sum to totals because of rounding: * = between ¥$500,000 and zero.

The PRESIDING OFFICER (Mr. [Rollcall Vote No. 301 Leg.] singles out one college in America PERDUE). The Senator from Alaska. YEAS—48 from the university endowment tax set Ms. MURKOWSKI. Mr. President, I Baldwin Franken Murray forth in the underlying bill. strongly oppose this motion to strike. Bennet Gillibrand Nelson To be sure, I don’t like the endow- Blumenthal Harris Peters ment tax in this bill. It diminishes the This is our opportunity to provide jobs, Booker Hassan Reed to create revenues and resources, and Brown Heinrich Sanders ability of colleges to provide scholar- to protect an environment that as Cantwell Heitkamp Schatz ships to financially challenged stu- Alaskans we know how to protect. We Cardin Hirono Schumer dents. But if the majority is intent on Carper Kaine Shaheen are seeking with this energy title to Casey King Stabenow having an endowment tax, then no col- develop 2,000 acres out of 19.3 million Collins Klobuchar Tester lege should be exempted. acres, one ten-thousandths of all of Coons Leahy Udall The argument for the exemption is Cortez Masto Markey Van Hollen that this college doesn’t take Federal ANWR, and we are seeking to do it Donnelly McCaskill Warner with a smaller, limited footprint, using Duckworth Menendez Warren funds. But remember why: They were the technologies that have become Durbin Merkley Whitehouse sued in the 1980s for discriminatory available over the decades that we have Feinstein Murphy Wyden practices, and they wanted to continue been seeking to advance these opportu- NAYS—52 those practices. This school, Hillsdale nities—opportunities for Alaska, op- Alexander Gardner Perdue College, does have powerful friends, in- portunities for the Nation. Barrasso Graham Portman cluding our Secretary of Education, Blunt Grassley Risch but isn’t that just the type of insider I would implore colleagues. For 40 Boozman Hatch Roberts deal for the wealthy and well con- years now we have been looking for the Burr Heller Rounds opportunity to best protect our long- Capito Hoeven Rubio nected that we should oppose? term energy and national security. Cassidy Inhofe Sasse A vote against this amendment is a Cochran Isakson Scott vote for an earmark for a school with This is our chance. Corker Johnson Shelby Cornyn Kennedy powerful friends and for subsidizing The pending amendment No. 1717 Strange Cotton Lankford discrimination. A vote for my amend- would cause the underlying legislation Sullivan Crapo Lee ment is a vote to strike down such an to exceed the Energy and Natural Re- Cruz Manchin Thune sources Committee’s section 302(a) al- Daines McCain Tillis earmark, a vote for fair treatment of Enzi McConnell Toomey schools, and a vote against discrimina- location of new budget authority or Wicker outlays. Therefore, I raise a point of Ernst Moran tion, and I urge you to vote aye. Fischer Murkowski Young The PRESIDING OFFICER. The Sen- order against this measure pursuant to Flake Paul section 302(f) of the Congressional ator from Pennsylvania. The PRESIDING OFFICER. On this Mr. TOOMEY. Mr. President, Hills- Budget Act of 1974. vote, the yeas are 48, the nays are 52. dale College has been unfairly ma- Ms. CANTWELL. Mr. President, pur- Three-fifths of the Senators duly cho- ligned on the Senate floor. The fact is, suant to section 904 of the Congres- sen and sworn not having voted in the Hillsdale College was the first college sional Budget Act of 1974 and the waiv- affirmative, the motion is rejected. in America to prohibit in its charter er provisions of applicable budget reso- The point of order is sustained and any discrimination based on race, reli- lutions, I move to waive all applicable the amendment falls. gion, or sex and was an early force in sections of that act and applicable The PRESIDING OFFICER. The Sen- ator from Oregon. the abolition of slavery. budget resolutions for purposes of the But it is not really about Hillsdale AMENDMENT NO. 1856 TO AMENDMENT NO. 1618 pending amendment, and I ask for the college, exclusively. This is a broader Mr. MERKLEY. Mr. President, I call yeas and nays. idea. The idea here, and it is in this up amendment No. 1856. The PRESIDING OFFICER. Is there a amendment, is that for any college sufficient second? The PRESIDING OFFICER. The clerk will report. that chooses to forgo Federal funding There appears to be a sufficient sec- for its students—chooses not to be a ond. The senior assistant legislative clerk read as follows: burden on the taxpayers that way—it is The question is on agreeing to the The Senator from Oregon [Mr. MERKLEY] reasonable for us to respond by sparing motion. proposes an amendment numbered 1856 to that college a tax on the endowment The clerk will call the roll. amendment No. 1618. fund. That is all. The legislative clerk called the roll. On page 289, strike lines 17 through 19 Now there are colleges, a number of The yeas and nays resulted—yeas 48, Mr. MERKLEY. Mr. President, this colleges, including one in Pennsyl- nays 52, as follows: amendment strikes a tax earmark that vania, that choose this mode. They

VerDate Sep 11 2014 10:42 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00059 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.102 S01DEPT1 S7712 CONGRESSIONAL RECORD — SENATE December 1, 2017 would prefer to have the freedom to op- The question is on agreeing to the Feinstein Manchin Schumer erate as they see fit rather than have amendment. Franken Markey Shaheen Gillibrand McCaskill Stabenow to deal with Federal regulations, and I The amendment (No. 1618), as amend- Harris Menendez Tester suspect that is a big part of what the ed, was agreed to. Hassan Merkley Udall real problem is on the other side of the The amendment was ordered to be Heinrich Murphy Van Hollen Heitkamp Murray aisle. But, folks, I think it is a per- engrossed and the bill to be read a Warner Hirono Nelson Warren Kaine Peters fectly reasonable proposition that if a third time. Whitehouse King Reed college chooses to forgo the very sub- The bill was read the third time. Wyden Klobuchar Sanders stantial funds available to it from Fed- The PRESIDING OFFICER. There Leahy Schatz eral taxpayers, it is OK to say that it will now be 2 minutes of debate prior to will be exempt from this endowment. the vote on H.R. 1. The bill (H.R. 1), as amended, was So I urge my colleagues to vote no on The Senator from Oregon. passed. The VICE PRESIDENT. The Tax Cuts the amendment. Mr. WYDEN. Mr. President, millions and Jobs Act, as amended, is passed. The PRESIDING OFFICER. The of Americans must be watching in (Applause, Senators rising.) question is on agreeing to the amend- stunned disbelief tonight as the Repub- The PRESIDING OFFICER (Mr. ment. lican Senate betrays the middle class PERDUE). The majority leader. Mr. MERKLEY. I ask for the yeas for the benefit of faceless, multi- and nays. national corporations. f The PRESIDING OFFICER. Is there a Colleagues, how many middle-class EXECUTIVE SESSION sufficient second? families need to see their hard-earned There appears to be a sufficient sec- pay snatched away in tax hikes before ond. these corporate handouts are no longer EXECUTIVE CALENDAR The clerk will call the roll. worth it? How many more Americans Mr. MCCONNELL. Mr. President, I The senior assistant legislative clerk need to see their jobs shipped overseas move to proceed to executive session to called the roll. before corporate paymasters no longer consider Calendar No. 495, Kirstjen The result was announced—yeas 52, call the shots? How many Americans Nielsen. nays 48, as follows: need to lose their healthcare or see The PRESIDING OFFICER. The [Rollcall Vote No. 302 Leg.] their premiums shoot sky-high before question is on agreeing to the motion. YEAS—52 this is stopped? The motion was agreed to. Baldwin Gillibrand Murray What is happening tonight is the The PRESIDING OFFICER. The Bennet Harris Nelson worst of the U.S. Senate. There is a clerk will report the nomination. Blumenthal Hassan Peters trail of broken promises—broken prom- Booker Heinrich Reed The senior assistant legislative clerk Brown Heitkamp Sanders ises to working families in the mad read the nomination of Kirstjen Cantwell Hirono Schatz dash to pass this bill. The American Nielsen, of Virginia, to be Secretary of Cardin Kaine Schumer people understand this is the first step Homeland Security. Carper Kennedy Shaheen Casey King of continuing attacks on Medicare, on CLOTURE MOTION Stabenow Collins Klobuchar Tester Medicaid, and on Social Security. This Mr. MCCONNELL. Mr. President, I Coons Leahy Udall vote will not be forgotten. Cortez Masto Manchin send a cloture motion to the desk. Donnelly Markey Van Hollen I yield the floor. The PRESIDING OFFICER. The clo- Duckworth McCaskill Warner The PRESIDING OFFICER. The ma- ture motion having been presented Warren Durbin Menendez jority leader. under rule XXII, the Chair directs the Feinstein Merkley Whitehouse C Fischer Murkowski Wyden Mr. M CONNELL. Mr. President, I clerk to read the motion. Franken Murphy yield back the time on this side. The senior assistant legislative clerk The PRESIDING OFFICER. The bill NAYS—48 read as follows: having been read the third time, the Alexander Flake Perdue CLOTURE MOTION Barrasso Gardner Portman question is, Shall the bill pass? We, the undersigned Senators, in accord- Blunt Graham Risch Mr. MCCONNELL. Mr. President, I ance with the provisions of rule XXII of the Boozman Grassley Roberts ask for the yeas and nays. Standing Rules of the Senate, do hereby Burr Hatch Rounds The PRESIDING OFFICER. Is there a move to bring to a close debate on the nomi- Capito Heller Rubio Cassidy Hoeven Sasse sufficient second? nation of Kirstjen Nielsen, of Virginia, to be Cochran Inhofe Scott There appears to be a sufficient sec- Secretary of Homeland Security. Corker Isakson Shelby ond. Mitch McConnell, Tom Cotton, Roy Cornyn Johnson Strange The clerk will call the roll. Blunt, Rob Portman, James E. Risch, Cotton Lankford Sullivan Lindsey Graham, Richard Burr, Mike Crapo Lee Thune The legislative clerk called the roll. Crapo, John Boozman, Roger F. Cruz McCain Tillis The result was announced—yeas 51, Wicker, Ron Johnson, John Thune, Daines McConnell Toomey Enzi Moran Wicker nays 49, as follows: John Hoeven, Steve Daines, Marco Ernst Paul Young [Rollcall Vote No. 303 Leg.] Rubio, John Cornyn, John Barrasso. The amendment (No. 1856) was agreed YEAS—51 Mr. MCCONNELL. Mr. President, I to. Alexander Flake Paul ask unanimous consent that the man- The PRESIDING OFFICER. The ma- Barrasso Gardner Perdue datory quorum call for the cloture mo- Blunt Graham Portman tion be waived. jority leader. Boozman Grassley Risch Mr. MCCONNELL. Colleagues, we are Burr Hatch Roberts The PRESIDING OFFICER. Without moving now to final passage. Capito Heller Rounds objection, it is so ordered. I know of no further amendments to Cassidy Hoeven Rubio Mr. MCCONNELL. Mr. President, I Cochran Inhofe Sasse ask unanimous consent that notwith- the bill. Collins Isakson Scott AMENDMENT NO. 1618, AS AMENDED Cornyn Johnson Shelby standing rule XXII, the Senate vote on The PRESIDING OFFICER. There Cotton Kennedy Strange this cloture motion at 5:30 p.m. on Crapo Lankford Sullivan Monday, December 4. will be 2 minutes of debate on amend- Cruz Lee Thune ment No. 1618, as amended. Daines McCain Tillis The PRESIDING OFFICER. Without Mr. MCCONNELL. Mr. President, I Enzi McConnell Toomey objection, it is so ordered. Ernst Moran Wicker The PRESIDING OFFICER. The Sen- yield back our time. Fischer Murkowski Young The PRESIDING OFFICER. All time ator from Wyoming. is yielded back for the majority. NAYS—49 TAX CUTS AND JOBS BILL Mr. SCHUMER. Mr. President, I yield Baldwin Cantwell Corker Mr. ENZI. Mr. President, earlier this back. Bennet Cardin Cortez Masto week, I said it was historic that we Blumenthal Carper Donnelly The PRESIDING OFFICER. All time Booker Casey Duckworth began the consideration of the Tax is yielded back. Brown Coons Durbin Cuts and Jobs Act. Today is even more

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00060 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.093 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7713 significant because we are one step that position. She has been in a num- to search through as they listen to closer to enacting that bill. ber of positions in the Senate that both sides make cases about what can The chairman of the Finance Com- trained her well to be able to do that, and can’t be in a budget reconciliation mittee, Senator HATCH, has called this and she did a marvelous job. bill. a once-in-a-generation opportunity. I I also want to thank her team: Matt There are also many other staffers agree. Giroux, Paul Vinovich, Becky Cole, who deserve to be thanked for their As an accountant, one of my goals Thomas Fuller, Elizabeth Keys, Joe work on this product, including the en- when I came to the Senate in 1996 was Brenckle, Jim Neill, Steve Robinson, tire Finance and Energy Committee to serve on the Finance Committee. Greg D’Angelo, Tom Borck, Rick staffs, but in the interest of time, I will When I joined the committee in 2009, I Berger, Jeremy Dalrymple, David just say that I appreciate them and said that positive, pro-growth changes Ditch, Susan Eckerly, Alison McGuire, look forward to working with all of to our tax policy could help us out of Will Morris, Steve Townsend, Kelsie them to help finish enacting this bill the economic downturn. I believe this Wendelberger, and Eric Ueland. that will benefit hard-working Ameri- bill makes those types of changes and I would like to thank my personal of- cans and make our economy and coun- will jump-start our economy. fice staff who worked hard on the tax try stronger. This week, 137 economists agreed provisions in this package and kept all Mr. President, I yield the floor. with that assessment. In a letter to of my other issues going at the same Mr. HATCH. Mr. President, with pas- Senators and Representatives, these time. Particularly, I want to thank sage of this bill, we are another step economists wrote: ‘‘Economic growth Bart Massey, who is a CPA and who has closer to providing real tax relief to will accelerate if the Tax Cuts and Jobs been my special person to work on the middle class and providing a much- Act passes, leading to more jobs, high- these finance issues with me for more needed boost to our economy. er wages, and a better standard of liv- than 3 years. Today’s events have been years in ing for the American people.’’ I also want to thank Tara Shaw, my the making. This has been my chief My colleagues on the other side of chief of staff, who had to put together legislative focus for many years, and it the aisle dispute that analysis. But a new staff because a lot of good people has been a priority for many of my col- after a decade of below-average growth I had were taken to the administration leagues as well, including some that and official projections showing real and to the Budget Committee. She did are no longer serving. I am talking, of economic growth will average less than a marvelous job on that. course, about people like Dave Camp 2 percent annually over the next dec- Landon Stropko is the legislative di- and Senator Max Baucus, who did a lot ade, isn’t it time that we tried some- rector, and he has coordinated well. I to move this effort forward. I feel thing new? thank Liz Schwartz, Natalia Riggin, gratified to have been here and to have Some of my colleagues have also sug- Aniela Butler, Charlie Carroll, Shawna worked with my colleagues to get this gested that this bill hasn’t gone Newsome, Garnett Decosimo, Chris far. through regular order. I have already Lydon, Aron Wehr, Dylan Mitchell, As efforts this year began earnest, we reminded folks of the 70 tax hearings in Coy Knobel, Max D’Onofrio, Rachel set out to give low- and middle-income the Senate Finance Committee held Vliem, and the rest of my Wyoming Americans some much-needed relief over the last 6 years, but that isn’t all team that worked out in Wyoming col- and to give our country an opportunity we have done. In the last Congress, lecting the information and doing case- to compete in the global economy. Chairman HATCH organized five bipar- work out there while we got this work This bill will do that. With passage of tisan groups to propose changes to the done. this bill, American families will have Tax Code. I was party to those groups, I thank the Budget Committee’s bi- bigger paychecks and better wages. Our which made many recommendations partisan staff: Kim Proctor, Katie employers will have more favorable that have informed this package. I Smith, George Woodall, Grace Bruno, conditions to invest in expansion, grow would say that those working groups and Kevin Walsh, as well as Celina their businesses, and create more jobs were also bipartisan. Inman, who has been on loan to us right here in the United States. While I don’t sit on the Energy Com- from the Government Publishing Of- So many people both in and out of mittee, I understand that Chairman fice. Congress have worked hard to get us to MURKOWSKI led a similarly robust proc- We have also been supported by the this point, and I want to express my ess. The issue of oil and gas exploration great work of our leadership, the floor, appreciation for their efforts. Of and development in the Arctic Na- and the cloakroom staff. Specific course, I can’t thank everyone in a sin- tional Wildlife Refuge has been an thanks are owed to Sharon gle floor speech, but I do want to thank issue since before I was a Senator. We Soderstrom, Hazen Marshall, Jane Lee, some who may be within earshot at the have been considering and debating the Brandon Dunn in the leader’s office, moment. matter for years. This year alone, Sen- Monica Popp, John Chapuis, Emily First and foremost, I want to thank ator MURKOWSKI has introduced a bill, Kirlin, Sam Beaver, Jody Wright, and the members of the Senate Finance held a hearing, and then marked up Noah McCullough in the whip’s office Committee, who put in countless days, legislation on this issue. Now the bill and especially Laura Dove, who coordi- weeks, and months in preparing this that is a product of the Finance and nates all of this activity on the floor legislation and helping to get it passed. Energy Committee’s efforts is on the and who knows the rules backward and All of our majority members contrib- floor. forward and is able to give good ad- uted greatly to this process, and I am We have not bypassed committees. vice—some very definite advice some- most grateful. We have not filled the tree. We have times but always helpful advice—and I also want to thank the distin- not cut off debate by filing cloture, Robert Duncan, Chris Tuck, Megan guished majority leader who also did so which was a common practice in recent Mercer, Tony Hanagan, Mike Smith, much to secure the details of the bill years. I think this is as open and trans- Katherine Kilroy, and Chloe Barz in and shepherd it through the Senate. parent a process as I have seen in many the cloakroom. I want to thank Chairman BRADY and years, and I appreciate the leader, I ap- I would really be remiss if we didn’t Speaker RYAN over in the House of preciate Chairman HATCH, and I appre- thank the Senate Parliamentarian, Representatives. They, too, have been ciate Chairman MURKOWSKI for their Elizabeth MacDonough, and her team: great partners in this endeavor. work to make that happen. Leigh Hilderbrand, Michael Beaver, Of course, I need to thank Secretary I also want to thank my Budget Com- and Allison Markoski. Reconciliation Mnuchin and Director Cohn for their mittee staff for their work on this bill. bills are subject to special rules and commitment to this effort and their In particular, I want to thank my staff procedures, and I know they have given help in getting it done. director, Betsy McDonnell, who has up a lot of their nights and their week- I want to thank the staff of the Fi- done a remarkable job shepherding ends, as well as their regular job time, nance Committee, who have done so both the budget resolution and rec- to work in detail on this product. Peo- much of the heavy lifting here. I need onciliation bill through the committee ple wouldn’t even realize the file cabi- to single out Mark Prater, my chief tax and on the floor. She has been new to nets full of precedents that they have counsel, who has served the committee

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00061 Fmt 0624 Sfmt 0634 E:\CR\FM\G01DE6.097 S01DEPT1 S7714 CONGRESSIONAL RECORD — SENATE December 1, 2017 for decades now and whose knowledge help us get the bill written and ready grade indicated under title 10, U.S.C., section and expertise on these matters is rec- to pass. As did the staff at the legisla- 12203: ognized by everyone here and pretty tive counsel’s office, led by Mark To be brigadier general much everyone everywhere else. Thank McGunagle and Jim Fransen and their Col. John M. Breazeale you, as well, to the rest of my com- whole team and those who work with Col. Damon S. Feltman mittee tax staff: Jennifer Acuna, Tony Elizabeth McDounagh in the Parlia- Col. Anne B. Gunter Coughlan, Christopher Hanna, Alex mentarian’s office. Col. Scheid P. Hodges Monie, Eric Oman, Marty Pippins, There are too many people to thank Col. Richard L. Kemble Col. Tanya R. Kubinec Preston Rutledge, and Nick Wyatt. in a single floor speech, but, I am very Col. Erich C. Novak I need to thank my staff director, grateful for the countless individuals Col. Jeffrey T. Pennington Jay Khosla, who quarterbacked the who have in this endeavor over the Col. John N. Tree staff through this whole ordeal and years. We are not there yet, but we are Col. Aaron G. Vangelisti who has spent many years with me as getting closer. Col. William W. Whittenberger, Jr. we have laid the groundwork and start- I look forward to moving this effort Col. Christopher F. Yancy ed construction on this undertaking. I through the next steps and to working The following named Air National Guard of want to thank the other members of with my colleagues on other challenges the United States officer for appointment in my senior team as well, including Matt that lie ahead. the Reserve of the Air Force to the grade in- Hoffman, Jeff Wrase, Julia Lawless, The PRESIDING OFFICER. The Sen- dicated under title 10, U.S.C., sections 12203 and 12212: Jennifer Kuskowski, Chris Armstrong, ator from Wyoming. and Bryan Hickman. I need to thank To be brigadier general f the communications staff on the com- Col. Darlow G. Botha, Jr. mittee: Katie Niederee, Nicole Hager, EXECUTIVE CALENDAR The following named Air National Guard of and Joshua Blume. the United States officers for appointment in Mr. ENZI. Mr. President, I ask unani- the Reserve of the Air Force to the grade in- I also need to thank a couple of mous consent that the Senate proceed former staff members. Chris Campbell, dicated under title 10, U.S.C., sections 12203 to the consideration of Executive Cal- and 12212: my former staff director, worked for endar Nos. 510 through 522 and all years on this effort, and while, he is To be brigadier general nominations placed on the Secretary’s Col. Steven J. deMilliano now at Treasury, I am sure he is cele- desk; that the nominations be con- brating on his own today. I would also Col. Christopher E. Finerty firmed, the motions to reconsider be The following named Air National Guard of like to give a thank you to Jim Lyons, considered made and laid upon the my tax counsel who, unfortunately, the United States officers for appointment in table with no intervening action or de- the Reserve of the Air Force to the grade in- passed away a little over a year ago. He bate; that no further motions be in dicated under title 10, U.S.C., sections 12203 contributed greatly to this effort for a order; that any statements related to and 12212: number of years, and his steady pres- the nominations be printed in the To be brigadier general ence has definitely been missed. RECORD; that the President be imme- Beyond my own staff, I want to Col. Michele K. LaMontagne diately notified of the Senate’s action Col. Michael J. Regan, Jr. thank the tax legislative assistants and the Senate then resume legislative from each of the committee members The following named Air National Guard of session. the United States officers for appointment in who helped to craft this bill, namely, The PRESIDING OFFICER. Without the Reserve of the Air Force to the grade in- Chris Allen, Sam Beaver, Joseph objection, it is so ordered. dicated under title 10, U.S.C., sections 12203 Boddicker, Chris Conlin, Shay Haw- The nominations considered and con- and 12212: kins, Randy Herndon, Bart Massey, firmed en bloc are as follows: To be brigadier general Monica McGuire, Mike Quickel, IN THE ARMY Col. Travis K. Acheson Zacshary Rudisill, Andrew Siracuse, Col. Barry A. Blanchard The following named officers for appoint- Robert Sneeden, Derek Theurer, and Col. Michael A. Borkowski ment to the grade indicated in the United Mark Warren, all of whom did an out- Col. Michael T. Butler States Army under title 10, U.S.C., section Col. Michael A. Cooper standing job in helping us to produce 624: this bill. Col. Monique J. DeSpain To be brigadier general I also want to thank the committee’s Col. Matthew D. Dinmore legislative directors: Charles Cogar, Col. Douglas F. Stitt Col. Teresa S. Edwards IN THE NAVY Col. Emmanuel I. Haldopoulos Ken Flanz, Chris Gillott, Brad Grantz, Col. Charles G. Jeffries The following named officer for appoint- Amber Kirchhoefer, Kurt Kovarik, Jes- Col. Gregory W. Lair ment in the United States Navy to the grade sica McBride, Sarah Paul, Landon Col. Jeffrey W. Magram indicated under title 10, U.S.C., section 624: Stropko, Jay Sulzmann, Stephen Col. James C. McEachen Tausend, Pam Thiessen, and Chris- To be rear admiral (lower half) Col. Maurice M. McKinney topher Toppings. Capt. Michael E. Boyle Col. Suellen Overton I also need to thank the staff from The following named officer for appoint- Col. Gregg A. Perez the leader’s office, including Brendan ment in the United States Navy to the grade Col. Mark D. Piper Dunn, Antonia Ferrier, Hazen Mar- indicated while assigned to a position of im- Col. James P. Rowlett Col. Michael D. Sproul shall, Erica Suares, Terry Van Doren, portance and responsibility under title 10, U.S.C., section 601: Col. Christan L. Stewart Don Stewart, and Jane Lee. Col. David W. Walter To be vice admiral This process has been a joint effort Col. Terry L. Williams with our friends on the Budget Com- Rear Adm. Lisa M. Franchetti Col. Shanna M. Woyak mittee, and I need to thank Senator IN THE AIR FORCE Col. Frank Y. Yang ENZI, once again, for his leadership on The following named officer for appoint- Col. Jeffrey D. Young that committee to give us the rec- ment in the Reserve of the Air Force to the The following named Air National Guard of onciliation instruction that made this grade indicated under title 10, U.S.C., section the United States officers for appointment in possible. Additionally, I would like to 12203: the Reserve of the Air Force to the grade in- thank members of his staff, including: To be major general dicated under title 10, U.S.C., sections 12203 and 12212: Joe Brenckle, Jim Neill, Betsy McDon- Brig. Gen. Arthur E. Jackman, Jr. To be major general nell, Matt Giroux, Paul Vinovich, The following named officer for appoint- Becky Cole, Eric Ueland, Thomas ment in the Reserve of the Air Force to the Brig. Gen. Ondra L. Berry Fueller, and the rest of the Budget grade indicated under title 10, U.S.C., section Brig. Gen. Samuel W. Black 12203: Brig. Gen. William D. Bunch Committee team. Brig. Gen. Joseph S. Chisolm To be major general Other bodies deserve our thanks as Brig. Gen. Thomas B. Cucchi well. Tom Barthold and his team at the Brig. Gen. Josef F. Schmid, III Brig. Gen. Gary L. Ebben Joint Committee on Taxation made The following named officers for appoint- Brig. Gen. Jerry L. Fenwick themselves available at all hours to ment in the Reserve of the Air Force to the Brig. Gen. Dawn M. Ferrel

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00062 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.111 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7715 Brig. Gen. Thomas J. Kennett and appeared in the Congressional Record of ty. For 10 years, she also fundraised for Brig. Gen. Eric W. Mann November 14, 2017. the LifeSpan Center, a 25,000-square- Brig. Gen. Edward A. Sauley, III PN1241 ARMY nominations (2) beginning foot multipurpose intergenerational fa- Brig. Gen. Dean A. Tremps MARK E. QUERY, and ending SAMUEL H. cility in Mattoon, IL. Dee devoted her- The following named Air National Guard of TAHK, which nominations were received by self to bettering the quality of life for the Senate and appeared in the Congres- the United States officers for appointment in our older Illinoisans. the Reserve of the Air Force to the grade in- sional Record of November 14, 2017. dicated under title 10, U.S.C., sections 12203 PN1242 ARMY nomination of Victor A. Dee’s many years of leadership and and 12212: Pachecofowler, which was received by the contributions to the elderly made her To be major general Senate and appeared in the Congressional the deserving recipient of several Record of November 14, 2017. awards, including the Coles County Brig. Gen. George M. Degnon Brig. Gen. Tamhra L. Hutchins-Frye PN1243 ARMY nomination of James M. Zonta Woman of the Year Award for Brig. Gen. Sherrie L. McCandless Brumit, which was received by the Senate Community Service, the Epsilon Sigma Brig. Gen. Steven Nordhaus and appeared in the Congressional Record of Alpha Diana Award for her service, and Brig. Gen. Kirk S. Pierce November 14, 2017. the Illinois Governor’s Award for Brig. Gen. Frank H. Stokes PN1254 ARMY nomination of Melvin J. Unique Achievement after she devel- Nickell, which was received by the Senate Brig. Gen. Bradley A. Swanson oped a countywide Elder Abuse Task Brig. Gen. Thomas K. Wark and appeared in the Congressional Record of November 16, 2017. Force. This year, the East Central Illi- The following named Air National Guard of PN1255 ARMY nomination of Erica L. nois Area Agency on Aging awarded the United States officers for appointment in Dee the Dr. Arthur H. Larsen Leader- the Reserve of the Air Force to the grade in- Herzog, which was received by the Senate ship Award for her outstanding leader- dicated under title 10, U.S.C., sections 12203 and appeared in the Congressional Record of and 12212: November 16, 2017. ship in advancing programs, services, PN1256 ARMY nomination of Adam W. To be major general and opportunities for older persons in Vanek, which was received by the Senate east central Illinois. Brig. Gen. Douglas A. Farnham and appeared in the Congressional Record of Brig. Gen. Clay L. Garrison These are just a few of Dee’s many November 16, 2017. accomplishment. A full rendering of NOMINATIONS PLACED ON THE SECRETARY’S PN1257 ARMY nomination of Jason Park, her achievements would take much DESK which was received by the Senate and ap- longer than these few moments. I will IN THE AIR FORCE peared in the Congressional Record of No- end by saying that I visited the CCCoA PN951 AIR FORCE nominations (14) begin- vember 16, 2017. several times, and I can tell you first- ning DANE V. CAMPBELL, and ending PN1258 ARMY nomination of John T. RICHARD L. WOODRUFF, JR., which nomi- Huckabay, which was received by the Senate hand that the work Dee has done in the nations were received by the Senate and ap- and appeared in the Congressional Record of community is nothing short of remark- peared in the Congressional Record of Sep- November 16, 2017. able. tember 5, 2017. f Dee’s generous heart is as big as Illi- PN1234 AIR FORCE nominations (69) begin- nois. I don’t know a better volunteer ning JOSEPH BENJAMIN AHLERS, and end- LEGISLATIVE SESSION who has given so much to helping peo- ing TRENTON M. WHITE, which nomina- The PRESIDING OFFICER. The Sen- ple. I wish Dee a happy, relaxing retire- tions were received by the Senate and ap- ment and the best of luck in her life’s peared in the Congressional Record of No- ate will now resume legislative session. vember 14, 2017. next chapter. She has certainly earned PN1236 AIR FORCE nomination of Erika R. it. MORNING BUSINESS Woodson, which was received by the Senate f and appeared in the Congressional Record of Mr. ENZI. Mr. President, I ask unani- November 14, 2017. mous consent that the Senate be in a BUDGETARY REVISIONS PN1237 AIR FORCE nomination of Michael Mr. ENZI. Mr. President, section 3003 S. Stroud, which was received by the Senate period of morning business, with Sen- and appeared in the Congressional Record of ators permitted to speak therein for up of H. Con. Res. 71, the concurrent reso- November 14, 2017. to 10 minutes each. lution on the budget for fiscal year PN1238 AIR FORCE nominations (17) begin- The PRESIDING OFFICER. Without 2018, allows the chairman of the Senate ning LANCE A. AIUMOPAS, and ending objection, it is so ordered. Budget Committee to revise the alloca- TARA L. VILLENA, which nominations were tions, aggregates, and levels in the received by the Senate and appeared in the f budget resolution for legislation con- Congressional Record of November 14, 2017. TRIBUTE TO DEE BRADEN sidered under the resolution’s rec- PN1239 AIR FORCE nomination of Robert onciliation instructions. Sarlay, Jr., which was received by the Sen- Mr. DURBIN. Mr. President, today I I find that S. Amdt. 1855 fulfills the ate and appeared in the Congressional wish to congratulate Ms. Dee Braden conditions found in section 3003 of H. Record of November 14, 2017. on her retirement from the Coles Coun- PN1253 AIR FORCE nominations (88) begin- Con. Res. 71. Accordingly, I am revising ning RICHARD G. ADAMS, and ending JO- ty Council on Aging, CCCoA, after the allocations to the Committee on SEPH F. ZINGARO, which nominations were more than 41 years of service. Finance, the Committee on Energy and received by the Senate and appeared in the One of Illinois’ finest advocates for Natural Resources, and other enforce- Congressional Record of November 16, 2017. older residents, Dee started with able budgetary levels to account for IN THE ARMY CCCoA in 1976, as the RSVP volunteer the budgetary effects of the amend- PN956 ARMY nomination of Ashley R. recruiter and was quickly promoted to ment. Sellers, which was received by the Senate be its first executive director in 1978. This adjustment supersedes the ad- and appeared in the Congressional Record of Under Dee’s leadership, CCCoA flour- justment I previously made for the September 5, 2017. ished and received the 2008 Governor’s processing of S. Amdt. 1618 on Novem- PN958 ARMY nomination of Elias M. Award for Unique Achievement for its ber 29, 2017. This adjustment applies Chelala, which was received by the Senate vision, innovation, and collaborative and appeared in the Congressional Record of while this amendment is under consid- September 5, 2017. public and private partnerships in Illi- eration. Should the amendment be PN1144 ARMY nomination of Cathleen A. nois. withdrawn or fail, this adjustment will Labate, which was received by the Senate To understand Dee’s tireless commit- be null and void and the adjustment for and appeared in the Congressional Record of ment to Illinois’ older population, one S. Amdt. 1618 shall remain active. October 16, 2017. need only look at her long service I ask unanimous consent that the ac- PN1147 ARMY nominations (2) beginning record. Dee developed and orchestrated companying tables, which provide de- REBECCA J, COOPER, and ending MAT- the first successful passage of a coun- tails about the adjustment, be printed THEW L. DANIELS, which nominations were received by the Senate and appeared in the ty-wide property tax referendum in Il- in the RECORD. Congressional Record of October 16, 2017. linois to fund senior services and advo- There being no objection, the mate- PN1240 ARMY nomination of Brantley J. cated for decades to enhance the qual- rial was ordered to be printed in the Combs, which was received by the Senate ity of life of older adults in Coles Coun- RECORD, as follows:

VerDate Sep 11 2014 10:42 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00063 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.098 S01DEPT1 S7716 CONGRESSIONAL RECORD — SENATE December 1, 2017 BUDGET AGGREGATES—BUDGET AUTHORITY AND OUT- PAY-AS-YOU-GO SCORECARD FOR THE SENATE (PURSU- their families, and the faculty. From LAYS (PURSUANT TO SECTION 311 OF THE CONGRES- ANT TO SECTION 4106 AND SECTION 3003 OF H. CON. the annual ‘‘Walk-a-Thon,’’ to Fall Fun SIONAL BUDGET ACT OF 1974 AND SECTION 3003 OF RES. 71, THE CONCURRENT RESOLUTION ON THE Night, to Pastries with Parents, to H.CON.RES. 71, THE CONCURRENT RESOLUTION ON BUDGET FOR FISCAL YEAR 2018)—Continued Grandparents Day, Maple Elementary THE BUDGET FOR FISCAL YEAR 2018) [$s in millions] School is an example of how dedica- [$s in millions] tion, motivation, collaboration, and Balances strong family engagement in education 2018 Fiscal Years 2017 through 2027 ...... 0 can benefit both the students and the Adjustments: Current Aggregates: Fiscal Year 2018 ...... 31,300 local community. Spending: Fiscal Years 2017 through 2022 ...... 921,095 With a diverse student body, Maple Budget Authority ...... 3,089,061 Fiscal Years 2017 through 2027 ...... 1,473,615 Outlays ...... 3,109,221 Revised Balance: has created an atmosphere for students Adjustments *: Fiscal Year 2018 ...... 31,300 to learn about the various backgrounds Spending: Fiscal Years 2017 through 2022 ...... 921,095 Budget Authority ...... * Fiscal Years 2017 through 2027 ...... 1,473,615 and cultures represented at the school. Outlays ...... * Revised Aggregates: From country flags displayed in the Spending: f hallway representing the nationality of Budget Authority ...... 3,089,061 Outlays ...... 3,109,221 UNKNOWN BUDGETARY EFFECTS current students to the counselor-spon- sored Diversity Club, students are able * The Congressional Budget Office and Joint Committee on Taxation esti- Mr. ENZI. Mr. President, section 4105 mate that this amendment would have an effect on direct spending but are of H. Con. Res. 71, the concurrent reso- to experience and interact with dif- only able to provide a range between 09$50 million and $50 million. This ferent cultures. adjustment allows for this range of budgetary change. lution on the budget for fiscal year 2018, makes out of order any amend- I am proud to recognize Maple Ele- BUDGET AGGREGATE—REVENUES (PURSUANT TO SECTION ment to a fiscal year 2018 reconcili- mentary School Principal, Nicola Jo 311 OF THE CONGRESSIONAL BUDGET ACT OF 1974 ation measure if the amendment has an Harrison, the entire staff, the students, AND SECTION 3003 OF H.CON.RES. 71, THE CONCUR- unknown budgetary effect. and their families. The effort, dedica- RENT RESOLUTION ON THE BUDGET FOR FISCAL YEAR As chairman of the Budget Com- tion, and value you put into these stu- 2018) mittee, I have reviewed S. Amdt. 1846 dents’ education has led not only to [$s in millions] and determined that it has an unknown this prestigious recognition, but will budgetary effect. Therefore, section benefit you and the Avon community 2018 2018–2022 2018–2027 4105 applies to S. Amdt. 1846. This well into the future. Current Aggregates: amendment is susceptible to a section On behalf of the citizens of Indiana, I Revenue ...... 2,640,939 14,509,252 32,671,567 congratulate Maple Elementary Adjustments: 4105 point of order. Revenue ...... ¥31,300 ¥967,000 ¥1,694,800 f School, and I wish the students and Revised Aggregates: staff continued success in the future. Revenue ...... 2,609,639 13,542,252 30,976,767 RECOGNIZING MAPLE ELEMENTARY SCHOOL f REVISION TO ALLOCATION TO THE COMMITTEE ON FI- Mr. DONNELLY. Mr. President, MESSAGES FROM THE PRESIDENT NANCE (PURSUANT TO SECTION 302 OF THE CONGRES- today, I wish to recognize Maple Ele- SIONAL BUDGET ACT OF 1974 AND SECTION 3003 OF mentary School of Avon, IN, for being Messages from the President of the H.CON.RES. 71, THE CONCURRENT RESOLUTION ON named a 2017 National Blue Ribbon United States were communicated to THE BUDGET FOR FISCAL YEAR 2018) School by the U.S. Department of Edu- the Senate by Mr. Pate, one of his sec- [$s in millions] cation. retaries. 2018 2018–2022 2018–2027 Established in 1982, the National Blue Ribbon Schools Program recognizes f Current Allocation: schools that have demonstrated a vi- Budget Authority ...... 2,281,616 13,510,107 32,116,900 EXECUTIVE MESSAGES REFERRED Outlays ...... 2,280,970 13,482,300 32,069,238 sion of educational excellence for all Adjustments *: As in executive session the Presiding Budget Authority ...... * ¥45,600 ¥220,100 students, regardless of their social or Outlays ...... * ¥45,600 ¥220,100 economic background. Since its incep- Officer laid before the Senate messages Revised Allocation: from the President of the United Budget Authority ...... 2,281,616 13,464,507 31,896,800 tion, this program has allowed schools Outlays ...... 2,280,970 13,436,700 31,849,138 in every State to gain recognition for States submitting sundry nominations which were referred to the appropriate * The Congressional Budget Office and Joint Committee on Taxation esti- educational accomplishments, particu- mate that this amendment would have an effect on direct spending but are larly in closing the achievement gaps committees. only able to provide a range between a ¥$50 million and $50 million. This (The messages received today are adjustment allows for this range of budgetary change. among students. Maple Elementary School opened in printed at the end of the Senate pro- REVISION TO ALLOCATION TO THE COMMITTEE ON ENERGY 1971 and currently serves about 265 stu- ceedings.) dents. Maple prides itself on educating AND NATURAL RESOURCES (PURSUANT TO SECTION f 302 OF THE CONGRESSIONAL BUDGET ACT OF 1974 the ‘‘whole child’’ and ensuring that AND SECTION 3003 OF H. CON. RES. 71, THE CONCUR- students are safe, healthy, supported, MESSAGE FROM THE HOUSE RENT RESOLUTION ON THE BUDGET FOR FISCAL YEAR engaged, and challenged. These prin- At 10:04 a.m., a message from the 2018) ciples reflect the school’s belief that, House of Representatives, delivered by when students’ basic needs are met, [$s in millions] Mrs. Cole, one of its reading clerks, an- they are able to thrive academically. 2018 2018–2022 2018–2027 Maple Elementary’s staff, students, nounced that the House has passed the following bills, in which it requests the Current Allocation: and families work together to teach Budget Authority ...... 4,703 25,212 49,342 and foster values that develop strong concurrence of the Senate: Outlays ...... 4,391 24,909 49,112 Adjustments: character including academic excel- H.R. 3017. An act to amend the Comprehen- Budget Authority ...... 0 ¥305 ¥1,085 lence and service to others. Teachers sive Environmental Response, Compensa- Outlays ...... 0 ¥305 ¥1,085 tion, and Liability Act of 1980 to reauthorize Revised Allocation: and staff mentor students and encour- Budget Authority ...... 4,703 24,907 48,257 and improve the brownfields program, and Outlays ...... 4,391 24,604 48,027 age them to take on leadership roles, for other purposes. including student council service. Stu- H.R. 3905. An act to require congressional dent council members are selected by PAY-AS-YOU-GO SCORECARD FOR THE SENATE (PURSU- approval of any mineral withdrawal or their peers and organize several serv- monument designation involving the Na- ANT TO SECTION 4106 AND SECTION 3003 OF H. CON. ice-oriented and school events each tional Forest System lands in the State of RES. 71, THE CONCURRENT RESOLUTION ON THE year. In addition, the school counselor Minnesota, to provide for the renewal of cer- BUDGET FOR FISCAL YEAR 2018) trains a group of students to mediate tain mineral leases in such lands, and for [$s in millions] other purposes. disputes through Project Peace, a pro- H.R. 4182. An act to amend title 5, United Balances gram that fosters leadership skills and States Code, to modify probationary periods promotes healthy conflict resolution. Starting Balances: with respect to positions within the competi- Fiscal Year 2018 ...... 0 Maple Elementary helps nurture tive service and the Senior Executive Serv- Fiscal Years 2017 through 2022 ...... 0 strong relationships between students, ice, and for other purposes.

VerDate Sep 11 2014 10:59 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00064 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.112 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7717 MEASURES REFERRED tions’’ ((FCC 17–136) (IB Docket No. 17–55)) care benefits, and for other purposes; to the received in the Office of the President of the Committee on Veterans’ Affairs. The following bills were read the first Senate on November 29, 2017; to the Com- and the second times by unanimous mittee on Commerce, Science, and Transpor- f consent, and referred as indicated: tation. H.R. 3905. An act to require congressional f SUBMISSION OF CONCURRENT AND approval of any mineral withdrawal or SENATE RESOLUTIONS monument designation involving the Na- PETITIONS AND MEMORIALS The following concurrent resolutions tional Forest System lands in the State of The following petitions and memo- and Senate resolutions were read, and Minnesota, to provide for the renewal of cer- rials were laid before the Senate and tain mineral leases in such lands, and for referred (or acted upon), as indicated: other purposes; to the Committee on Energy were referred or ordered to lie on the table as indicated: By Mr. JOHNSON (for himself, Ms. and Natural Resources. HEITKAMP, Mr. BOOZMAN, and Ms. H.R. 4182. An act to amend title 5, United POM–139. A resolution adopted by the BALDWIN): States Code, to modify probationary periods Mayor and City Commission of the City of S. Res. 346. A resolution recognizing the with respect to positions within the competi- Miami Beach, Florida, urging the United importance and effectiveness of trauma-in- tive service and the Senior Executive Serv- States Congress to reform the Federal Flood formed care; to the Committee on Health, ice, and for other purposes; to the Com- Insurance Program to eliminate dispropor- Education, Labor, and Pensions. mittee on Homeland Security and Govern- tionate subsidies paid by the State of Florida mental Affairs. to other parts of the nation and to increase f f the amount of subsidies, to an amount equal to at least 25% of flood insurance premiums EXECUTIVE AND OTHER paid in the State of Florida, for reinvest- ADDITIONAL COSPONSORS COMMUNICATIONS ment in resilient infrastructure projects in S. 264 The following communications were Florida and to amend flood insurance policy At the request of Mr. LANKFORD, the renewals from annually to every four years; name of the Senator from Florida (Mr. laid before the Senate, together with to the Committee on Banking, Housing, and accompanying papers, reports, and doc- Urban Affairs. RUBIO) was added as a cosponsor of S. uments, and were referred as indicated: POM–140. A petition from a citizen of the 264, a bill to amend the Internal Rev- EC–3588. A communication from the Acting State of Texas relative to an amendment to enue Code of 1986 to allow charitable Deputy Chief, Public Safety and Homeland the United States Constitution; to the Com- organizations to make statements re- Security Bureau, Federal Communications mittee on the Judiciary. lating to political campaigns if such Commission, transmitting, pursuant to law, POM–141. A resolution adopted by the Lau- statements are made in ordinary the report of a rule entitled ‘‘Wireless Emer- derdale Lakes City Commission, Lauderdale course of carrying out its tax exempt gency Alerts; Amendments to Part 11 of the Lakes, Florida recognizing and honoring all purpose. Commission’s Rules Regarding the Emer- United States armed forces veterans; to the gency Alert System’’ ((FCC 17–143) (PS Dock- Committee on Veterans’ Affairs. S. 654 et No. 15–91)) received in the Office of the f At the request of Mr. TOOMEY, the President of the Senate on November 27, names of the Senator from Virginia 2017; to the Committee on Commerce, REPORTS OF COMMITTEES (Mr. WARNER) and the Senator from Science, and Transportation. The following reports of committees Michigan (Ms. STABENOW) were added EC–3589. A communication from the Dep- were submitted: as cosponsors of S. 654, a bill to revise uty Assistant Administrator for Regulatory section 48 of title 18, United States Programs, National Marine Fisheries Serv- By Mr. JOHNSON, from the Committee on ice, Department of Commerce, transmitting, Homeland Security and Governmental Af- Code, and for other purposes. pursuant to law, the report of a rule entitled fairs, with an amendment in the nature of a S. 662 ‘‘Magnuson-Stevens Fishery Conservation substitute: At the request of Mr. BLUMENTHAL, and Management Act Provisions; Fisheries S. 1886. A bill to amend subchapter I of the name of the Senator from Cali- of the Northeastern United States; North- chapter 31 of title 5, United States Code, to authorize agencies to make noncompetitive fornia (Ms. HARRIS) was added as a co- east Groundfish Fishery; Fishing Year 2017; sponsor of S. 662, a bill to provide in- Recreational Management Measures’’ temporary and term appointments in the (RIN0648–BG52) received in the Office of the competitive service (Rept. No. 115–189). centives for hate crime reporting, President of the Senate on November 27, By Mr. GRASSLEY, from the Committee grants for State-run hate crime hot- 2017; to the Committee on Commerce, on the Judiciary, with an amendment: lines, a Federal private right of action Science, and Transportation. S. 2070. A bill to amend the Violent Crime for victims of hate crimes, and addi- EC–3590. A communication from the Dep- Control and Law Enforcement Act of 1994, to tional penalties for individuals con- uty Assistant Administrator for Regulatory reauthorize the Missing Alzheimer’s Disease victed under the Matthew Shephard Programs, National Marine Fisheries Serv- Patient Alert Program, and to promote ini- tiatives that will reduce the risk of injury and James Byrd, Jr. Hate Crimes Pre- ice, Department of Commerce, transmitting, vention Act. pursuant to law, the report of a rule entitled and death relating to the wandering charac- ‘‘Pacific Island Fisheries; 2017–18 Annual teristics of some children with autism. S. 915 Catch Limit and Accountability Measures; f At the request of Mr. BROWN, the Main Hawaiian Islands Deep 7 Bottomfish’’ names of the Senator from Florida (Mr. INTRODUCTION OF BILLS AND (RIN0648–XF335) received in the Office of the NELSON), the Senator from Hawaii (Ms. JOINT RESOLUTIONS President of the Senate on November 27, HIRONO), the Senator from Rhode Is- 2017; to the Committee on Commerce, The following bills and joint resolu- land (Mr. WHITEHOUSE), the Senator Science, and Transportation. tions were introduced, read the first EC–3591. A communication from the Acting from Rhode Island (Mr. REED), the Sen- Deputy Assistant Administrator for Regu- and second times by unanimous con- ator from Vermont (Mr. LEAHY) and latory Programs, National Marine Fisheries sent, and referred as indicated: the Senator from Massachusetts (Ms. Service, Department of Commerce, transmit- By Ms. MURKOWSKI: WARREN) were added as cosponsors of ting, pursuant to law, the report of a rule en- S. 2182. A bill to provide for the resettle- S. 915, a bill to amend title II of the So- titled ‘‘Magnuson-Stevens Act Provisions; ment and relocation of the people of Bikini; cial Security Act to repeal the Govern- Fisheries Off West Coast States; Pacific to the Committee on Energy and Natural Re- ment pension offset and windfall elimi- Coast Groundfish Fishery; 2017–2018 Biennial sources. nation provisions. Specifications and Management Measures; By Mr. HELLER: Amendment 27’’ (RIN0648–BG17) received in S. 2183. A bill to amend title XXI of the So- S. 946 the Office of the President of the Senate on cial Security Act to provide for a special rule At the request of Mr. FLAKE, the November 27, 2017; to the Committee on during the first quarter of fiscal year 2018 for name of the Senator from Wisconsin Commerce, Science, and Transportation. the redistribution of certain Children’s (Ms. BALDWIN) was added as a cospon- EC–3592. A communication from the Chief, Health Insurance Program allocations for sor of S. 946, a bill to require the Sec- International Bureau, Federal Communica- certain shortfall States; to the Committee retary of Veterans Affairs to hire addi- tions Commission, transmitting, pursuant to on Finance. law, the report of a rule entitled ‘‘Section By Mr. MCCAIN (for himself and Mr. tional Veterans Justice Outreach Spe- 43.62 Reporting Requirements for U.S. Pro- MORAN): cialists to provide treatment court viders of International Services; 2016 Bien- S. 2184. A bill to amend title 38, United services to justice-involved veterans, nial Review of Telecommunications Regula- States Code, to improve veterans’ health and for other purposes.

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00065 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.016 S01DEPT1 S7718 CONGRESSIONAL RECORD — SENATE December 1, 2017 S. 1425 dren of the deceased member remains (Ms. KLOBUCHAR), the Senator from Il- At the request of Mr. WICKER, the eligible for installation benefits to linois (Mr. DURBIN) and the Senator name of the Senator from Massachu- which the surviving spouse was pre- from New Hampshire (Mrs. SHAHEEN) setts (Ms. WARREN) was added as a co- viously eligible, and for other purposes. were added as cosponsors of amend- sponsor of S. 1425, a bill to reauthorize S. 2147 ment No. 1665 intended to be proposed the Integrated Coastal and Ocean Ob- At the request of Mr. BROWN, the to H.R. 1, to provide for reconciliation servation System Act of 2009, and for name of the Senator from Florida (Mr. pursuant to titles II and V of the con- other purposes. NELSON) was added as a cosponsor of S. current resolution on the budget for S. 1827 2147, a bill to amend the Internal Rev- fiscal year 2018. At the request of Mr. HATCH, the enue Code of 1986 to create a Pension AMENDMENT NO. 1675 name of the Senator from Nebraska Rehabilitation Trust Fund to establish At the request of Mr. WHITEHOUSE, (Mrs. FISCHER) was added as a cospon- a Pension Rehabilitation Administra- the name of the Senator from Min- sor of S. 1827, a bill to extend funding tion within the Department of the nesota (Ms. KLOBUCHAR) was added as a for the Children’s Health Insurance Treasury to make loans to multiem- cosponsor of amendment No. 1675 in- Program, and for other purposes. ployer defined benefit plans, and for tended to be proposed to H.R. 1, to pro- S. 1829 other purposes. vide for reconciliation pursuant to ti- At the request of Mr. GRASSLEY, the S. 2159 tles II and V of the concurrent resolu- name of the Senator from Nebraska At the request of Mrs. GILLIBRAND, tion on the budget for fiscal year 2018. (Mrs. FISCHER) was added as a cospon- the names of the Senator from Min- AMENDMENT NO. 1711 sor of S. 1829, a bill to amend title V of nesota (Ms. KLOBUCHAR) and the Sen- At the request of Mr. THUNE, the the Social Security Act to extend the ator from New Hampshire (Mrs. SHA- name of the Senator from Missouri Maternal, Infant, and Early Childhood HEEN) were added as cosponsors of S. (Mr. BLUNT) was added as a cosponsor Home Visiting Program. 2159, a bill to require covered harass- of amendment No. 1711 intended to be S. 1830 ment and covered discrimination proposed to H.R. 1, to provide for rec- At the request of Mr. PAUL, the name awareness and prevention training for onciliation pursuant to titles II and V of the Senator from Iowa (Mrs. ERNST) Members, officers, employees, interns, of the concurrent resolution on the was added as a cosponsor of S. 1830, a fellows, and detailees of Congress with- budget for fiscal year 2018. bill to strengthen employee cost sav- in 30 days of employment and annually AMENDMENT NO. 1717 ings suggestions programs within the thereafter, to require a biennial cli- At the request of Ms. CANTWELL, the Federal Government. mate survey of Congress, to amend the name of the Senator from California S. 1838 enforcement process under the Office of (Mrs. FEINSTEIN) was added as a co- Congressional Workplace Rights for At the request of Ms. WARREN, the sponsor of amendment No. 1717 pro- name of the Senator from California covered harassment and covered dis- posed to H.R. 1, to provide for rec- crimination complaints, and for other (Ms. HARRIS) was added as a cosponsor onciliation pursuant to titles II and V of S. 1838, a bill to repeal the authority purposes. of the concurrent resolution on the under the National Labor Relations AMENDMENT NO. 1622 budget for fiscal year 2018. Act for States to enact laws prohib- At the request of Mr. PAUL, the AMENDMENT NO. 1724 iting agreements requiring member- names of the Senator from Louisiana At the request of Mrs. ERNST, her ship in a labor organization as a condi- (Mr. CASSIDY) and the Senator from name was added as a cosponsor of tion of employment, and for other pur- Mississippi (Mr. WICKER) were added as amendment No. 1724 intended to be pro- poses. cosponsors of amendment No. 1622 in- posed to H.R. 1, to provide for rec- S. 1871 tended to be proposed to H.R. 1, to pro- onciliation pursuant to titles II and V vide for reconciliation pursuant to ti- At the request of Mr. CASSIDY, the of the concurrent resolution on the name of the Senator from Indiana (Mr. tles II and V of the concurrent resolu- budget for fiscal year 2018. tion on the budget for fiscal year 2018. DONNELLY) was added as a cosponsor of At the request of Mr. HATCH, the S. 1871, a bill to amend title 38, United AMENDMENT NO. 1623 names of the Senator from Georgia States Code, to clarify the role of po- At the request of Mr. PAUL, the name (Mr. ISAKSON), the Senator from Ala- diatrists in the Department of Vet- of the Senator from Texas (Mr. CRUZ) bama (Mr. SHELBY), the Senator from erans Affairs, and for other purposes. was added as a cosponsor of amend- Tennessee (Mr. ALEXANDER), the Sen- OUNDS S. 2070 ment No. 1623 intended to be proposed ator from South Dakota (Mr. R ) to H.R. 1, to provide for reconciliation and the Senator from Colorado (Mr. At the request of Mr. GRASSLEY, the names of the Senator from California pursuant to titles II and V of the con- GARDNER) were added as cosponsors of current resolution on the budget for amendment No. 1724 intended to be pro- (Mrs. FEINSTEIN) and the Senator from fiscal year 2018. posed to H.R. 1, supra. Vermont (Mr. LEAHY) were added as co- sponsors of S. 2070, a bill to amend the AMENDMENT NO. 1640 AMENDMENT NO. 1735 Violent Crime Control and Law En- At the request of Mr. GARDNER, the At the request of Mr. ROUNDS, the forcement Act of 1994, to reauthorize name of the Senator from Georgia (Mr. names of the Senator from Missouri the Missing Alzheimer’s Disease Pa- ISAKSON) was added as a cosponsor of (Mr. BLUNT) and the Senator from Lou- tient Alert Program, and to promote amendment No. 1640 intended to be pro- isiana (Mr. KENNEDY) were added as co- initiatives that will reduce the risk of posed to H.R. 1, to provide for rec- sponsors of amendment No. 1735 in- injury and death relating to the wan- onciliation pursuant to titles II and V tended to be proposed to H.R. 1, to pro- dering characteristics of some children of the concurrent resolution on the vide for reconciliation pursuant to ti- with autism. budget for fiscal year 2018. tles II and V of the concurrent resolu- S. 2088 AMENDMENT NO. 1642 tion on the budget for fiscal year 2018. At the request of Mrs. FISCHER, the At the request of Mr. RUBIO, the AMENDMENT NO. 1736 name of the Senator from Hawaii (Ms. names of the Senator from Nebraska At the request of Mr. INHOFE, the HIRONO) was added as a cosponsor of S. (Mr. SASSE) and the Senator from Lou- name of the Senator from Oklahoma 2088, a bill to amend title 10, United isiana (Mr. KENNEDY) were added as co- (Mr. LANKFORD) was added as a cospon- States Code, to provide for the issuance sponsors of amendment No. 1642 in- sor of amendment No. 1736 intended to of the Gold Star Installation Access tended to be proposed to H.R. 1, to pro- be proposed to H.R. 1, to provide for Card to the surviving spouse, depend- vide for reconciliation pursuant to ti- reconciliation pursuant to titles II and ent children, and other next of kin of a tles II and V of the concurrent resolu- V of the concurrent resolution on the member of the Armed Forces who dies tion on the budget for fiscal year 2018. budget for fiscal year 2018. while serving on certain active or re- AMENDMENT NO. 1665 AMENDMENT NO. 1738 serve duty, to ensure that a remarried At the request of Ms. CANTWELL, the At the request of Mr. ALEXANDER, the surviving spouse with dependent chil- names of the Senator from Minnesota name of the Senator from Texas (Mr.

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00066 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.025 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7719 CRUZ) was added as a cosponsor of can affect the mental, emotional, physical, coordinate multiple trauma-informed activi- amendment No. 1738 intended to be pro- spiritual, economic, and social well-being of ties, including a community education day; posed to H.R. 1, to provide for rec- an individual; (8) community members in Worcester, Whereas adverse childhood experiences (in Massachusetts, who worked with the Massa- onciliation pursuant to titles II and V chusetts Department of Mental Health to of the concurrent resolution on the this preamble referred to as ‘‘ACEs’’) can be traumatizing and, if not recognized, can af- create a venue with peer-to-peer support to budget for fiscal year 2018. fect health across the lifespan of an indi- better engage individuals dealing with trau- AMENDMENT NO. 1739 vidual and, in some cases, result in a short- ma and extreme emotional distress; At the request of Mr. UDALL, the ened lifespan; (9) the city of Walla Walla, Washington, names of the Senator from California Whereas ACEs are recognized as a proxy which, together with community members, launched the Children’s Resilience Initiative (Mrs. FEINSTEIN) and the Senator from for toxic stress, which can affect brain devel- to mobilize neighborhoods and Washington Minnesota (Ms. KLOBUCHAR) were added opment and can cause a lifetime of physical, mental, and social challenges; State agencies to tackle ACEs; as cosponsors of amendment No. 1739 (10) the State of Oregon, which passed the intended to be proposed to H.R. 1, to Whereas ACEs and trauma are deter- minants of public health problems in the first State law in the United States to pro- provide for reconciliation pursuant to mote— United States such as obesity, addiction, and (A) trauma-informed approaches in order titles II and V of the concurrent resolu- serious mental illness; tion on the budget for fiscal year 2018. to decrease rates of school absenteeism and Whereas trauma-informed care is an ap- increase understanding of ACEs and trauma; AMENDMENT NO. 1758 proach that can bring greater understanding and At the request of Mr. CASSIDY, the and more effective ways to support and serve (B) best practices to leverage community name of the Senator from Idaho (Mr. children, adults, families, and communities resources to support youth; RISCH) was added as a cosponsor of affected by trauma; (11) the Commonwealth of Massachusetts, amendment No. 1758 intended to be pro- Whereas trauma-informed care is not a which passed a law to promote whole-school posed to H.R. 1, to provide for rec- therapy or an intervention, but a principle- efforts to implement trauma-informed care onciliation pursuant to titles II and V based, culture-change process aimed at rec- approaches to support the social, emotional, ognizing strengths and resiliency as well as of the concurrent resolution on the and academic well-being of all students, in- helping people who have experienced trauma cluding both preventive and intensive serv- budget for fiscal year 2018. to overcome those issues in order to lead ices and support depending on the needs of AMENDMENT NO. 1760 healthy and positive lives; students; and At the request of Mr. CASSIDY, the Whereas adopting trauma-informed ap- (12) the State of Washington, which imple- name of the Senator from Colorado proaches in workplaces, communities, and mented the ACEs Public-Private Initiative, a (Mr. GARDNER) was added as a cospon- government programs can aid in preventing collaboration among private, public, and sor of amendment No. 1760 intended to mental, emotional, physical, and social community organizations to research and in- be proposed to H.R. 1, to provide for issues for people impacted by toxic stress or form policies to prevent childhood trauma and reduce the negative emotional, social, reconciliation pursuant to titles II and trauma; Whereas trauma-informed care has been and health effects of childhood trauma; V of the concurrent resolution on the promoted and established in communities Whereas the Substance Abuse and Mental budget for fiscal year 2018. across the United States, including many Health Services Administration provides AMENDMENT NO. 1765 different uses of trauma-informed care being substantial resources to better engage indi- At the request of Mr. ISAKSON, the utilized by various types of entities, such viduals and communities across the United name of the Senator from North Caro- as— States to implement trauma-informed care; lina (Mr. BURR) was added as a cospon- (1) the State of Wisconsin, which estab- Whereas numerous Federal agencies have sor of amendment No. 1765 intended to lished Fostering Futures, a statewide initia- integrated trauma-informed approaches into be proposed to H.R. 1, to provide for tive— programs and grants that those agencies ad- (A) under which the State partnered with minister, and those agencies could benefit reconciliation pursuant to titles II and Indian tribes, State agencies, county govern- from closer collaboration; and V of the concurrent resolution on the ments, and nonprofit organizations to make Whereas national recognition through a budget for fiscal year 2018. Wisconsin the first trauma-informed State; trauma-focused awareness month would help AMENDMENT NO. 1774 and to deepen the understanding of the nature At the request of Mr. UDALL, the (B) the goal of which is to reduce toxic and impact of trauma, the importance of pre- name of the Senator from New Mexico stress and improve life-long health and well- vention, the impact that ACEs can have on being for all Wisconsinites; (Mr. HEINRICH) was added as a cospon- brain development, and the benefits of trau- (2) the Menominee Tribe in Wisconsin, sor of amendment No. 1774 intended to ma-informed care: Now, therefore, be it which improved educational and public Resolved, That the Senate— be proposed to H.R. 1, to provide for health outcomes by increasing under- (1) recognizes the importance, effective- reconciliation pursuant to titles II and standing of historical trauma and childhood ness, and need for trauma-informed care V of the concurrent resolution on the adversity and by developing culturally rel- among existing programs and agencies at the budget for fiscal year 2018. evant, trauma-informed practices; Federal level; AMENDMENT NO. 1790 (3) schools of medicine that provide crit- (2) encourages the use and practice of trau- At the request of Mr. MENENDEZ, the ical trauma-informed care in Chicago, Illi- ma-informed care within the Federal Gov- name of the Senator from Massachu- nois, including— ernment, including within the executive (A) the University of Illinois at Chicago branch agencies and Congress; and setts (Ms. WARREN) was added as a co- Comprehensive Assessment and Response sponsor of amendment No. 1790 in- (3) supports the designation of May 2018 as Training System, which improves the qual- ‘‘National Trauma Awareness Month’’ and tended to be proposed to H.R. 1, to pro- ity of psychiatric services provided to youth May 22, 2018, as ‘‘National Trauma-Informed vide for reconciliation pursuant to ti- in foster care; and Awareness Day’’ in order to highlight com- tles II and V of the concurrent resolu- (B) the University of Chicago Recovery and munity resilience through trauma-informed tion on the budget for fiscal year 2018. Empowerment After Community Trauma change. Program, which helps residents who are cop- f ing with community violence; f SUBMITTED RESOLUTIONS (4) service providers, academics, and local SENATE RESOLUTION 347—COM- artists in Philadelphia, Pennsylvania, that MEMORATING THE 62ND ANNI- use art to engage communities to educate VERSARY OF THE DEDICATION and involve citizens in trauma-informed care SENATE RESOLUTION 346—RECOG- OF WHITEMAN AIR FORCE BASE NIZING THE IMPORTANCE AND activities; EFFECTIVENESS OF TRAUMA-IN- (5) the Department of Public Health of San Mrs MCCASKILL (for herself and Mr. FORMED CARE Francisco, California, which aligned its BLUNT) submitted the following reso- workforce to create a trauma-informed sys- lution; which was considered and Mr. JOHNSON (for himself, Ms. tem; agreed to: HEITKAMP, Mr. BOOZMAN, and Ms. BALD- (6) schools in Kansas City, Missouri, that— S. RES. 347 WIN) submitted the following resolu- (A) worked to become trauma-informed by tion; which was referred to the Com- encouraging teachers and children to create Whereas, 70 years ago, the National Secu- mittee on Health, Education, Labor, self-care plans to manage stress; and rity Act of 1947 (50 U.S.C. 3001 et seq.), signed (B) have implemented broad community- into law by President Harry S. Truman, es- and Pensions: wide, trauma-informed culture changes; tablished the Department of the Air Force as S. RES. 346 (7) the city of Tarpon Springs, Florida, an executive department and established the Whereas traumatic experiences affect mil- which crafted a community effort to gather United States Air Force under the Depart- lions of individuals in the United States and city officials, professionals, and residents to ment of the Air Force;

VerDate Sep 11 2014 10:42 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00067 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.027 S01DEPT1 S7720 CONGRESSIONAL RECORD — SENATE December 1, 2017 Whereas, at Pearl Harbor, Hawaii, on De- piloted aircraft MQ-9 Reaper for aerial re- SA 1820. Mr. HATCH submitted an amend- cember 7, 1941, during the attack on Bellows connaissance and forward observation; ment intended to be proposed to amendment Field, Second Lieutenant George Allison Whereas, though geographically separated SA 1618 proposed by Mr. MCCONNELL (for Mr. Whiteman reached his aircraft, but while at- from the 432d Operations Group, the 20th At- HATCH (for himself and Ms. MURKOWSKI)) to tempting take off, Second Lieutenant White- tack Squadron provides integral intelligence the bill H.R. 1, supra; which was ordered to man’s P-40 Warhawk was attacked by enemy and close air support and is able to conduct lie on the table. fighters and crashed, fatally injuring Second strikes; SA 1821. Mr. GARDNER submitted an Lieutenant Whiteman; Whereas the 1-135th Assault Helicopter amendment intended to be proposed to Whereas, in 1942, the site where Whiteman Battalion, a unit of the Missouri National amendment SA 1618 proposed by Mr. MCCON- Air Force Base (in this preamble referred to Guard, supports humanitarian and disaster NELL (for Mr. HATCH (for himself and Ms. as ‘‘Whiteman AFB’’) currently exists was relief operations as well as transportation on MURKOWSKI)) to the bill H.R. 1, supra; which established as Sedalia Glider Base, and Seda- drug interdiction missions; and was ordered to lie on the table. lia Army Air Field was later established at Whereas the 1-135th Assault Helicopter SA 1822. Mr. GARDNER submitted an that site to train Waco glider pilots for com- Battalion has recently transitioned to using amendment intended to be proposed to bat missions during World War II; the UH-60 Blackhawk Helicopter, which al- amendment SA 1618 proposed by Mr. MCCON- Whereas, in 1951, that site was reopened as lows for more effective joint force training: NELL (for Mr. HATCH (for himself and Ms. Sedalia Air Force Base and, beginning in Now, therefore, be it MURKOWSKI)) to the bill H.R. 1, supra; which 1952, housed the 340th Bombardment Wing, Resolved, That the Senate commemorates was ordered to lie on the table. which was assigned the newest aircraft sys- the 62nd anniversary of the dedication of SA 1823. Mr. INHOFE submitted an amend- tems of the time, including the B-47 Whiteman Air Force Base. ment intended to be proposed to amendment Stratojet, which was the first all-jet bomber, SA 1618 proposed by Mr. MCCONNELL (for Mr. f and the KC-97, which is an aerial refueling HATCH (for himself and Ms. MURKOWSKI)) to tanker; AMENDMENTS SUBMITTED AND the bill H.R. 1, supra; which was ordered to Whereas, on December 3, 1955, Sedalia Air PROPOSED lie on the table. Force Base was dedicated as Whiteman AFB, SA 1824. Mr. INHOFE submitted an amend- in memory of Sedalia-native Second Lieu- SA 1811. Mr. BLUNT submitted an amend- ment intended to be proposed to amendment tenant George Allison Whiteman, one of the ment intended to be proposed to amendment SA 1618 proposed by Mr. MCCONNELL (for Mr. first airmen killed in World War II; SA 1618 proposed by Mr. MCCONNELL (for Mr. HATCH (for himself and Ms. MURKOWSKI)) to Whereas Whiteman AFB developed and ma- HATCH (for himself and Ms. MURKOWSKI)) to the bill H.R. 1, supra; which was ordered to tured alongside United States Air Force ca- the bill H.R. 1, to provide for reconciliation lie on the table. pabilities and necessities, transitioning from pursuant to titles II and V of the concurrent SA 1825. Mr. HOEVEN (for himself, Mr. a bomber base to the chosen location for the resolution on the budget for fiscal year 2018; GARDNER, Mr. BOOZMAN, Mrs. ERNST, Mr. fourth Minuteman intercontinental ballistic which was ordered to lie on the table. BLUNT, Mr. RISCH, Mr. ROUNDS, Mr. MORAN, missile wing and the home of the 351st Stra- SA 1812. Ms. MURKOWSKI submitted an Mr. COTTON, and Mr. DAINES) submitted an tegic Missile Wing; amendment intended to be proposed to amendment intended to be proposed to Whereas Whiteman AFB assisted in paving amendment SA 1618 proposed by Mr. MCCON- amendment SA 1618 proposed by Mr. MCCON- the way for a fully integrated United States NELL (for Mr. HATCH (for himself and Ms. NELL (for Mr. HATCH (for himself and Ms. Air Force, with the 351st Strategic Missile MURKOWSKI)) to the bill H.R. 1, supra; which MURKOWSKI)) to the bill H.R. 1, supra; which Wing fielding the first female Minuteman was ordered to lie on the table. was ordered to lie on the table. crew and the first gender-integrated Minute- SA 1813. Ms. MURKOWSKI submitted an SA 1826. Mr. SCOTT (for himself, Mr. man crew; amendment intended to be proposed to BLUNT, Mr. PORTMAN, Mr. ISAKSON, Mr. Whereas the 509th Bomb Wing is stationed amendment SA 1618 proposed by Mr. MCCON- GRASSLEY, Mr. CRAPO, Mr. ROBERTS, Mr. at Whiteman AFB, operates a B-2 Spirit NELL (for Mr. HATCH (for himself and Ms. ROUNDS, Mr. STRANGE, Mr. SHELBY, Mrs. stealth bomber, and is able to deploy from MURKOWSKI)) to the bill H.R. 1, supra; which ERNST, Mr. CASSIDY, and Ms. COLLINS) sub- Missouri to engage adversaries of the United was ordered to lie on the table. mitted an amendment intended to be pro- States anywhere in the world; SA 1814. Mr. DAINES submitted an amend- posed to amendment SA 1618 proposed by Mr. Whereas the 509th Bomb Wing first en- ment intended to be proposed to amendment MCCONNELL (for Mr. HATCH (for himself and gaged in combat as part of Operation Allied SA 1618 proposed by Mr. MCCONNELL (for Mr. Ms. MURKOWSKI)) to the bill H.R. 1, supra; Force over Serbia and Kosovo in 1999; HATCH (for himself and Ms. MURKOWSKI)) to which was ordered to lie on the table. Whereas, in October 2001, the 509th Bomb the bill H.R. 1, supra; which was ordered to SA 1827. Mr. BURR submitted an amend- Wing carried out the first military response lie on the table. ment intended to be proposed to amendment after the attacks on New York City, New SA 1815. Mr. DAINES (for himself, Mrs. SA 1618 proposed by Mr. MCCONNELL (for Mr. York, and Washington, District of Columbia, ERNST, Mr. LANKFORD, Mr. MORAN, Mrs. HATCH (for himself and Ms. MURKOWSKI)) to on September 11, 2001 by flying a B-2 Spirit FISCHER, Mr. INHOFE, Mr. BLUNT, Mr. LEE, the bill H.R. 1, supra; which was ordered to stealth bomber into the airspace of Afghani- Mr. RISCH, Mr. SASSE, Mr. KENNEDY, and Mr. lie on the table. stan and preceding the coalition aircraft WICKER) submitted an amendment intended SA 1828. Ms. COLLINS (for herself and Mr. that would engage the forces of the Taliban to be proposed to amendment SA 1618 pro- KING) submitted an amendment intended to and al-Qaeda; posed by Mr. MCCONNELL (for Mr. HATCH (for be proposed to amendment SA 1618 proposed Whereas, while selectively used, the B-2 himself and Ms. MURKOWSKI)) to the bill H.R. by Mr. MCCONNELL (for Mr. HATCH (for him- Spirit stealth bomber represents the preci- 1, supra; which was ordered to lie on the self and Ms. MURKOWSKI)) to the bill H.R. 1, sion capabilities and the endurance of the table. supra; which was ordered to lie on the table. United States Air Force; SA 1816. Mr. TOOMEY submitted an SA 1829. Mr. RISCH submitted an amend- Whereas the 442nd Fighter Wing, an Air amendment intended to be proposed to ment intended to be proposed to amendment Force Reserve Command organization re- amendment SA 1618 proposed by Mr. MCCON- SA 1618 proposed by Mr. MCCONNELL (for Mr. sponsible for the operation, maintenance, NELL (for Mr. HATCH (for himself and Ms. HATCH (for himself and Ms. MURKOWSKI)) to and support of the A-10 Thunderbolt II air- MURKOWSKI)) to the bill H.R. 1, supra; which the bill H.R. 1, supra; which was ordered to craft (commonly known as the ‘‘Warthog’’), was ordered to lie on the table. lie on the table. is located at Whiteman AFB and works SA 1817. Mr. HOEVEN (for himself, Mr. SA 1830. Mr. RISCH submitted an amend- alongside the 509th Bomb Wing; GARDNER, Mr. BOOZMAN, Mrs. ERNST, Mr. ment intended to be proposed to amendment Whereas the 442nd Citizen Airmen carry on BLUNT, Mr. RISCH, Mr. ROUNDS, and Mr. SA 1618 proposed by Mr. MCCONNELL (for Mr. the proud tradition, dating back to World MORAN) submitted an amendment intended HATCH (for himself and Ms. MURKOWSKI)) to War II, of supporting the United States to be proposed to amendment SA 1618 pro- the bill H.R. 1, supra; which was ordered to Army and allied ground forces through close posed by Mr. MCCONNELL (for Mr. HATCH (for lie on the table. air support; himself and Ms. MURKOWSKI)) to the bill H.R. SA 1831. Mr. KAINE (for himself, Mr. Whereas the 131st Bomb Wing, a unit of the 1, supra; which was ordered to lie on the MANCHIN, Mr. BENNET, and Mrs. MCCASKILL) Missouri Air National Guard located at table. submitted an amendment intended to be pro- Whiteman AFB, is the only Air National SA 1818. Mr. ENZI submitted an amend- posed by him to the bill H.R. 1, supra; which Guard Bomb Wing to fly the B-2 Spirit ment intended to be proposed to amendment was ordered to lie on the table. stealth bomber and to be nuclear-capable; SA 1618 proposed by Mr. MCCONNELL (for Mr. SA 1832. Mr. JOHNSON submitted an Whereas the 131st Air National Guardsmen HATCH (for himself and Ms. MURKOWSKI)) to amendment intended to be proposed to carry on the proud tradition of supporting the bill H.R. 1, supra; which was ordered to amendment SA 1618 proposed by Mr. MCCON- the State of Missouri and the United States, lie on the table. NELL (for Mr. HATCH (for himself and Ms. which dates back to the founding of the 131st SA 1819. Mr. HATCH submitted an amend- MURKOWSKI)) to the bill H.R. 1, supra; which Bomb Wing in 1923; ment intended to be proposed to amendment was ordered to lie on the table. Whereas the 20th Attack Squadron, which SA 1618 proposed by Mr. MCCONNELL (for Mr. SA 1833. Mr. SCOTT (for himself and Mr. has been based at Whiteman AFB since Jan- HATCH (for himself and Ms. MURKOWSKI)) to PORTMAN) submitted an amendment intended uary 2011 and is assigned to the 432d Oper- the bill H.R. 1, supra; which was ordered to to be proposed by him to the bill H.R. 1, ations Group in Nevada, flies the remotely lie on the table. supra; which was ordered to lie on the table.

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00068 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.030 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7721

SA 1834. Mr. BENNET submitted an SA 1850. Mr. MCCONNELL (for Mr. RUBIO ‘‘(1) IN GENERAL.—An electing insurance, amendment intended to be proposed to (for himself, Mr. LEE, Mr. SASSE, and Mr. banking, and financing branch shall be treat- amendment SA 1618 proposed by Mr. MCCON- KENNEDY)) proposed an amendment to ed as a specified 10-percent owned foreign NELL (for Mr. HATCH (for himself and Ms. amendment SA 1618 proposed by Mr. MCCON- corporation. MURKOWSKI)) to the bill H.R. 1, supra; which NELL (for Mr. HATCH (for himself and Ms. ‘‘(2) ELECTING INSURANCE, BANKING, AND FI- was ordered to lie on the table. MURKOWSKI)) to the bill H.R. 1, supra. NANCING BRANCH.—The term ‘electing insur- SA 1835. Mr. GRASSLEY (for himself, Mr. SA 1851. Mr. RUBIO (for himself, Mr. LEE, ance, banking, and financing branch’ means, PORTMAN, Mr. HELLER, Mr. ROBERTS, and Mr. Mr. SASSE, and Mr. KENNEDY) submitted an with respect to any taxable year, a qualified THUNE) submitted an amendment intended to amendment intended to be proposed by him business unit (as defined in section 989(a)) of be proposed to amendment SA 1618 proposed to the bill H.R. 1, supra; which was ordered a domestic corporation, if— by Mr. MCCONNELL (for Mr. HATCH (for him- to lie on the table . ‘‘(A) the domestic corporation is an insur- self and Ms. MURKOWSKI)) to the bill H.R. 1, SA 1852. Mr. CORNYN (for Mr. CRUZ (for ance company taxable under subchapter L or supra; which was ordered to lie on the table. himself, Mr. COTTON, Mr. KENNEDY, and Mr. is a bank taxable under subchapter H, SA 1836. Mr. HATCH submitted an amend- SASSE)) proposed an amendment to amend- ‘‘(B) the qualified business unit is a quali- ment intended to be proposed by him to the ment SA 1618 proposed by Mr. MCCONNELL fied insurance branch or a qualified banking bill H.R. 1, supra; which was ordered to lie on (for Mr. HATCH (for himself and Ms. MUR- and financing branch, and the table. KOWSKI)) to the bill H.R. 1, supra. ‘‘(C) the election described in paragraph (5) SA 1837. Mr. INHOFE submitted an amend- SA 1853. Mr. INHOFE (for himself and Mr. is in effect with respect to such branch for ment intended to be proposed to amendment LANKFORD) submitted an amendment in- the taxable year. SA 1618 proposed by Mr. MCCONNELL (for Mr. tended to be proposed by him to the bill H.R. ‘‘(3) TAXABLE INCOME OF DOMESTIC CORPORA- HATCH (for himself and Ms. MURKOWSKI)) to 1, supra; which was ordered to lie on the TION COMPUTED WITHOUT REGARD TO QUALIFIED the bill H.R. 1, supra; which was ordered to table. lie on the table. SA 1854. Mr. MCCONNELL (for Mr. BROWN BUSINESS UNIT.—For purposes of this title, SA 1838. Mr. SASSE submitted an amend- (for himself, Mr. BENNET, Mr. DURBIN, Mr. the taxable income of a domestic corpora- ment intended to be proposed to amendment CASEY, Mr. WYDEN, Mrs. MURRAY, and Mr. tion described in paragraph (2)(A) shall be SA 1618 proposed by Mr. MCCONNELL (for Mr. MENENDEZ)) proposed an amendment to computed without regard to items of the HATCH (for himself and Ms. MURKOWSKI)) to amendment SA 1618 proposed by Mr. MCCON- qualified business unit described in para- the bill H.R. 1, supra; which was ordered to NELL (for Mr. HATCH (for himself and Ms. graph (2)(B) which are separately accounted lie on the table. MURKOWSKI)) to the bill H.R. 1, supra. for in accordance with paragraph (6). SA 1839. Mr. SASSE submitted an amend- SA 1855. Mr. MCCONNELL (for Mr. HATCH ‘‘(4) DEFINITIONS.— ment intended to be proposed to amendment (for himself and Ms. MURKOWSKI)) proposed ‘‘(A) QUALIFIED INSURANCE BRANCH.—The SA 1618 proposed by Mr. MCCONNELL (for Mr. an amendment to amendment SA 1618 pro- term ‘qualified insurance branch’ means a HATCH (for himself and Ms. MURKOWSKI)) to posed by Mr. MCCONNELL (for Mr. HATCH (for qualified business unit (within the meaning the bill H.R. 1, supra; which was ordered to himself and Ms. MURKOWSKI)) to the bill H.R. of section 989(a)) of a domestic corporation lie on the table. 1, supra. that is an insurance company taxable under SA 1840. Mr. INHOFE (for himself and Mr. SA 1856. Mr. MERKLEY proposed an subchapter L, if such unit is licensed, au- LANKFORD) submitted an amendment in- amendment to amendment SA 1618 proposed thorized, or regulated by the applicable in- tended to be proposed to amendment SA 1618 by Mr. MCCONNELL (for Mr. HATCH (for him- surance regulatory body for its home coun- proposed by Mr. MCCONNELL (for Mr. HATCH self and Ms. MURKOWSKI)) to the bill H.R. 1, try to sell insurance, reinsurance, or annuity (for himself and Ms. MURKOWSKI)) to the bill supra. contracts to persons other than related per- H.R. 1, supra; which was ordered to lie on the SA 1857. Mr. DAINES (for himself, Mrs. sons (within the meaning of section 954(d)(3)) table. ERNST, Mr. LANKFORD, Mr. MORAN, Mrs. in such home country. Any term used in this SA 1841. Mr. GARDNER submitted an FISCHER, Mr. INHOFE, Mr. BLUNT, Mr. LEE, subparagraph which is also used in section amendment intended to be proposed to Mr. RISCH, and Mr. SASSE) submitted an 953(e) shall have the meaning given to such amendment SA 1618 proposed by Mr. MCCON- amendment intended to be proposed to term by section 953(e). NELL (for Mr. HATCH (for himself and Ms. amendment SA 1618 proposed by Mr. MCCON- ‘‘(B) QUALIFIED BANKING AND FINANCING MURKOWSKI)) to the bill H.R. 1, supra; which NELL (for Mr. HATCH (for himself and Ms. BRANCH.—The term ‘qualified banking and fi- was ordered to lie on the table. MURKOWSKI)) to the bill H.R. 1, supra; which nancing branch’ means a qualified business SA 1842. Mr. RUBIO (for himself and Mr. was ordered to lie on the table. unit (within the meaning of section 989(a)) of LEE) submitted an amendment intended to SA 1858. Ms. BALDWIN submitted an a domestic corporation that is a bank tax- be proposed by him to the bill H.R. 1, supra; amendment intended to be proposed by her able under subchapter H, if such unit is pre- which was ordered to lie on the table. to the bill H.R. 1, supra; which was ordered dominantly engaged in the active conduct of SA 1843. Mr. RUBIO (for himself and Mr. to lie on the table. a banking, financing, or similar business, LEE) submitted an amendment intended to SA 1859. Mr. FRANKEN submitted an and conducts substantial activity with re- be proposed by him to the bill H.R. 1, supra; amendment intended to be proposed by him spect to such business. Any term used in this which was ordered to lie on the table. to the bill H.R. 1, supra; which was ordered subparagraph which is also used in section SA 1844. Mr. LANKFORD submitted an to lie on the table. 954(h) shall have the meaning given to such amendment intended to be proposed to SA 1860. Mr. FRANKEN submitted an term by section 954(h). amendment SA 1618 proposed by Mr. MCCON- amendment intended to be proposed by him ‘‘(5) ELECTION.— NELL (for Mr. HATCH (for himself and Ms. to the bill H.R. 1, supra; which was ordered ‘‘(A) IN GENERAL.—A domestic corporation MURKOWSKI)) to the bill H.R. 1, supra; which to lie on the table. may make the election described in this was ordered to lie on the table. SA 1861. Mr. FRANKEN submitted an SA 1845. Mr. INHOFE (for himself and Mr. paragraph with respect to any qualified in- amendment intended to be proposed by him surance branch or qualified banking and fi- LANKFORD) submitted an amendment in- to the bill H.R. 1, supra; which was ordered tended to be proposed by him to the bill H.R. nancing branch for any taxable year. to lie on the table. ‘‘(B) DURATION AND TERMINATION OF ELEC- 1, supra; which was ordered to lie on the SA 1862. Mr. FRANKEN submitted an TION.—Subject to subparagraph (C), an elec- table. amendment intended to be proposed by him tion made under this paragraph for any tax- SA 1846. Mr. CORNYN (for Mr. KAINE (for to the bill H.R. 1, supra; which was ordered able year shall remain in effect for all subse- himself, Mr. MANCHIN, Mrs. MCCASKILL, and to lie on the table. Mr. BENNET)) proposed an amendment to quent taxable years, except that it may be f amendment SA 1618 proposed by Mr. MCCON- revoked with the consent of the Secretary. NELL (for Mr. HATCH (for himself and Ms. TEXT OF AMENDMENTS ‘‘(C) TIMING OF ELECTION.—The election MURKOWSKI)) to the bill H.R. 1, supra. provided by this paragraph shall be made not SA 1847. Ms. CANTWELL submitted an SA 1811. Mr. BLUNT submitted an later than the time prescribed by law for fil- amendment intended to be proposed to amendment intended to be proposed to ing the return for the taxable year (including amendment SA 1618 proposed by Mr. MCCON- amendment SA 1618 proposed by Mr. extensions thereof) with respect to which NELL (for Mr. HATCH (for himself and Ms. MCCONNELL (for Mr. HATCH (for himself such election is made, and such election and MURKOWSKI)) to the bill H.R. 1, supra; which and Ms. MURKOWSKI)) to the bill H.R. 1, any approved revocation thereof shall be was ordered to lie on the table. to provide for reconciliation pursuant made in the manner provided by the Sec- retary. SA 1848. Ms. CANTWELL submitted an to titles II and V of the concurrent res- amendment intended to be proposed to ‘‘(6) SEPARATE ACCOUNTING REQUIRED.—Any olution on the budget for fiscal year amendment SA 1618 proposed by Mr. MCCON- domestic corporation which makes the elec- NELL (for Mr. HATCH (for himself and Ms. 2018; which was ordered to lie on the tion described in paragraph (5) with respect MURKOWSKI)) to the bill H.R. 1, supra; which table; as follows: to a qualified business unit shall establish was ordered to lie on the table. On page 381, line 1, strike ‘‘(g) REGULA- and maintain a separate account for the var- SA 1849. Mr. BENNET submitted an TIONS.—’’ and insert: ious income, exclusion, deduction, asset, re- amendment intended to be proposed by him ‘‘(g) ELECTION TO BE TREATED AS A SPECI- serve, liability, and surplus items properly to the bill H.R. 1, supra; which was ordered FIED 10-PERCENT OWNED FOREIGN CORPORA- attributable to the qualified business unit. to lie on the table. TION.—For purposes of this section— Such separate accounting shall be made—

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00069 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.036 S01DEPT1 S7722 CONGRESSIONAL RECORD — SENATE December 1, 2017 ‘‘(A) in accordance with the method regu- to amendment SA 1618 proposed by Mr. ‘‘(ii) included or allowed in determining larly employed by such domestic company, if MCCONNELL (for Mr. HATCH (for himself taxable income for the taxable year. such method clearly reflects income derived and Ms. MURKOWSKI)) to the bill H.R. 1, ‘‘(B) EXCEPTIONS.—The following invest- from, and the other items attributable to, to provide for reconciliation pursuant ment items shall not be taken into account the qualified business unit, and as a qualified item of income, gain, deduc- ‘‘(B) in all other cases, in accordance with to titles II and V of the concurrent res- tion, or loss: regulations prescribed by the Secretary. olution on the budget for fiscal year ‘‘(i) Any item of short-term capital gain, ‘‘(7) EFFECT OF ELECTION AND TERMI- 2018; which was ordered to lie on the short-term capital loss, long-term capital NATION.— table; as follows: gain, or long-term capital loss. ‘‘(A) IN GENERAL.—For purposes of this At the appropriate place in title I, insert ‘‘(ii) Any dividend, income equivalent to a title, each electing insurance, banking, and the following: dividend, or payment in lieu of dividends de- financing branch shall be treated as a foreign SEC. 1lll. EXTENSION OF AMERICAN SAMOA scribed in section 954(c)(1)(G). corporation organized in its home country ECONOMIC DEVELOPMENT CREDIT. ‘‘(iii) Any interest income other than in- (as defined in section 953(e)(6)(B)). (a) IN GENERAL.—Section 119(d) of division terest income which is properly allocable to ‘‘(B) TREATMENT OF ASSETS AND LIABIL- A of the Tax Relief and Health Care Act of a trade or business. ITIES.—Any domestic corporation making an 2006 is amended— ‘‘(iv) Any item of gain or loss described in election under paragraph (5) shall be treated (1) by striking ‘‘January 1, 2017’’ each place subparagraph (C) or (D) of section 954(c)(1) as transferring (as of the first day of the first it appears and inserting ‘‘January 1, 2023’’, (applied by substituting ‘qualified trade or taxable year to which such election applies) (2) by striking ‘‘first 11 taxable years’’ in business’ for ‘controlled foreign corpora- all of the assets and liabilities separately ac- paragraph (1) and inserting ‘‘first 17 taxable tion’). counted for under paragraph (6) to a foreign years’’, and ‘‘(v) Any item of income, gain, deduction, corporation in connection with an exchange (3) by striking ‘‘first 5 taxable years’’ in or loss taken into account under section to which section 351 applies, subject to sec- paragraph (2) and inserting ‘‘first 11 taxable 954(c)(1)(F) (determined without regard to tion 367. years’’. clause (ii) thereof and other than items at- ‘‘(C) EFFECT OF TERMINATION OF ELECTION.— (b) TREATMENT OF CERTAIN REFERENCES.— tributable to notional principal contracts en- If an election is made by a domestic corpora- Section 119(e) of division A of the Tax Relief tered into in transactions qualifying under tion under paragraph (5) for any taxable and Health Care Act of 2006 is amended by section 1221(a)(7)). year, and such election ceases to apply to adding at the end the following: ‘‘References ‘‘(vi) Any amount received from an annu- the electing insurance, banking, and financ- in this subsection to section 199 of the Inter- ity which is not received in connection with ing branch for any subsequent taxable year, nal Revenue Code of 1986 shall be treated as the trade or business. the electing insurance, banking, and financ- references to such section as in effect before ‘‘(vii) Any item of deduction or loss prop- ing branch treated as a foreign corporation its repeal by the Tax Cuts and Jobs Act.’’. erly allocable to an amount described in any shall be treated (as of the first day of the (c) EFFECTIVE DATE.—The amendments of the preceding clauses. first taxable year following such cessation) made by this section shall apply to taxable ‘‘(4) TREATMENT OF REASONABLE COMPENSA- as liquidating under section 332, subject to years beginning after December 31, 2016. TION AND GUARANTEED PAYMENTS.—Qualified section 367. business income shall not include— ‘‘(8) TRANSACTIONS BETWEEN ELECTING IN- SA 1814. Mr. DAINES submitted an ‘‘(A) reasonable compensation paid to the SURANCE, BANKING, AND FINANCING BRANCH amendment intended to be proposed to taxpayer by any qualified trade or business AND DOMESTIC CORPORATION.—Any amount di- amendment SA 1618 proposed by Mr. of the taxpayer for services rendered with re- rectly or indirectly transferred or credited MCCONNELL (for Mr. HATCH (for himself spect to the trade or business, from an electing insurance, banking, and fi- ‘‘(B) any guaranteed payment described in and Ms. MURKOWSKI)) to the bill H.R. 1, nancing branch account established pursuant section 707(c) paid to a partner for services to paragraph (6) to one or more other ac- to provide for reconciliation pursuant rendered with respect to the trade or busi- counts of such domestic company shall be to titles II and V of the concurrent res- ness, and treated as a deemed distribution for purposes olution on the budget for fiscal year ‘‘(C) to the extent provided in regulations, of this title. 2018; which was ordered to lie on the any payment described in section 707(a) to a ‘‘(h) REGULATIONS.— table; as follows: partner for services rendered with respect to the trade or business. SA 1812. Ms. MURKOWSKI submitted Beginning on page 26, strike line 21 and all that follows through page 30, line 14, and in- ‘‘(d) QUALIFIED TRADE OR BUSINESS.—For an amendment intended to be proposed sert the following: to amendment SA 1618 proposed by Mr. purposes of this section— ‘‘(6) FRANCHISE EXCEPTION.—In the case of a ‘‘(1) IN GENERAL.—The term ‘qualified trade MCCONNELL (for Mr. HATCH (for himself taxpayer utilizing business format fran- or business’ means any trade or business and Ms. MURKOWSKI)) to the bill H.R. 1, chising as a franchisor or franchisee under other than a specified service trade or busi- to provide for reconciliation pursuant part 436 of title 16, Code of Federal Regula- ness. to titles II and V of the concurrent res- tions, with respect to any qualified trade or ‘‘(2) SPECIFIED SERVICE TRADE OR BUSI- olution on the budget for fiscal year business, paragraph (2) shall be applied with- NESS.— 2018; which was ordered to lie on the out regard to subparagraph (B). ‘‘(A) IN GENERAL.—The term ‘specified table; as follows: ‘‘(c) QUALIFIED BUSINESS INCOME.—For pur- service trade or business’ means any trade or poses of this section— At the appropriate place in title I, insert business involving the performance of serv- ‘‘(1) IN GENERAL.—The term ‘qualified busi- the following: ices described in section 1202(e)(3)(A), includ- ness income’ means, for any taxable year, ing investing and investment management, SEC. 1lll. EXTENSION OF AMERICAN SAMOA the net amount of qualified items of income, ECONOMIC DEVELOPMENT CREDIT. trading, or dealing in securities (as defined gain, deduction, and loss with respect to any (a) IN GENERAL.—Section 119(d) of division in section 475(c)(2)), partnership interests, or A of the Tax Relief and Health Care Act of qualified trade or business of the taxpayer. commodities (as defined in section 475(e)(2)). 2006 is amended— ‘‘(2) CARRYOVER OF LOSSES.—If the net ‘‘(B) FRANCHISE EXCEPTION.—Such term (1) by striking ‘‘January 1, 2017’’ each place amount of qualified income, gain, deduction, does not include any trade or business uti- it appears and inserting ‘‘January 1, 2023’’, and loss with respect to qualified trade or lizing business format franchising as a (2) by striking ‘‘first 11 taxable years’’ in businesses of the taxpayer amount for any franchisor or franchisee under part 436 of paragraph (1) and inserting ‘‘first 17 taxable taxable year is less than zero, such amount title 16, Code of Federal Regulations. years’’, and shall be treated as a loss from a qualified (3) by striking ‘‘first 5 taxable years’’ in trade or business in the succeeding taxable paragraph (2) and inserting ‘‘first 11 taxable year. SA 1815. Mr. DAINES (for himself, years’’. ‘‘(3) QUALIFIED ITEMS OF INCOME, GAIN, DE- Mrs. ERNST, Mr. LANKFORD, Mr. MORAN, (b) TREATMENT OF CERTAIN REFERENCES.— DUCTION, AND LOSS.—For purposes of this sub- Mrs. FISCHER, Mr. INHOFE, Mr. BLUNT, section— Section 119(e) of division A of the Tax Relief Mr. LEE, Mr. RISCH, and Mr. SASSE) ‘‘(A) IN GENERAL.—The term ‘qualified and Health Care Act of 2006 is amended by submitted an amendment intended to adding at the end the following: ‘‘References items of income, gain, deduction, and loss’ in this subsection to section 199 of the Inter- means items of income, gain, deduction, and be proposed to amendment SA 1618 pro- nal Revenue Code of 1986 shall be treated as loss to the extent such items are— posed by Mr. MCCONNELL (for Mr. references to such section as in effect before ‘‘(i) effectively connected with the conduct HATCH (for himself and Ms. MUR- its repeal by the Tax Cuts and Jobs Act.’’. of a trade or business within the United KOWSKI)) to the bill H.R. 1, to provide (c) EFFECTIVE DATE.—The amendments States (within the meaning of section 864(c), for reconciliation pursuant to titles II determined by substituting ‘qualified trade made by this section shall apply to taxable and V of the concurrent resolution on years beginning after December 31, 2016. or business (within the meaning of section 199A)’ for ‘nonresident alien individual or a the budget for fiscal year 2018; which SA 1813. Ms. MURKOWSKI submitted foreign corporation’ or for ‘a foreign corpora- was ordered to lie on the table; as fol- an amendment intended to be proposed tion’ each place it appears), and lows:

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00070 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.034 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7723 Beginning on page 43, strike line 16 and all 2018; which was ordered to lie on the (A) by striking ‘‘and qualified cooperative that follows through page 45, line 20 and in- table; as follows: dividends’’ in subsection (b)(1)(B) thereof, sert the following: On page 456, between lines 2 and 3, insert and ‘‘(4) PARTIAL CREDIT ALLOWED FOR CERTAIN the following: (B) by striking paragraph (4) of subsection OTHER DEPENDENTS.— (e) thereof. ‘‘(E) PHASE IN OF PERCENTAGE USED IN DE- ‘‘(A) IN GENERAL.—The credit determined (2) EFFECTIVE DATE.—The amendments TERMINING EXCESS INDEBTEDNESS.—In the under subsection (a) (after the application of case of any taxable year beginning in a cal- made by this section shall apply as if in- paragraph (2)) shall be increased by $500 for endar year before 2022, the following percent- cluded in the amendments made by section each dependent of the taxpayer (as defined in ages shall be substituted for ‘110 percent’ in 11011 of this Act. section 152) other than a qualifying child de- applying subparagraph (B)(ii): scribed in subsection (c). ‘‘(i) 130 percent for calendar year 2018. SA 1818. Mr. ENZI submitted an ‘‘(B) EXCEPTION FOR CERTAIN NONCITIZENS.— ‘‘(ii) 125 percent for calendar year 2019. amendment intended to be proposed to Subparagraph (A) shall not apply with re- ‘‘(iii) 120 percent for calendar year 2020. amendment SA 1618 proposed by Mr. spect to any individual who would not be a ‘‘(iv) 115 percent for calendar year 2021. dependent if subparagraph (A) of section MCCONNELL (for Mr. HATCH (for himself 152(b)(3) were applied without regard to all SA 1817. Mr. HOEVEN (for himself, and Ms. MURKOWSKI)) to the bill H.R. 1, to provide for reconciliation pursuant that follows ‘resident of the United States’. Mr. GARDNER, Mr. BOOZMAN, Mrs. ‘‘(5) MAXIMUM AMOUNT OF REFUNDABLE to titles II and V of the concurrent res- ERNST, Mr. BLUNT, Mr. RISCH, Mr. CREDIT.— OUNDS ORAN olution on the budget for fiscal year ‘‘(A) IN GENERAL.—Subsection (d)(1)(A) R , and Mr. M ) submitted an amendment intended to be proposed to 2018; which was ordered to lie on the shall be applied without regard to para- table; as follows: graphs (2) and (4) of this subsection. amendment SA 1618 proposed by Mr. ‘‘(B) ADJUSTMENT FOR INFLATION.—In the MCCONNELL (for Mr. HATCH (for himself At the end of subpart B of part VII of sub- case of a taxable year beginning after 2017, and Ms. MURKOWSKI)) to the bill H.R. 1, title C of title I, add the following: subsection (d)(1)(A) shall be applied as if the to provide for reconciliation pursuant SEC. 1361l. MODIFICATION OF RULES GOV- $1,000 amount in subsection (a) were in- to titles II and V of the concurrent res- ERNING HARDSHIP DISTRIBUTIONS. creased (but not to exceed the amount under olution on the budget for fiscal year (a) IN GENERAL.—Not later than 1 year paragraph (2) of this subsection) by an after the date of the enactment of this Act, amount equal to— 2018; which was ordered to lie on the table; as follows: the Secretary of the Treasury shall modify ‘‘(i) such dollar amount, multiplied by Treasury Regulation section 1.401(k)– ‘‘(ii) the cost-of-living adjustment deter- Strike section 13305 and insert the fol- 1(d)(3)(iv)(E) to— mined under section 1(f)(3) for the calendar lowing: (1) delete the 6-month prohibition on con- year in which the taxable year begins. SEC. 13305. DEDUCTION FOR INCOME ATTRIB- tributions imposed by paragraph (2) thereof, Any increase determined under the preceding UTABLE TO DOMESTIC PRODUCTION and ACTIVITIES FOR FARMING BUSI- sentence shall be rounded to the next highest (2) make any other modifications nec- multiple of $100. NESSES. (a) LIMITATION.— essary to carry out the purposes of section ‘‘(6) EARNED INCOME THRESHOLD FOR RE- (1) IN GENERAL.—Section 199 is amended— 401(k)(2)(B)(i)(IV) of the Internal Revenue FUNDABLE CREDIT.—Subsection (d)(1)(B)(i) Code of 1986. shall be applied by substituting ‘$2,500’ for (A) in subsection (a), by striking ‘‘There (b) EFFECTIVE DATE.—The revised regula- ‘$3,000’. shall be’’ and inserting ‘‘Subject to sub- section (e), there shall be’’; and tions under this section shall apply to plan ‘‘(7) SOCIAL SECURITY NUMBER REQUIRED.— years beginning after December 31, 2017. No credit shall be allowed under subsection (B) by adding at the end the following new (d) to a taxpayer with respect to any quali- subsection: ‘‘(e) LIMITATION.—Notwithstanding any fying child unless the taxpayer includes the SA 1819. Mr. HATCH submitted an other provision of law, effective with taxable social security number of such child on the amendment intended to be proposed to years beginning after December 31, 2018, the return of tax for the taxable year. For pur- amendment SA 1618 proposed by Mr. deduction for income attributable to domes- poses of the preceding sentence, the term ‘so- tic production activities provided under this MCCONNELL (for Mr. HATCH (for himself cial security number’ means a social secu- section shall be allowed only with respect to and Ms. MURKOWSKI)) to the bill H.R. 1, rity number issued to an individual by the domestic production activities incurred in to provide for reconciliation pursuant Social Security Administration, but only if any farming trade or business, including to titles II and V of the concurrent res- the social security number is issued to a cit- with respect to any agricultural and horti- izen of the United States or is issued pursu- olution on the budget for fiscal year cultural cooperative described in subsection ant to subclause (I) (or that portion of sub- 2018; which was ordered to lie on the (d).’’. clause (III) that relates to subclause (I)) of table; as follows: (2) ADMINISTRATION.—Until the date on section 205(c)(2)(B)(i) of the Social Security which any regulations necessary to carry out On page 440, strike lines 16 through 25, and Act. the provisions of and amendments made by insert the following: ‘‘(8) CREDIT ALLOWED WITH RESPECT TO UN- this subsection are fully implemented, the ‘‘(i) SALES TO RELATED PARTIES.—If prop- BORN CHILDREN.— Secretary shall continue to carry out section erty is sold to a related party who is not a ‘‘(A) IN GENERAL.—The term ‘qualifying 199 of the Internal Revenue Code of 1986 in United States person, such sale shall not be child’ includes an unborn child (as defined in the same manner as on the day before the treated as for a foreign use unless— section 1841(d) of title 18, United States date of enactment of this Act, including with ‘‘(I) such property is ultimately sold by a Code) for any such taxable year if such child respect to agricultural and horticultural co- related party, or used by a related party in is born and issued a social security number operatives, except that deductions allowed connection with property which is sold or (as defined in paragraph (7)) before the due under such section shall be allowed con- the provision of services, to another person date for the return of tax (without regard to sistent with subsection (e) of such section (as who is an unrelated party who is not a extensions) for the taxable year. added by paragraph (1)). United States person, and ‘‘(B) DOUBLE CREDIT IN CASE OF CHILDREN (b) TAX ON CERTAIN FARMERS’ COOPERA- ‘‘(II) the taxpayer establishes to the satis- UNABLE TO CLAIM CREDIT.—In the case of any TIVES.— faction of the Secretary that such property child born during a taxable year described in (1) IN GENERAL.—Section 1381(b) is amended is for a foreign use. paragraph (1) who is not taken into account to read as follows: For purposes of this clause, a sale of prop- under subparagraph (A) for the taxable year ‘‘(b) TAX ON CERTAIN FARMERS’ COOPERA- erty shall be treated as a sale of each of the immediately preceding the taxable year in TIVES.—An organization described in sub- components thereof. which the child is born, the amount of the section (a)(1) shall be subject to the tax im- credit determined under this section with re- posed by section 11, except that in the case spect to such child for the taxable year of SA 1820. Mr. HATCH submitted an of an organization eligible for a deduction amendment intended to be proposed to the child’s birth shall be increased by 100 under section 199 for the taxable year by rea- percent.’’. son of subsection (e) thereof, section 11(b) amendment SA 1618 proposed by Mr. shall be applied by substituting ‘35 percent’ MCCONNELL (for Mr. HATCH (for himself SA 1816. Mr. TOOMEY submitted an for ‘20 percent’.’’. and Ms. MURKOWSKI)) to the bill H.R. 1, amendment intended to be proposed to (2) EFFECTIVE DATE.—The amendment to provide for reconciliation pursuant amendment SA 1618 proposed by Mr. made by this subsection shall apply to tax- to titles II and V of the concurrent res- able years beginning after December 31, 2018. MCCONNELL (for Mr. HATCH (for himself olution on the budget for fiscal year (c) REPEAL OF SPECIAL RULE FOR DEDUC- URKOWSKI 2018; which was ordered to lie on the and Ms. M )) to the bill H.R. 1, TION FOR QUALIFIED COOPERATIVE DIVI- to provide for reconciliation pursuant DENDS.— table; as follows: to titles II and V of the concurrent res- (1) IN GENERAL.—Section 199A, as added by At the end of subpart D of part VII of sub- olution on the budget for fiscal year section 11011 of this Act is amended — title C of title I, add the following:

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00071 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.043 S01DEPT1 S7724 CONGRESSIONAL RECORD — SENATE December 1, 2017 SEC. 13543. MODIFICATION OF TREATMENT OF S section (b)(1)(A)(ii) with respect to a bene- tion on the budget for fiscal year 2018; CORPORATION CONVERSIONS TO C ficiary during any taxable year, shall, in the which was ordered to lie on the table; CORPORATIONS. aggregate, include (as the case may be) not as follows: (a) IN GENERAL.—Section 1371 is amended more than $10,000 in expenses for tuition in- by adding at the end the following new sub- curred during the taxable year in connection Strike section 13305 and insert the fol- section: with the enrollment or attendance of the lowing: ‘‘(f) CASH DISTRIBUTIONS FOLLOWING POST- beneficiary as an elementary or secondary SEC. 13305. DEDUCTION FOR INCOME ATTRIB- TERMINATION TRANSITION PERIOD.— school student at a public, private, or reli- UTABLE TO DOMESTIC PRODUCTION ‘‘(1) IN GENERAL.—In the case of a distribu- ACTIVITIES FOR FARMING BUSI- gious school; or not more than $10,000 in NESSES. tion of money by an eligible terminated S qualified early education expenses incurred (a) LIMITATION.— corporation after the post-termination tran- during the taxable year.’’. (1) IN GENERAL.—Section 199 is amended— sition period, the accumulated adjustments (c) ROLLOVERS FROM COVERDELL EDUCATION (A) in subsection (a), by striking ‘‘There account shall be allocated to such distribu- SAVINGS ACCOUNTS TO QUALIFIED TUITION shall be’’ and inserting ‘‘Subject to sub- tion, and the distribution shall be chargeable PROGRAMS.—Section 530(d)(5) is amended by section (e), there shall be’’; and to accumulated earnings and profits, in the inserting ‘‘, or into (by purchase or contribu- (B) by adding at the end the following new same ratio as the amount of such accumu- tion) a qualified tuition program (as defined subsection: lated adjustments account bears to the in section 529),’’ after ‘‘into another Cover- ‘‘(e) LIMITATION.—Effective with taxable amount of such accumulated earnings and dell education savings account’’. years beginning after December 31, 2018, the profits. (d) EFFECTIVE DATES.— deduction for income attributable to domes- ‘‘(2) ELIGIBLE TERMINATED S CORPORATION.— (1) IN GENERAL.—Except as provided in tic production activities provided under this For purposes of this subsection, the term ‘el- paragraph (2), the amendments made by this section shall be allowed only with respect to igible terminated S corporation’ means any section shall apply to contributions made domestic production activities incurred in C corporation— after December 31, 2017. any farming trade or business, including ‘‘(A) which— (2) ROLLOVERS TO QUALIFIED TUITION PRO- with respect to any agricultural and horti- ‘‘(i) was an S corporation on the day before GRAMS.—The amendments made by sub- cultural cooperative described in subsection the date of the enactment of the Tax Cuts section (b) shall apply to distributions after (d).’’. and Jobs Act, and December 31, 2017. ‘‘(ii) during the 2-year period beginning on (2) ADMINISTRATION.—Until the date on which any regulations necessary to carry out the date of such enactment makes a revoca- SA 1822. Mr. GARDNER submitted an tion of its election under section 1362(a), and the provisions of and amendments made by amendment intended to be proposed to this subsection are fully implemented, the ‘‘(B) the owners of the stock of which, de- amendment SA 1618 proposed by Mr. termined on the date such revocation is Secretary shall continue to carry out section made, are the same owners (and in identical MCCONNELL (for Mr. HATCH (for himself 199 of the Internal Revenue Code of 1986 in proportions) as on the date of such enact- and Ms. MURKOWSKI)) to the bill H.R. 1, the same manner as on the day before the ment.’’. to provide for reconciliation pursuant date of enactment of this Act, including with (b) EFFECTIVE DATE.—The amendments to titles II and V of the concurrent res- respect to agricultural and horticultural co- made by this sectin shall apply to distribu- olution on the budget for fiscal year operatives, except that deductions allowed tions after the date of the enactment of this 2018; which was ordered to lie on the under such section shall be allowed con- Act. sistent with subsection (e) of such section (as table; as follows: added by paragraph (1)). SA 1821. Mr. GARDNER submitted an Strike section 13532. (b) TAX ON CERTAIN FARMERS’ COOPERA- amendment intended to be proposed to TIVES.— SA 1823. Mr. INHOFE submitted an (1) IN GENERAL.—Section 1381(b) is amended amendment SA 1618 proposed by Mr. amendment intended to be proposed to to read as follows: C ONNELL ATCH M C (for Mr. H (for himself amendment SA 1618 proposed by Mr. ‘‘(b) TAX ON CERTAIN FARMERS’ COOPERA- and Ms. MURKOWSKI)) to the bill H.R. 1, MCCONNELL (for Mr. HATCH (for himself TIVES.—An organization described in sub- to provide for reconciliation pursuant and Ms. MURKOWSKI)) to the bill H.R. 1, section (a)(1) shall be subject to the tax im- to titles II and V of the concurrent res- to provide for reconciliation pursuant posed by section 11, except that in the case olution on the budget for fiscal year of an organization eligible for a deduction to titles II and V of the concurrent res- under section 199 for the taxable year by rea- 2018; which was ordered to lie on the olution on the budget for fiscal year table; as follows: son of subsection (e) thereof, section 11(b) 2018; which was ordered to lie on the shall be applied by substituting ‘35 percent’ At the appropriate place, insert the fol- table; as follows: for ‘20 percent’.’’. lowing: On page 187, strike line 15 and insert the (2) EFFECTIVE DATE.—The amendment SEC. ll. CONSOLIDATION OF EDUCATION SAV- following: ‘‘body of an elective cooperative; made by this subsection shall apply to tax- INGS RULES. or able years beginning after December 31, 2018. (a) NO NEW CONTRIBUTIONS TO COVERDELL ‘‘(v) manufacturers making upgrades to (c) REPEAL OF SPECIAL RULE FOR DEDUC- EDUCATION SAVINGS ACCOUNT.—Section comply with State or Federal environmental TION FOR QUALIFIED COOPERATIVE DIVI- 530(b)(1)(A) is amended to read as follows: regulations. DENDS.— ‘‘(A) Except in the case of rollover con- (1) IN GENERAL.—Section 199A, as added by tributions, no contribution will be accepted SA 1824. Mr. INHOFE submitted an section 11011 of this Act is amended — after December 31, 2017.’’. amendment intended to be proposed to (A) by striking ‘‘and qualified cooperative (b) LIMITED DISTRIBUTION ALLOWED FOR EL- amendment SA 1618 proposed by Mr. dividends’’ in subsection (b)(1)(B) thereof, EMENTARY AND SECONDARY TUITION AND and QUALIFIED EARLY EDUCATION EXPENSES.— MCCONNELL (for Mr. HATCH (for himself (B) by striking paragraph (4) of subsection (1) IN GENERAL.—Section 529(c) is amended and Ms. MURKOWSKI)) to the bill H.R. 1, (e) thereof. by adding at the end the following new para- to provide for reconciliation pursuant (2) EFFECTIVE DATE.—The amendments graph: to titles II and V of the concurrent res- made by this section shall apply as if in- ‘‘(7) TREATMENT OF ELEMENTARY AND SEC- olution on the budget for fiscal year cluded in the amendments made by section ONDARY TUITION AND QUALIFIED EARLY EDU- 2018; which was ordered to lie on the 11011 of this Act. CATION EXPENSES.—Each reference in this table; as follows: section to the term ‘qualified higher edu- Mr. SCOTT (for himself, Mr. On page 30, line 10, insert ‘‘(except with re- SA 1826. cation expense’ is deemed to include— BLUNT, Mr. PORTMAN, Mr. ISAKSON, Mr. ‘‘(A) a reference to expenses for tuition in spect to engineering and architecture)’’ after GRASSLEY, Mr. CRAPO, Mr. ROBERTS, connection with enrollment at an elemen- ‘‘1202(e)(3)(A)’’. tary or secondary school; and Mr. ROUNDS, Mr. STRANGE, Mr. SHELBY, ‘‘(B) a reference to expenses for providing SA 1825. Mr. HOEVEN (for himself, Mrs. ERNST, Mr. CASSIDY, and Ms. COL- educational and other care to a child under Mr. GARDNER, Mr. BOOZMAN, Mrs. LINS) submitted an amendment in- age 5, as determined under the law of the ERNST, Mr. BLUNT, Mr. RISCH, Mr. tended to be proposed to amendment State involved, provided pursuant to attend- ROUNDS, Mr. MORAN, Mr. COTTON, and SA 1618 proposed by Mr. MCCONNELL ance at a school or facility licensed in the Mr. DAINES) submitted an amendment (for Mr. HATCH (for himself and Ms. State for such purpose (referred to in this intended to be proposed to amendment MURKOWSKI)) to the bill H.R. 1, to pro- section as ‘qualified early education ex- SA 1618 proposed by Mr. MCCONNELL vide for reconciliation pursuant to ti- penses’).’’. ATCH (2) LIMITATION.—Section 529(e)(3)(A) is (for Mr. H (for himself and Ms. tles II and V of the concurrent resolu- amended by adding at the end the following: MURKOWSKI)) to the bill H.R. 1, to pro- tion on the budget for fiscal year 2018; ‘‘The amount of cash distributions from all vide for reconciliation pursuant to ti- which was ordered to lie on the table; qualified tuition pro grams described in sub- tles II and V of the concurrent resolu- as follows:

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00072 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.041 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7725 On page 254, strike lines 10 through 25 and with respect to any contract shall be deter- least 26 States when the contract was issued. insert the following: mined by using the tax reserve method appli- If the prevailing commissioners’ standard ta- SEC. 13517. COMPUTATION OF LIFE INSURANCE cable to such contract.’’, bles as of the beginning of any calendar year TAX RESERVES. (D) by striking ‘‘(as of the date of (hereinafter in this paragraph referred to as (a) IN GENERAL.— issuance)’’ in paragraph (3)(A)(iv)(I) and in- the ‘year of change’) are different from the (1) COMPUTATION OF RESERVES.—Section serting ‘‘(as of the date the reserve is deter- prevailing commissioners’ standard tables as 807(c) is amended to read as follows: mined)’’, of the beginning of the preceding calendar ‘‘(c) ITEMS TAKEN INTO ACCOUNT.—The (E) by striking ‘‘as of the date of the year, the issuer may use the prevailing com- items referred to in subsections and (b) are issuance of’’ in paragraph (3)(A)(iv)(II) and missioners’ standard tables as of the begin- as follows— inserting ‘‘as of the date the reserve is deter- ning of the preceding calendar year with re- ‘‘(1) The life insurance reserves (as defined mined for’’, spect to any contract issued after the change in section 816(b)). (F) by striking ‘‘in effect on the date of the and before the close of the 3-year period be- ‘‘(2) The unearned premiums and unpaid issuance of the contract’’ in paragraph ginning on the first day of the year of losses included in total reserves under sec- (3)(B)(i) and inserting ‘‘applicable to the con- change.’’. tion 816(c)(2). tract and in effect as of the date the reserve (b) CONFORMING AMENDMENTS.— ‘‘(3) The amounts (discounted at the appro- is determined’’, and (1) Section 808 is amended by adding at the priate rate of interest) necessary to satisfy (G) by striking ‘‘in effect on the date of the end the following new subsection: the obligations under insurance and annuity issuance of the contract’’ in paragraph contracts, but only if such obligations do not (3)(B)(ii) and inserting ‘‘applicable to the ‘‘(g) PREVAILING STATE ASSUMED INTEREST involve (at the time with respect to which contract and in effect as of the date the re- RATE.—For purposes of this subchapter— the computation is made under this para- serve is determined’’. ‘‘(1) IN GENERAL.—The term ‘prevailing graph) life, accident, or health contin- (3) Section 807(e) is amended— State assumed interest rate’ means, with re- gencies. (A) by striking paragraphs (2) and (5), spect to any contract, the highest assumed ‘‘(4) Dividend accumulations, and other (B) by redesignating paragraphs (3), (4), (6), interest rate permitted to be used in com- amounts, held at interest in connection with and (7) as paragraphs (2), (3), (4), and (5), re- puting life insurance reserves for insurance insurance and annuity contracts. spectively, contracts or annuity contracts (as the case ‘‘(5) Premiums received in advance, and li- (C) by amending paragraph (2) (as so redes- may be) under the insurance laws of at least abilities for premium deposit funds. ignated) to read as follows: 26 States. For purposes of the preceding sen- ‘‘(6) Reasonable special contingency re- ‘‘(2) QUALIFIED SUPPLEMENTAL BENEFITS.— tence, the effect of nonforfeiture laws of a serves under contracts of group term life in- ‘‘(A) QUALIFIED SUPPLEMENTAL BENEFITS State on interest rates for reserves shall not surance or group accident and health insur- TREATED SEPARATELY.—For purposes of this be taken into account. ance which are established and maintained part, the amount of the life insurance re- ‘‘(2) WHEN RATE DETERMINED.—The pre- for the provision of insurance on retired serve for any qualified supplemental benefit vailing State assumed interest rate with re- lives, for premium stabilization, or a com- shall be computed separately as though such spect to any contract shall be determined as bination thereof. benefit were under a separate contract. of the beginning of the calendar year in For purposes of paragraph (3), the appro- ‘‘(B) QUALIFIED SUPPLEMENTAL BENEFIT.— which the contract was issued.’’. priate rate of interest is the highest rate or For purposes of this paragraph, the term (2) Paragraph (1) of section 811(d) is amend- rates permitted to be used to discount the ‘qualified supplemental benefit’ means any ed by striking ‘‘the greater of the prevailing obligations by the National Association of supplemental benefit described in subpara- State assumed interest rate or applicable Insurance Commissioners as of the date the graph (C) if— Federal interest rate in effect under section reserve is determined. In no case shall the ‘‘(i) there is a separately identified pre- 807’’ and inserting ‘‘the interest rate in effect amount determined under paragraph (3) for mium or charge for such benefit, and under section 808(g)’’. any contract be less than the net surrender ‘‘(ii) any net surrender value under the (3) Subparagraph (A) of section 846(f)(6) is value of such contract. For purposes of para- contract attributable to any other benefit is amended by striking ‘‘except that’’ and all graph (2) and section 805(a)(1), the amount of not available to fund such benefit. that follows and inserting ‘‘except that the the unpaid losses (other than losses on life ‘‘(C) SUPPLEMENTAL BENEFITS.—For pur- limitation of subsection (a)(3) shall apply, insurance contracts) shall be the amount of poses of this paragraph, the supplemental and’’. the discounted unpaid losses as defined in benefits described in this subparagraph are (4) Subparagraph (B) of section 954(i)(5) is section 846.’’. any— amended by striking ‘‘shall apply, and’’. (2) Section 807(d) is amended— ‘‘(i) guaranteed insurability, (A) by striking paragraphs (1), (2), (4), and ‘‘(ii) accidental death or disability benefit, (c) EFFECTIVE DATE.— (5), ‘‘(iii) convertibility, (1) IN GENERAL.—The amendments made by (B) by redesignating paragraph (6) as para- ‘‘(iv) disability waiver benefit, or this section shall apply to taxable years be- graph (4), ‘‘(v) other benefit prescribed by regula- ginning after December 31, 2017. (C) by inserting before paragraph (3) the tions, (2) TRANSITION RULE.—For the first taxable following new paragraphs: which is supplemental to a contract for year beginning after December 31, 2017, the ‘‘(1) DETERMINATION OF RESERVE.— which there is a reserve described in sub- reserve with respect to any contract (as de- ‘‘(A) IN GENERAL.—For purposes of this section (c).’’, and termined under section 807(d)(2) of the Inter- part (other than section 816), the amount of (D) by adding at the end the following new nal Revenue Code of 1986) at the end of the the life insurance reserves for any contract paragraph: preceding taxable year shall be determined (other than a contract to which subpara- ‘‘(6) REPORTING RULES.—The Secretary as if the amendments made by this section graph (B) applies) shall be the greater of— shall require reporting (at such time and in had applied to such reserve in such preceding ‘‘(i) the net surrender value of such con- such manner as the Secretary shall pre- taxable year. tract, or scribe) with respect to the opening balance (3) TRANSITION RELIEF.— ‘‘(ii) 92.87 percent of the reserve deter- and closing balance of reserves and with re- (A) IN GENERAL.—If— mined under paragraph (2). spect to the method of computing reserves (i) the reserve determined under section ‘‘(B) VARIABLE CONTRACTS.—For purposes for purposes of determining income.’’. 807(d)(2) of the Internal Revenue Code of 1986 of this part (other than section 816), the (4) Section 7702 is amended— (determined without regard to the amend- amount of the life insurance reserves for a (A) by striking clause (i) of subsection ments made by this section) with respect to variable contract shall be equal to the sum (c)(3)(B) and inserting the following: any contract as of the close of the year pre- of— ‘‘(i) reasonable mortality charges which ceding the first taxable year beginning after ‘‘(i) the greater of— meet the requirements prescribed in regula- December 31, 2017, differs from ‘‘(I) the net surrender value of such con- tions to be promulgated by the Secretary or (ii) the reserve which would have been de- tract, or that do not exceed the mortality charges termined with respect to such contract as of ‘‘(II) the portion of the reserve that is sep- specified in the prevailing commissioners’ the close of such taxable year under such arately accounted for under section 817, plus standard tables as defined in subsection section determined without regard to para- ‘‘(ii) 92.87 percent of the excess (if any) of (f)(10),’’ and graph (2), the reserve determined under paragraph (2) (B) by adding at the end of subsection (f) then the difference between the amount of over the amount in clause (i). the following new paragraph: the reserve described in clause (i) and the ‘‘(C) STATUTORY CAP.—In no event shall the ‘‘(10) PREVAILING COMMISSIONERS’ STANDARD amount of the reserve described in clause (ii) reserves determined under subparagraphs (A) TABLES.—For purposes of subsection shall be taken into account under the meth- or (B) for any contract as of any time exceed (c)(3)(B)(i), the term ‘prevailing commis- od provided in subparagraph (B). the amount which would be taken into ac- sioners’ standard tables’ means the most re- (B) METHOD.—The method provided in this count with respect to such contract as of cent commissioners’ standard tables pre- subparagraph is as follows: such time in determining statutory reserves scribed by the National Association of Insur- (i) If the amount determined under sub- (as defined in paragraph (4)). ance Commissioners which are permitted to paragraph (A)(i) exceeds the amount deter- ‘‘(2) AMOUNT OF RESERVE.—The amount of be used in computing reserves for that type mined under subparagraph (A)(ii), 1/8 of such the reserve determined under this paragraph of contract under the insurance laws of at excess shall be taken into account, for each

VerDate Sep 11 2014 10:42 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00073 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.042 S01DEPT1 S7726 CONGRESSIONAL RECORD — SENATE December 1, 2017 of the 8 succeeding taxable years, as a deduc- MCCONNELL (for Mr. HATCH (for himself ‘‘(5) SPECIAL RULE FOR BDC DIVIDENDS.— tion under section 805(a)(2) or 832(c)(4) of and Ms. MURKOWSKI)) to the bill H.R. 1, ‘‘(A) IN GENERAL.—For purposes of this sec- such Code, as applicable. to provide for reconciliation pursuant tion, a qualified BDC dividend shall be treat- (ii) If the amount determined under sub- to titles II and V of the concurrent res- ed in the same manner as a qualified REIT paragraph (A)(ii) exceeds the amount deter- olution on the budget for fiscal year dividend. mined under subparagraph (A)(i), 1/8 of such ‘‘(B) QUALIFIED BDC DIVIDEND.—For pur- excess shall be included in gross income, for 2018; which was ordered to lie on the poses of this paragraph, the term ‘qualified each of the 8 succeeding taxable years, under table; as follows: BDC dividend’ means any dividend received section 803(a)(2) or 832(b)(1)(C) of such Code, At the end of part III of subtitle A of title from an electing business development com- as applicable. I, insert the following: pany during the taxable year which is not— SEC. 13518. MODIFICATION OF RULES FOR LIFE SEC. 11030. REFUNDABILITY OF CHILD AND DE- ‘‘(i) a capital gain dividend, as defined in INSURANCE PRORATION FOR PUR- PENDENT CARE TAX CREDIT. section 852(b)(3), and POSES OF DETERMINING THE DIVI- (a) IN GENERAL.—The Internal Revenue ‘‘(ii) qualified dividend income, as defined DENDS RECEIVED DEDUCTION. Code of 1986 is amended— in section 1(h)(11). (a) IN GENERAL.—Section 812 is amended to (1) by redesignating section 21 as section ‘‘(C) ELECTING BUSINESS DEVELOPMENT COM- read as follows: 36C, and PANY.—For purposes of this paragraph, the ‘‘SEC. 812. DEFINITION OF COMPANY’S SHARE (2) by moving section 36C, as so redesig- term ‘electing business development com- AND POLICYHOLDER’S SHARE. nated, from subpart A of part IV of sub- pany’ means a business development com- ‘‘(a) COMPANY’S SHARE.—For purposes of chapter A of chapter 1 to the location imme- pany (as defined in section 2(a) of the Invest- section 805(a)(4), the term ‘company’s share’ diately before section 37 in subpart C of part ment Company Act of 1940 (15 U.S.C. 80a– means, with respect to any taxable year be- IV of subchapter A of chapter 1. 2(a))) which has an election in effect under (b) TECHNICAL AMENDMENTS.— ginning after December 31, 2017, 70 percent. section 851 to be treated as a regulated in- (1) Paragraph (1) of section 23(f) is amended ‘‘(b) POLICYHOLDER’S SHARE.—For purposes vestment company. of section 807, the term ‘policyholder’s share’ by striking ‘‘21(e)’’ and inserting ‘‘36C(e)’’. means, with respect to any taxable year be- (2) Paragraph (6) of section 35(g) is amend- SA 1830. Mr. RISCH submitted an ginning after December 31, 2017, 30 percent.’’. ed by striking ‘‘21(e)’’ and inserting ‘‘36C(e)’’. amendment intended to be proposed to (b) CONFORMING AMENDMENT.—Section (3) Paragraph (1) of section 36C(a) (as redes- ignated by subsection (a)) is amended by amendment SA 1618 proposed by Mr. 817A(e)(2) is amended by striking ‘‘, MCCONNELL (for Mr. HATCH (for himself 807(d)(2)(B), and 812’’ and inserting ‘‘and striking ‘‘this chapter’’ and inserting ‘‘this and Ms. MURKOWSKI)) to the bill H.R. 1, 807(d)(2)(B)’’. subtitle’’. (c) EFFECTIVE DATE.—The amendments (4) Subparagraph (C) of section 129(a)(2) is to provide for reconciliation pursuant made by this section shall apply to taxable amended by striking ‘‘section 21(e)’’ and in- to titles II and V of the concurrent res- years beginning after December 31, 2017. serting ‘‘section 36C(e)’’. olution on the budget for fiscal year (5) Paragraph (2) of section 129(b) is amend- SEC. 13519. CAPITALIZATION OF CERTAIN POLICY 2018; which was ordered to lie on the ACQUISITION EXPENSES. ed by striking ‘‘section 21(d)(2)’’ and insert- table; as follows: ing ‘‘section 36C(d)(2)’’. (a) IN GENERAL.— On page 33, between lines 17 and 18, insert (6) Paragraph (1) of section 129(e) is amend- (1) Section 848(a)(2) is amended by striking the following: ed by striking ‘‘section 21(b)(2)’’ and insert- ‘‘120-month’’ and inserting ‘‘180-month’’. ‘‘(5) SPECIAL RULE FOR BDC DIVIDENDS.— ing ‘‘section 36C(b)(2)’’. (2) Section 848(c)(1) is amended by striking ‘‘(A) IN GENERAL.—For purposes of this sec- (7) Subsection (e) of section 213 is amended ‘‘1.75 percent’’ and inserting ‘‘2.1 percent’’. tion, a qualified BDC dividend shall be treat- by striking ‘‘section 21’’ and inserting ‘‘sec- (3) Section 848(c)(2) is amended by striking tion 36C’’. ed in the same manner as a qualified REIT ‘‘2.05 percent’’ and inserting ‘‘2.46 percent’’. (8) Subparagraph (H) of section 6213(g)(2) is dividend. (4) Section 848(c)(3) is amended by striking amended by striking ‘‘section 21’’ and insert- ‘‘(B) QUALIFIED BDC DIVIDEND.—For pur- ‘‘7.7 percent’’ and inserting ‘‘9.24 percent’’. ing ‘‘section 36C’’. poses of this paragraph, the term ‘qualified (b) CONFORMING AMENDMENTS.—Section (9) Subparagraph (L) of section 6213(g)(2) is BDC dividend’ means any dividend received 848(b)(1) is amended by striking ‘‘120-month’’ amended by striking ‘‘section 21, 24, or 32,’’ from an electing business development com- and inserting ‘‘180-month’’. and inserting ‘‘section 24, 32, or 36C,’’. pany during the taxable year which is not— (c) EFFECTIVE DATE.— (10) Paragraph (2) of section 1324(b) of title ‘‘(i) a capital gain dividend, as defined in (1) IN GENERAL.—The amendments made by section 852(b)(3), and this section shall apply to net premiums for 31, United States Code, is amended by insert- ing ‘‘36C,’’ after ‘‘36B,’’. ‘‘(ii) qualified dividend income, as defined taxable years beginning after December 31, in section 1(h)(11). 2017. (11) The table of sections for subpart C of part IV of subchapter A of chapter 1 is ‘‘(C) ELECTING BUSINESS DEVELOPMENT COM- (2) TRANSITION RULE.—Specified policy ac- PANY.—For purposes of this paragraph, the quisition expenses first required to be cap- amended by inserting after the item relating to section 36B the following: term ‘electing business development com- italized in a taxable year beginning before pany’ means a business development com- ‘‘Sec. 36C. Expenses for household and de- January 1, 2018, will continue to be allowed pany (as defined in section 2(a) of the Invest- pendent care services necessary as a deduction ratably over the 120-month ment Company Act of 1940 (15 U.S.C. 80a– for gainful employment.’’. period beginning with the first month in the 2(a))) which has an election in effect under second half of such taxable year. (12) The table of sections for subpart A of section 851 to be treated as a regulated in- such part IV is amended by striking the item vestment company. SA 1827. Mr. BURR submitted an relating to section 21. amendment intended to be proposed to (c) OFFSET.—Section 1061, as added by sec- SA 1831. Mr. KAINE (for himself, Mr. amendment SA 1618 proposed by Mr. tion 13310, is amended— MANCHIN, Mr. BENNET, and Mrs. MCCAS- (1) by striking ‘‘3 years’’ in subsection MCCONNELL (for Mr. HATCH (for himself KILL) submitted an amendment in- (a)(2) and inserting ‘‘8 years’’, tended to be proposed by him to the and Ms. MURKOWSKI)) to the bill H.R. 1, (2) by striking ‘‘3 years’’ in subsection to provide for reconciliation pursuant (d)(1)(A) and inserting ‘‘8 years’’, and bill H.R. 1, to provide for reconciliation to titles II and V of the concurrent res- (3) by striking ‘‘three calendar years’’ in pursuant to titles II and V of the con- olution on the budget for fiscal year subsection (d)(2)(B) and inserting ‘‘8 calendar current resolution on the budget for 2018; which was ordered to lie on the years’’. fiscal year 2018; which was ordered to table; as follows: (d) EFFECTIVE DATE.—The amendments lie on the table; as follows: made by subsections (a), (b), and (c) shall Beginning on page 104, strike line 15 and At the end of part IV of subtitle C of title apply to taxable years beginning after De- I, add the following: all that follows through page 112, line 12 and cember 31, 2017. insert the following: SEC. 13311. 7-YEAR CLASS LIFE FOR MOTOR- SPORTS ENTERTAINMENT COMPLEX SA 1829. Mr. RISCH submitted an Subtitle B—Permanent Individual Income FACILITIES MADE PERMANENT. amendment intended to be proposed to Tax Relief for Middle Class (a) IN GENERAL.—Section 168(i)(15) of the amendment SA 1618 proposed by Mr. SEC. 12001. AMENDMENT OF INCOME TAX BRACK- Internal Revenue Code of 1986 is amended by ETS. striking subparagraph (D). MCCONNELL (for Mr. HATCH (for himself (a) MARRIED INDIVIDUALS FILING JOINT RE- (b) EFFECTIVE DATE.—The amendment and Ms. MURKOWSKI)) to the bill H.R. 1, TURNS AND SURVIVING SPOUSES.—The table made by this section shall apply to property to provide for reconciliation pursuant contained in subsection (a) of section 1 is placed in service after December 31, 2016. to titles II and V of the concurrent res- amended to read as follows: olution on the budget for fiscal year SA 1828. Ms. COLLINS (for herself 2018; which was ordered to lie on the If taxable income is: The tax is: and Mr. KING) submitted an amend- table; as follows: Not over $19,050 ...... 10% of taxable income. Over $19,050 but not over ment intended to be proposed to On page 33, between lines 17 and 18, insert $77,400 ...... $1,905, plus 12% of the ex- amendment SA 1618 proposed by Mr. the following: cess over $19,050.

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00074 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.042 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7727

If taxable income is: The tax is: (g) EFFECTIVE DATE.—The amendments SEC. 13823. OPPORTUNITY ZONES. made by this section shall apply to taxable (a) IN GENERAL.—Chapter 1 is amended by Over $77,400 but not over adding at the end the following: $140,000 ...... $8,907, plus 22% of the ex- years beginning after December 31, 2025. cess over $77,400. SEC. 12002. CORPORATE TAX RATE. ‘‘Subchapter Z—Opportunity Zones Over $140,000 but not over (a) IN GENERAL.—Section 11(b), as amended ‘‘Sec. 1400Z–1. Designation. $320,000 ...... $22,679, plus 24% of the excess over $140,000. by this Act, is amended by striking ‘‘20 per- ‘‘Sec. 1400Z–2. Special rules for capital gains Over $320,000 but not over cent’’ and inserting ‘‘25 percent’’. invested in opportunity zones. $400,000 ...... $65,879, plus 32% of the (b) EFFECTIVE DATE.—The amendment ‘‘SEC. 1400Z–1. DESIGNATION. excess over $320,000. made by this section shall apply to taxable Over $400,000 but not over ‘‘(a) QUALIFIED OPPORTUNITY ZONE DE- $480,050 ...... $91,479, plus 35% of the years beginning after December 31, 2018. FINED.—For the purposes of this subchapter, excess over $400,000. the term ‘qualified opportunity zone’ means Over $480,050 ...... $119,496.50, plus 39.6% of SA 1832. Mr. JOHNSON submitted an the excess over $480,050. a population census tract that is a low-in- amendment intended to be proposed to come community that is designated as a (b) HEADS OF HOUSEHOLDS.—The table con- amendment SA 1618 proposed by Mr. qualified opportunity zone. tained in subsection (b) of section 1 is MCCONNELL (for Mr. HATCH (for himself ‘‘(b) DESIGNATION.— amended to read as follows: and Ms. MURKOWSKI)) to the bill H.R. 1, ‘‘(1) IN GENERAL.—For purposes of sub- section (a), a population census tract that is If taxable income is: The tax is: to provide for reconciliation pursuant to titles II and V of the concurrent res- a low-income community is designated as a Not over $13,600 ...... 10% of taxable income. qualified opportunity zone if— Over $13,600 but not over olution on the budget for fiscal year ‘‘(A) not later than the end of the deter- $51,800 ...... $1,360, plus 12% of the ex- 2018; which was ordered to lie on the cess over $13,600. mination period, the governor of the State in Over $51,800 but not over table; as follows: which the tract is located— $70,000 ...... $5,944, plus 22% of the ex- At the appropriate place, insert the fol- ‘‘(i) nominates the tract for designation as cess over $51,800. Over $70,000 but not over lowing: a qualified opportunity zone, and $160,000 ...... $9,948, plus 24% of the ex- SEC. ll. MODIFICATION OF TREATMENT OF S ‘‘(ii) notifies the Secretary in writing of cess over $70,000. CORPORATION CONVERSIONS TO C such nomination, and Over $160,000 but not over CORPORATIONS. ‘‘(B) the Secretary certifies such nomina- $200,000 ...... $31,548, plus 32% of the excess over $160,000. (a) ADJUSTMENTS ATTRIBUTABLE TO CON- tion and designates such tract as a qualified Over $200,000 but not over VERSION FROM S CORPORATION TO C CORPORA- opportunity zone before the end of the con- $453,350 ...... $44,348, plus 35% of the TION.—Section 481 is amended by adding at sideration period. excess over $200,000. Over $453,350 ...... $133,020.50, plus 39.6% of the end the following new subsection: ‘‘(2) EXTENSION OF PERIODS.—A governor the excess over $453,350. ‘‘(d) ADJUSTMENTS ATTRIBUTABLE TO CON- may request that the Secretary extend ei- VERSION FROM S CORPORATION TO C CORPORA- (c) UNMARRIED INDIVIDUALS OTHER THAN ther the determination or consideration pe- TION.— SURVIVING SPOUSES AND HEADS OF HOUSE- riod, or both (determined without regard to ‘‘(1) IN GENERAL.—In the case of an eligible HOLDS.—The table contained in subsection this subparagraph), for an additional 30 days. (c) of section 1 is amended to read as follows: terminated S corporation, any adjustment ‘‘(c) OTHER DEFINITIONS.—For purposes of required by subsection (a)(2) which is attrib- this subsection— If taxable income is: The tax is: utable to such corporation’s revocation de- ‘‘(1) LOW-INCOME COMMUNITIES.—The term scribed in paragraph (2)(A)(ii) shall be taken ‘low-income community’ has the same mean- Not over $9,525 ...... 10% of taxable income. into account ratably during the 10-taxable Over $9,525 but not over ing as when used in section 45D(e). $38,700 ...... $952.50, plus 12% of the year period beginning with the year of the ‘‘(2) DEFINITION OF PERIODS.— excess over $9,525. change. ‘‘(A) CONSIDERATION PERIOD.—The term Over $38,700 but not over ‘‘(2) ELIGIBLE TERMINATED S CORPORATION.— $70,000 ...... $4,453.50, plus 22% of the ‘consideration period’ means the 30-day pe- excess over $38,700. For purposes of this subsection, the term ‘el- riod beginning on the date on which the Sec- Over $70,000 but not over igible terminated S corporation’ means any retary receives notice under subsection $160,000 ...... $11,339.50, plus 24% of the C corporation— excess over $70,000. (b)(1)(A)(ii), as extended under subsection Over $160,000 but not over ‘‘(A) which— (b)(2). $200,000 ...... $32,939.50, plus 32% of the ‘‘(i) was an S corporation on the day before ‘‘(B) DETERMINATION PERIOD.—The term excess over $160,000. the date of the enactment of the Tax Cuts Over $200,000 but not over ‘determination period’ means the 90-day pe- $426,700 ...... $45,739.50, plus 35% of the and Jobs Ac; and riod beginning on the date of the enactment excess over $200,000. ‘‘(ii) during the 3-year period beginning on of the Tax Cuts and Jobs Act, as extended Over $426,700 ...... $125,084.50, plus 39.6% of the date of such enactment makes a revoca- the excess over $426,700. under subsection (b)(2). tion of its election under section 1362(a); and ‘‘(3) STATE.—For purposes of this section, (d) MARRIED INDIVIDUALS FILING SEPARATE ‘‘(B) the owners of the stock of which, de- the term ‘State’ includes any possession of RETURNS.—The table contained in subsection termined on the date such revocation is the United States. (d) of section 1 is amended to read as follows: made, are the same owners (and in identical ‘‘(d) NUMBER OF DESIGNATIONS.— proportions) as on the date of such enact- ‘‘(1) IN GENERAL.—Except as provided by If taxable income is: The tax is: ment.’’. paragraph (2), the number of population cen- Not over $9,525 ...... 10% of taxable income. (b) CASH DISTRIBUTIONS FOLLOWING POST- sus tracts in a State that may be designated Over $9,525 but not over TERMINATION TRANSITION PERIOD FROM S as qualified opportunity zones under this $38,700 ...... $952.50, plus 12% of the excess over $9,525. CORPORATION STATUS.—Section 1371 is section may not exceed 25 percent of the Over $38,700 but not over amended by adding at the end the following number of low-income communities in the $70,000 ...... $4,453.50, plus 22% of the new subsection: State. excess over $38,700. ‘‘(f) CASH DISTRIBUTIONS FOLLOWING POST- Over $70,000 but not over ‘‘(2) EXCEPTION.—If the number of low-in- $160,000 ...... $11,339.50, plus 24% of the TERMINATION TRANSITION PERIOD.—In the come communities in a State is less than 100, excess over $70,000. case of a distribution of money by an eligible then a total of 25 of such tracts may be des- Over $160,000 but not over terminated S corporation (as defined in sec- $200,000 ...... $32,939.50, plus 32% of the ignated as qualified opportunity zones. excess over $160,000. tion 481(d)) after the post-termination tran- ‘‘(e) DESIGNATION OF TRACTS CONTIGUOUS Over $200,000 but not over sition period, the accumulated adjustments WITH LOW-INCOME COMMUNITIES.— $240,026 ...... $45,739.50, plus 35% of the account shall be allocated to such distribu- excess over $200,000. ‘‘(1) IN GENERAL.—A population census Over $240,026 ...... $59,748.60, plus 39.6% of tion, and the distribution shall be chargeable tract that is not a low-income community the excess over $240,026. to accumulated earnings and profits, in the may be designated as a qualified opportunity (e) ESTATES AND TRUSTS.—The table con- same ratio as the amount of such accumu- zone under this section if— tained in subsection (e) of section 1 is lated adjustments account bears to the ‘‘(A) the tract is contiguous with the low- amended to read as follows: amount of such accumulated earnings and income community that is designated as a profits.’’. qualified opportunity zone, and If taxable income is: The tax is: ‘‘(B) the median family income of the tract SA 1833. Mr. SCOTT (for himself and does not exceed 125 percent of the median Not over $2,550 ...... 10% of taxable income. Over $2,550 but not over Mr. PORTMAN) submitted an amend- family income of the low-income community $9,150 ...... $255, plus 24% of the ex- ment intended to be proposed by him with which the tract is contiguous. cess over $2,550. ‘‘(2) LIMITATION.—Not more than 5 percent Over $9,150 but not over to the bill H.R. 1, to provide for rec- $12,700 ...... $1,839, plus 35% of the ex- onciliation pursuant to titles II and V of the population census tracts designated in cess over $9,150. of the concurrent resolution on the a State as a qualified opportunity zone may Over $12,700 ...... $3,081.50, plus 39.6% of be designated under paragraph (1). the excess over $12,700. budget for fiscal year 2018; which was ‘‘(f) PERIOD FOR WHICH DESIGNATION ISIN (f) INFLATION ADJUSTMENT.—Section ordered to lie on the table; as follows: EFFECT.—A designation as a qualified oppor- 1(f)(2)(A), as amended by this Act, is amend- Strike section 13823 and insert the fol- tunity zone shall remain in effect for the pe- ed by striking ‘‘1992’’ and inserting ‘‘2017’’. lowing: riod beginning on the date of the designation

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and ending at the close of the 10th calendar ‘‘(B) on the last day of the taxable year of ‘‘(A) IN GENERAL.—The term ‘qualified op- year beginning on or after such date of des- the fund. portunity zone business’ means a trade or ignation. ‘‘(2) QUALIFIED OPPORTUNITY ZONE PROP- business— ‘‘SEC. 1400Z–2. SPECIAL RULES FOR CAPITAL ERTY.— ‘‘(i) in which substantially all of the tan- GAINS INVESTED IN OPPORTUNITY ‘‘(A) IN GENERAL.—The term ‘qualified op- gible property owned or leased by the tax- ZONES. portunity zone property’ means property payer is qualified opportunity zone business ‘‘(a) IN GENERAL.—In the case of gain from which is— property, the sale to, or exchange with, an unrelated ‘‘(i) qualified opportunity zone stock, ‘‘(ii) which satisfies the requirements of person of any property held by the taxpayer, ‘‘(ii) qualified opportunity zone partner- paragraphs (2), (4), and (8) of section 1397C(b), at the election of the taxpayer— ship interest, or and ‘‘(1) gross income for the taxable year shall ‘‘(iii) qualified opportunity zone business ‘‘(iii) which is not described in section not include so much of such gain as does not property. 144(c)(6)(B). exceed the aggregate amount invested by the ‘‘(B) QUALIFIED OPPORTUNITY ZONE STOCK.— ‘‘(B) SPECIAL RULE.—For purposes of sub- taxpayer in a qualified opportunity fund dur- ‘‘(i) IN GENERAL.—Except as provided in paragraph (A), tangible property that ceases ing the 180-day period beginning on the date clause (ii), the term ‘qualified opportunity to be a qualified opportunity zone business of such sale or exchange, zone stock’ means any stock in a domestic property shall continue to be treated as a ‘‘(2) the amount of gain excluded by para- corporation if— qualified opportunity zone business property graph (1) shall be included in gross income as ‘‘(I) such stock is acquired by the taxpayer for the lesser of— provided by subsection (b), and after December 31, 2017, at its original issue ‘‘(i) 5 years after the date on which such ‘‘(3) subsection (c) shall apply. (directly or through an underwriter) from tangible property ceases to be so qualified, No election may be made under the pre- the corporation solely in exchange for cash, or ceding sentence with respect to a sale or ex- ‘‘(II) as of the time such stock was issued, ‘‘(ii) the date on which such tangible prop- change if an election previously made with such corporation was a qualified opportunity erty is no longer held by the qualified oppor- respect to such sale or exchange is in effect. zone business (or, in the case of a new cor- tunity zone business. ‘‘(b) DEFERRAL OF GAIN INVESTED IN OPPOR- poration, such corporation was being orga- ‘‘(e) APPLICABLE RULES.— TUNITY ZONE PROPERTY.— nized for purposes of being a qualified oppor- ‘‘(1) TREATMENT OF INVESTMENTS WITH ‘‘(1) YEAR OF INCLUSION.—Gain to which tunity zone business), and MIXED FUNDS.—In the case of any investment subsection (a)(2) applies shall be included in ‘‘(III) during substantially all of the tax- in a qualified opportunity fund only a por- income in the taxable year which includes payer’s holding period for such stock, such tion of which consists of investments of gain the earlier of— corporation qualified as a qualified oppor- to which an election under subsection (a)(1) ‘‘(A) the date on which such investment is tunity zone business. is in effect— sold or exchanged, or ‘‘(ii) REDEMPTIONS.—A rule similar to the ‘‘(A) such investment shall be treated as 2 ‘‘(B) December 31, 2026. rule of section 1202(c)(3) shall apply for pur- separate investments, consisting of— ‘‘(2) AMOUNT INCLUDIBLE.— poses of this paragraph. ‘‘(i) one investment that only includes ‘‘(A) IN GENERAL.—The amount of gain in- ‘‘(C) QUALIFIED OPPORTUNITY ZONE PART- amounts to which the election under sub- cluded in gross income under subsection NERSHIP INTEREST.—The term ‘qualified op- (a)(1) shall be the excess of— portunity zone partnership interest’ means section (a)(1) applies, and ‘‘(i) the lesser of the amount of gain ex- any capital or profits interest in a domestic ‘‘(ii) a separate investment consisting of cluded under paragraph (1) or the fair mar- partnership if— other amounts, and ket value of the property as determined as of ‘‘(i) such interest is acquired by the tax- ‘‘(B) subsections (a), (b), and (c) shall only the date described in paragraph (1), over payer after December 31, 2017, from the part- apply to the investment described in sub- ‘‘(ii) the taxpayer’s basis in the invest- nership solely in exchange for cash, paragraph (A)(i). ment. ‘‘(ii) as of the time such interest was ac- ‘‘(2) RELATED PERSONS.—For purposes of ‘‘(B) DETERMINATION OF BASIS.— quired, such partnership was a qualified op- this section, persons are related to each ‘‘(i) IN GENERAL.—Except as otherwise pro- portunity zone business (or, in the case of a other if such persons are described in section vided in this clause or subsection (c), the new partnership, such partnership was being 267(b) or 707(b)(1), determined by substituting taxpayer’s basis in the investment shall be organized for purposes of being a qualified ‘20 percent’ for ‘50 percent’ each place it oc- zero. opportunity zone business), and curs in such sections. ECEDENTS ‘‘(ii) INCREASE FOR GAIN RECOGNIZED UNDER ‘‘(iii) during substantially all of the tax- ‘‘(3) D .—In the case of a decedent, SUBSECTION (a)(2).—The basis in the invest- payer’s holding period for such interest, such amounts recognized under this section shall, ment shall be increased by the amount of partnership qualified as a qualified oppor- if not properly includible in the gross income gain recognized by reason of subsection (a)(2) tunity zone business. of the decedent, be includible in gross in- with respect to such property. ‘‘(D) QUALIFIED OPPORTUNITY ZONE BUSINESS come as provided by section 691. EGULATIONS ‘‘(iii) INVESTMENTS HELD FOR 5 YEARS.—In PROPERTY.— ‘‘(4) R .—The Secretary shall the case of any investment held for at least ‘‘(i) IN GENERAL.—The term ‘qualified op- prescribe such regulations as may be nec- 5 years, the basis of such investment shall be portunity zone business property’ means tan- essary or appropriate to carry out the pur- increased by an amount equal to 10 percent gible property used in a trade or business of poses of this section, including— of the amount of gain deferred by reason of the taxpayer if— ‘‘(A) rules for the certification of qualified subsection (a)(1). ‘‘(I) such property was acquired by the tax- opportunity funds for the purposes of this ‘‘(iv) INVESTMENTS HELD FOR 7 YEARS.—In payer by purchase (as defined in section section, and the case of any investment held by the tax- 179(d)(2)) after December 31, 2017, ‘‘(B) rules to prevent abuse. payer for at least 7 years, in addition to any ‘‘(II) the original use of such property in ‘‘(f) FAILURE OF QUALIFIED OPPORTUNITY adjustment made under clause (iii), the basis the qualified opportunity zone commences FUND TO MAINTAIN INVESTMENT STANDARD.— of such property shall be increased by an with the taxpayer or the taxpayer substan- ‘‘(1) IN GENERAL.—If a qualified oppor- amount equal to 5 percent of the amount of tially improves the property, and tunity fund fails to meet the 90-percent re- gain deferred by reason of subsection (a)(1). ‘‘(III) during substantially all of the tax- quirement of subsection (c)(1), the qualified ‘‘(c) SPECIAL RULE FOR INVESTMENTS HELD payer’s holding period for such property, opportunity fund shall pay a penalty for FOR AT LEAST 10 YEARS.—In the case of any substantially all of the use of such property each month it fails to meet the requirement investment held by the taxpayer for at least was in a qualified opportunity zone. in an amount equal to the product of— 10 years and with respect to which the tax- ‘‘(ii) SUBSTANTIAL IMPROVEMENT.—For pur- ‘‘(A) the excess of— payer makes an election under this clause, poses of subparagraph (A)(ii), property shall ‘‘(i) the amount equal to 90 percent of its the basis of such property shall be equal to be treated as substantially improved by the aggregate assets, over the fair market value of such investment on taxpayer only if, during any 30-month period ‘‘(ii) the aggregate amount of qualified op- the date that the investment is sold or ex- beginning after the date of acquisition of portunity zone property held by the fund, changed. such property, additions to basis with re- multiplied by ‘‘(d) QUALIFIED OPPORTUNITY FUND.—For spect to such property in the hands of the ‘‘(B) the underpayment rate established purposes of this section— taxpayer exceed an amount equal to the ad- under section 6621(a)(2) for such month. ‘‘(1) QUALIFIED OPPORTUNITY FUND.—The justed basis of such property at the begin- ‘‘(2) SPECIAL RULE FOR PARTNERSHIPS.—In term ‘qualified opportunity fund’ means any ning of such 30-month period in the hands of the case that the qualified opportunity fund investment vehicle which is organized as a the taxpayer. is a partnership, the penalty imposed by corporation or a partnership for the purpose ‘‘(iii) RELATED PARTY.—For purposes of paragraph (1) shall be taken into account of investing in qualified opportunity zone subparagraph (A)(i), the related person rule proportionately as part of the distributive property (other than another qualified op- of section 179(d)(2) shall be applied pursuant share of each partner of the partnership. portunity fund) that holds at least 90 percent to paragraph (8) of this subsection in lieu of ‘‘(3) REASONABLE CAUSE EXCEPTION.—No of its assets in qualified opportunity zone the application of such rule in section penalty shall be imposed under this sub- property, determined— 179(d)(2)(A). section with respect to any failure if it is ‘‘(A) on the last day of the first 6-month ‘‘(3) QUALIFIED OPPORTUNITY ZONE BUSI- shown that such failure is due to reasonable period of the taxable year of the fund, and NESS.— cause.’’.

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00076 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.050 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7729 (b) BASIS ADJUSTMENTS.—Section 1016(a) is munication, attributed identity, and non-re- olution on the budget for fiscal year amended by striking ‘‘and’’ at the end of pudiation, and 2018; which was ordered to lie on the paragraph (36), by striking the period at the ‘‘(iii) is approved for purposes of this sec- table; as follows: end of paragraph (37) and inserting ‘‘, and’’, tion by the Secretary (in consultation with On page 481, strike lines 14 through 19, and and by inserting after paragraph (37) the fol- the Secretary of Energy). insert the following: lowing: ‘‘(C) QUALIFIED AUTOMATED DISTRIBUTION (c) RULES RELATING TO CREDITS.— ‘‘(38) to the extent provided in subsections DEVICE.—The term ‘qualified automated dis- (1) DISALLOWANCE OF CREDITS AGAINST BASE (b)(2) and (c) of section 1400Z–2.’’. tribution device’ means any automated de- EROSION TAX.—Paragraph (2) of section 26(b) (c) CLERICAL AMENDMENT.—The table of vice which— is amended by inserting after subparagraph subchapters for chapter 1 is amended by add- ‘‘(i) is used for distributing electricity (A) the following new subparagraph: ing at the end the following new item: through the electric grid, including property ‘‘(B) section 59A (relating to base erosion integral to local or centralized control sys- ‘‘SUBCHAPTER Z. OPPORTUNITY ZONES’’. and anti-abuse tax),’’. tems, such as distribution sensors, commu- (d) EFFECTIVE DATE.—The amendments (2) ALLOWANCE OF UNUSED BUSINESS CRED- nication security equipment (including com- made by this section shall take effect on the ITS.—Section 39(a) is amended by adding at munication encryption devices), automated date of the enactment of this Act. the end the following new paragraph: switches, automated threat detection and re- ‘‘(5) INCREASE IN CURRENT YEAR CREDIT FOR mediation devices, system protective de- SA 1834. Mr. BENNET submitted an UNUSED CREDITS ARISING FROM BASE EROSION vices, smart inverters, and other property amendment intended to be proposed to TAX.— used to coordinate and control devices across amendment SA 1618 proposed by Mr. ‘‘(A) IN GENERAL.—If a taxpayer— the system, and ‘‘(i) is not an applicable taxpayer for the MCCONNELL (for Mr. HATCH (for himself ‘‘(ii) is approved for purposes of this sec- taxable year, but and Ms. MURKOWSKI)) to the bill H.R. 1, tion by the Secretary (in consultation with ‘‘(ii) was an applicable taxpayer during any to provide for reconciliation pursuant the Secretary of Energy). of the 5 preceding taxable years, to titles II and V of the concurrent res- ‘‘(D) ADVANCED VOLTAGE CONTROL SYS- then the taxpayer’s current year business TEMS.—The term ‘advanced voltage control olution on the budget for fiscal year credit for the taxable year shall be increased system’ means any property which— 2018; which was ordered to lie on the by the unused base erosion credit amount for ‘‘(i) is used to provide accurate and dy- table; as follows: the taxable year. namic voltage control, including voltage reg- ‘‘(B) UNUSED BASE EROSION CREDIT At the appropriate place, insert the fol- ulators, capacitors, inverters, sensors, and AMOUNT.—For purposes of this paragraph, the lowing: communication devices, and term ‘unused base erosion credit amount’ SEC. ll. INVESTMENT CREDIT FOR ELEC- ‘‘(ii) is approved for purposes of this sec- means, with respect to any taxable year, the TRICITY GRID SECURITY AND MOD- tion by the Secretary (in consultation with ERNIZATION PROPERTY. excess (if any) of— the Secretary of Energy). (a) IN GENERAL.—Section 48(a)(3)(A) is ‘‘(i) the sum of the amounts determined ‘‘(E) ADVANCED METERING INFRASTRUC- amended by striking ‘‘or’’ at the end of under subparagraph (C) for any of the 5 pre- TURE.—The term ‘advanced metering infra- clause (vi), by inserting ‘‘or’’ at the end of ceding years in which the taxpayer was an structure’ means any property which— clause (vii), and by adding at the end the fol- applicable taxpayer, over ‘‘(i) provides both the capability to meas- lowing new clause: ‘‘(ii) any portion of the amount described ure services consumed from the utility and a ‘‘(viii) grid security and modernization in clause (i) taken into account under sub- two-way communication pathway between property.’’. paragraph (A) for any preceding taxable the utility control center and the meter, and (b) RATE OF CREDIT.—Section 48(a)(2)(A) is year. ‘‘(ii) is approved for purposes of this sec- amended— ‘‘(C) DETERMINATION OF UNUSED AMOUNT.— tion by the Secretary (in consultation with (1) by striking ‘‘and’’ at the end of clause The amount determined under this subpara- the Secretary of Energy). (i)(IV); graph for any taxable year described in sub- ‘‘(F) ADVANCED AND SECURE TRANSMISSION (2) by redesignating clause (ii) as clause paragraph (B)(i) shall be the excess (if any) SYSTEM TECHNOLOGIES.—The term ‘advanced (iii); and of— and secure transmission system tech- (3) by inserting after clause (i) the fol- ‘‘(i) the taxpayer’s base erosion minimum nologies’ means any property which— lowing new clause: tax amount for the taxable year without re- ‘‘(i) increases that efficiency, security, and ‘‘(ii) in the case of grid security and mod- gard to this section, over reliability of a transmission facility, but not ernization property— ‘‘(ii) the taxpayer’s base erosion minimum the main transmission property, and ‘‘(I) 4 percent for the taxable year begin- tax amount for the taxable year which would ‘‘(ii) is approved for purposes of this sec- ning after December 31, 2019, and ending be- have been determined if section 59A(b)(1)(B) tion by the Secretary (in consultation with fore January 1, 2021, had been applied by taking into account the Secretary of Energy).’’. ‘‘(II) 8 percent for the taxable year begin- under clause (ii) thereof the total credit al- (2) LIST OF APPROVED PROPERTY.— ning after December 31, 2020, and ending be- lowed under section 38 for the taxable year (A) IN GENERAL.—Not later than 1 year fore January 1, 2022, and rather than only the portion properly allo- after the date of the enactment of this Act, ‘‘(III) 20 percent for taxable years begin- cable to the research credit determined the Secretary of the Treasury (or the Sec- ning after December 31, 2021, and’’. under section 41(a). retary’s delegate), in consultation with the (c) GRID SECURITY AND MODERNIZATION ‘‘(D) APPLICABLE TAXPAYER.—For purposes Secretary of Energy, shall publish a list of PROPERTY.— of this paragraph, the term ‘applicable tax- property approved as grid security and mod- (1) IN GENERAL.—Section 48(c) is amended payer’ has the meaning given such term by ernization property under section 48(c)(5) of by adding at the end the following new para- section 59A(e).’’. graph: the Internal Revenue Code of 1986, as added by this subsection. ‘‘(5) GRID SECURITY AND MODERNIZATION SA 1836. Mr. HATCH submitted an (B) UPDATES.—The Secretary of the Treas- PROPERTY.— amendment intended to be proposed by ‘‘(A) IN GENERAL.—The term ‘grid security ury (or the Secretary’s delegate), in con- sultation with the Secretary of Energy, shall him to the bill H.R. 1, to provide for and modernization property’ means any reconciliation pursuant to titles II and qualified software, qualified automated dis- revise the list published under subparagraph tribution device, advanced voltage control (A) not less frequently than every 3 years. V of the concurrent resolution on the (d) EFFECTIVE DATE.—The amendments system, advanced metering property, and ad- budget for fiscal year 2018; which was made by this section shall apply to periods vanced and secure transmission system tech- ordered to lie on the table; as follows: after the date of the enactment of this Act, nologies. On page 480, between lines 11 and 12, insert in taxable years ending after such date, ‘‘(B) QUALIFIED SOFTWARE.—The term the following: under rules similar to the rules of section ‘qualified software’ means any software 48(m) of the Internal Revenue Code of 1986 ‘‘(3) INCREASED RATE FOR CERTAIN BANKS which— (as in effect on the day before the date of the AND SECURITIES DEALERS.— ‘‘(i) is used to optimize efficiency or enactment of the Revenue Reconciliation ‘‘(A) IN GENERAL.—In the case of an appli- connectivity of the electrical grid, including Act of 1990). cable taxpayer described in subparagraph (B) detailed electrical models, modeling and for any taxable year— simulation tools, distributed energy resource SA 1835. Mr. GRASSLEY (for him- ‘‘(i) paragraphs (1)(A) and (2)(A) shall each management systems used to control local self, Mr. PORTMAN, Mr. HELLER, Mr. be applied by substituting ‘11 percent’ for ‘10 generation and storage, and advanced dis- ROBERTS, and Mr. THUNE) submitted an percent’, and tribution management systems used as the amendment intended to be proposed to ‘‘(ii) paragraph (2)(A) shall be applied by software platform to provide core system substituting ‘13.5 percent’ for ‘12.5 percent’. amendment SA 1618 proposed by Mr. functions such as fault location, isolation, ‘‘(B) TAXPAYER DESCRIBED.—An applicable and service restoration, voltage optimiza- MCCONNELL (for Mr. HATCH (for himself taxpayer is described in this subparagraph if tion, and peak demand management, and Ms. MURKOWSKI)) to the bill H.R. 1, such taxpayer is a member of an affiliated ‘‘(ii) is developed with information assur- to provide for reconciliation pursuant group (as defined in section 1504(a)(1)) which ance techniques to support encrypted com- to titles II and V of the concurrent res- includes—

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‘‘(i) a bank (as defined in section 581), or ‘‘(A) the use of unrelated persons, conduit ‘‘(C) AGGREGATION.—A taxpayer may elect ‘‘(ii) a registered securities dealer under transactions, or other intermediaries, or to treat all applicable retirement plans as 1 section 15(a) of the Securities Exchange Act ‘‘(B) transactions or arrangements de- plan for purposes of applying this section of 1934. signed, in whole or in part— and may allocate qualified distributions On page 489, strike lines 3 through 19, and ‘‘(i) to characterize payments otherwise among such plans in such manner as speci- insert: subject to this section as payments not sub- fied in the election. ‘‘(g) EXCEPTION FOR CERTAIN PAYMENTS ject to this section, or ‘‘(3) APPLICABLE RETIREMENT PLAN.—The MADE IN THE ORDINARY COURSE OF TRADE OR ‘‘(ii) to substitute payments not subject to term ‘applicable retirement plan’ means— BUSINESS.—For purposes of this section— this section for payments otherwise subject ‘‘(A) a defined contribution plan to which ‘‘(1) IN GENERAL.—Except as provided in to this section and section 401(a) or 403(a) applies, paragraph (3), any qualified derivative pay- ‘‘(2) for the application of subsection (g), ‘‘(B) an annuity contract under section ment shall not be treated as a base erosion including rules to prevent the avoidance of 403(b), payment. the exceptions under subsection (g)(3). ‘‘(C) an eligible deferred compensation plan ‘‘(2) QUALIFIED DERIVATIVE PAYMENT.— described in section 457(b) which is main- ‘‘(A) IN GENERAL.—The term ‘qualified de- SA 1837. Mr. INHOFE submitted an tained by an eligible employer described in rivative payment’ means any payment made amendment intended to be proposed to section 457(e)(1)(A), or by a taxpayer pursuant to a derivative with amendment SA 1618 proposed by Mr. ‘‘(D) an individual retirement plan.’’. (b) EFFECTIVE DATE.—The amendments respect to which the taxpayer— MCCONNELL (for Mr. HATCH (for himself made by this section shall apply to taxable ‘‘(i) recognizes gain or loss as if such deriv- and Ms. MURKOWSKI)) to the bill H.R. 1, years beginning after December 31, 2017. ative were sold for its fair market value on to provide for reconciliation pursuant the last business day of the taxable year (and such additional times as required by this to titles II and V of the concurrent res- SA 1838. Mr. SASSE submitted an title or the taxpayer’s method of account- olution on the budget for fiscal year amendment intended to be proposed to ing), 2018; which was ordered to lie on the amendment SA 1618 proposed by Mr. ‘‘(ii) treats any gain or loss so recognized table; as follows: MCCONNELL (for Mr. HATCH (for himself as ordinary, and At the appropriate place, insert the fol- and Ms. MURKOWSKI)) to the bill H.R. 1, ‘‘(iii) treats the character of all items of lowing: to provide for reconciliation pursuant income, deduction, gain, or loss with respect SEC. ll. ONE-TIME WITHDRAWAL OF PENSION to titles II and V of the concurrent res- to a payment pursuant to the derivative as SAVINGS AT A 10-PERCENT TAX olution on the budget for fiscal year ordinary. RATE. 2018; which was ordered to lie on the ‘‘(B) REPORTING REQUIREMENT.—No pay- (a) IN GENERAL.—Section 72 is amended by ments shall be treated as qualified derivative redesignating subsection (x) as subsection table; as follows: payments under subparagraph (A) for any (y) and by inserting after subsection (w) the At the appropriate place, insert the fol- taxable year unless the taxpayer includes in following new subsection: lowing: the information required to be reported ‘‘(x) SPECIAL RATE FOR DISTRIBUTIONS SEC. lll. MAXIMUM CONTRIBUTION LIMIT TO under section 6038B(b)(2) with respect to such FROM APPLICABLE PLANS DURING 2018.— HEALTH SAVINGS ACCOUNT IN- taxable year such information as is nec- ‘‘(1) IN GENERAL.—If a taxpayer receives 1 CREASED TO 150 PERCENT OF THE essary to identify the payments to be so or more qualified distributions from 1 or AMOUNT OF DEDUCTIBLE AND OUT- treated and such other information as the more applicable retirement plans during the OF-POCKET LIMITATION. Secretary determines necessary to carry out taxpayer’s first taxable year beginning after (a) SELF-ONLY COVERAGE.—Section the provisions of this subsection. December 31, 2017, then, notwithstanding any 223(b)(2)(A) is amended by striking ‘‘$2,250’’ and inserting ‘‘150 percent of the amount in ‘‘(3) EXCEPTIONS FOR PAYMENTS OTHERWISE other provision of this title— effect under subsection (c)(2)(A)(ii)(I)’’. TREATED AS BASE EROSION PAYMENTS.—This ‘‘(A) the tax imposed by this chapter for (b) FAMILY COVERAGE.—Section 223(b)(2)(B) subsection shall not apply to any qualified such taxable year shall, in lieu of the tax is amended by striking ‘‘$4,500’’ and inserting derivative payment if— otherwise imposed by this chapter, be equal ‘‘150 percent of the amount in effect under ‘‘(A) the payment would be treated as a to the sum of— subsection (c)(2)(A)(ii)(II)’’. base erosion payment if it were not made ‘‘(i) a tax computed at the rates and in the (c) COST-OF-LIVING ADJUSTMENT.—Section pursuant to a derivative, including any in- same manner as if this subsection had not 223(g)(1) is amended— terest, royalty, or service payment, or been enacted on taxable income reduced by (1) by striking ‘‘subsections (b)(2) and’’ ‘‘(B) in the case of a contract which has de- the aggregate qualified distributions of the both places it appears and inserting ‘‘sub- rivative and nonderivative components, the taxpayer, plus section’’, and payment is properly allocable to the non- ‘‘(ii) a tax of 10 percent of such qualified (2) in subparagraph (B), by striking ‘‘deter- derivative component. distributions (or, if less, taxable income), mined by’’ and all that follows through ‘‘(4) DERIVATIVE DEFINED.—For purposes of and ‘‘ ‘calendar year 2003’.’’ and inserting ‘‘deter- this subsection— ‘‘(B) no penalty or addition to tax shall be mined by substituting ‘calendar year 2003’ ‘‘(A) IN GENERAL.—The term ‘derivative’ imposed with respect to such qualified dis- for ‘calendar year 1992’ in subparagraph (B) means any contract (including any option, tributions. thereof.’’. forward contract, futures contract, short po- ‘‘(2) QUALIFIED DISTRIBUTION.—For purposes (d) EFFECTIVE DATE.—The amendments sition, swap, or similar contract) the value of this subsection— made by this section shall apply to taxable of which, or any payment or other transfer ‘‘(A) IN GENERAL.—The term ‘qualified dis- years beginning after December 31, 2017. with respect to which, is (directly or indi- tribution’ means, with respect to any appli- rectly) determined by reference to one or cable retirement plan, any applicable dis- SA 1839. Mr. SASSE submitted an more of the following: tribution received by a taxpayer from the amendment intended to be proposed to ‘‘(i) Any share of stock in a corporation. plan to the extent that such distribution, ‘‘(ii) Any evidence of indebtedness. when added to all other applicable distribu- amendment SA 1618 proposed by Mr. ‘‘(iii) Any commodity which is actively tions received by the taxpayer from the plan MCCONNELL (for Mr. HATCH (for himself traded. during such taxable year, does not exceed 25 and Ms. MURKOWSKI)) to the bill H.R. 1, ‘‘(iv) Any currency. percent of the aggregate balance to the cred- to provide for reconciliation pursuant ‘‘(v) Any rate, price, amount, index, for- it of the individual (whether as a partici- to titles II and V of the concurrent res- mula, or algorithm. pant, owner, or beneficiary) in the plan (de- olution on the budget for fiscal year ‘‘(B) TREATMENT OF AMERICAN DEPOSITORY termined as of the close of the calendar year 2018; which was ordered to lie on the RECEIPTS AND SIMILAR INSTRUMENTS.—Except preceding the calendar year in which the table; as follows: as otherwise provided by the Secretary, for taxable year begins). purposes of this part, American depository ‘‘(B) APPLICABLE DISTRIBUTION.— At the end of part III of subtitle A of title receipts (and similar instruments) with re- ‘‘(i) IN GENERAL.—The term ‘applicable dis- I, insert the following: spect to shares of stock in foreign corpora- tribution’ means any distribution received SEC. 11030. EXTENSION OF CARRYOVER PERIOD tions shall be treated as shares of stock in by a taxpayer from an applicable retirement FOR ADOPTION TAX CREDIT. such foreign corporations. plan which is includible in gross income of (a) IN GENERAL.—Section 23(c)(2) is amend- ‘‘(h) REGULATIONS.—The Secretary shall the taxpayer. ed by striking ‘‘fifth’’ and inserting ‘‘tenth’’. prescribe such regulations or other guidance ‘‘(ii) EXCEPTION FOR REQUIRED DISTRIBU- (b) EFFECTIVE DATE.—The amendment as may be necessary or appropriate to carry TIONS.—Such term shall not include any min- made by this section shall apply to taxable out the provisions of this section, including imum required distribution (as defined in years beginning after December 31, 2017. regulations— section 4974(b)) from an applicable retire- ‘‘(1) providing for such adjustments to the ment plan for any taxable year and the 25- SA 1840. Mr. INHOFE (for himself application of this section as are necessary percent amount under subparagraph (A) and Mr. LANKFORD) submitted an to prevent the avoidance of the purposes of shall be reduced by the amount of such dis- amendment intended to be proposed to this section, including through— tributions. amendment SA 1618 proposed by Mr.

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00078 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.056 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7731 MCCONNELL (for Mr. HATCH (for himself Subtitle A—Individual Tax Reform ‘‘If taxable income is: The tax is: and Ms. MURKOWSKI)) to the bill H.R. 1, PART I—TAX RATE REFORM Over $2,550 but not over $255, plus 24% of the ex- $9,150. cess over $2,550. to provide for reconciliation pursuant SEC. 11001. MODIFICATION OF RATES. Over $9,150 but not over $1,839, plus 35% of the ex- to titles II and V of the concurrent res- (a) IN GENERAL.—Section 1 is amended by $12,500. cess over $9,150. olution on the budget for fiscal year adding at the end the following new sub- Over $12,500...... $3,011.50, plus 38.5% of 2018; which was ordered to lie on the section: the excess over $12,500. ‘‘(F) REFERENCES TO RATE TABLES.—Any table; as follows: ‘‘(j) MODIFICATIONS FOR TAXABLE YEARS 2018 THROUGH 2025.— reference in this title to a rate of tax under On page 34, line 23, strike ‘‘trust or’’ and ‘‘(1) IN GENERAL.—In the case of a taxable subsection (c) shall be treated as a reference insert ‘‘trust (except for calendar year 2018) year beginning after December 31, 2017, and to the corresponding rate bracket under sub- or’’ before January 1, 2026— paragraph (C) of this paragraph, except that ‘‘(A) subsection (i) shall not apply, and the reference in section 3402(q)(1) to the third SA 1841. Mr. GARDNER submitted an ‘‘(B) this section (other than subsection (i)) lowest rate of tax applicable under sub- amendment intended to be proposed to shall be applied as provided in paragraphs (2) section (c) shall be treated as a reference to amendment SA 1618 proposed by Mr. through (7). the fourth lowest rate of tax under subpara- MCCONNELL (for Mr. HATCH (for himself ‘‘(2) RATE TABLES.— graph (C). and Ms. MURKOWSKI)) to the bill H.R. 1, ‘‘(A) MARRIED INDIVIDUALS FILING JOINT RE- ‘‘(3) ADJUSTMENTS, ELIMINATION OF MAR- to provide for reconciliation pursuant TURNS AND SURVIVING SPOUSES.—The fol- RIAGE PENALTY; ETC.— ‘‘(A) NO ADJUSTMENT IN 2018.—The tables to titles II and V of the concurrent res- lowing table shall be applied in lieu of the table contained in subsection (a): contained in paragraph (2) shall apply with- olution on the budget for fiscal year out adjustment for taxable years beginning 2018; which was ordered to lie on the ‘‘If taxable income is: The tax is: Not over $19,050 ...... 10% of taxable income. after December 31, 2017, and before January table; as follows: Over $19,050 but not over $1,905, plus 12% of the ex- 1, 2019. At the appropriate place in title I, insert $77,400. cess over $19,050. ‘‘(B) SUBSEQUENT YEARS.—For taxable the following: Over $77,400 but not over $8,907, plus 22% of the ex- years beginning after December 31, 2018, the $140,000. cess over $77,400. SEC. llll. BASE EROSION AND ANTI-ABUSE Secretary shall prescribe tables which shall Over $140,000 but not over $22,679, plus 24% of the apply in lieu of the tables contained in para- TAX IMPROVEMENTS. $320,000. excess over $140,000. (a) IN GENERAL.—Section 59A(b), as added Over $320,000 but not over $65,879, plus 32% of the graph (2) in the same manner as under para- by section 14401 of this Act, is amended— $400,000. excess over $320,000. graphs (1) and (2) of subsection (f), except (1) in paragraph (1)(B), by striking clause Over $400,000 but not over $91,479, plus 35% of the that in prescribing such tables— (ii) and inserting the following: $1,000,000. excess over $400,000. ‘‘(i) subsection (f)(3) shall be applied by Over $1,000,000 ...... $301,479 plus 38.5% of the ‘‘(ii) the sum of— substituting ‘calendar year 2017’ for ‘cal- excess over $1,000,000. endar year 2016’ in subparagraph (A)(ii) ‘‘(I) the credit allowed under section 38 for ‘‘(B) HEADS OF HOUSEHOLDS.—The following the taxable year which are properly allo- thereof, and table shall be applied in lieu of the table con- ‘‘(ii) subsection (f)(7) shall not apply and— cable to the research credit determined tained in subsection (b): under section 41(a); ‘‘(I) the maximum taxable income in each ‘‘(II) the credits determined under section ‘‘If taxable income is: The tax is: of the rate brackets in the table contained in Not over $13,600 ...... 10% of taxable income. 45 (including the refined coal credit); and paragraph (2)(A) (and the minimum taxable Over $13,600 but not over $1,360, plus 12% of the ex- income in the next higher taxable income ‘‘(III) the energy credit determined under $51,800. cess over $13,600. section 48(a) with respect to a facility or Over $51,800 but not over $5,944, plus 22% of the ex- bracket with respect to each such bracket in property the construction of which begins on $70,000. cess over $51,800. such table) shall be 200 percent of the max- or before January 1, 2020.’’; and Over $70,000 but not over $9,948, plus 24% of the ex- imum taxable income in the corresponding (2) in paragraph (2)(B), by inserting ‘‘(other $160,000. cess over $70,000. rate bracket in the table contained in para- Over $160,000 but not over $31,548, plus 32% of the than a credit described in subclause (II) or graph (2)(C) (after any other adjustment $200,000. excess over $160,000. under paragraph (3)), and (III) of paragraph (1)(B)(ii))’’ after ‘‘allowed Over $200,000 but not over $44,348, plus 35% of the under this chapter’’. $500,000. excess over $200,000. ‘‘(II) the comparable taxable income (b) REVENUE DEPENDENT PROPOSAL.—Sec- Over $500,000 ...... $149,348, plus 38.5% of the amounts in the table contained in paragraph tion 59A(b), as amended by section 15004, if excess over $500,000. (2)(D) shall be 1⁄2 of the amounts determined amended, is further amended by striking ‘‘(C) UNMARRIED INDIVIDUALS OTHER THAN under subparagraph (A). paragraph (2)(B) and inserting the following: SURVIVING SPOUSES AND HEADS OF HOUSE- ‘‘(4) SPECIAL RULES FOR CERTAIN CHILDREN ‘‘(B) the sum of— HOLDS.—The following table shall be applied WITH UNEARNED INCOME.— ‘‘(i) the credit allowed under section 38 for in lieu of the table contained in subsection ‘‘(A) IN GENERAL.—In the case of a child to the taxable year which are properly allo- (c): whom subsection (g) applies for the taxable cable to the research credit determined ‘‘If taxable income is: The tax is: year, the rules of subparagraphs (B) and (C) under section 41(a); Not over $9,525 ...... 10% of taxable income. shall apply in lieu of the rule under sub- ‘‘(ii) the credits determined under section Over $9,525 but not over $952.50, plus 12% of the section (g)(1). 45 (including the refined coal credit); and $38,700. excess over $9,525. ‘‘(B) MODIFICATIONS TO APPLICABLE RATE Over $38,700 but not over $4,453.50, plus 22% of the ‘‘(iii) the energy credit determined under BRACKETS.—In determining the amount of $70,000. excess over $38,700. tax imposed by this section for the taxable section 48(a) with respect to a facility or Over $70,000 but not over $11,339.50, plus 24% of the property the construction of which begins on $160,000. excess over $70,000. year on a child described in subparagraph or before January 1, 2020.’’. Over $160,000 but not over $32,939.50, plus 32% of the (A), the income tax table otherwise applica- $200,000. excess over $160,000. ble under this subsection to the child shall SA 1842. Mr. RUBIO (for himself and Over $200,000 but not over $45,739.50, plus 35% of the be applied with the following modifications: $500,000. excess over $200,000. ‘‘(i) 24-PERCENT BRACKET.—The maximum Mr. LEE) submitted an amendment in- Over $500,000 ...... $150,739.50, plus 38.5% of taxable income which is taxed at a rate the excess over $500,000. tended to be proposed by him to the below 24 percent shall not be more than the ‘‘(D) MARRIED INDIVIDUALS FILING SEPARATE bill H.R. 1, to provide for reconciliation earned taxable income of such child. RETURNS.—The following table shall be ap- pursuant to titles II and V of the con- ‘‘(ii) 35-PERCENT BRACKET.—The maximum plied in lieu of the table contained in sub- current resolution on the budget for taxable income which is taxed at a rate section (d): fiscal year 2018; which was ordered to below 35 percent shall not be more than the lie on the table; as follows: ‘‘If taxable income is: The tax is: sum of— Not over $9,525 ...... 10% of taxable income. ‘‘(I) the earned taxable income of such Beginning on page 1, strike line 1 and all Over $9,525 but not over $952.50, plus 12% of the that follows through page 123, line 22, and in- $38,700. excess over $9,525. child, plus sert the following: Over $38,700 but not over $4,453.50, plus 22% of the ‘‘(II) the minimum taxable income for the $70,000. excess over $38,700. 35-percent bracket in the table under para- TITLE I Over $70,000 but not over $11,339.50, plus 24% of the graph (2)(E) (as adjusted under paragraph (3)) SEC. 11000. SHORT TITLE, ETC. $160,000. excess over $70,000. for the taxable year. Over $160,000 but not over $32,939.50, plus 32% of the (a) SHORT TITLE.—This title may be cited ‘‘(iii) 38.5-PERCENT BRACKET.—The max- $200,000. excess over $160,000. as the ‘‘Tax Cuts and Jobs Act’’. Over $200,000 but not over $45,739.50, plus 35% of the imum taxable income which is taxed at a (b) AMENDMENT OF 1986 CODE.—Except as $500,000. excess over $200,000. rate below 38.5 percent shall not be more otherwise expressly provided, whenever in Over $500,000 ...... $150,739.50, plus 38.5% of than the sum of— this title an amendment or repeal is ex- the excess over $500,000. ‘‘(I) the earned taxable income of such pressed in terms of an amendment to, or re- ‘‘(E) ESTATES AND TRUSTS.—The following child, plus peal of, a section or other provision, the ref- table shall be applied in lieu of the table con- ‘‘(II) the minimum taxable income for the erence shall be considered to be made to a tained in subsection (e): 38.5-percent bracket in the table under para- section or other provision of the Internal ‘‘If taxable income is: The tax is: graph (2)(E) (as adjusted under paragraph (3)) Revenue Code of 1986. Not over $2,550 ...... 10% of taxable income. for the taxable year.

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‘‘(C) COORDINATION WITH CAPITAL GAINS FITS.—Any person who is a tax return pre- (D) Subsection (b)(2)(B)(ii)(II), and clauses RATES.—For purposes of applying section 1(h) parer with respect to any return or claim for (i) and (ii) of subsection (j)(1)(B), of section (after the modifications under paragraph refund who fails to comply with due dili- 32. (5))— gence requirements imposed by the Sec- (E) Section 36B(f)(2)(B)(ii)(II). ‘‘(i) the maximum zero rate amount shall retary by regulations with respect to deter- (F) Section 41(e)(5)(C)(i). not be more than the sum of— mining— (G) Subsections (e)(3)(D)(ii) and ‘‘(I) the earned taxable income of such ‘‘(1) eligibility to file as a head of house- (h)(3)(H)(i)(II) of section 42. child, plus hold (as defined in section 2(b)) on the re- (H) Section 45R(d)(3)(B)(ii). ‘‘(II) the amount in effect under paragraph turn, or (I) Section 62(d)(3)(B). (5)(B)(i)(IV) for the taxable year, and ‘‘(2) eligibility for, or the amount of, the (J) Section 125(i)(2)(B). ‘‘(ii) the maximum 15-percent rate amount credit allowable by section 24, 25A(a)(1), or (K) Section 135(b)(2)(B)(ii). shall not be more than the sum of— 32, (L) Section 137(f)(2). ‘‘(I) the earned taxable income of such shall pay a penalty of $500 for each such fail- (M) Section 146(d)(2)(B). child, plus ure.’’. ‘‘(II) the amount in effect under paragraph (N) Section 147(c)(2)(H)(ii). (c) EFFECTIVE DATE.—The amendments (5)(B)(ii)(IV) for the taxable year. (O) Section 179(b)(6)(A)(ii). made by this section shall apply to taxable (P) Subsections (b)(5)(C)(i)(II) and (g)(8)(B) ‘‘(D) EARNED TAXABLE INCOME.—For pur- years beginning after December 31, 2017. poses of this paragraph, the term ‘earned of section 219. taxable income’ means, with respect to any SEC. 11002. INFLATION ADJUSTMENTS BASED ON (Q) Section 220(g)(2). CHAINED CPI. child for any taxable year, the taxable in- (R) Section 221(f)(1)(B). (a) IN GENERAL.—Subsection (f) of section 1 come of such child reduced (but not below (S) Section 223(g)(1)(B). is amended by striking paragraph (3) and by zero) by the net unearned income (as defined (T) Section 408A(c)(3)(D)(ii). inserting after paragraph (2) the following in subsection (g)(4)) of such child. (U) Section 430(c)(7)(D)(vii)(II). new paragraph: ‘‘(5) APPLICATION OF CURRENT INCOME TAX (V) Section 512(d)(2)(B). ‘‘(3) COST-OF-LIVING ADJUSTMENT.—For pur- BRACKETS TO CAPITAL GAINS BRACKETS.— (W) Section 513(h)(2)(C)(ii). poses of this subsection— ‘‘(A) IN GENERAL.—Section 1(h)(1) shall be (X) Section 831(b)(2)(D)(ii). ‘‘(A) IN GENERAL.—The cost-of-living ad- applied— (Y) Section 877A(a)(3)(B)(i)(II). justment for any calendar year is the per- ‘‘(i) by substituting ‘below the maximum (Z) Section 2010(c)(3)(B)(ii). centage (if any) by which— zero rate amount’ for ‘which would (without (AA) Section 2032A(a)(3)(B). ‘‘(i) the C-CPI-U for the preceding calendar regard to this paragraph) be taxed at a rate (BB) Section 2503(b)(2)(B). year, exceeds below 25 percent’ in subparagraph (B)(i), and ‘‘(ii) the CPI for calendar year 2016, multi- (CC) Section 4261(e)(4)(A)(ii). ‘‘(ii) by substituting ‘below the maximum plied by the amount determined under sub- (DD) Section 5000A(c)(3)(D)(ii). 15-percent rate amount’ for ‘which would paragraph (B). (EE) Section 6323(i)(4)(B). (without regard to this paragraph) be taxed ‘‘(B) AMOUNT DETERMINED.—The amount (FF) Section 6334(g)(1)(B). at a rate below 39.6 percent’ in subparagraph determined under this clause is the amount (GG) Section 6601(j)(3)(B). (C)(ii)(I). obtained by dividing— (HH) Section 6651(i)(1). ‘‘(B) MAXIMUM AMOUNTS DEFINED.—For pur- ‘‘(i) the C-CPI-U for calendar year 2016, by (II) Section 6652(c)(7)(A). poses of applying section 1(h) with the modi- ‘‘(ii) the CPI for calendar year 2016. (JJ) Section 6695(h)(1). fications described in subparagraph (A)— ‘‘(C) SPECIAL RULE FOR ADJUSTMENTS WITH (KK) Section 6698(e)(1). ‘‘(i) MAXIMUM ZERO RATE AMOUNT.—The A BASE YEAR AFTER 2016.—For purposes of any (LL) Section 6699(e)(1). maximum zero rate amount shall be— provision of this title which provides for the (MM) Section 6721(f)(1). ‘‘(I) in the case of a joint return or sur- substitution of a year after 2016 for ‘2016’ in (NN) Section 6722(f)(1). viving spouse, $77,200 (1⁄2 such amount in the subparagraph (A)(ii), subparagraph (A) shall (OO) Section 7345(f)(2). case of a married individual filing a separate be applied by substituting ‘the C-CPI-U for (PP) Section 7430(c)(1). return), calendar year 2016’ for ‘the CPI for calendar (QQ) Section 9831(d)(2)(D)(ii)(II). ‘‘(II) in the case of an individual who is a year 2016’ and all that follows in clause (ii) (2) Section 41(e)(5)(C)(ii) is amended— head of household (as defined in section 2(b)), thereof.’’. (A) by striking ‘‘1(f)(3)(B)’’ and inserting $51,700, (b) C-CPI-U.—Subsection (f) of section 1 is ‘‘1(f)(3)(A)(ii)’’, and ‘‘(III) in the case of any other individual amended by striking paragraph (7), by redes- (B) by striking ‘‘1992’’ and inserting ‘‘2016’’. (other than an estate or trust), an amount ignating paragraph (6) as paragraph (7), and (3) Section 42(h)(6)(G) is amended— equal to 1⁄2 of the amount in effect for the by inserting after paragraph (5) the following taxable year under clause (i), and (A) by striking ‘‘for ‘calendar year 1987’ ’’ new paragraph: ‘‘(IV) in the case of an estate or trust, in clause (i)(II) and inserting ‘‘for ‘calendar ‘‘(6) C-CPI-U.—For purposes of this sub- $2,600. year 2016’ in subparagraph (A)(ii) thereof’’, section— ‘‘(ii) MAXIMUM 15-PERCENT RATE AMOUNT.— and ‘‘(A) IN GENERAL.—The term ‘C-CPI-U’ The maximum 15-percent rate amount shall (B) by striking ‘‘if the CPI for any calendar means the Chained Consumer Price Index for be— year’’ and all that follows in clause (ii) and All Urban Consumers (as published by the ‘‘(I) in the case of a joint return or sur- inserting ‘‘if the C-CPI-U for any calendar Bureau of Labor Statistics of the Depart- viving spouse, $479,000 (1⁄2 such amount in the year (as defined in section 1(f)(6)) exceeds the ment of Labor). The values of the Chained case of a married individual filing a separate C-CPI-U for the preceding calendar year by Consumer Price Index for All Urban Con- return), more than 5 percent, the C-CPI-U for the sumers taken into account for purposes of ‘‘(II) in the case of an individual who is the base calendar year shall be increased such determining the cost-of-living adjustment head of a household (as defined in section that such excess shall never be taken into for any calendar year under this subsection 2(b)), $452,400, account under clause (i). In the case of a base shall be the latest values so published as of ‘‘(III) in the case of any other individual calendar year before 2017, the C-CPI-U for the date on which such Bureau publishes the (other than an estate or trust), $425,800, and such year shall be determined by multi- initial value of the Chained Consumer Price ‘‘(IV) in the case of an estate or trust, plying the CPI for such year by the amount Index for All Urban Consumers for the $12,700. determined under section 1(f)(3)(B).’’. month of August for the preceding calendar ‘‘(C) INFLATION ADJUSTMENT.—In the case (4) Section 132(f)(6)(A)(ii) is amended by year. of any taxable year beginning after 2018, striking ‘‘for ‘calendar year 1992’ ’’ and in- ‘‘(B) DETERMINATION FOR CALENDAR YEAR.— each of the dollar amounts in clauses (i) and The C-CPI-U for any calendar year is the av- serting ‘‘for ‘calendar year 2016’ in subpara- (ii) of subparagraph (B) shall be increased by erage of the C-CPI-U as of the close of the 12- graph (A)(ii) thereof’’. an amount equal to— month period ending on August 31 of such (5) Section 162(o)(3) is amended by striking ‘‘(i) such dollar amount, multiplied by calendar year.’’. ‘‘adjusted for changes in the Consumer Price ‘‘(ii) the cost-of-living adjustment deter- (c) APPLICATION TO PERMANENT TAX TA- Index (as defined in section 1(f)(5)) since mined under subsection (f)(3) for the cal- BLES.—Section 1(f)(2)(A) is amended by in- 1991’’ and inserting ‘‘adjusted by increasing endar year in which the taxable year begins, serting ‘‘, determined by substituting ‘1992’ any such amount under the 1991 agreement determined by substituting ‘calendar year for ‘2016’ in paragraph (3)(A)(ii)’’. by an amount equal to— 2017’ for ‘calendar year 2016’ in subparagraph (d) APPLICATION TO OTHER INTERNAL REV- ‘‘(A) such amount, multiplied by (A)(ii) thereof. ENUE CODE OF 1986 PROVISIONS.— ‘‘(B) the cost-of-living adjustment deter- ‘‘(6) SECTION 15 NOT TO APPLY.—Section 15 (1) The following sections are each amend- mined under section 1(f)(3) for the calendar shall not apply to any change in a rate of tax ed by striking ‘‘for ‘calendar year 1992’ in year in which the taxable year begins, by by reason of this subsection.’’. substituting ‘calendar year 1990’ for ‘cal- (b) DUE DILIGENCE TAX PREPARER REQUIRE- subparagraph (B)’’ and inserting ‘‘for ‘cal- endar year 2016’ in subparagraph (A)(ii) MENT WITH RESPECT TO HEAD OF HOUSEHOLD endar year 2016’ in subparagraph (A)(ii)’’: FILING STATUS.—Subsection (g) of section (A) Section 23(h)(2). thereof’’. 6695 is amended to read as follows: (B) Paragraphs (1)(A)(ii) and (2)(A)(ii) of (6) So much of clause (ii) of section ‘‘(g) FAILURE TO BE DILIGENT IN DETER- section 25A(h). 213(d)(10)(B) as precedes the last sentence is MINING ELIGIBILITY FOR CERTAIN TAX BENE- (C) Section 25B(b)(3)(B). amended to read as follows:

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‘‘(ii) MEDICAL CARE COST ADJUSTMENT.—For ‘‘(2) an amount equal to 17.4 percent of the erly allocable to qualified business income purposes of clause (i), the medical care cost excess (if any) of— for purposes of subsection (c)(1). adjustment for any calendar year is the per- ‘‘(A) the taxable income of the taxpayer for ‘‘(C) RETURN REQUIREMENT.—Such term centage (if any) by which— the taxable year, over shall not include any amount which is not ‘‘(I) the medical care component of the C- ‘‘(B) any net capital gain (as defined in sec- properly included in a return filed with the CPI-U (as defined in section 1(f)(6)) for Au- tion 1(h)) of the taxpayer for the taxable Social Security Administration on or before gust of the preceding calendar year, exceeds year. the 60th day after the due date (including ex- ‘‘(II) such component of the CPI (as defined ‘‘(b) COMBINED QUALIFIED BUSINESS INCOME tensions) for such return. in section 1(f)(4)) for August of 1996, multi- AMOUNT.—For purposes of this section— ‘‘(5) ACQUISITIONS, DISPOSITIONS, AND SHORT plied by the amount determined under sec- ‘‘(1) IN GENERAL.—The term ‘combined TAXABLE YEARS.—The Secretary shall pro- tion 1(f)(3)(B).’’. qualified business income amount’ means, vide for the application of this subsection in (7) Section 877(a)(2) is amended by striking with respect to any taxable year, an amount cases of a short taxable year or where the ‘‘for ‘1992’ in subparagraph (B)’’ and inserting equal to— taxpayer acquires, or disposes of, the major ‘‘for ‘2016’ in subparagraph (A)(ii)’’. ‘‘(A) the sum of the amounts determined portion of a trade or business or the major (8) Section 911(b)(2)(D)(ii)(II) is amended by under paragraph (2) for each qualified trade portion of a separate unit of a trade or busi- striking ‘‘for ‘1992’ in subparagraph (B)’’ and or business carried on by the taxpayer, plus ness during the taxable year. inserting ‘‘for ‘2016’ in subparagraph (A)(ii)’’. ‘‘(B) 17.4 percent of the aggregate amount ‘‘(c) QUALIFIED BUSINESS INCOME.—For pur- (9) Paragraph (2) of section 1274A(d) is of the qualified REIT dividends and qualified poses of this section— amended to read as follows: cooperative dividends of the taxpayer for the ‘‘(1) IN GENERAL.—The term ‘qualified busi- ‘‘(2) ADJUSTMENT FOR INFLATION.—In the taxable year. ness income’ means, for any taxable year, case of any debt instrument arising out of a ‘‘(2) DETERMINATION OF DEDUCTIBLE AMOUNT the net amount of qualified items of income, sale or exchange during any calendar year FOR EACH TRADE OR BUSINESS.—The amount gain, deduction, and loss with respect to any after 1989, each dollar amount contained in determined under this paragraph with re- qualified trade or business of the taxpayer. the preceding provisions of this section shall spect to any qualified trade or business is ‘‘(2) CARRYOVER OF LOSSES.—If the net be increased by an amount equal to— the lesser of— amount of qualified income, gain, deduction, ‘‘(A) such amount, multiplied by ‘‘(A) 17.4 percent of the taxpayer’s qualified and loss with respect to qualified trade or ‘‘(B) the cost-of-living adjustment deter- business income with respect to the qualified businesses of the taxpayer amount for any trade or business, or taxable year is less than zero, such amount mined under section 1(f)(3) for the calendar ‘‘(B) 50 percent of the W-2 wages with re- shall be treated as a loss from a qualified year in which the taxable year begins, by spect to the qualified trade or business. trade or business in the succeeding taxable substituting ‘calendar year 1988’ for ‘cal- ‘‘(3) MODIFICATIONS TO THE WAGE LIMIT year. endar year 2016’ in subparagraph (A)(ii) BASED ON TAXABLE INCOME.— ‘‘(3) QUALIFIED ITEMS OF INCOME, GAIN, DE- thereof. ‘‘(A) EXCEPTION FROM WAGE LIMIT.—In the DUCTION, AND LOSS.—For purposes of this sub- Any increase under the preceding sentence case of any taxpayer whose taxable income section— shall be rounded to the nearest multiple of for the taxable year does not exceed the ‘‘(A) IN GENERAL.—The term ‘qualified $100 (or, if such increase is a multiple of $50, threshold amount, paragraph (2) shall be ap- items of income, gain, deduction, and loss’ such increase shall be increased to the near- plied without regard to subparagraph (B). means items of income, gain, deduction, and est multiple of $100).’’. ‘‘(B) PHASE-IN OF LIMIT FOR CERTAIN TAX- loss to the extent such items are— (10) Section 4161(b)(2)(C)(i)(II) is amended PAYERS.— ‘‘(i) effectively connected with the conduct by striking ‘‘for ‘1992’ in subparagraph (B)’’ ‘‘(i) IN GENERAL.—If— of a trade or business within the United and inserting ‘‘for ‘2016’ in subparagraph ‘‘(I) the taxable income of a taxpayer for States (within the meaning of section 864(c), (A)(ii)’’. any taxable year exceeds the threshold determined by substituting ‘qualified trade (11) Section 4980I(b)(3)(C)(v)(II) is amended amount, but does not exceed the sum of the or business (within the meaning of section by striking ‘‘for ‘1992’ in subparagraph (B)’’ threshold amount plus $50,000 ($100,000 in the 199A)’ for ‘nonresident alien individual or a and inserting ‘‘for ‘2016’ in subparagraph case of a joint return), and foreign corporation’ or for ‘a foreign corpora- (A)(ii)’’. ‘‘(II) the amount determined under para- tion’ each place it appears), and (12) Section 6039F(d) is amended by strik- graph (2)(B) (determined without regard to ‘‘(ii) included or allowed in determining ing ‘‘subparagraph (B) thereof shall be ap- this subparagraph) with respect to any quali- taxable income for the taxable year. plied by substituting ‘1995’ for ‘1992’ ’’ and in- fied trade or business carried on by the tax- ‘‘(B) EXCEPTIONS.—The following invest- serting ‘‘subparagraph (A)(ii) thereof shall be payer is less than the amount determined ment items shall not be taken into account applied by substituting ‘1995’ for ‘2016’ ’’. under paragraph (2)(A) with respect such as a qualified item of income, gain, deduc- (13) Section 7872(g)(5) is amended to read as trade or business, tion, or loss: follows: then paragraph (2) shall be applied with re- ‘‘(i) Any item of short-term capital gain, ‘‘(5) ADJUSTMENT OF LIMIT FOR INFLATION.— spect to such trade or business without re- short-term capital loss, long-term capital In the case of any loan made during any cal- gard to subparagraph (B) thereof and by re- gain, or long-term capital loss. endar year after 1986, the dollar amount in ducing the amount determined under sub- ‘‘(ii) Any dividend, income equivalent to a paragraph (2) shall be increased by an paragraph (A) thereof by the amount deter- dividend, or payment in lieu of dividends de- amount equal to— mined under clause (ii). scribed in section 954(c)(1)(G). ‘‘(A) such amount, multiplied by ‘‘(ii) AMOUNT OF REDUCTION.—The amount ‘‘(iii) Any interest income other than in- ‘‘(B) the cost-of-living adjustment deter- determined under this subparagraph is the terest income which is properly allocable to mined under section 1(f)(3) for the calendar amount which bears the same ratio to the a trade or business. year in which the taxable year begins, by excess amount as— ‘‘(iv) Any item of gain or loss described in substituting ‘calendar year 1985’ for ‘cal- ‘‘(I) the amount by which the taxpayer’s subparagraph (C) or (D) of section 954(c)(1) endar year 2016’ in subparagraph (A)(ii) taxable income for the taxable year exceeds (applied by substituting ‘qualified trade or thereof. the threshold amount, bears to business’ for ‘controlled foreign corpora- Any increase under the preceding sentence ‘‘(II) $50,000 ($100,000 in the case of a joint tion’). shall be rounded to the nearest multiple of return). ‘‘(v) Any item of income, gain, deduction, $100 (or, if such increase is a multiple of $50, ‘‘(iii) EXCESS AMOUNT.—For purposes of or loss taken into account under section such increase shall be increased to the near- clause (ii), the excess amount is the excess 954(c)(1)(F) (determined without regard to est multiple of $100).’’. of— clause (ii) thereof and other than items at- (e) EFFECTIVE DATE.—The amendments ‘‘(I) the amount determined under para- tributable to notional principal contracts en- made by this section shall apply to taxable graph (2)(A) (determined without regard to tered into in transactions qualifying under years beginning after December 31, 2017. this paragraph), over section 1221(a)(7)). PART II—DEDUCTION FOR QUALIFIED ‘‘(II) the amount determined under para- ‘‘(vi) Any amount received from an annu- BUSINESS INCOME OF PASS-THRU ENTI- graph (2)(B) (determined without regard to ity which is not received in connection with TIES this paragraph). the trade or business. SEC. 11011. DEDUCTION FOR QUALIFIED BUSI- ‘‘(4) WAGES, ETC.— ‘‘(vii) Any item of deduction or loss prop- NESS INCOME. ‘‘(A) IN GENERAL.—The term ‘W-2 wages’ erly allocable to an amount described in any (a) IN GENERAL.—Part VI of subchapter B means, with respect to any person for any of the preceding clauses. of chapter 1 is amended by adding at the end taxable year of such person, the amounts de- ‘‘(4) TREATMENT OF REASONABLE COMPENSA- the following new section: scribed in paragraphs (3) and (8) of section TION AND GUARANTEED PAYMENTS.—Qualified ‘‘SEC. 199A. QUALIFIED BUSINESS INCOME. 6051(a) paid by such person with respect to business income shall not include— ‘‘(a) IN GENERAL.—In the case of a taxpayer employment of employees by such person ‘‘(A) reasonable compensation paid to the other than a corporation, there shall be al- during the calendar year ending during such taxpayer by any qualified trade or business lowed as a deduction for any taxable year an taxable year. of the taxpayer for services rendered with re- amount equal to the lesser of— ‘‘(B) LIMITATION TO WAGES ATTRIBUTABLE TO spect to the trade or business, ‘‘(1) the combined qualified business in- QUALIFIED BUSINESS INCOME.—Such term shall ‘‘(B) any guaranteed payment described in come amount of the taxpayer, or not include any amount which is not prop- section 707(c) paid to a partner for services

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00081 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.055 S01DEPT1 S7734 CONGRESSIONAL RECORD — SENATE December 1, 2017 rendered with respect to the trade or busi- fined in section 1388(c)), or any similar any taxpayer who claims the deduction al- ness, and amount received from an organization de- lowed under section 199A for the taxable ‘‘(C) to the extent provided in regulations, scribed in subparagraph (B)(ii), which— year, subparagraph (A) shall be applied by any payment described in section 707(a) to a ‘‘(A) is includible in gross income, and substituting ‘5 percent’ for ‘10 percent’.’’. partner for services rendered with respect to ‘‘(B) is received from— (c) CONFORMING AMENDMENTS.— the trade or business. ‘‘(i) an organization or corporation de- (1) Section 170(b)(2)(D) is amended by strik- ‘‘(d) QUALIFIED TRADE OR BUSINESS.—For scribed in section 501(c)(12) or 1381(a), or ing ‘‘, and’’ at the end of clause (iv), by re- purposes of this section— ‘‘(ii) an organization which is governed designating clause (v) as clause (vi), and by ‘‘(1) IN GENERAL.—The term ‘qualified trade under this title by the rules applicable to co- inserting after clause (iv) the following new or business’ means any trade or business operatives under this title before the enact- clause: other than a specified service trade or busi- ment of subchapter T. ‘‘(v) section 199A, and’’. ness. ‘‘(f) SPECIAL RULES.— (2) Section 172(d) is amended by adding at ‘‘(2) SPECIFIED SERVICE TRADE OR BUSI- ‘‘(1) APPLICATION TO PARTNERSHIPS AND S the end the following new paragraph: NESS.— CORPORATIONS.— ‘‘(8) QUALIFIED BUSINESS INCOME DEDUC- ‘‘(A) IN GENERAL.—The term ‘specified ‘‘(A) IN GENERAL.—In the case of a partner- TION.—The deduction under section 199A service trade or business’ means— ship or S corporation— shall not be allowed.’’. ‘‘(i) any trade or business involving the ‘‘(i) this section shall be applied at the (3) Section 246(b)(1) is amended by insert- performance of services described in section partner or shareholder level, ing ‘‘199A,’’ before ‘‘243(a)(1)’’. 1202(e)(3)(A), including investing and invest- ‘‘(ii) each partner or shareholder shall take (4) Section 613(a) is amended by inserting ment management, trading, or dealing in se- into account such person’s allocable share of ‘‘and without the deduction under section curities (as defined in section 475(c)(2)), part- each qualified item of income, gain, deduc- 199A’’ after ‘‘and without the deduction nership interests, or commodities (as defined tion, and loss, and under section 199’’. in section 475(e)(2)). ‘‘(iii) each partner or shareholder shall be (5) Section 613A(d)(1) is amended by redes- ‘‘(3) EXCEPTION FOR SPECIFIED SERVICE BUSI- treated for purposes of subsection (b) as hav- ignating subparagraphs (C), (D), and (E) as NESSES BASED ON TAXPAYER’S INCOME.— ing W-2 wages for the taxable year in an subparagraphs (D), (E), and (F), respectively, ‘‘(A) IN GENERAL.—If, for any taxable year, amount equal to such person’s allocable and by inserting after subparagraph (B), the the taxable income of any taxpayer is less share of the W-2 wages of the partnership or following new subparagraph: than the sum of the threshold amount plus S corporation for the taxable year (as deter- ‘‘(C) any deduction allowable under section $50,000 ($100,000 in the case of a joint return), mined under regulations prescribed by the 199A,’’. then— Secretary). (6) The table of sections for part VI of sub- ‘‘(i) the exception under paragraph (1) shall For purposes of clause (iii), a partner’s or chapter B of chapter 1 is amended by insert- not apply to specified service trades or busi- shareholder’s allocable share of W-2 wages ing at the end the following new item: nesses of the taxpayer for the taxable year, shall be determined in the same manner as but the partner’s or shareholder’s allocable share ‘‘Sec. 199A. Qualified business income.’’. ‘‘(ii) only the applicable percentage of of wage expenses. For purposes of this sub- (d) EFFECTIVE DATE.—The amendments qualified items of income, gain, deduction, paragraph, in the case of an S corporation, made by this section shall apply to taxable or loss, and the W-2 wages, of the taxpayer an allocable share shall be the shareholder’s years beginning after December 31, 2017. allocable to such specified service trades or pro rata share of an item. SEC. 11012. LIMITATION ON LOSSES FOR TAX- businesses shall be taken into account in ‘‘(B) APPLICATION TO TRUSTS AND ES- PAYERS OTHER THAN CORPORA- TIONS. computing the qualified business income and TATES.—This section shall not apply to any W-2 wages of the taxpayer for the taxable trust or estate. (a) IN GENERAL.—Section 461 is amended by year for purposes of applying this section. ‘‘(C) TREATMENT OF TRADES OR BUSINESS IN adding at the end the following new sub- ‘‘(B) APPLICABLE PERCENTAGE.—For pur- PUERTO RICO.— section: poses of subparagraph (A), the term ‘applica- ‘‘(i) IN GENERAL.—In the case of any tax- ‘‘(l) LIMITATION ON EXCESS BUSINESS ble percentage’ means, with respect to any payer with qualified business income from LOSSES OF NONCORPORATE TAXPAYERS.— taxable year, 100 percent reduced (not below sources within the commonwealth of Puerto ‘‘(1) LIMITATION.—In the case of taxable zero) by the percentage equal to the ratio Rico, if all such income is taxable under sec- year of a taxpayer other than a corporation of— tion 1 for such taxable year, then for pur- beginning after December 31, 2017, and before ‘‘(i) the taxable income of the taxpayer for poses of determining the qualified business January 1, 2026— the taxable year in excess of the threshold income of such taxpayer for such taxable ‘‘(A) subsection (j) (relating to limitation amount, bears to year, the term ‘United States’ shall include on excess farm losses of certain taxpayers) ‘‘(ii) $50,000 ($100,000 in the case of a joint the Commonwealth of Puerto Rico. shall not apply, and return). ‘‘(ii) SPECIAL RULE FOR APPLYING WAGE LIM- ‘‘(B) any excess business loss of the tax- ‘‘(e) OTHER DEFINITIONS.—For purposes of ITATION.—In the case of any taxpayer de- payer for the taxable year shall not be al- this section— scribed in clause (i), the determination of W- lowed. ‘‘(1) TAXABLE INCOME.—Taxable income 2 wages of such taxpayer with respect to any ‘‘(2) DISALLOWED LOSS CARRYOVER.—Any shall be computed without regard to the de- qualified trade or business conducted in loss which is disallowed under paragraph (1) duction allowable under this section. Puerto Rico shall be made without regard to shall be treated as a net operating loss car- ‘‘(2) THRESHOLD AMOUNT.— any exclusion under section 3401(a)(8) for re- ryover to the following taxable year under ‘‘(A) IN GENERAL.—The term ‘threshold muneration paid for services in Puerto Rico. section 172. amount’ means $250,000 (200 percent of such ‘‘(2) COORDINATION WITH MINIMUM TAX.—For ‘‘(3) EXCESS BUSINESS LOSS.—For purposes amount in the case of a joint return). purposes of determining alternative min- of this subsection— ‘‘(B) INFLATION ADJUSTMENT.—In the case imum taxable income under section 55, ‘‘(A) IN GENERAL.—The term ‘excess busi- of any taxable year beginning after 2018, the qualified business income shall be deter- ness loss’ means the excess (if any) of— dollar amount in paragraph (1) shall be in- mined without regard to any adjustments ‘‘(i) the aggregate deductions of the tax- creased by an amount equal to— under sections 56 through 59. payer for the taxable year which are attrib- ‘‘(i) such dollar amount, multiplied by ‘‘(3) DEDUCTION LIMITED TO INCOME TAXES.— utable to trades or businesses of such tax- ‘‘(ii) the cost-of-living adjustment deter- The deduction under subsection (a) shall payer (determined without regard to whether mined under section 1(f)(3) for the calendar only be allowed for purposes of this chapter. or not such deductions are disallowed for year in which the taxable year begins. ‘‘(4) REGULATIONS.—The Secretary shall such taxable year under paragraph (1)), over If any amount as increased under the pre- prescribe such regulations as are necessary ‘‘(ii) the sum of— ceding sentence is not a multiple of $1,000, to carry out the purposes of this section, in- ‘‘(I) the aggregate gross income or gain of such amount shall be rounded to the nearest cluding regulations— such taxpayer for the taxable year which is multiple of $1,000. ‘‘(A) for requiring or restricting the alloca- attributable to such trades or businesses, ‘‘(3) QUALIFIED REIT DIVIDEND.—The term tion of items and wages under this section plus ‘qualified REIT dividend’ means any divi- and such reporting requirements as the Sec- ‘‘(II) $250,000 (200 percent of such amount in dend from a real estate investment trust re- retary determines appropriate, and the case of a joint return). ceived during the taxable year which— ‘‘(B) for the application of this section in ‘‘(B) ADJUSTMENT FOR INFLATION.—In the ‘‘(A) is not a capital gain dividend, as de- the case of tiered entities. case of any taxable year beginning after De- fined in section 857(b)(3), and ‘‘(g) TERMINATION.—This section shall not cember 31, 2018, the $250,000 amount in sub- ‘‘(B) is not qualified dividend income, as apply to taxable years beginning after De- paragraph (A)(ii)(II) shall be increased by an defined in section 1(h)(11). cember 31, 2025.’’. amount equal to— ‘‘(4) QUALIFIED COOPERATIVE DIVIDEND.— (b) ACCURACY-RELATED PENALTY ON DETER- ‘‘(i) such dollar amount, multiplied by The term ‘qualified cooperative dividend’ MINATION OF APPLICABLE PERCENTAGE.—Sec- ‘‘(ii) the cost-of-living adjustment deter- means any patronage dividend (as defined in tion 6662(d)(1) is amended by inserting at the mined under section 1(f)(3) for the calendar section 1388(a)), any per-unit retain alloca- end the following new subparagraph: year in which the taxable year begins. tion (as defined in section 1388(f)), and any ‘‘(C) SPECIAL RULE FOR TAXPAYERS CLAIM- If any amount as increased under the pre- qualified written notice of allocation (as de- ING SECTION 199A DEDUCTION.—In the case of ceding sentence is not a multiple of $1,000,

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such amount shall be rounded to the nearest ‘‘(4) DEFINITION OF QUALIFYING CHILD.— izen of the United States or is issued pursu- multiple of $1,000. Paragraph (1) of subsection (c) shall be ap- ant to subclause (I) (or that portion of sub- ‘‘(4) APPLICATION OF SUBSECTION IN CASE OF plied by substituting ‘18’ for ‘17’. clause (III) that relates to subclause (I)) of PARTNERSHIPS AND S CORPORATIONS.—In the ‘‘(5) PARTIAL CREDIT ALLOWED FOR CERTAIN section 205(c)(2)(B)(i) of the Social Security case of a partnership or S corporation— OTHER DEPENDENTS.— Act.’’. ‘‘(A) this subsection shall be applied at the ‘‘(A) IN GENERAL.—The credit determined (b) EFFECTIVE DATE.—The amendments partner or shareholder level, and under subsection (a) (after the application of made by this section shall apply to taxable ‘‘(B) each partner’s or shareholder’s allo- paragraph (2)) shall be increased by $500 for years beginning after December 31, 2017. cable share of the items of income, gain, de- each dependent of the taxpayer (as defined in duction, or loss of the partnership or S cor- section 152) other than a qualifying child de- SEC. 11023. INCREASED LIMITATION FOR CER- TAIN CHARITABLE CONTRIBUTIONS. poration for any taxable year from trades or scribed in subsection (c) (after the applica- businesses attributable to the partnership or tion of paragraph (4)). (a) IN GENERAL.—Section 170(b)(1) is S corporation shall be taken into account by ‘‘(B) EXCEPTION FOR CERTAIN NONCITIZENS.— amended by redesignating subparagraph (G) the partner or shareholder in applying this Subparagraph (A) shall not apply with re- as subparagraph (H) and by inserting after subsection to the taxable year of such part- spect to any individual who would not be a subparagraph (F) the following new subpara- ner or shareholder with or within which the dependent if subparagraph (A) of section graph: taxable year of the partnership or S corpora- 152(b)(3) were applied without regard to all ‘‘(G) INCREASED LIMITATION FOR CASH CON- tion ends. that follows ‘resident of the United States’. TRIBUTIONS.— For purposes of this paragraph, in the case of ‘‘(6) PORTION OF CREDIT REFUNDABLE.—In ‘‘(i) IN GENERAL.—In the case of any con- an S corporation, an allocable share shall be lieu of subsection (d), the following provi- tribution of cash to an organization de- the shareholder’s pro rata share of an item. sions shall apply for purposes of the credit scribed in subparagraph (A), the total ‘‘(5) ADDITIONAL REPORTING.—The Sec- allowable under this section: amount of such contributions which may be retary shall prescribe such additional report- ‘‘(A) IN GENERAL.—The aggregate credits taken into account under subsection (a) for ing requirements as the Secretary deter- allowed to a taxpayer under subpart C shall any taxable year beginning after December mines appropriate to carry out the purposes be increased by the lesser of— 31, 2017, and before January 1, 2026, shall not of this subsection. ‘‘(i) the credit which would be allowed exceed 60 percent of the taxpayer’s contribu- ‘‘(6) COORDINATION WITH SECTION 469.—This under this section without regard to this tion base for such year. subsection shall be applied after the applica- paragraph and the limitation under section ‘‘(ii) CARRYOVER.—If the aggregate amount tion of section 469.’’. 26(a), or of contributions described in clause (i) ex- (b) EFFECTIVE DATE.—The amendments ‘‘(ii) the amount by which the aggregate ceeds the applicable limitation under clause made by this section shall apply to taxable amount of credits allowed by this subpart (i) for any taxable year described in such years beginning after December 31, 2017. (determined without regard to this para- clause, such excess shall be treated (in a PART III—TAX BENEFITS FOR FAMILIES graph) would increase if the limitation im- manner consistent with the rules of sub- AND INDIVIDUALS posed by section 26(a) were increased by an section (d)(1)) as a charitable contribution to SEC. 11021. INCREASE IN STANDARD DEDUCTION. amount equal to the sum of the taxpayer’s which clause (i) applies in each of the 5 suc- (a) IN GENERAL.—Subsection (c) of section payroll taxes for the taxable year. ceeding years in order of time. 63 is amended by adding at the end the fol- ‘‘(B) PAYROLL TAXES.— ‘‘(iii) COORDINATION WITH SUBPARAGRAPHS lowing new paragraph: ‘‘(i) IN GENERAL.—For purposes of subpara- (A) AND (B).— ‘‘(7) SPECIAL RULES FOR TAXABLE YEARS 2018 graph (A), the term ‘payroll taxes’ means, ‘‘(I) IN GENERAL.—Contributions taken into THROUGH 2025.—In the case of a taxable year with respect to any taxpayer for any taxable account under this subparagraph shall not be beginning after December 31, 2017, and before year, the amount of the taxes imposed by— taken into account under subparagraph (A). January 1, 2026— ‘‘(I) section 1401 on the self-employment in- ‘‘(II) LIMITATION REDUCTION.—Subpara- ‘‘(A) INCREASE IN STANDARD DEDUCTION.— come of the taxpayer for the taxable year, graphs (A) and (B) shall be applied for each Paragraph (2) shall be applied— ‘‘(II) section 3101 on wages received by the taxable year described in clause (i), and each ‘‘(i) by substituting ‘$18,000’ for ‘$4,400’ in taxpayer during the calendar year in which taxable year to which any contribution subparagraph (B), and the taxable year begins, under this subparagraph is carried over ‘‘(ii) by substituting ‘$12,000’ for ‘$3,000’ in ‘‘(III) section 3111 on wages paid by an em- under clause (ii), by reducing (but not below subparagraph (C). ployer with respect to employment of the zero) the aggregate contribution limitation ‘‘(B) ADJUSTMENT FOR INFLATION.— taxpayer during the calendar year in which allowed for the taxable year under each such ‘‘(i) IN GENERAL.—Paragraph (4) shall not the taxable year begins, subparagraph by the aggregate contributions apply to the dollar amounts contained in ‘‘(IV) sections 3201(a) and 3211(a) on com- allowed under this subparagraph for such paragraphs (2)(B) and (2)(C). pensation received by the taxpayer during taxable year.’’. the calendar year in which the taxable year ‘‘(ii) ADJUSTMENT OF INCREASED AMOUNTS.— (b) EFFECTIVE DATE.—The amendment begins, and In the case of a taxable year beginning after made by this section shall apply to contribu- ‘‘(V) section 3221(a) on compensation paid 2018, the $18,000 and $12,000 amounts in sub- tions in taxable years beginning after De- by an employer with respect to services ren- paragraph (A) shall each be increased by an cember 31, 2017. amount equal to— dered by the taxpayer during the calendar year in which the taxable year begins. SEC. 11024. INCREASED CONTRIBUTIONS TO ‘‘(I) such dollar amount, multiplied by ABLE ACCOUNTS. ‘‘(II) the cost-of-living adjustment deter- ‘‘(ii) COORDINATION WITH SPECIAL REFUND OF mined under section 1(f)(3) for the calendar PAYROLL TAXES.—The term ‘payroll taxes’ (a) INCREASE IN LIMITATION FOR CONTRIBU- year in which the taxable year begins, deter- shall not include any taxes to the extent the TIONS FROM COMPENSATION OF INDIVIDUALS mined by substituting ‘2017’ for ‘2016’ in sub- taxpayer is entitled to a special refund of WITH DISABILITIES.— paragraph (A)(ii) thereof.’’. such taxes under section 6413(c). (1) IN GENERAL.—Section 529A(b)(2)(B) is (b) EFFECTIVE DATE.—The amendment ‘‘(iii) SPECIAL RULE.—Any amounts paid amended to read as follows: made by this section shall apply to taxable pursuant to an agreement under section ‘‘(B) except in the case of contributions years beginning after December 31, 2017. 3121(l) (relating to agreements entered into under subsection (c)(1)(C), if such contribu- SEC. 11022. INCREASE IN AND MODIFICATION OF by American employers with respect to for- tion to an ABLE account would result in ag- CHILD TAX CREDIT. eign affiliates) which are equivalent to the gregate contributions from all contributors (a) IN GENERAL.—Section 24 is amended by taxes referred to in subclause (II) or (III) of to the ABLE account for the taxable year ex- adding at the end the following new sub- clause (i) shall be treated as taxes referred to ceeding the sum of— section: in such clause. ‘‘(i) the amount in effect under section ‘‘(h) SPECIAL RULES FOR TAXABLE YEARS ‘‘(C) EXCEPTION FOR TAXPAYERS EXCLUDING 2503(b) for the calendar year in which the 2018 THROUGH 2025.— FOREIGN EARNED INCOME.—Subparagraph (A) taxable year begins, plus ‘‘(1) IN GENERAL.—In the case of a taxable shall not apply to any taxpayer for any tax- ‘‘(ii) in the case of any contribution by a year beginning after December 31, 2017, and able year if such taxpayer elects to exclude designated beneficiary described in para- before January 1, 2026, this section shall be any amount from gross income under section graph (7) before January 1, 2026, the lesser applied as provided in paragraphs (2) through 911 for such taxable year. of— (7). ‘‘(7) SOCIAL SECURITY NUMBER REQUIRED.— ‘‘(I) compensation (as defined by section ‘‘(2) CREDIT AMOUNT.—Subsection (a) shall No credit shall be allowed under subsection 219(f)(1)) includible in the designated bene- be applied by substituting ‘$2,000’ for ‘$1,000’. (d) to a taxpayer with respect to any quali- ficiary’s gross income for the preceding tax- ‘‘(3) LIMITATION.—In lieu of the amount de- fying child unless the taxpayer includes the able year, or termined under subsection (b)(2), the thresh- social security number of such child on the ‘‘(II) an amount equal to the poverty line old amount shall be— return of tax for the taxable year. For pur- for a one-person household, as determined ‘‘(A) in the case of a joint return, $500,000, poses of the preceding sentence, the term ‘so- for the calendar year preceding the calendar and cial security number’ means a social secu- year in which the taxable year begins.’’. ‘‘(B) in the case of an individual who is not rity number issued to an individual by the (2) ELIGIBLE DESIGNATED BENEFICIARY.— married or a married individual filing a sepa- Social Security Administration, but only if Section 529A(b) is amended by adding at the rate return, $250,000. the social security number is issued to a cit- end the following:

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‘‘(7) SPECIAL RULES RELATED TO CONTRIBU- (7) Section 6013(f)(1) (relating to joint re- Relief and Emergency Assistance Act before TION LIMIT.—For purposes of paragraph turn where individual is in missing status). March 31, 2016, by reason of severe storms (2)(B)(ii)— (8) Section 7508 (relating to time for per- and flooding occurring in Louisiana, Texas, ‘‘(A) DESIGNATED BENEFICIARY.—A des- forming certain acts postponed by reason of and Mississippi during March of 2016. ignated beneficiary described in this para- service in combat zone). (b) SPECIAL RULES FOR USE OF RETIREMENT graph is an employee (including an employee (b) QUALIFIED HAZARDOUS DUTY AREA.—For FUNDS WITH RESPECT TO MISSISSIPPI DELTA within the meaning of section 401(c)) with re- purposes of this section, the term ‘‘qualified AREAS DAMAGED BY 2016 FLOODING.— spect to whom— hazardous duty area’’ means the Sinai Pe- (1) TAX-FAVORED WITHDRAWALS FROM RE- ‘‘(i) no contribution is made for the taxable ninsula of Egypt, if as of the date of the en- TIREMENT PLANS.— year to a defined contribution plan (within actment of this section any member of the (A) IN GENERAL.—Section 72(t) of the Inter- the meaning of section 414(i)) with respect to Armed Forces of the United States is enti- nal Revenue Code of 1986 shall not apply to which the requirements of section 401(a) or tled to special pay under section 310 of title any qualified Mississippi River Delta flood- 403(a) are met, 37, United States Code (relating to special ing distribution. ‘‘(ii) no contribution is made for the tax- pay; duty subject to hostile fire or imminent (B) AGGREGATE DOLLAR LIMITATION.— able year to an annuity contract described in danger), for services performed in such loca- (i) IN GENERAL.—For purposes of this sub- section 403(b), and tion. Such term includes such location only section, the aggregate amount of distribu- ‘‘(iii) no contribution is made for the tax- during the period such entitlement is in ef- tions received by an individual which may be able year to an eligible deferred compensa- fect. treated as qualified Mississippi River Delta tion plan described in section 457(b). (c) APPLICABLE PERIOD.— flooding distributions for any taxable year ‘‘(B) POVERTY LINE.—The term ‘poverty (1) IN GENERAL.—Except as provided in shall not exceed the excess (if any) of— line’ has the meaning given such term by paragraph (2), the applicable period is— (I) $100,000, over section 673 of the Community Services Block (A) the portion of the first taxable year (II) the aggregate amounts treated as Grant Act (42 U.S.C. 9902).’’. ending after June 9, 2015, which begins on qualified Mississippi River Delta flooding (b) ALLOWANCE OF SAVER’S CREDIT FOR such date, and distributions received by such individual for ABLE CONTRIBUTIONS BY ACCOUNT HOLDER.— (B) any subsequent taxable year beginning all prior taxable years. Section 25B(d)(1) is amended by striking before January 1, 2026. (ii) TREATMENT OF PLAN DISTRIBUTIONS.—If ‘‘and’’ at the end of subparagraph (B)(ii), by (2) WITHHOLDING.—In the case of subsection a distribution to an individual would (with- striking the period at the end of subpara- (a)(5), the applicable period is— out regard to clause (i)) be a qualified Mis- graph (C) and inserting ‘‘, and’’, and by in- (A) the portion of the first taxable year sissippi River Delta flooding distribution, a serting at the end the following: ending after the date of the enactment of plan shall not be treated as violating any re- ‘‘(D) the amount of contributions made be- this Act which begins on such date, and quirement of this title merely because the fore January 1, 2026, by such individual to (B) any subsequent taxable year beginning plan treats such distribution as a qualified the ABLE account (within the meaning of before January 1, 2026. Mississippi River Delta flooding distribution, section 529A) of which such individual is the (d) EFFECTIVE DATE.— unless the aggregate amount of such dis- designated beneficiary.’’. (1) IN GENERAL.—Except as provided in tributions from all plans maintained by the (c) EFFECTIVE DATE.—The amendments paragraph (2), the provisions of this section employer (and any member of any controlled made by this section shall apply to taxable shall take effect on June 9, 2015. group which includes the employer) to such years beginning after the date of the enact- (2) WITHHOLDING.—Subsection (a)(5) shall individual exceeds $100,000. ment of this Act. apply to remuneration paid after the date of (iii) CONTROLLED GROUP.—For purposes of SEC. 11025. ROLLOVERS TO ABLE PROGRAMS the enactment of this Act. clause (ii), the term ‘‘controlled group’’ means any group treated as a single em- FROM 529 PROGRAMS. SEC. 11027. EXTENSION OF WAIVER OF LIMITA- (a) IN GENERAL.—Clause (i) of section TIONS WITH RESPECT TO EXCLUD- ployer under subsection (b), (c), (m), or (o) of 529(c)(3)(C) is amended by striking ‘‘or’’ at ING FROM GROSS INCOME AMOUNTS section 414 of the Internal Revenue Code of the end of subclause (I), by striking the pe- RECEIVED BY WRONGFULLY INCAR- 1986. riod at the end of subclause (II) and inserting CERATED INDIVIDUALS. (C) AMOUNT DISTRIBUTED MAY BE REPAID.— ‘‘, or’’, and by adding at the end the fol- (a) IN GENERAL.—Section 304(d) of the Pro- (i) IN GENERAL.—Any individual who re- lowing: tecting Americans from Tax Hikes Act of ceives a qualified Mississippi River Delta ‘‘(III) before January 1, 2026, to an ABLE 2015 (26 U.S.C. 139F note) is amended by flooding distribution may, at any time dur- account (as defined in section 529A(e)(6)) of striking ‘‘1-year’’ and inserting ‘‘2-year’’. ing the 3-year period beginning on the day the designated beneficiary or a member of (b) EFFECTIVE DATE.—The amendments after the date on which such distribution the family of the designated beneficiary. made by this section shall take effect on the was received, make one or more contribu- Subclause (III) shall not apply to so much of date of the enactment of this Act. tions in an aggregate amount not to exceed a distribution which, when added to all other SEC. 11028. UNBORN CHILDREN ALLOWED AS 529 the amount of such distribution to an eligi- contributions made to the ABLE account for ACCOUNT BENEFICIARIES. ble retirement plan of which such individual the taxable year, exceeds the limitation (a) IN GENERAL.—Section 529(e) is amended is a beneficiary and to which a rollover con- under section 529A(b)(2)(B).’’. by adding at the end the following new para- tribution of such distribution could be made (b) EFFECTIVE DATE.—The amendments graph: under section 402(c), 403(a)(4), 403(b)(8), made by this section shall apply to distribu- ‘‘(6) TREATMENT OF UNBORN CHILDREN.— 408(d)(3), or 457(e)(16) of the Internal Revenue tions after the date of the enactment of this ‘‘(A) IN GENERAL.—Nothing shall prevent Code of 1986, as the case may be. Act. an unborn child from being treated as a des- (ii) TREATMENT OF REPAYMENTS OF DIS- SEC. 11026. TREATMENT OF CERTAIN INDIVID- ignated beneficiary or an individual under TRIBUTIONS FROM ELIGIBLE RETIREMENT PLANS UALS PERFORMING SERVICES IN this section. OTHER THAN IRAS.—For purposes of this title, THE SINAI PENINSULA OF EGYPT. ‘‘(B) UNBORN CHILD.—For purposes of this if a contribution is made pursuant to clause (a) IN GENERAL.—For purposes of the fol- paragraph— (i) with respect to a qualified Mississippi lowing provisions of the Internal Revenue ‘‘(i) IN GENERAL.—The term ‘unborn child’ River Delta flooding distribution from an el- Code of 1986, with respect to the applicable means a child in utero. igible retirement plan other than an indi- period, a qualified hazardous duty area shall ‘‘(ii) CHILD IN UTERO.—The term ‘child in vidual retirement plan, then the taxpayer be treated in the same manner as if it were utero’ means a member of the species homo shall, to the extent of the amount of the con- a combat zone (as determined under section sapiens, at any stage of development, who is tribution, be treated as having received the 112 of such Code): carried in the womb.’’. qualified Mississippi River Delta flooding (1) Section 2(a)(3) (relating to special rule (b) EFFECTIVE DATE.—The amendment distribution in an eligible rollover distribu- where deceased spouse was in missing sta- made by this section shall apply to contribu- tion (as defined in section 402(c)(4) of the In- tus). tions made after December 31, 2017. ternal Revenue Code of 1986) and as having (2) Section 112 (relating to the exclusion of SEC. 11029. RELIEF FOR MISSISSIPPI RIVER transferred the amount to the eligible retire- certain combat pay of members of the Armed DELTA FLOOD DISASTER AREA. ment plan in a direct trustee to trustee Forces). (a) IN GENERAL.—For purposes of this sec- transfer within 60 days of the distribution. (3) Section 692 (relating to income taxes of tion, the term ‘‘Mississippi River Delta flood (iii) TREATMENT OF REPAYMENTS FOR DIS- members of Armed Forces on death). disaster area’’ means any area— TRIBUTIONS FROM IRAS.—For purposes of the (4) Section 2201 (relating to members of the (1) with respect to which a major disaster Internal Revenue Code of 1986, if a contribu- Armed Forces dying in combat zone or by has been declared by the President under tion is made pursuant to clause (i) with re- reason of combat-zone-incurred wounds, section 401 of the Robert T. Stafford Disaster spect to a qualified Mississippi River Delta etc.). Relief and Emergency Assistance Act before flooding distribution from an individual re- (5) Section 3401(a)(1) (defining wages relat- September 3, 2016, by reason of severe storms tirement plan (as defined by section ing to combat pay for members of the Armed and flooding occurring in Louisiana during 7701(a)(37) of the Internal Revenue Code of Forces). August of 2016, or 1986), then, to the extent of the amount of (6) Section 4253(d) (relating to the taxation (2) with respect to which a major disaster the contribution, the qualified Mississippi of phone service originating from a combat has been declared by the President under River Delta flooding distribution shall be zone from members of the Armed Forces). section 401 of the Robert T. Stafford Disaster treated as a distribution described in section

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00084 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.055 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7737 408(d)(3) of such Code and as having been In the case of a governmental plan (as de- ginning after December 31, 2017, and before transferred to the eligible retirement plan in fined in section 414(d) of the Internal Rev- January 1, 2026, does not include any amount a direct trustee to trustee transfer within 60 enue Code of 1986), subclause (II) shall be ap- which (but for this subsection) would be in- days of the distribution. plied by substituting the date which is 2 cludible in gross income for such taxable (D) DEFINITIONS.—For purposes of this years after the date otherwise applied under year by reasons of the discharge (in whole or paragraph— subclause (II). in part) of any loan described in subpara- (i) QUALIFIED MISSISSIPPI RIVER DELTA (ii) CONDITIONS.—This paragraph shall not graph (B) if such discharge was— FLOODING DISTRIBUTION.—Except as provided apply to any amendment unless— ‘‘(i) pursuant to subsection (a) or (d) of sec- in subparagraph (B), the term ‘‘qualified Mis- (I) during the period— tion 437 of the Higher Education Act of 1965 sissippi River Delta flooding distribution’’ (aa) beginning on the date that this section or the parallel benefit under part D of title means— or the regulation described in clause (i)(I) IV of such Act (relating to the repayment of (I) any distribution from an eligible retire- takes effect (or in the case of a plan or con- loan liability), ment plan made on or after August 11, 2016, tract amendment not required by this sec- ‘‘(ii) pursuant to section 464(c)(1)(F) of such and before January 1, 2018, to an individual tion or such regulation, the effective date Act, or whose principal place of abode on August 11, specified by the plan); and ‘‘(iii) otherwise discharged on account of 2016, was located in the portion of Mississippi (bb) ending on the date described in clause the death or total and permanent disability River Delta disaster area described in sub- (i)(II) (or, if earlier, the date the plan or con- of the student. section (a)(1) and who has sustained an eco- tract amendment is adopted), ‘‘(B) LOANS DESCRIBED.—A loan is described nomic loss by reason of the severe storms the plan or contract is operated as if such in this subparagraph if such loan is— and flooding giving rise to the Presidential plan or contract amendment were in effect; ‘‘(i) a student loan (as defined in paragraph declaration described in subsection (a)(1), or and (2)), or (II) any distribution from an eligible re- (II) such plan or contract amendment ap- ‘‘(ii) a private education loan (as defined in tirement plan made on or after March 1, 2016, plies retroactively for such period. section 140(7) of the Consumer Credit Protec- and before January 1, 2018, to an individual (c) SPECIAL RULES FOR PERSONAL CASUALTY tion Act (15 U.S.C. 1650(7))).’’. whose principal place of abode on March 1, LOSSES RELATED TO LOUISIANA SEVERE (b) EFFECTIVE DATE.—The amendment 2016, was located in the portion of Mississippi STORMS AND FLOODING.— made by this section shall apply to dis- River Delta disaster area described in sub- (1) IN GENERAL.—If an individual has a net charges of indebtedness after December 31, section (a)(2) and who has sustained an eco- disaster loss for any taxable year beginning 2017. nomic loss by reason of the severe storms after December 31, 2017, and before January SEC. 11032. INCREASE IN DEDUCTION FOR and flooding giving rise to the Presidential 1, 2026— TEACHER EXPENSES. (A) the amount determined under section declaration described in subsection (a)(2). (a) IN GENERAL.—Subparagraph (D) of sec- (ii) ELIGIBLE RETIREMENT PLAN.—The term 165(h)(2)(A)(ii) of the Internal Revenue Code tion 62(a)(2) is amended by striking ‘‘$250’’ ‘‘eligible retirement plan’’ shall have the of 1986 shall be equal to the sum of— and inserting ‘‘$250 ($500 in the case of tax- meaning given such term by section (i) such net disaster loss, and able years beginning after December 31, 2017, 402(c)(8)(B) of the Internal Revenue Code of (ii) so much of the excess referred to in the and before January 1, 2026)’’. matter preceding clause (i) of section 1986. (b) EFFECTIVE DATE.—The amendment 165(h)(2)(A) of such Code (reduced by the (E) INCOME INCLUSION SPREAD OVER 3-YEAR made by this section shall apply to taxable amount in clause (i) of this subparagraph) as PERIOD.— years beginning after December 31, 2017. (i) IN GENERAL.—In the case of any quali- exceeds 10 percent of the adjusted gross in- fied Mississippi River Delta flooding dis- come of the individual, PART V—DEDUCTIONS AND EXCLUSIONS tribution, unless the taxpayer elects not to (B) section 165(h)(1) of such Code shall be SEC. 11041. SUSPENSION OF DEDUCTION FOR have this subparagraph apply for any taxable applied by substituting ‘‘$500’’ for ‘‘$500 ($100 PERSONAL EXEMPTIONS. year, any amount required to be included in for taxable years beginning after December (a) IN GENERAL.—Subsection (d) of section gross income for such taxable year shall be 31, 2009)’’, 151 is amended— so included ratably over the 3-taxable-year (C) the standard deduction determined (1) by striking ‘‘In the case of’’ in para- period beginning with such taxable year. under section 63(c) of such Code shall be in- graph (4) and inserting ‘‘Except as provided (ii) SPECIAL RULE.—For purposes of clause creased by the net disaster loss, and in paragraph (5), in the case of’’, and (i), rules similar to the rules of subparagraph (D) section 56(b)(1)(E) of such Code shall (2) by adding at the end the following new (E) of section 408A(d)(3) of the Internal Rev- not apply to so much of the standard deduc- paragraph: enue Code of 1986 shall apply. tion as is attributable to the increase under ‘‘(5) SPECIAL RULES FOR TAXABLE YEARS 2018 (F) SPECIAL RULES.— subparagraph (C) of this paragraph. THROUGH 2025.—In the case of a taxable year (i) EXEMPTION OF DISTRIBUTIONS FROM (2) NET DISASTER LOSS.—For purposes of beginning after December 31, 2017, and before TRUSTEE TO TRUSTEE TRANSFER AND WITH- this subsection, the term ‘‘net disaster loss’’ January 1, 2026— HOLDING RULES.—For purposes of sections means the excess of qualified disaster-re- ‘‘(A) EXEMPTION AMOUNT.—The term ‘ex- 401(a)(31), 402(f), and 3405 of the Internal Rev- lated personal casualty losses over personal emption amount’ means zero. enue Code of 1986, qualified Mississippi River casualty gains (as defined in section ‘‘(B) REFERENCES.—For purposes of any Delta flooding distributions shall not be 165(h)(3)(A) of the Internal Revenue Code of other provision of this title, the reduction of treated as eligible rollover distributions. 1986). the exemption amount to zero under sub- (ii) QUALIFIED MISSISSIPPI RIVER DELTA (3) QUALIFIED DISASTER-RELATED PERSONAL paragraph (A) shall not be taken into ac- FLOODING DISTRIBUTIONS TREATED AS MEETING CASUALTY LOSSES.—For purposes of this para- count in determining whether a deduction is PLAN DISTRIBUTION REQUIREMENTS.—For pur- graph, the term ‘‘qualified disaster-related allowed or allowable, or whether a taxpayer poses of the Internal Revenue Code of 1986, a personal casualty losses’’ means losses de- is entitled to a deduction, under this sec- qualified Mississippi River Delta flooding scribed in section 165(c)(3) of the Internal tion.’’. distribution shall be treated as meeting the Revenue Code of 1986 which arise— (b) APPLICATION TO ESTATES AND TRUSTS.— requirements of sections 401(k)(2)(B)(i), (A) in the portion of the Mississippi River Section 642(b)(2)(C) is amended by adding at 403(b)(7)(A)(ii), 403(b)(11), and 457(d)(1)(A) of Delta flood disaster area described in sub- the end the following new clause: the Internal Revenue Code of 1986. section (a)(1) on or after August 11, 2016, and ‘‘(iii) YEARS WHEN PERSONAL EXEMPTION (2) PROVISIONS RELATING TO PLAN AMEND- which are attributable to the severe storms AMOUNT IS ZERO.— MENTS.— and flooding giving rise to the Presidential ‘‘(I) IN GENERAL.—In the case of any tax- (A) IN GENERAL.—If this paragraph applies declaration described in subsection (a)(1), or able year in which the exemption amount to any amendment to any plan or annuity (B) in the portion of the Mississippi River under section 151(d) is zero, clause (i) shall be contract, such plan or contract shall be Delta flood disaster area described in sub- applied by substituting ‘$4,150’ for ‘the ex- treated as being operated in accordance with section (a)(2) on or after March 1, 2016, and emption amount under section 151(d)’. the terms of the plan during the period de- which are attributable to the severe storms ‘‘(II) INFLATION ADJUSTMENT.—In the case scribed in subparagraph (B)(ii)(I). and flooding giving rise to the Presidential of any calendar year beginning after 2018, the (B) AMENDMENTS TO WHICH SUBSECTION AP- declaration described in subsection (a)(2). $4,150 amount in subparagraph (A) shall be PLIES.— PART IV—EDUCATION increased by an amount equal to— (i) IN GENERAL.—This paragraph shall apply SEC. 11031. TREATMENT OF STUDENT LOANS DIS- ‘‘(aa) such dollar amount, multiplied by to any amendment to any plan or annuity CHARGED ON ACCOUNT OF DEATH ‘‘(bb) the cost-of-living adjustment deter- contract which is made— OR DISABILITY. mined under section 1(f)(3) for the calendar (I) pursuant to any provision of this sec- (a) IN GENERAL.—Section 108(f) is amended year in which the taxable year begins, deter- tion, or pursuant to any regulation under by adding at the end the following new para- mined by substituting ‘2017’ for ‘2016’ in sub- any provision of this section; and graph: paragraph (A)(ii) thereof. (II) on or before the last day of the first ‘‘(5) DISCHARGES ON ACCOUNT OF DEATH OR If any increase determined under the pre- plan year beginning on or after January 1, DISABILITY.— ceding sentence is not a multiple of $100, 2018, or such later date as the Secretary pre- ‘‘(A) IN GENERAL.—In the case of an indi- such increase shall be rounded to the next scribes. vidual, gross income for any taxable year be- lowest multiple of $100.’’.

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(c) EXCEPTION FOR WAGE WITHHOLDING ‘‘(2) an individual entitled to make a joint SEC. 11045. SUSPENSION OF MISCELLANEOUS RULES.—Section 3402(a) is amended by add- return if— ITEMIZED DEDUCTIONS. ing at the end the following new paragraph: ‘‘(A) the gross income of such individual, (a) IN GENERAL.—Section 67 is amended by ‘‘(3) YEARS WHEN PERSONAL EXEMPTION when combined with the gross income of adding at the end the following new sub- AMOUNT IS ZERO.— such individual’s spouse, for the taxable year section: ‘‘(A) IN GENERAL.—In the case of any tax- does not exceed the standard deduction ‘‘(g) SUSPENSION FOR TAXABLE YEARS 2018 able year in which the exemption amount which would be applicable to the taxpayer THROUGH 2025.—Notwithstanding subsection under section 151(d) is zero, paragraph (2) for such taxable year under section 63 if such (a), no miscellaneous itemized deduction shall be applied by substituting ‘$4,150’ for individual and such individual’s spouse made shall be allowed for any taxable year begin- ‘the amount of one personal exemption pro- a joint return, ning after December 31, 2017, and before Jan- vided in section 151(b)’. ‘‘(B) such individual and such individual’s uary 1, 2026.’’. ‘‘(B) INFLATION ADJUSTMENT.—In the case spouse have the same household as their (b) EFFECTIVE DATE.—The amendment of any calendar year beginning after 2018, the home at the close of the taxable year, made by this section shall apply to taxable $4,150 amount in subparagraph (A) shall be ‘‘(C) such individual’s spouse does not years beginning after December 31, 2017. increased by an amount equal to— make a separate return, and SEC. 11046. SUSPENSION OF OVERALL LIMITA- ‘‘(i) such dollar amount, multiplied by ‘‘(D) neither such individual nor such indi- TION ON ITEMIZED DEDUCTIONS. ‘‘(ii) the cost-of-living adjustment deter- vidual’s spouse is an individual described in (a) IN GENERAL.—Section 68 is amended by mined under section 1(f)(3) for the calendar section 63(c)(5) who has income (other than adding at the end the following new sub- year in which the taxable year begins, deter- earned income) in excess of the amount in ef- section: mined by substituting ‘2017’ for ‘2016’ in sub- fect under section 63(c)(5)(A). ‘‘(f) SECTION NOT TO APPLY.—This section paragraph (A)(ii) thereof. The amount specified in paragraph (1) or shall not apply to any taxable year begin- If any increase determined under the pre- (2)(A) shall be increased by the amount of 1 ning after December 31, 2017, and before Jan- ceding sentence is not a multiple of $100, additional standard deduction (within the uary 1, 2026.’’. such increase shall be rounded to the next meaning of section 63(c)(3)) in the case of an (b) EFFECTIVE DATE.—The amendment lowest multiple of $100.’’. individual entitled to such deduction by rea- made by this section shall apply to taxable years beginning after December 31, 2017. (d) EXCEPTION FOR DETERMINING PROPERTY son of section 63(f)(1)(A) (relating to individ- EXEMPT FROM LEVY.—Section 6334(d) is uals age 65 or more), and by the amount of SEC. 11047. MODIFICATION OF EXCLUSION OF amended by adding at the end the following each additional standard deduction to which GAIN FROM SALE OF PRINCIPAL RESIDENCE. new paragraph: the individual or the individual’s spouse is (a) IN GENERAL.—Section 121 is amended by ‘‘(4) YEARS WHEN PERSONAL EXEMPTION entitled by reason of section 63(f)(1).’’. adding at the end the following new sub- AMOUNT IS ZERO.— (f) EFFECTIVE DATE.—The amendments section: ‘‘(A) IN GENERAL.—In the case of any tax- made by this section shall apply to taxable ‘‘(h) SPECIAL RULES FOR SALES OR EX- able year in which the exemption amount years beginning after December 31, 2017. CHANGES IN TAXABLE YEARS 2018 THROUGH SEC. 11042. SUSPENSION OF DEDUCTION FOR under section 151(d) is zero, paragraph (2) 2025.— shall not apply and for purposes of paragraph STATE AND LOCAL, ETC. TAXES. ‘‘(1) IN GENERAL.—In applying this section (1) the term ‘exempt amount’ means an (a) IN GENERAL.—Subsection (b) of section 164 is amended by adding at the end the fol- with respect to sales or exchanges after De- amount equal to— cember 31, 2017, and before January 1, 2026— ‘‘(i) the sum of the amount determined lowing new paragraph: ‘‘(6) SUSPENSION OF INDIVIDUAL DEDUCTIONS ‘‘(A) ‘8-year’ shall be substituted for ‘5- under subparagraph (B) and the standard de- year’ each place it appears in subsections (a), duction, divided by FOR TAXABLE YEARS 2018 THROUGH 2025.—In the case of an individual and a taxable year be- (b)(5)(C)(ii)(I), and (c)(1)(B)(i)(I) and para- ‘‘(ii) 52. graphs (7), (9), (10), and (12) of subsection (d), ‘‘(B) AMOUNT DETERMINED.—For purposes of ginning after December 31, 2017, and before January 1, 2026— ‘‘(B) ‘5 years’ shall be substituted for ‘2 subparagraph (A), the amount determined years’ each place it appears in subsections under this subparagraph is $4,150 multiplied ‘‘(A) paragraphs (1) and (2) of subsection (a) shall not apply to any real property or per- (a), (b)(3), (b)(4), (b)(5)(C)(ii)(III), and by the number of the taxpayer’s dependents (c)(1)(B)(ii), and for the taxable year in which the levy oc- sonal property taxes, other than taxes which are paid or accrued in carrying on a trade or ‘‘(C) ‘5-year’ shall be substituted for ‘2- curs. year’ in subsection (b)(3). ‘‘(C) INFLATION ADJUSTMENT.—In the case business or an activity described in section ‘‘(2) EXCEPTION FOR BINDING CONTRACTS.— of any taxable year beginning after 2018, the 212, and ‘‘(B) subsection (a)(3) shall not apply to Paragraph (1) shall not apply to any sale or $4,150 amount in subparagraph (B) shall be exchange with respect to which there was a increased by an amount equal to— any State or local taxes.’’. (b) EFFECTIVE DATE.—The amendment written binding contract in effect before ‘‘(i) such dollar amount, multiplied by January 1, 2018, and at all times thereafter ‘‘(ii) the cost-of-living adjustment deter- made by this section shall apply to taxable years beginning after December 31, 2017. before the sale or exchange.’’. mined under section 1(f)(3) for the calendar (b) EFFECTIVE DATE.—The amendment year in which the taxable year begins, deter- SEC. 11043. SUSPENSION OF DEDUCTION FOR HOME EQUITY INTEREST. made by this section shall apply to sales and mined by substituting ‘2017’ for ‘2016’ in sub- (a) IN GENERAL.—Section 163(h)(3)(A)(ii) is exchanges after December 31, 2017. paragraph (A)(ii) thereof. amended by inserting ‘‘in the case of taxable SEC. 11048. SUSPENSION OF EXCLUSION FOR If any increase determined under the pre- years beginning before January 1, 2018, or QUALIFIED BICYCLE COMMUTING ceding sentence is not a multiple of $100, after December 31, 2025,’’ before ‘‘home eq- REIMBURSEMENT. such increase shall be rounded to the next uity indebtedness’’. (a) IN GENERAL.—Section 132(f) is amended lowest multiple of $100. (b) EFFECTIVE DATE.—The amendments by adding at the end the following new para- ‘‘(D) VERIFIED STATEMENT.—Unless the tax- made by this section shall apply to taxable graph: payer submits to the Secretary a written and years ending after December 31, 2017. ‘‘(8) SUSPENSION OF QUALIFIED BICYCLE COM- properly verified statement specifying the SEC. 11044. MODIFICATION OF DEDUCTION FOR MUTING REIMBURSEMENT EXCLUSION.—Para- facts necessary to determine the proper PERSONAL CASUALTY LOSSES. graph (1)(D) shall not apply to any taxable amount under subparagraph (A), subpara- (a) IN GENERAL.—Subsection (h) of section year beginning after December 31, 2017, and graph (A) shall be applied as if the taxpayer 165 is amended by adding at the end the fol- before January 1, 2026.’’. were a married individual filing a separate lowing new paragraph: (b) EFFECTIVE DATE.—The amendment return with no dependents.’’. ‘‘(5) LIMITATION FOR TAXABLE YEARS 2018 made by this section shall apply to taxable (e) PERSONS REQUIRED TO MAKE RETURNS THROUGH 2025.—In the case of any loss of an years beginning after December 31, 2017. OF INCOME.—Section 6012 is amended by add- individual described in subsection (c)(3) SEC. 11049. SUSPENSION OF EXCLUSION FOR ing at the end the following new subsection: which (but for this paragraph) would be de- QUALIFIED MOVING EXPENSE REIM- ‘‘(f) SPECIAL RULE FOR TAXABLE YEARS 2018 ductible in a taxable year beginning after BURSEMENT. THROUGH 2025.—In the case of a taxable year December 31, 2017, and before January 1, 2026 (a) IN GENERAL.—Section 132(g) is amend- beginning after December 31, 2017, and before (without regard to any election under sub- ed— January 1, 2026, subsection (a)(1) shall not section (i), such loss shall be allowed only to (1) by striking ‘‘For purposes of this sec- apply, and every individual who has gross in- the extent it is attributable to a Federally tion, the term’’ and inserting ‘‘For purposes come for the taxable year shall be required declared disaster (as defined in subsection of this section— to make returns with respect to income (i)(5)). The preceding sentence shall not ‘‘(1) IN GENERAL.—The term’’, and taxes under subtitle A, except that a return apply to any deduction under section 172 (2) by adding at the end the following new shall not be required of— which is carried to such a taxable year from paragraph: ‘‘(1) an individual who is not married (de- a taxable year beginning before January 1, ‘‘(2) SUSPENSION FOR TAXABLE YEARS 2018 termined by applying section 7703) and who 2018.’’. THROUGH 2025.—Except in the case of a mem- has gross income for the taxable year which (b) EFFECTIVE DATE.—The amendment ber of the Armed Forces of the United States does not exceed the standard deduction ap- made by this section shall apply to losses in- on active duty who moves pursuant to a plicable to such individual for such taxable curred in taxable years beginning after De- military order and incident to a permanent year under section 63, or cember 31, 2017. change of station, subsection (a)(6) shall not

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00086 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.055 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7739 apply to any taxable year beginning after PART VII—TAXPAYER RIGHTS AND TAX be assessed, and if assessed shall be abated, December 31, 2017, and before January 1, ADMINISTRATION and if collected shall be credited or refunded 2026.’’. SEC. 11071. EXTENSION OF TIME LIMIT FOR CON- as an overpayment made on the due date for (b) EFFECTIVE DATE.—The amendments TESTING IRS LEVY. filing the return of tax for such taxable year. made by this section shall apply to taxable (a) EXTENSION OF TIME FOR RETURN OF ‘‘(B) EXCEPTION.—Subparagraph (A) shall years beginning after December 31, 2017. PROPERTY SUBJECT TO LEVY.—Subsection (b) not apply to a rollover contribution under of section 6343 is amended by striking ‘‘9 this subsection which is made from an eligi- SEC. 11050. SUSPENSION OF DEDUCTION FOR ble retirement plan which is not a Roth IRA MOVING EXPENSES. months’’ and inserting ‘‘2 years’’. (b) PERIOD OF LIMITATION ON SUITS.—Sub- or a designated Roth account (within the (a) IN GENERAL.—Section 217 is amended by section (c) of section 6532 is amended— meaning of section 402A) to a Roth IRA or a adding at the end the following new sub- (1) by striking ‘‘9 months’’ in paragraph (1) designated Roth account under an eligible section: and inserting ‘‘2 years’’, and retirement plan. ‘‘(k) SUSPENSION OF DEDUCTION FOR TAX- (2) by striking ‘‘9-month’’ in paragraph (2) ‘‘(4) INTEREST.—Notwithstanding sub- ABLE YEARS 2018 THROUGH 2025.—Except in and inserting ‘‘2-year’’. section (d), interest shall be allowed under the case of an individual to whom subsection (c) EFFECTIVE DATE.—The amendments subsection (c) in a case in which the Sec- (g) applies, this section shall not apply to made by this section shall apply to— retary makes a determination described in any taxable year beginning after December (1) levies made after the date of the enact- subsection (d)(2)(A) with respect to a levy 31, 2017, and before January 1, 2026.’’. ment of this Act, and upon an individual retirement plan. REATMENT OF INHERITED ACCOUNTS (b) EFFECTIVE DATE.—The amendment (2) levies made on or before such date if the ‘‘(5) T .— made by this section shall apply to taxable 9-month period has not expired under section For purposes of paragraph (1)(A), section years beginning after December 31, 2017. 6343(b) of the Internal Revenue Code of 1986 408(d)(3)(C) shall be disregarded in deter- (without regard to this section) as of such mining whether an individual retirement SEC. 11051. LIMITATION ON WAGERING LOSSES. date. plan is a plan to which a rollover contribu- tion of a distribution from the plan levied (a) IN GENERAL.—Section 165(d) is amended SEC. 11072. INDIVIDUALS HELD HARMLESS ON by adding at the end the following: ‘‘For pur- IMPROPER LEVY ON RETIREMENT upon is permitted.’’. poses of the preceding sentence, in the case PLANS. (b) EFFECTIVE DATE.—The amendment of taxable years beginning after December (a) IN GENERAL.—Section 6343 is amended made by this section shall apply to amounts 31, 2017, and before January 1, 2026, the term by adding at the end the following new sub- paid under subsections (b), (c), and (d)(2)(A) ‘losses from wagering transactions’ includes section: of section 6343 of the Internal Revenue Code any deduction otherwise allowable under ‘‘(f) INDIVIDUALS HELD HARMLESS ON of 1986 in taxable years beginning after De- this chapter incurred in carrying on any wa- WRONGFUL LEVY, ETC. ON RETIREMENT cember 31, 2017. gering transaction.’’. PLAN.— SEC. 11073. MODIFICATION OF USER FEE RE- (b) EFFECTIVE DATE.—The amendment ‘‘(1) IN GENERAL.—If the Secretary deter- QUIREMENTS FOR INSTALLMENT made by this section shall apply to taxable mines that an individual’s account or benefit AGREEMENTS. years beginning after December 31, 2017. under an eligible retirement plan (as defined (a) IN GENERAL.—Section 6159 is amended in section 402(c)(8)(B)) has been levied upon by redesignating subsection (f) as subsection PART VI—INCREASE IN ESTATE AND GIFT in a case to which subsection (b) or (d)(2)(A) (g) and by inserting after subsection (e) the TAX EXEMPTION applies and property or an amount of money following new subsection: SEC. 11061. INCREASE IN ESTATE AND GIFT TAX is returned to the individual— ‘‘(f) INSTALLMENT AGREEMENT FEES.— EXEMPTION. ‘‘(A) the individual may contribute such ‘‘(1) LIMITATION ON FEE AMOUNT.—The amount of any fee imposed on an installment (a) IN GENERAL.—Section 2010(c)(3) is property or an amount equal to the sum of— agreement under this section may not exceed amended by adding at the end the following ‘‘(i) the amount of money so returned by the amount of such fee as in effect on the new subparagraph: the Secretary, and date of the enactment of this subsection. ‘‘(C) INCREASE IN BASIC EXCLUSION ‘‘(ii) interest paid under subsection (c) on ‘‘(2) WAIVER OR REIMBURSEMENT.—In the AMOUNT.—In the case of estates of decedents such amount of money, case of any taxpayer with an adjusted gross dying or gifts made after December 31, 2017, into such eligible retirement plan if such income, as determined for the most recent and before January 1, 2026, subparagraph (A) contribution is permitted by the plan, or year for which such information is available, shall be applied by substituting ‘$10,000,000’ into an individual retirement plan (other which does not exceed 250 percent of the ap- for ‘$5,000,000’.’’. than an endowment contract) to which a rollover contribution of a distribution from plicable poverty level (as determined by the (b) CONFORMING AMENDMENT.—Subsection such eligible retirement plan is permitted, Secretary)— (g) of section 2001 is amended to read as fol- but only if such contribution is made not ‘‘(A) if the taxpayer has agreed to make lows: later than the due date (not including exten- payments under the installment agreement ‘‘(g) MODIFICATIONS TO TAX PAYABLE.— sions) for filing the return of tax for the tax- by electronic payment through a debit in- ‘‘(1) MODIFICATIONS TO GIFT TAX PAYABLE TO able year in which such property or amount strument, no fee shall be imposed on an in- REFLECT DIFFERENT TAX RATES.—For pur- of money is returned, and stallment agreement under this section, and poses of applying subsection (b)(2) with re- ‘‘(B) the Secretary shall, at the time such ‘‘(B) if the taxpayer is unable to make pay- spect to 1 or more gifts, the rates of tax property or amount of money is returned, ments under the installment agreement by under subsection (c) in effect at the dece- notify such individual that a contribution electronic payment through a debit instru- dent’s death shall, in lieu of the rates of tax described in subparagraph (A) may be made. ment, the Secretary shall, upon completion in effect at the time of such gifts, be used ‘‘(2) TREATMENT AS ROLLOVER.—The dis- of the installment agreement, pay the tax- both to compute— tribution on account of the levy and any payer an amount equal to any such fees im- ‘‘(A) the tax imposed by chapter 12 with re- contribution under paragraph (1) with re- posed.’’. spect to such gifts, and spect to the return of such distribution shall (b) EFFECTIVE DATE.—The amendments ‘‘(B) the credit allowed against such tax be treated for purposes of this title as if such made by this section shall apply to agree- under section 2505, including in computing— distribution and contribution were described ments entered into on or after the date ‘‘(i) the applicable credit amount under in section 402(c), 402A(c)(3), 403(a)(4), which is 60 days after the date of the enact- section 2505(a)(1), and 403(b)(8), 408(d)(3), 408A(d)(3), or 457(e)(16), ment of this Act. ‘‘(ii) the sum of the amounts allowed as a whichever is applicable; except that— SEC. 11074. FORM 1040SR FOR SENIORS. credit for all preceding periods under section ‘‘(A) the contribution shall be treated as (a) IN GENERAL.—The Secretary of the 2505(a)(2). having been made for the taxable year in Treasury (or the Secretary’s delegate) shall ‘‘(2) MODIFICATIONS TO ESTATE TAX PAYABLE which the distribution on account of the levy make available a form, to be known as TO REFLECT DIFFERENT BASIC EXCLUSION occurred, and the interest paid under sub- ‘‘Form 1040SR’’, for use by individuals to file AMOUNTS.—The Secretary shall prescribe section (c) shall be treated as earnings with- the return of tax imposed by chapter 1 of the such regulations as may be necessary or ap- in the plan after the contribution and shall Internal Revenue Code of 1986. Such form propriate to carry out this section with re- not be included in gross income, and shall be as similar as practicable to Form spect to any difference between— ‘‘(B) such contribution shall not be taken 1040EZ, except that— ‘‘(A) the basic exclusion amount under sec- into account under section 408(d)(3)(B). (1) the form shall be available only to indi- tion 2010(c)(3) applicable at the time of the ‘‘(3) REFUND, ETC., OF INCOME TAX ON viduals who have attained age 65 as of the decedent’s death, and LEVY.— close of the taxable year, ‘‘(B) the basic exclusion amount under ‘‘(A) IN GENERAL.—If any amount is includ- (2) the form may be used even if income for such section applicable with respect to any ible in gross income for a taxable year by the taxable year includes— gifts made by the decedent.’’. reason of a distribution on account of a levy (A) social security benefits (as defined in (c) EFFECTIVE DATE.—The amendments referred to in paragraph (1) and any portion section 86(d) of the Internal Revenue Code of made by this section shall apply to estates of of such amount is treated as a rollover con- 1986), decedents dying and gifts made after Decem- tribution under paragraph (2), any tax im- (B) distributions from qualified retirement ber 31, 2017. posed by chapter 1 on such portion shall not plans (as defined in section 4974(c) of such

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Code), annuities or other such deferred pay- ‘‘(C) PRIORITY.—In awarding grants under ‘‘(2) QUALIFIED ENTITY.— ment arrangements, this section, the Secretary shall give pri- ‘‘(A) IN GENERAL.—The term ‘qualified en- (C) interest and dividends, or ority to applications— tity’ means any entity which— (D) capital gains and losses taken into ac- ‘‘(i) demonstrating assistance to low-in- ‘‘(i) is an eligible organization (as de- count in determining adjusted net capital come taxpayers, with emphasis on outreach scribed in subparagraph (B)), gain (as defined in section 1(h)(3) of such to and services for such taxpayers, ‘‘(ii) is in compliance with Federal tax fil- Code), and ‘‘(ii) demonstrating taxpayer outreach and ing and payment requirements, (3) the form shall be available without re- educational activities relating to eligibility ‘‘(iii) is not debarred or suspended from gard to the amount of any item of taxable and availability of income supports available Federal contracts, grants, or cooperative income or the total amount of taxable in- through the Internal Revenue Code of 1986, agreements, and come for the taxable year. such as the earned income tax credit, and ‘‘(iv) agrees to provide documentation to (b) EFFECTIVE DATE.—The form required by ‘‘(iii) demonstrating specific outreach and substantiate any matching funds provided subsection (a) shall be made available for focus on one or more underserved popu- under the VITA grant program. taxable years beginning after the date of the lations. ‘‘(B) ELIGIBLE ORGANIZATION.— enactment of this Act and ending before Jan- ‘‘(D) DURATION OF GRANTS.—Upon applica- ‘‘(i) IN GENERAL.—Subject to clause (ii), the uary 1, 2026. tion of a qualified return preparation pro- term ‘eligible organization’ means— gram, the Secretary is authorized to award a ‘‘(I) an institution of higher education SEC. 11075. SENSE OF THE SENATE ON IMPROV- ING CUSTOMER SERVICE AND PRO- multi-year grant not to exceed 3 years. which is described in section 102 (other than TECTIONS FOR TAXPAYERS BY REIN- ‘‘(3) AGGREGATE LIMITATION.—Unless other- subsection (a)(1)(C) thereof) of the Higher STATING APPROPRIATE FUNDING wise provided by specific appropriation, the Education Act of 1965 (20 U.S.C. 1088), as in LEVELS. Secretary shall not allocate more than effect on the date of the enactment of this It is the sense of the Senate that politi- $30,000,000 per fiscal year (exclusive of costs section, and which has not been disqualified cally motivated budget cuts— of administering the program) to carry out from participating in a program under title (1) are counterproductive to deficit reduc- the purposes of this section. IV of such Act, tion, ‘‘(b) USE OF FUNDS.— ‘‘(II) an organization described in section (2) diminish the ability of the Internal ‘‘(1) IN GENERAL.—Qualified return prepara- 501(c) of the Internal Revenue Code of 1986 Revenue Service to adequately serve tax- tion programs receiving a grant under this and exempt from tax under section 501(a) of payers and protect taxpayer information, section may use the grant for— such Code, and ‘‘(A) ordinary and necessary costs associ- ‘‘(III) a local government agency, includ- (3) reduce the ability of the Internal Rev- ated with program operation in accordance ing— enue Service to enforce the law. with Cost Principles Circulars as set forth by ‘‘(aa) a county or municipal government the Office of Management and Budget, in- agency, and SEC. 11076. RETURN PREPARATION PROGRAMS cluding— FOR LOW-INCOME TAXPAYERS. ‘‘(bb) an Indian tribe, as defined in section ‘‘(i) for wages or salaries of persons coordi- 4(13) of the Native American Housing Assist- (a) IN GENERAL.—Chapter 77 is amended by nating the activities of the program, ance and Self-Determination Act of 1996 (25 inserting after section 7526 the following new ‘‘(ii) to develop training materials, conduct U.S.C. 4103(13)), including any tribally des- section: training, and perform quality reviews of the ignated housing entity (as defined in section ‘‘SEC. 7526A. RETURN PREPARATION PROGRAMS returns for which assistance has been pro- 4(22) of such Act (25 U.S.C. 4103(22))), tribal FOR LOW-INCOME TAXPAYERS. vided under the program, and subsidiary, subdivision, or other wholly ‘‘(a) VOLUNTEER INCOME TAX ASSISTANCE ‘‘(iii) for equipment purchases and vehicle- owned tribal entity, or MATCHING GRANT PROGRAM.— related expenses associated with remote or ‘‘(IV) a local, State, regional, or national ‘‘(1) ESTABLISHMENT OF PROGRAM.—The rural tax preparation services, coalition (with one lead organization which Secretary, through the Internal Revenue ‘‘(B) outreach and educational activities meets the eligibility requirements of sub- Service, shall establish a Community Volun- described in subsection (a)(2)(C)(ii), and clause (I), (II), or (III) acting as the applicant teer Income Tax Assistance Matching Grant ‘‘(C) services related to financial education organization). Program (hereinafter in this section referred and capability, asset development, and the ‘‘(ii) ALTERNATIVE ELIGIBLE ORGANIZA- to as the ‘VITA grant program’). Except as establishment of savings accounts in connec- TION.—If no eligible organization described otherwise provided in this section, the VITA tion with tax return preparation. in clause (i) is available to assist the tar- grant program shall be administered in a ‘‘(2) USE OF GRANTS FOR OVERHEAD EX- geted population or community, the term manner which is substantially similar to the PENSES PROHIBITED.—No grant made under ‘eligible organization’ shall include— Community Volunteer Income Tax Assist- this section may be used for overhead ex- ‘‘(I) a State government agency, and ance matching grants demonstration pro- penses that are not directly related to any ‘‘(II) a Cooperative Extension Service of- gram established under title I of division D qualified return preparation program. fice. of the Consolidated Appropriations Act, 2008. ‘‘(c) PROMOTION AND REFERRAL.— ‘‘(3) LOW-INCOME TAXPAYERS.—The term ‘‘(2) MATCHING GRANTS.— ‘‘(1) PROMOTION.—The Secretary shall pro- ‘low-income taxpayer’ means a taxpayer who ‘‘(A) IN GENERAL.—The Secretary shall, mote the benefits of, and encourage the use has income for the taxable year which does subject to the availability of appropriated of, tax preparation through qualified return not exceed an amount equal to the com- funds, make available grants under the VITA preparation programs through the use of pleted phaseout amount under section 32(b) grant program to provide matching funds for mass communications, referrals, and other for a married couple filing a joint return the development, expansion, or continuation means. with three or more qualifying children, as of qualified return preparation programs as- ‘‘(2) INTERNAL REVENUE SERVICE REFER- determined in a revenue procedure or other sisting low-income taxpayers and members RALS.—The Secretary shall refer taxpayers published guidance. of underserved populations. to qualified return preparation programs re- ‘‘(4) UNDERSERVED POPULATION.—The term ‘‘(B) APPLICATION.— ceiving funding under this section. ‘underserved population’ includes popu- ‘‘(i) IN GENERAL.—Subject to clause (ii), in ‘‘(3) VITA GRANTEE REFERRAL.—Qualified lations of persons with disabilities, persons order to be eligible for a grant under this return preparation programs receiving a with limited English proficiency, Native section, a qualified return preparation pro- grant under this section are encouraged to Americans, individuals living in rural areas, gram shall submit an application to the Sec- refer, as appropriate, to local or regional members of the Armed Forces and their retary at such time, in such manner, and Low Income Taxpayer Clinics individuals spouses, and the elderly.’’. containing such information as the Sec- who are eligible to receive services at such (b) CLERICAL AMENDMENT.—The table of retary reasonably requires. clinics. sections for chapter 77 is amended by insert- ‘‘(ii) ACCURACY REVIEW.—In the case of any ‘‘(d) DEFINITIONS.—For purposes of this sec- ing after the item relating to section 7526 the qualified return preparation program which tion— following new item: was awarded a grant under this section and ‘‘(1) QUALIFIED RETURN PREPARATION PRO- ‘‘7526A. Return preparation programs for was subsequently subject to a field site visit GRAM.—The term ‘qualified return prepara- low-income taxpayers.’’. by the Internal Revenue Service (including tion program’ means any program— SEC. 11077. FREE FILE PROGRAM. through the Stakeholder Partnerships, Edu- ‘‘(A) which provides assistance to individ- (a) The Secretary of the Treasury, or the cation, and Communication office) in which uals, not less than 90 percent of whom are Secretary’s delegate, shall continue to oper- it was determined that the average accuracy low-income taxpayers, in preparing and fil- ate the IRS Free File Program as established rate for preparation of tax returns through ing Federal income tax returns, by the Internal Revenue Service and pub- such program was less than 90 percent, such ‘‘(B) which is administered by a qualified lished in the Federal Register on November program shall not be eligible for any addi- entity, 4, 2002 (67 Fed. Reg. 67247), including any sub- tional grants under this section unless such ‘‘(C) in which all of the volunteers who as- sequent agreements and governing rules es- program provides, as part of their applica- sist in the preparation of Federal income tax tablished pursuant thereto. tion, sufficient documentation regarding the returns meet the training requirements pre- (b) The IRS Free File Program shall con- corrective measures established by such pro- scribed by the Secretary, and tinue to provide free commercial-type online gram to address the deficiencies identified ‘‘(D) which uses a quality review process individual income tax preparation and elec- following the field site visit. which reviews 100 percent of all returns. tronic filing services to the lowest 70 percent

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00088 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.055 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7741 of taxpayers by income. The number of tax- each amended by inserting ‘‘(determined (i) in paragraph (1)(B)— payers eligible to receive such services each without regard to whether such proceeds are (I) by striking ‘‘section 55(b)(1)(A)(ii)’’ and year shall be calculated by the Internal Rev- available to the Secretary)’’ after ‘‘in re- inserting ‘‘section 55(b)(1)(B)’’, and enue Service annually based on prior year sponse to such action’’. (II) by striking ‘‘section 55(b)(1)(A)(i)’’ and aggregate taxpayer adjusted gross income (c) DISPUTED AMOUNT THRESHOLD.—Section inserting ‘‘section 55(b)(1)(A)’’, and data. 7623(b)(5)(B) is amended by striking ‘‘tax, (ii) in paragraph (2)(B), by striking ‘‘sec- (c) In addition to the services described in penalties, interest, additions to tax, and ad- tion 55(b)(1)(A)(ii)’’ each place it appears and subsection (b), and in the same manner, the ditional amounts’’ and inserting ‘‘proceeds’’. inserting ‘‘section 55(b)(1)(B)’’. IRS Free File Program shall continue to (d) EFFECTIVE DATE.—The amendments (3) Section 55(c)(1) is amended by striking make available to all taxpayers (without re- made by this section shall apply to informa- ‘‘, the section 936 credit allowable under sec- gard to income) a basic, online electronic tion provided before, on, or after the date of tion 27(b), and the Puerto Rico economic ac- fillable forms utility. the enactment of this Act with respect to tivity credit under section 30A’’. (d) The IRS Free File Program shall con- which a final determination for an award has (4) Section 55(d) is amended— tinue to work cooperatively with the private not been made before such date of enact- (A) by striking paragraph (2) and redesig- sector to provide the free individual income ment. nating paragraphs (3) and (4) as paragraphs tax preparation and the electronic filing PART VIII—INDIVIDUAL MANDATE (2) and (3), respectively, services described in subsections (b) and (c). SEC. 11081. ELIMINATION OF SHARED RESPONSI- (B) in paragraph (2) (as so redesignated), by (e) The IRS Free File Program shall work BILITY PAYMENT FOR INDIVIDUALS inserting ‘‘and’’ at the end of subparagraph cooperatively with State government agen- FAILING TO MAINTAIN MINIMUM ES- (B), by striking ‘‘, and’’ at the end of sub- cies to enhance and expand the use of the SENTIAL COVERAGE. paragraph (C) and inserting a period, and by program to provide needed benefits to the (a) IN GENERAL.—Section 5000A(c) is striking subparagraph (D), and taxpayer while reducing the cost of proc- amended— (C) in paragraph (3) (as so redesignated)— essing returns. (1) in paragraph (2)(B)(iii), by striking ‘‘2.5 (i) by striking ‘‘(b)(1)(A)(i)’’ in subpara- (f) Nothing in this section is intended to percent’’ and inserting ‘‘Zero percent’’, and graph (B)(i) and inserting ‘‘(b)(1)(A)’’, and impact the continuity of services provided (2) in paragraph (3)— (ii) by striking ‘‘paragraph (3)’’ in subpara- under Taxpayer Assistance Centers, Tax (A) by striking ‘‘$695’’ in subparagraph (A) graph (B)(iii) and inserting ‘‘paragraph (2)’’. Counseling for the Elderly, and Volunteer In- and inserting ‘‘$0’’, and (5) Section 55 is amended by striking sub- come Tax Assistance programs. (B) by striking subparagraph (D). section (e). SEC. 11078. ATTORNEYS’ FEES RELATING TO (b) EFFECTIVE DATE.—The amendment (6)(A) Section 56 is amended by striking AWARDS TO WHISTLEBLOWERS. made by this section shall apply to months subsections (c) and (g). (a) IN GENERAL.—Paragraph (21) of section beginning after December 31, 2018. (B) Section 847 is amended by striking the 62(a) is amended to read as follows: Subtitle B—Alternative Minimum Tax last sentence of paragraph (9). ‘‘(21) ATTORNEYS’ FEES RELATING TO AWARDS SEC. 12001. REPEAL OF TAX FOR CORPORATIONS. (C) Section 848 is amended by striking sub- section (i). TO WHISTLEBLOWERS.— (a) IN GENERAL.—Section 55(a) is amended ‘‘(A) IN GENERAL.—Any deduction allowable by striking ‘‘There’’ and inserting ‘‘In the (7) Section 58(a) is amended by striking under this chapter for attorney fees and case of a taxpayer other than a corporation, paragraph (3) and redesignating paragraph court costs paid by, or on behalf of, the tax- there’’. (4) as paragraph (3). payer in connection with any award under— (b) CONFORMING AMENDMENTS.— (8) Section 59 is amended by striking sub- ‘‘(i) section 7623(b), or (1) Section 38(c)(6) is amended by adding at sections (b) and (f). ‘‘(ii) in the case of taxable years beginning the end the following new subparagraph: (9) Section 11(d) is amended by striking after December 31, 2017, and before January ‘‘(E) CORPORATIONS.—In the case of a cor- ‘‘the taxes imposed by subsection (a) and sec- 1, 2026, any action brought under— poration, this subsection shall be applied by tion 55’’ and inserting ‘‘the tax imposed by ‘‘(I) section 21F of the Securities Exchange treating the corporation as having a ten- subsection (a)’’. Act of 1934 (15 U.S.C. 78u-6), tative minimum tax of zero.’’. (10) Section 12 is amended by striking para- ‘‘(II) a State law relating to false or fraud- (2)(A) Section 55(b)(1) is amended to read graph (7). ulent claims that meets the requirements de- as follows: (11) Section 168(k) is amended by striking scribed in section 1909(b) of the Social Secu- ‘‘(1) AMOUNT OF TENTATIVE TAX.— paragraph (4). rity Act (42 U.S.C. 1396h(b)), or ‘‘(A) IN GENERAL.—The tentative minimum (12) Section 882(a)(1) is amended by strik- ‘‘(III) section 23 of the Commodity Ex- tax for the taxable year is the sum of— ing ‘‘, 55,’’. change Act (7 U.S.C. 26). ‘‘(i) 26 percent of so much of the taxable (13) Section 962(a)(1) is amended by strik- ‘‘(B) MAY NOT EXCEED AWARD.—Subpara- excess as does not exceed $175,000, plus ing ‘‘sections 11 and 55’’ and inserting ‘‘sec- graph (A) shall not apply to any deduction in ‘‘(ii) 28 percent of so much of the taxable tion 11’’. excess of the amount includible in the tax- excess as exceeds $175,000. (14) Section 1561(a) is amended— payer’s gross income for the taxable year on The amount determined under the preceding (A) by inserting ‘‘and’’ at the end of para- account of such award.’’. sentence shall be reduced by the alternative graph (1), by striking ‘‘, and’’ at the end of (b) EFFECTIVE DATE.—The amendment minimum tax foreign tax credit for the tax- paragraph (2) and inserting a period, and by made by this section shall apply to taxable able year. striking paragraph (3), and years beginning after December 31, 2017. ‘‘(B) TAXABLE EXCESS.—For purposes of (B) by striking the last sentence. SEC. 11079. CLARIFICATION OF WHISTLEBLOWER this subsection, the term ‘taxable excess’ (15) Section 6425(c)(1)(A) is amended to AWARDS. means so much of the alternative minimum read as follows: (a) DEFINITION OF PROCEEDS.— taxable income for the taxable year as ex- ‘‘(A) the tax imposed by section 11 or (1) IN GENERAL.—Section 7623 is amended ceeds the exemption amount. 1201(a), or subchapter L of chapter 1, which- by adding at the end the following new sub- ‘‘(C) MARRIED INDIVIDUAL FILING SEPARATE ever is applicable, over’’. section: RETURN.—In the case of a married individual (16) Section 6655(e)(2) is amended by strik- ‘‘(c) PROCEEDS.—For purposes of this sec- filing a separate return, subparagraph (A) ing ‘‘and alternative minimum taxable in- tion, the term ‘proceeds’ includes— shall be applied by substituting 50 percent of come’’ each place it appears in subpara- ‘‘(1) penalties, interest, additions to tax, the dollar amount otherwise applicable graphs (A) and (B)(i). and additional amounts provided under the under clause (i) and cause (ii) thereof. For (17) Section 6655(g)(1)(A) is amended by in- internal revenue laws, and purposes of the preceding sentence, marital serting ‘‘plus’’ at the end of clause (i), by ‘‘(2) any proceeds arising from laws for status shall be determined under section striking clause (ii), and by redesignating which the Internal Revenue Service is au- 7703.’’. clause (iii) as clause (ii). (c) EFFECTIVE DATE.—The amendments thorized to administer, enforce, or inves- (B) Section 59(a) is amended— made by this section shall apply to taxable tigate, including— (i) by striking ‘‘subparagraph (A)(i) or years beginning after December 31, 2017. ‘‘(A) criminal fines and civil forfeitures, (B)(i) of section 55(b)(1) (whichever applies) and in lieu of the highest rate of tax specified in SEC. 12002. SUSPENSION OF TAX ON INDIVID- UALS. ‘‘(B) violations of reporting require- section 1 or 11 (whichever applies)’’ in para- (a) IN GENERAL.—Section 55(a) is amended ments.’’. graph (1)(C) and inserting ‘‘section 55(b)(1) in by adding at the end the following new flush (2) CONFORMING AMENDMENTS.—Paragraphs lieu of the highest rate of tax specified in sentence: (1) and (2)(A) of section 7623(b) are each section 1’’, and ‘‘No tax shall be imposed by this section for amended by striking ‘‘collected proceeds (in- (ii) in paragraph (2), by striking ‘‘means’’ any taxable year beginning after December cluding penalties, interest, additions to tax, and all that follows and inserting ‘‘means 31, 2017, and before January 1, 2026, and the and additional amounts) resulting from the the amount determined under the first sen- tentative minimum tax of any taxpayer for action’’ and inserting ‘‘proceeds collected as tence of section 55(b)(1).’’. any such taxable year shall be zero for pur- a result of the action’’. (C) Section 897(a)(2)(A) is amended by poses of this title.’’. (b) AMOUNT OF PROCEEDS DETERMINED striking ‘‘section 55(b)(1)(A)’’ and inserting (b) EFFECTIVE DATE.—The amendment WITHOUT REGARD TO AVAILABILITY.—Para- ‘‘section 55(b)(1)’’. made by this section shall apply to taxable graphs (1) and (2)(A) of section 7623(b) are (D) Section 911(f) is amended— years beginning after December 31, 2017.

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00089 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.055 S01DEPT1 S7742 CONGRESSIONAL RECORD — SENATE December 1, 2017 SEC. 12003. CREDIT FOR PRIOR YEAR MINIMUM (ii) by striking all that precedes ‘‘is hereby (i) by striking ‘‘35 percent’’ and inserting TAX LIABILITY. imposed’’ and inserting: ‘‘the highest rate of tax in effect for the tax- (a) CREDITS TREATED AS REFUNDABLE.— ‘‘(b) TAX IMPOSED.—A tax’’. able year under section 11(b)’’, and Section 53 is amended by adding at the end (E) Sections 594(a) is amended by striking (ii) by striking ‘‘of the gain’’ and inserting the following new subsection: ‘‘taxes imposed by section 11 or 1201(a)’’ and ‘‘multiplied by the gain’’. ‘‘(e) PORTION OF CREDIT TREATED AS RE- inserting ‘‘tax imposed by section 11’’. (B) Section 1445(e)(2) is amended by strik- FUNDABLE.— (F) Section 691(c)(4) is amended by striking ing ‘‘35 percent of the amount’’ and inserting ‘‘(1) IN GENERAL.—In the case of any tax- ‘‘1201,’’. ‘‘the highest rate of tax in effect for the tax- able year beginning in 2018, 2019, 2020, or 2021, (G) Section 801(a) is amended— able year under section 11(b) multiplied by the limitation under subsection (c) shall be (i) by striking paragraph (2), and the amount’’. increased by the AMT refundable credit (ii) by striking all that precedes ‘‘is hereby (C) Section 1445(e)(6) is amended— amount for such year. imposed’’ and inserting: (i) by striking ‘‘35 percent’’ and inserting ‘‘(2) AMT REFUNDABLE CREDIT AMOUNT.— ‘‘(a) TAX IMPOSED.—A tax’’. ‘‘the highest rate of tax in effect for the tax- For purposes of paragraph (1), the AMT re- (H) Section 831(e) is amended by striking able year under section 11(b)’’, and fundable credit amount is an amount equal paragraph (1) and by redesignating para- (ii) by striking ‘‘of the amount’’ and in- to 50 percent (100 percent in the case of a graphs (2) and (3) as paragraphs (1) and (2), serting ‘‘multiplied by the amount’’. taxable year beginning in 2021) of the excess respectively. (D) Section 1446(b)(2)(B) is amended by (if any) of— (I) Sections 832(c)(5) and 834(b)(1)(D) are striking ‘‘section 11(b)(1)’’ and inserting ‘‘(A) the minimum tax credit determined each amended by striking ‘‘sec. 1201 and fol- ‘‘section 11(b)’’. under subsection (b) for the taxable year, lowing,’’. (4) Section 852(b)(1) is amended by striking over (J) Section 852(b)(3)(A) is amended by the last sentence. ‘‘(B) the minimum tax credit allowed under striking ‘‘section 1201(a)’’ and inserting ‘‘sec- (5)(A) Part I of subchapter B of chapter 5 is subsection (a) for such year (before the appli- tion 11(b)’’. amended by striking section 1551 (and by cation of this subsection for such year). (K) Section 857(b)(3) is amended— striking the item relating to such section in ‘‘(3) CREDIT REFUNDABLE.—For purposes of (i) by striking subparagraph (A) and redes- the table of sections for such part). this title (other than this section), the credit ignating subparagraphs (B) through (F) as (B) Section 535(c)(5) is amended to read as allowed by reason of this subsection shall be subparagraphs (A) through (E), respectively, follows: treated as a credit allowed under subpart C (ii) in subparagraph (C), as so redesig- ‘‘(5) CROSS REFERENCE.—For limitation on (and not this subpart). nated— credit provided in paragraph (2) or (3) in the ‘‘(4) SHORT TAXABLE YEARS.—In the case of (I) by striking ‘‘subparagraph (A)(ii)’’ in case of certain controlled corporations, see any taxable year of less than 365 days, the clause (i) thereof and inserting ‘‘paragraph section 1561.’’. AMT refundable credit amount determined (1)’’, (6)(A) Section 1561, as amended by section under paragraph (2) with respect to such tax- (II) by striking ‘‘the tax imposed by sub- 12001, is amended to read as follows: able year shall be the amount which bears paragraph (A)(ii)’’ in clauses (ii) and (iv) ‘‘SEC. 1561. LIMITATION ON ACCUMULATED the same ratio to such amount determined thereof and inserting ‘‘the tax imposed by EARNINGS CREDIT IN THE CASE OF without regard to this paragraph as the num- paragraph (1) on undistributed capital gain’’, CERTAIN CONTROLLED CORPORA- ber of days in such taxable year bears to TIONS. (iii) in subparagraph (E), as so redesig- 365.’’. ‘‘(a) IN GENERAL.—The component mem- nated, by striking ‘‘subparagraph (B) or (D)’’ (b) TREATMENT OF REFERENCES.—Section bers of a controlled group of corporations on and inserting ‘‘subparagraph (A) or (C)’’, and 53(d) is amended by adding at the end the fol- a December 31 shall, for their taxable years (iv) by adding at the end the following new lowing new paragraph: which include such December 31, be limited subparagraph: ‘‘(3) AMT TERM REFERENCES.—In the case of for purposes of this subtitle to one $250,000 ‘‘(F) UNDISTRIBUTED CAPITAL GAIN.—For a corporation, any references in this sub- ($150,000 if any component member is a cor- purposes of this paragraph, the term ‘undis- section to section 55, 56, or 57 shall be treat- poration described in section 535(c)(2)(B)) tributed capital gain’ means the excess of ed as a reference to such section as in effect amount for purposes of computing the accu- the net capital gain over the deduction for before the amendments made by Tax Cuts mulated earnings credit under section dividends paid (as defined in section 561) de- and Jobs Act.’’. 535(c)(2) and (3). Such amount shall be di- termined with reference to capital gain divi- (c) CONFORMING AMENDMENT.—Section vided equally among the component mem- 1374(b)(3)(B) is amended by striking the last dends only.’’. bers of such group on such December 31 un- sentence thereof. (L) Section 882(a)(1), as amended by section less the Secretary prescribes regulations per- (d) EFFECTIVE DATE.— 12001, is amended by striking ‘‘or 1201(a)’’. mitting an unequal allocation of such (1) IN GENERAL.—The amendments made by (M) Section 904(b) is amended— amount. this section shall apply to taxable years be- (i) by striking ‘‘or 1201(a)’’ in paragraph ‘‘(b) CERTAIN SHORT TAXABLE YEARS.—If a ginning after December 31, 2017. (2)(C), corporation has a short taxable year which (2) CONFORMING AMENDMENT.—The amend- (ii) by striking paragraph (3)(D) and insert- does not include a December 31 and is a com- ment made by subsection (c) shall apply to ing the following: ponent member of a controlled group of cor- taxable years beginning after December 31, ‘‘(D) CAPITAL GAIN RATE DIFFERENTIAL.— porations with respect to such taxable year, 2021. There is a capital gain rate differential for then for purposes of this subtitle, the any year if subsection (h) of section 1 applies amount to be used in computing the accumu- Subtitle C—Business-related Provisions to such taxable year.’’, and lated earnings credit under section 535(c)(2) PART I—CORPORATE PROVISIONS (iii) by striking paragraph (3)(E) and in- and (3) of such corporation for such taxable Subpart A—20.94-percent Tax Rate serting the following: year shall be the amount specified in sub- SEC. 13001. 20.94-PERCENT CORPORATE TAX ‘‘(E) RATE DIFFERENTIAL PORTION.—The section (a) with respect to such group, di- RATE. rate differential portion of foreign source net vided by the number of corporations which (a) IN GENERAL.—Subsection (b) of section capital gain, net capital gain, or the excess are component members of such group on the 11 is amended to read as follows: of net capital gain from sources within the last day of such taxable year. For purposes ‘‘(b) AMOUNT OF TAX.—The amount of the United States over net capital gain, as the of the preceding sentence, section 1563(b) tax imposed by subsection (a) shall be 20.94 case may be, is the same proportion of such shall be applied as if such last day were sub- percent of taxable income.’’. amount as— stituted for December 31.’’. (b) CONFORMING AMENDMENTS.— ‘‘(i) the excess of— (B) The table of sections for part II of sub- (1) The following sections are each amend- ‘‘(I) the highest rate of tax set forth in sub- chapter B of chapter 5 is amended by strik- ed by striking ‘‘section 11(b)(1)’’ and insert- section (a), (b), (c), (d), or (e) of section 1 ing the item relating to section 1561 and in- ing ‘‘section 11(b)’’: (whichever applies), over serting the following new item: (A) Section 280C(c)(3)(B)(ii)(II). ‘‘(II) the alternative rate of tax determined ‘‘Sec. 1561. Limitation on accumulated earn- (B) Paragraphs (2)(B) and (6)(A)(ii) of sec- under section 1(h), bears to ings credit in the case of cer- tion 860E(e). ‘‘(ii) that rate referred to in subclause tain controlled corporations.’’. (C) Section 7874(e)(1)(B) (I).’’. (7) Section 7518(g)(6)(A) is amended— (2)(A) Part I of subchapter P of chapter 1 is (N) Section 1374(b) is amended by striking (A) by striking ‘‘With respect to the por- amended by striking section 1201 (and by paragraph (4). tion’’ and inserting ‘‘In the case of a tax- striking the item relating to such section in (O) Section 1381(b) is amended by striking payer other than a corporation, with respect the table of sections for such part). ‘‘taxes imposed by section 11 or 1201’’ and in- to the portion’’, and (B) Section 12 is amended by striking para- serting ‘‘tax imposed by section 11’’. (B) by striking ‘‘(34 percent in the case of graphs (4) and (6), and by redesignating para- (P) Sections 6425(c)(1)(A), as amended by a corporation)’’. graph (5) as paragraph (4). section 12001, and 6655(g)(1)(A)(i) are each (c) EFFECTIVE DATE.— (C) Section 453A(c)(3) is amended by strik- amended by striking ‘‘or 1201(a),’’. (1) IN GENERAL.—Except as otherwise pro- ing ‘‘or 1201 (whichever is appropriate)’’. (Q) Section 7518(g)(6)(A) is amended by vided in this subsection, the amendments (D) Section 527(b) is amended— striking ‘‘or 1201(a)’’. made by this section shall apply to taxable (i) by striking paragraph (2), and (3)(A) Section 1445(e)(1) is amended— years beginning after December 31, 2018.

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00090 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.055 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7743

(2) WITHHOLDING.—The amendments made serve more rapidly than permitted under a ‘‘If taxable income is: The tax is: by subsection (b)(3) shall apply to distribu- normalization method of accounting. Over $70,000 but not over $11,339.50, plus 24% of the tions made after December 31, 2018. $160,000. excess over $70,000. Over $160,000 but not over $32,939.50, plus 32% of the (3) CERTAIN TRANSFERS.—The amendments Mr. RUBIO (for himself and SA 1843. $200,000. excess over $160,000. made by subsection (b)(6) shall apply to Mr. LEE) submitted an amendment in- Over $200,000 but not over $45,739.50, plus 35% of the transfers made after December 31, 2018. tended to be proposed by him to the $500,000. excess over $200,000. (d) NORMALIZATION REQUIREMENTS.— bill H.R. 1, to provide for reconciliation Over $500,000 ...... $150,739.50, plus 38.5% of the excess over $500,000. (1) IN GENERAL.—A normalization method pursuant to titles II and V of the con- of accounting shall not be treated as being ‘‘(D) MARRIED INDIVIDUALS FILING SEPARATE current resolution on the budget for RETURNS.—The following table shall be ap- used with respect to any public utility prop- fiscal year 2018; which was ordered to erty for purposes of section 167 or 168 of the plied in lieu of the table contained in sub- Internal Revenue Code of 1986 if the tax- lie on the table; as follows: section (d): payer, in computing its cost of service for Beginning on page 1, strike line 1 and all ‘‘If taxable income is: The tax is: ratemaking purposes and reflecting oper- that follows through page 123, line 22, and in- Not over $9,525 ...... 10% of taxable income. sert the following: Over $9,525 but not over $952.50, plus 12% of the ating results in its regulated books of ac- $38,700. excess over $9,525. count, reduces the excess tax reserve more TITLE I Over $38,700 but not over $4,453.50, plus 22% of the rapidly or to a greater extent than such re- $70,000. excess over $38,700. SEC. 11000. SHORT TITLE, ETC. serve would be reduced under the average Over $70,000 but not over $11,339.50, plus 24% of the (a) SHORT TITLE.—This title may be cited rate assumption method. $160,000. excess over $70,000. as the ‘‘Tax Cuts and Jobs Act’’. Over $160,000 but not over $32,939.50, plus 32% of the (2) ALTERNATIVE METHOD FOR CERTAIN TAX- (b) AMENDMENT OF 1986 CODE.—Except as $200,000. excess over $160,000. PAYERS.—If, as of the first day of the taxable otherwise expressly provided, whenever in Over $200,000 but not over $45,739.50, plus 35% of the year that includes the date of enactment of this title an amendment or repeal is ex- $500,000. excess over $200,000. this Act— Over $500,000 ...... $150,739.50, plus 38.5% of pressed in terms of an amendment to, or re- (A) the taxpayer was required by a regu- the excess over $500,000. peal of, a section or other provision, the ref- latory agency to compute depreciation for ‘‘(E) ESTATES AND TRUSTS.—The following erence shall be considered to be made to a public utility property on the basis of an av- table shall be applied in lieu of the table con- section or other provision of the Internal erage life or composite rate method, and tained in subsection (e): Revenue Code of 1986. (B) the taxpayer’s books and underlying ‘‘If taxable income is: The tax is: records did not contain the vintage account Subtitle A—Individual Tax Reform Not over $2,550 ...... 10% of taxable income. data necessary to apply the average rate as- PART I—TAX RATE REFORM Over $2,550 but not over $255, plus 24% of the ex- sumption method, $9,150. cess over $2,550. SEC. 11001. MODIFICATION OF RATES. Over $9,150 but not over $1,839, plus 35% of the ex- the taxpayer will be treated as using a nor- (a) IN GENERAL.—Section 1 is amended by $12,500. cess over $9,150. malization method of accounting if, with re- adding at the end the following new sub- Over $12,500...... $3,011.50, plus 38.5% of spect to such jurisdiction, the taxpayer uses section: the excess over $12,500. the alternative method for public utility ‘‘(j) MODIFICATIONS FOR TAXABLE YEARS ‘‘(F) REFERENCES TO RATE TABLES.—Any property that is subject to the regulatory 2018 THROUGH 2025.— reference in this title to a rate of tax under authority of that jurisdiction. ‘‘(1) IN GENERAL.—In the case of a taxable subsection (c) shall be treated as a reference (3) DEFINITIONS.—For purposes of this sub- year beginning after December 31, 2017, and to the corresponding rate bracket under sub- section— before January 1, 2026— paragraph (C) of this paragraph, except that (A) EXCESS TAX RESERVE.—The term ‘‘ex- ‘‘(A) subsection (i) shall not apply, and the reference in section 3402(q)(1) to the third cess tax reserve’’ means the excess of— ‘‘(B) this section (other than subsection (i)) lowest rate of tax applicable under sub- (i) the reserve for deferred taxes (as de- shall be applied as provided in paragraphs (2) section (c) shall be treated as a reference to scribed in section 168(i)(9)(A)(ii) of the Inter- through (7). the fourth lowest rate of tax under subpara- nal Revenue Code of 1986) as determined ‘‘(2) RATE TABLES.— graph (C). under the Internal Revenue Code of 1986 as in ‘‘(A) MARRIED INDIVIDUALS FILING JOINT RE- ‘‘(3) ADJUSTMENTS, ELIMINATION OF MAR- effect on the day before the date of the en- TURNS AND SURVIVING SPOUSES.—The fol- RIAGE PENALTY; ETC.— actment of this Act, over lowing table shall be applied in lieu of the ‘‘(A) NO ADJUSTMENT IN 2018.—The tables (ii) the amount which would be the balance table contained in subsection (a): contained in paragraph (2) shall apply with- in such reserve if the amount of such reserve out adjustment for taxable years beginning ‘‘If taxable income is: The tax is: were determined by assuming that the cor- Not over $19,050 ...... 10% of taxable income. after December 31, 2017, and before January porate rate reductions provided in this Act Over $19,050 but not over $1,905, plus 12% of the ex- 1, 2019. were in effect for all prior periods. $77,400. cess over $19,050. ‘‘(B) SUBSEQUENT YEARS.—For taxable (B) AVERAGE RATE ASSUMPTION METHOD.— Over $77,400 but not over $8,907, plus 22% of the ex- years beginning after December 31, 2018, the The average rate assumption method is the $140,000. cess over $77,400. Secretary shall prescribe tables which shall method under which the excess in the re- Over $140,000 but not over $22,679, plus 24% of the apply in lieu of the tables contained in para- serve for deferred taxes is reduced over the $320,000. excess over $140,000. graph (2) in the same manner as under para- Over $320,000 but not over $65,879, plus 32% of the remaining lives of the property as used in its $400,000. excess over $320,000. graphs (1) and (2) of subsection (f), except regulated books of account which gave rise Over $400,000 but not over $91,479, plus 35% of the that in prescribing such tables— to the reserve for deferred taxes. Under such $1,000,000. excess over $400,000. ‘‘(i) subsection (f)(3) shall be applied by method, if timing differences for the prop- Over $1,000,000 ...... $301,479 plus 38.5% of the substituting ‘calendar year 2017’ for ‘cal- erty reverse, the amount of the adjustment excess over $1,000,000. endar year 2016’ in subparagraph (A)(ii) to the reserve for the deferred taxes is cal- ‘‘(B) HEADS OF HOUSEHOLDS.—The following thereof, and culated by multiplying— table shall be applied in lieu of the table con- ‘‘(ii) subsection (f)(7) shall not apply and— (i) the ratio of the aggregate deferred taxes tained in subsection (b): ‘‘(I) the maximum taxable income in each for the property to the aggregate timing dif- ‘‘If taxable income is: The tax is: of the rate brackets in the table contained in ferences for the property as of the beginning Not over $13,600 ...... 10% of taxable income. paragraph (2)(A) (and the minimum taxable of the period in question, by Over $13,600 but not over $1,360, plus 12% of the ex- income in the next higher taxable income (ii) the amount of the timing differences $51,800. cess over $13,600. bracket with respect to each such bracket in Over $51,800 but not over $5,944, plus 22% of the ex- which reverse during such period. $70,000. cess over $51,800. such table) shall be 200 percent of the max- (C) ALTERNATIVE METHOD.—The ‘‘alter- Over $70,000 but not over $9,948, plus 24% of the ex- imum taxable income in the corresponding native method’’ is the method in which the $160,000. cess over $70,000. rate bracket in the table contained in para- taxpayer— Over $160,000 but not over $31,548, plus 32% of the graph (2)(C) (after any other adjustment (i) computes the excess tax reserve on all $200,000. excess over $160,000. under paragraph (3)), and public utility property included in the plant Over $200,000 but not over $44,348, plus 35% of the ‘‘(II) the comparable taxable income account on the basis of the weighted average $500,000. excess over $200,000. amounts in the table contained in paragraph Over $500,000 ...... $149,348, plus 38.5% of the 1 life or composite rate used to compute depre- excess over $500,000. (2)(D) shall be ⁄2 of the amounts determined ciation for regulatory purposes, and under subparagraph (A). ‘‘(C) UNMARRIED INDIVIDUALS OTHER THAN (ii) reduces the excess tax reserve ratably ‘‘(4) SPECIAL RULES FOR CERTAIN CHILDREN SURVIVING SPOUSES AND HEADS OF HOUSE- over the remaining regulatory life of the WITH UNEARNED INCOME.— HOLDS.—The following table shall be applied property. in lieu of the table contained in subsection ‘‘(A) IN GENERAL.—In the case of a child to (4) TAX INCREASED FOR NORMALIZATION VIO- (c): whom subsection (g) applies for the taxable LATION.—If, for any taxable year ending after year, the rules of subparagraphs (B) and (C) the date of the enactment of this Act, the ‘‘If taxable income is: The tax is: shall apply in lieu of the rule under sub- Not over $9,525 ...... 10% of taxable income. taxpayer does not use a normalization meth- Over $9,525 but not over $952.50, plus 12% of the section (g)(1). od of accounting, the taxpayer’s tax for the $38,700. excess over $9,525. ‘‘(B) MODIFICATIONS TO APPLICABLE RATE taxable year shall be increased by the Over $38,700 but not over $4,453.50, plus 22% of the BRACKETS.—In determining the amount of amount by which it reduces its excess tax re- $70,000. excess over $38,700. tax imposed by this section for the taxable

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00091 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.055 S01DEPT1 S7744 CONGRESSIONAL RECORD — SENATE December 1, 2017 year on a child described in subparagraph case of a married individual filing a separate ment of Labor). The values of the Chained (A), the income tax table otherwise applica- return), Consumer Price Index for All Urban Con- ble under this subsection to the child shall ‘‘(II) in the case of an individual who is the sumers taken into account for purposes of be applied with the following modifications: head of a household (as defined in section determining the cost-of-living adjustment ‘‘(i) 24-PERCENT BRACKET.—The maximum 2(b)), $452,400, for any calendar year under this subsection taxable income which is taxed at a rate ‘‘(III) in the case of any other individual shall be the latest values so published as of below 24 percent shall not be more than the (other than an estate or trust), $425,800, and the date on which such Bureau publishes the earned taxable income of such child. ‘‘(IV) in the case of an estate or trust, initial value of the Chained Consumer Price ‘‘(ii) 35-PERCENT BRACKET.—The maximum $12,700. Index for All Urban Consumers for the taxable income which is taxed at a rate ‘‘(C) INFLATION ADJUSTMENT.—In the case month of August for the preceding calendar below 35 percent shall not be more than the of any taxable year beginning after 2018, year. sum of— each of the dollar amounts in clauses (i) and ‘‘(B) DETERMINATION FOR CALENDAR YEAR.— ‘‘(I) the earned taxable income of such (ii) of subparagraph (B) shall be increased by The C-CPI-U for any calendar year is the av- child, plus an amount equal to— erage of the C-CPI-U as of the close of the 12- ‘‘(II) the minimum taxable income for the ‘‘(i) such dollar amount, multiplied by month period ending on August 31 of such 35-percent bracket in the table under para- ‘‘(ii) the cost-of-living adjustment deter- calendar year.’’. (c) APPLICATION TO PERMANENT TAX TA- graph (2)(E) (as adjusted under paragraph (3)) mined under subsection (f)(3) for the cal- BLES.—Section 1(f)(2)(A) is amended by in- for the taxable year. endar year in which the taxable year begins, serting ‘‘, determined by substituting ‘1992’ ‘‘(iii) 38.5-PERCENT BRACKET.—The max- determined by substituting ‘calendar year 2017’ for ‘calendar year 2016’ in subparagraph for ‘2016’ in paragraph (3)(A)(ii)’’. imum taxable income which is taxed at a (d) APPLICATION TO OTHER INTERNAL REV- (A)(ii) thereof. rate below 38.5 percent shall not be more ENUE CODE OF 1986 PROVISIONS.— ‘‘(6) SECTION 15 NOT TO APPLY.—Section 15 than the sum of— (1) The following sections are each amend- shall not apply to any change in a rate of tax ‘‘(I) the earned taxable income of such ed by striking ‘‘for ‘calendar year 1992’ in by reason of this subsection.’’. child, plus subparagraph (B)’’ and inserting ‘‘for ‘cal- (b) DUE DILIGENCE TAX PREPARER REQUIRE- ‘‘(II) the minimum taxable income for the endar year 2016’ in subparagraph (A)(ii)’’: MENT WITH RESPECT TO HEAD OF HOUSEHOLD 38.5-percent bracket in the table under para- (A) Section 23(h)(2). FILING STATUS.—Subsection (g) of section graph (2)(E) (as adjusted under paragraph (3)) (B) Paragraphs (1)(A)(ii) and (2)(A)(ii) of for the taxable year. 6695 is amended to read as follows: ‘‘(g) FAILURE TO BE DILIGENT IN DETER- section 25A(h). ‘‘(C) COORDINATION WITH CAPITAL GAINS MINING ELIGIBILITY FOR CERTAIN TAX BENE- (C) Section 25B(b)(3)(B). RATES.—For purposes of applying section 1(h) FITS.—Any person who is a tax return pre- (D) Subsection (b)(2)(B)(ii)(II), and clauses (after the modifications under paragraph parer with respect to any return or claim for (i) and (ii) of subsection (j)(1)(B), of section (5))— refund who fails to comply with due dili- 32. ‘‘(i) the maximum zero rate amount shall gence requirements imposed by the Sec- (E) Section 36B(f)(2)(B)(ii)(II). not be more than the sum of— retary by regulations with respect to deter- (F) Section 41(e)(5)(C)(i). ‘‘(I) the earned taxable income of such mining— (G) Subsections (e)(3)(D)(ii) and child, plus ‘‘(1) eligibility to file as a head of house- (h)(3)(H)(i)(II) of section 42. ‘‘(II) the amount in effect under paragraph hold (as defined in section 2(b)) on the re- (H) Section 45R(d)(3)(B)(ii). (5)(B)(i)(IV) for the taxable year, and turn, or (I) Section 62(d)(3)(B). ‘‘(ii) the maximum 15-percent rate amount ‘‘(2) eligibility for, or the amount of, the (J) Section 125(i)(2)(B). shall not be more than the sum of— credit allowable by section 24, 25A(a)(1), or (K) Section 135(b)(2)(B)(ii). ‘‘(I) the earned taxable income of such 32, (L) Section 137(f)(2). child, plus shall pay a penalty of $500 for each such fail- (M) Section 146(d)(2)(B). ‘‘(II) the amount in effect under paragraph ure.’’. (N) Section 147(c)(2)(H)(ii). (5)(B)(ii)(IV) for the taxable year. (c) EFFECTIVE DATE.—The amendments (O) Section 179(b)(6)(A)(ii). ‘‘(D) EARNED TAXABLE INCOME.—For pur- made by this section shall apply to taxable (P) Subsections (b)(5)(C)(i)(II) and (g)(8)(B) poses of this paragraph, the term ‘earned years beginning after December 31, 2017. of section 219. taxable income’ means, with respect to any SEC. 11002. INFLATION ADJUSTMENTS BASED ON (Q) Section 220(g)(2). child for any taxable year, the taxable in- CHAINED CPI. (R) Section 221(f)(1)(B). come of such child reduced (but not below (a) IN GENERAL.—Subsection (f) of section 1 (S) Section 223(g)(1)(B). zero) by the net unearned income (as defined is amended by striking paragraph (3) and by (T) Section 408A(c)(3)(D)(ii). in subsection (g)(4)) of such child. inserting after paragraph (2) the following (U) Section 430(c)(7)(D)(vii)(II). ‘‘(5) APPLICATION OF CURRENT INCOME TAX new paragraph: (V) Section 512(d)(2)(B). BRACKETS TO CAPITAL GAINS BRACKETS.— ‘‘(3) COST-OF-LIVING ADJUSTMENT.—For pur- (W) Section 513(h)(2)(C)(ii). ‘‘(A) IN GENERAL.—Section 1(h)(1) shall be poses of this subsection— (X) Section 831(b)(2)(D)(ii). applied— ‘‘(A) IN GENERAL.—The cost-of-living ad- (Y) Section 877A(a)(3)(B)(i)(II). ‘‘(i) by substituting ‘below the maximum justment for any calendar year is the per- (Z) Section 2010(c)(3)(B)(ii). zero rate amount’ for ‘which would (without centage (if any) by which— (AA) Section 2032A(a)(3)(B). regard to this paragraph) be taxed at a rate ‘‘(i) the C-CPI-U for the preceding calendar (BB) Section 2503(b)(2)(B). below 25 percent’ in subparagraph (B)(i), and year, exceeds (CC) Section 4261(e)(4)(A)(ii). ‘‘(ii) by substituting ‘below the maximum ‘‘(ii) the CPI for calendar year 2016, multi- (DD) Section 5000A(c)(3)(D)(ii). 15-percent rate amount’ for ‘which would plied by the amount determined under sub- (EE) Section 6323(i)(4)(B). (without regard to this paragraph) be taxed paragraph (B). (FF) Section 6334(g)(1)(B). at a rate below 39.6 percent’ in subparagraph ‘‘(B) AMOUNT DETERMINED.—The amount (GG) Section 6601(j)(3)(B). (C)(ii)(I). determined under this clause is the amount (HH) Section 6651(i)(1). ‘‘(B) MAXIMUM AMOUNTS DEFINED.—For pur- obtained by dividing— (II) Section 6652(c)(7)(A). poses of applying section 1(h) with the modi- ‘‘(i) the C-CPI-U for calendar year 2016, by (JJ) Section 6695(h)(1). fications described in subparagraph (A)— ‘‘(ii) the CPI for calendar year 2016. (KK) Section 6698(e)(1). ‘‘(i) MAXIMUM ZERO RATE AMOUNT.—The ‘‘(C) SPECIAL RULE FOR ADJUSTMENTS WITH (LL) Section 6699(e)(1). maximum zero rate amount shall be— A BASE YEAR AFTER 2016.—For purposes of any (MM) Section 6721(f)(1). ‘‘(I) in the case of a joint return or sur- provision of this title which provides for the (NN) Section 6722(f)(1). viving spouse, $77,200 (1⁄2 such amount in the substitution of a year after 2016 for ‘2016’ in (OO) Section 7345(f)(2). case of a married individual filing a separate subparagraph (A)(ii), subparagraph (A) shall (PP) Section 7430(c)(1). return), be applied by substituting ‘the C-CPI-U for (QQ) Section 9831(d)(2)(D)(ii)(II). ‘‘(II) in the case of an individual who is a calendar year 2016’ for ‘the CPI for calendar (2) Section 41(e)(5)(C)(ii) is amended— head of household (as defined in section 2(b)), year 2016’ and all that follows in clause (ii) (A) by striking ‘‘1(f)(3)(B)’’ and inserting $51,700, thereof.’’. ‘‘1(f)(3)(A)(ii)’’, and ‘‘(III) in the case of any other individual (b) C-CPI-U.—Subsection (f) of section 1 is (B) by striking ‘‘1992’’ and inserting ‘‘2016’’. (other than an estate or trust), an amount amended by striking paragraph (7), by redes- (3) Section 42(h)(6)(G) is amended— equal to 1⁄2 of the amount in effect for the ignating paragraph (6) as paragraph (7), and (A) by striking ‘‘for ‘calendar year 1987’ ’’ taxable year under clause (i), and by inserting after paragraph (5) the following in clause (i)(II) and inserting ‘‘for ‘calendar ‘‘(IV) in the case of an estate or trust, new paragraph: year 2016’ in subparagraph (A)(ii) thereof’’, $2,600. ‘‘(6) C-CPI-U.—For purposes of this sub- and ‘‘(ii) MAXIMUM 15-PERCENT RATE AMOUNT.— section— (B) by striking ‘‘if the CPI for any calendar The maximum 15-percent rate amount shall ‘‘(A) IN GENERAL.—The term ‘C-CPI-U’ year’’ and all that follows in clause (ii) and be— means the Chained Consumer Price Index for inserting ‘‘if the C-CPI-U for any calendar ‘‘(I) in the case of a joint return or sur- All Urban Consumers (as published by the year (as defined in section 1(f)(6)) exceeds the viving spouse, $479,000 (1⁄2 such amount in the Bureau of Labor Statistics of the Depart- C-CPI-U for the preceding calendar year by

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00092 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.054 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7745 more than 5 percent, the C-CPI-U for the year in which the taxable year begins, by amount which bears the same ratio to the base calendar year shall be increased such substituting ‘calendar year 1985’ for ‘cal- excess amount as— that such excess shall never be taken into endar year 2016’ in subparagraph (A)(ii) ‘‘(I) the amount by which the taxpayer’s account under clause (i). In the case of a base thereof. taxable income for the taxable year exceeds calendar year before 2017, the C-CPI-U for Any increase under the preceding sentence the threshold amount, bears to such year shall be determined by multi- shall be rounded to the nearest multiple of ‘‘(II) $50,000 ($100,000 in the case of a joint plying the CPI for such year by the amount $100 (or, if such increase is a multiple of $50, return). determined under section 1(f)(3)(B).’’. such increase shall be increased to the near- ‘‘(iii) EXCESS AMOUNT.—For purposes of (4) Section 132(f)(6)(A)(ii) is amended by est multiple of $100).’’. clause (ii), the excess amount is the excess striking ‘‘for ‘calendar year 1992’ ’’ and in- (e) EFFECTIVE DATE.—The amendments of— serting ‘‘for ‘calendar year 2016’ in subpara- made by this section shall apply to taxable ‘‘(I) the amount determined under para- graph (A)(ii) thereof’’. years beginning after December 31, 2017. graph (2)(A) (determined without regard to (5) Section 162(o)(3) is amended by striking PART II—DEDUCTION FOR QUALIFIED this paragraph), over ‘‘adjusted for changes in the Consumer Price BUSINESS INCOME OF PASS-THRU ENTI- ‘‘(II) the amount determined under para- Index (as defined in section 1(f)(5)) since TIES graph (2)(B) (determined without regard to 1991’’ and inserting ‘‘adjusted by increasing SEC. 11011. DEDUCTION FOR QUALIFIED BUSI- this paragraph). any such amount under the 1991 agreement NESS INCOME. ‘‘(4) WAGES, ETC.— by an amount equal to— (a) IN GENERAL.—Part VI of subchapter B ‘‘(A) IN GENERAL.—The term ‘W-2 wages’ ‘‘(A) such amount, multiplied by of chapter 1 is amended by adding at the end means, with respect to any person for any ‘‘(B) the cost-of-living adjustment deter- the following new section: taxable year of such person, the amounts de- mined under section 1(f)(3) for the calendar scribed in paragraphs (3) and (8) of section year in which the taxable year begins, by ‘‘SEC. 199A. QUALIFIED BUSINESS INCOME. 6051(a) paid by such person with respect to substituting ‘calendar year 1990’ for ‘cal- ‘‘(a) IN GENERAL.—In the case of a taxpayer employment of employees by such person endar year 2016’ in subparagraph (A)(ii) other than a corporation, there shall be al- thereof’’. lowed as a deduction for any taxable year an during the calendar year ending during such (6) So much of clause (ii) of section amount equal to the lesser of— taxable year. 213(d)(10)(B) as precedes the last sentence is ‘‘(1) the combined qualified business in- ‘‘(B) LIMITATION TO WAGES ATTRIBUTABLE TO amended to read as follows: come amount of the taxpayer, or QUALIFIED BUSINESS INCOME.—Such term shall ‘‘(ii) MEDICAL CARE COST ADJUSTMENT.—For ‘‘(2) an amount equal to 17.4 percent of the not include any amount which is not prop- purposes of clause (i), the medical care cost excess (if any) of— erly allocable to qualified business income adjustment for any calendar year is the per- ‘‘(A) the taxable income of the taxpayer for for purposes of subsection (c)(1). centage (if any) by which— the taxable year, over ‘‘(C) RETURN REQUIREMENT.—Such term ‘‘(I) the medical care component of the C- ‘‘(B) any net capital gain (as defined in sec- shall not include any amount which is not CPI-U (as defined in section 1(f)(6)) for Au- tion 1(h)) of the taxpayer for the taxable properly included in a return filed with the gust of the preceding calendar year, exceeds year. Social Security Administration on or before ‘‘(II) such component of the CPI (as defined ‘‘(b) COMBINED QUALIFIED BUSINESS INCOME the 60th day after the due date (including ex- in section 1(f)(4)) for August of 1996, multi- AMOUNT.—For purposes of this section— tensions) for such return. plied by the amount determined under sec- ‘‘(1) IN GENERAL.—The term ‘combined ‘‘(5) ACQUISITIONS, DISPOSITIONS, AND SHORT tion 1(f)(3)(B).’’. qualified business income amount’ means, TAXABLE YEARS.—The Secretary shall pro- (7) Section 877(a)(2) is amended by striking with respect to any taxable year, an amount vide for the application of this subsection in ‘‘for ‘1992’ in subparagraph (B)’’ and inserting equal to— cases of a short taxable year or where the ‘‘for ‘2016’ in subparagraph (A)(ii)’’. ‘‘(A) the sum of the amounts determined taxpayer acquires, or disposes of, the major (8) Section 911(b)(2)(D)(ii)(II) is amended by under paragraph (2) for each qualified trade portion of a trade or business or the major striking ‘‘for ‘1992’ in subparagraph (B)’’ and or business carried on by the taxpayer, plus portion of a separate unit of a trade or busi- inserting ‘‘for ‘2016’ in subparagraph (A)(ii)’’. ‘‘(B) 17.4 percent of the aggregate amount ness during the taxable year. (9) Paragraph (2) of section 1274A(d) is of the qualified REIT dividends and qualified ‘‘(c) QUALIFIED BUSINESS INCOME.—For pur- amended to read as follows: cooperative dividends of the taxpayer for the poses of this section— ‘‘(2) ADJUSTMENT FOR INFLATION.—In the taxable year. case of any debt instrument arising out of a ‘‘(2) DETERMINATION OF DEDUCTIBLE AMOUNT ‘‘(1) IN GENERAL.—The term ‘qualified busi- sale or exchange during any calendar year FOR EACH TRADE OR BUSINESS.—The amount ness income’ means, for any taxable year, after 1989, each dollar amount contained in determined under this paragraph with re- the net amount of qualified items of income, the preceding provisions of this section shall spect to any qualified trade or business is gain, deduction, and loss with respect to any be increased by an amount equal to— the lesser of— qualified trade or business of the taxpayer. ‘‘(A) such amount, multiplied by ‘‘(A) 17.4 percent of the taxpayer’s qualified ‘‘(2) CARRYOVER OF LOSSES.—If the net ‘‘(B) the cost-of-living adjustment deter- business income with respect to the qualified amount of qualified income, gain, deduction, mined under section 1(f)(3) for the calendar trade or business, or and loss with respect to qualified trade or year in which the taxable year begins, by ‘‘(B) 50 percent of the W-2 wages with re- businesses of the taxpayer amount for any substituting ‘calendar year 1988’ for ‘cal- spect to the qualified trade or business. taxable year is less than zero, such amount endar year 2016’ in subparagraph (A)(ii) ‘‘(3) MODIFICATIONS TO THE WAGE LIMIT shall be treated as a loss from a qualified thereof. BASED ON TAXABLE INCOME.— trade or business in the succeeding taxable Any increase under the preceding sentence ‘‘(A) EXCEPTION FROM WAGE LIMIT.—In the year. shall be rounded to the nearest multiple of case of any taxpayer whose taxable income ‘‘(3) QUALIFIED ITEMS OF INCOME, GAIN, DE- $100 (or, if such increase is a multiple of $50, for the taxable year does not exceed the DUCTION, AND LOSS.—For purposes of this sub- such increase shall be increased to the near- threshold amount, paragraph (2) shall be ap- section— est multiple of $100).’’. plied without regard to subparagraph (B). ‘‘(A) IN GENERAL.—The term ‘qualified (10) Section 4161(b)(2)(C)(i)(II) is amended ‘‘(B) PHASE-IN OF LIMIT FOR CERTAIN TAX- items of income, gain, deduction, and loss’ by striking ‘‘for ‘1992’ in subparagraph (B)’’ PAYERS.— means items of income, gain, deduction, and and inserting ‘‘for ‘2016’ in subparagraph ‘‘(i) IN GENERAL.—If— loss to the extent such items are— (A)(ii)’’. ‘‘(I) the taxable income of a taxpayer for ‘‘(i) effectively connected with the conduct (11) Section 4980I(b)(3)(C)(v)(II) is amended any taxable year exceeds the threshold of a trade or business within the United by striking ‘‘for ‘1992’ in subparagraph (B)’’ amount, but does not exceed the sum of the States (within the meaning of section 864(c), and inserting ‘‘for ‘2016’ in subparagraph threshold amount plus $50,000 ($100,000 in the determined by substituting ‘qualified trade (A)(ii)’’. case of a joint return), and or business (within the meaning of section (12) Section 6039F(d) is amended by strik- ‘‘(II) the amount determined under para- 199A)’ for ‘nonresident alien individual or a ing ‘‘subparagraph (B) thereof shall be ap- graph (2)(B) (determined without regard to foreign corporation’ or for ‘a foreign corpora- plied by substituting ‘1995’ for ‘1992’ ’’ and in- this subparagraph) with respect to any quali- tion’ each place it appears), and serting ‘‘subparagraph (A)(ii) thereof shall be fied trade or business carried on by the tax- ‘‘(ii) included or allowed in determining applied by substituting ‘1995’ for ‘2016’ ’’. payer is less than the amount determined taxable income for the taxable year. (13) Section 7872(g)(5) is amended to read as under paragraph (2)(A) with respect such ‘‘(B) EXCEPTIONS.—The following invest- follows: trade or business, ment items shall not be taken into account ‘‘(5) ADJUSTMENT OF LIMIT FOR INFLATION.— then paragraph (2) shall be applied with re- as a qualified item of income, gain, deduc- In the case of any loan made during any cal- spect to such trade or business without re- tion, or loss: endar year after 1986, the dollar amount in gard to subparagraph (B) thereof and by re- ‘‘(i) Any item of short-term capital gain, paragraph (2) shall be increased by an ducing the amount determined under sub- short-term capital loss, long-term capital amount equal to— paragraph (A) thereof by the amount deter- gain, or long-term capital loss. ‘‘(A) such amount, multiplied by mined under clause (ii). ‘‘(ii) Any dividend, income equivalent to a ‘‘(B) the cost-of-living adjustment deter- ‘‘(ii) AMOUNT OF REDUCTION.—The amount dividend, or payment in lieu of dividends de- mined under section 1(f)(3) for the calendar determined under this subparagraph is the scribed in section 954(c)(1)(G).

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00093 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.054 S01DEPT1 S7746 CONGRESSIONAL RECORD — SENATE December 1, 2017

‘‘(iii) Any interest income other than in- ‘‘(2) THRESHOLD AMOUNT.— any exclusion under section 3401(a)(8) for re- terest income which is properly allocable to ‘‘(A) IN GENERAL.—The term ‘threshold muneration paid for services in Puerto Rico. a trade or business. amount’ means $250,000 (200 percent of such ‘‘(2) COORDINATION WITH MINIMUM TAX.—For ‘‘(iv) Any item of gain or loss described in amount in the case of a joint return). purposes of determining alternative min- subparagraph (C) or (D) of section 954(c)(1) ‘‘(B) INFLATION ADJUSTMENT.—In the case imum taxable income under section 55, (applied by substituting ‘qualified trade or of any taxable year beginning after 2018, the qualified business income shall be deter- business’ for ‘controlled foreign corpora- dollar amount in paragraph (1) shall be in- mined without regard to any adjustments tion’). creased by an amount equal to— under sections 56 through 59. ‘‘(v) Any item of income, gain, deduction, ‘‘(i) such dollar amount, multiplied by ‘‘(3) DEDUCTION LIMITED TO INCOME TAXES.— or loss taken into account under section ‘‘(ii) the cost-of-living adjustment deter- The deduction under subsection (a) shall 954(c)(1)(F) (determined without regard to mined under section 1(f)(3) for the calendar only be allowed for purposes of this chapter. clause (ii) thereof and other than items at- year in which the taxable year begins. ‘‘(4) REGULATIONS.—The Secretary shall tributable to notional principal contracts en- If any amount as increased under the pre- prescribe such regulations as are necessary tered into in transactions qualifying under ceding sentence is not a multiple of $1,000, to carry out the purposes of this section, in- section 1221(a)(7)). such amount shall be rounded to the nearest cluding regulations— ‘‘(vi) Any amount received from an annu- multiple of $1,000. ‘‘(A) for requiring or restricting the alloca- ity which is not received in connection with ‘‘(3) QUALIFIED REIT DIVIDEND.—The term tion of items and wages under this section the trade or business. ‘qualified REIT dividend’ means any divi- and such reporting requirements as the Sec- ‘‘(vii) Any item of deduction or loss prop- dend from a real estate investment trust re- retary determines appropriate, and erly allocable to an amount described in any ceived during the taxable year which— ‘‘(B) for the application of this section in of the preceding clauses. ‘‘(A) is not a capital gain dividend, as de- the case of tiered entities. ‘‘(4) TREATMENT OF REASONABLE COMPENSA- fined in section 857(b)(3), and ‘‘(g) TERMINATION.—This section shall not TION AND GUARANTEED PAYMENTS.—Qualified ‘‘(B) is not qualified dividend income, as apply to taxable years beginning after De- business income shall not include— defined in section 1(h)(11). cember 31, 2025.’’. ‘‘(A) reasonable compensation paid to the ‘‘(4) QUALIFIED COOPERATIVE DIVIDEND.— CCURACY-RELATED PENALTY ON DETER- taxpayer by any qualified trade or business The term ‘qualified cooperative dividend’ (b) A of the taxpayer for services rendered with re- means any patronage dividend (as defined in MINATION OF APPLICABLE PERCENTAGE.—Sec- spect to the trade or business, section 1388(a)), any per-unit retain alloca- tion 6662(d)(1) is amended by inserting at the ‘‘(B) any guaranteed payment described in tion (as defined in section 1388(f)), and any end the following new subparagraph: section 707(c) paid to a partner for services qualified written notice of allocation (as de- ‘‘(C) SPECIAL RULE FOR TAXPAYERS CLAIM- rendered with respect to the trade or busi- fined in section 1388(c)), or any similar ING SECTION 199A DEDUCTION.—In the case of ness, and amount received from an organization de- any taxpayer who claims the deduction al- ‘‘(C) to the extent provided in regulations, scribed in subparagraph (B)(ii), which— lowed under section 199A for the taxable any payment described in section 707(a) to a ‘‘(A) is includible in gross income, and year, subparagraph (A) shall be applied by partner for services rendered with respect to ‘‘(B) is received from— substituting ‘5 percent’ for ‘10 percent’.’’. the trade or business. ‘‘(i) an organization or corporation de- (c) CONFORMING AMENDMENTS.— ‘‘(d) QUALIFIED TRADE OR BUSINESS.—For scribed in section 501(c)(12) or 1381(a), or (1) Section 170(b)(2)(D) is amended by strik- purposes of this section— ‘‘(ii) an organization which is governed ing ‘‘, and’’ at the end of clause (iv), by re- ‘‘(1) IN GENERAL.—The term ‘qualified trade under this title by the rules applicable to co- designating clause (v) as clause (vi), and by or business’ means any trade or business operatives under this title before the enact- inserting after clause (iv) the following new other than a specified service trade or busi- ment of subchapter T. clause: ness. ‘‘(f) SPECIAL RULES.— ‘‘(v) section 199A, and’’. ‘‘(2) SPECIFIED SERVICE TRADE OR BUSI- ‘‘(1) APPLICATION TO PARTNERSHIPS AND S (2) Section 172(d) is amended by adding at NESS.— CORPORATIONS.— the end the following new paragraph: ‘‘(A) IN GENERAL.—The term ‘specified ‘‘(A) IN GENERAL.—In the case of a partner- ‘‘(8) QUALIFIED BUSINESS INCOME DEDUC- service trade or business’ means— ship or S corporation— TION.—The deduction under section 199A ‘‘(i) any trade or business involving the ‘‘(i) this section shall be applied at the shall not be allowed.’’. performance of services described in section partner or shareholder level, (3) Section 246(b)(1) is amended by insert- 1202(e)(3)(A), including investing and invest- ‘‘(ii) each partner or shareholder shall take ing ‘‘199A,’’ before ‘‘243(a)(1)’’. ment management, trading, or dealing in se- into account such person’s allocable share of (4) Section 613(a) is amended by inserting curities (as defined in section 475(c)(2)), part- each qualified item of income, gain, deduc- ‘‘and without the deduction under section nership interests, or commodities (as defined tion, and loss, and 199A’’ after ‘‘and without the deduction in section 475(e)(2)). ‘‘(iii) each partner or shareholder shall be under section 199’’. ‘‘(3) EXCEPTION FOR SPECIFIED SERVICE BUSI- treated for purposes of subsection (b) as hav- (5) Section 613A(d)(1) is amended by redes- NESSES BASED ON TAXPAYER’S INCOME.— ing W-2 wages for the taxable year in an ignating subparagraphs (C), (D), and (E) as ‘‘(A) IN GENERAL.—If, for any taxable year, amount equal to such person’s allocable subparagraphs (D), (E), and (F), respectively, the taxable income of any taxpayer is less share of the W-2 wages of the partnership or and by inserting after subparagraph (B), the than the sum of the threshold amount plus S corporation for the taxable year (as deter- following new subparagraph: $50,000 ($100,000 in the case of a joint return), mined under regulations prescribed by the ‘‘(C) any deduction allowable under section then— Secretary). 199A,’’. ‘‘(i) the exception under paragraph (1) shall For purposes of clause (iii), a partner’s or (6) The table of sections for part VI of sub- not apply to specified service trades or busi- shareholder’s allocable share of W-2 wages chapter B of chapter 1 is amended by insert- nesses of the taxpayer for the taxable year, shall be determined in the same manner as ing at the end the following new item: the partner’s or shareholder’s allocable share but ‘‘Sec. 199A. Qualified business income.’’. ‘‘(ii) only the applicable percentage of of wage expenses. For purposes of this sub- (d) EFFECTIVE DATE.—The amendments qualified items of income, gain, deduction, paragraph, in the case of an S corporation, made by this section shall apply to taxable or loss, and the W-2 wages, of the taxpayer an allocable share shall be the shareholder’s years beginning after December 31, 2017. allocable to such specified service trades or pro rata share of an item. businesses shall be taken into account in ‘‘(B) APPLICATION TO TRUSTS AND ES- SEC. 11012. LIMITATION ON LOSSES FOR TAX- computing the qualified business income and TATES.—This section shall not apply to any PAYERS OTHER THAN CORPORA- W-2 wages of the taxpayer for the taxable trust or estate. TIONS. year for purposes of applying this section. ‘‘(C) TREATMENT OF TRADES OR BUSINESS IN (a) IN GENERAL.—Section 461 is amended by ‘‘(B) APPLICABLE PERCENTAGE.—For pur- PUERTO RICO.— adding at the end the following new sub- poses of subparagraph (A), the term ‘applica- ‘‘(i) IN GENERAL.—In the case of any tax- section: ble percentage’ means, with respect to any payer with qualified business income from ‘‘(l) LIMITATION ON EXCESS BUSINESS taxable year, 100 percent reduced (not below sources within the commonwealth of Puerto LOSSES OF NONCORPORATE TAXPAYERS.— zero) by the percentage equal to the ratio Rico, if all such income is taxable under sec- ‘‘(1) LIMITATION.—In the case of taxable of— tion 1 for such taxable year, then for pur- year of a taxpayer other than a corporation ‘‘(i) the taxable income of the taxpayer for poses of determining the qualified business beginning after December 31, 2017, and before the taxable year in excess of the threshold income of such taxpayer for such taxable January 1, 2026— amount, bears to year, the term ‘United States’ shall include ‘‘(A) subsection (j) (relating to limitation ‘‘(ii) $50,000 ($100,000 in the case of a joint the Commonwealth of Puerto Rico. on excess farm losses of certain taxpayers) return). ‘‘(ii) SPECIAL RULE FOR APPLYING WAGE LIM- shall not apply, and ‘‘(e) OTHER DEFINITIONS.—For purposes of ITATION.—In the case of any taxpayer de- ‘‘(B) any excess business loss of the tax- this section— scribed in clause (i), the determination of W- payer for the taxable year shall not be al- ‘‘(1) TAXABLE INCOME.—Taxable income 2 wages of such taxpayer with respect to any lowed. shall be computed without regard to the de- qualified trade or business conducted in ‘‘(2) DISALLOWED LOSS CARRYOVER.—Any duction allowable under this section. Puerto Rico shall be made without regard to loss which is disallowed under paragraph (1)

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00094 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.054 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7747 shall be treated as a net operating loss car- ‘‘(I) such dollar amount, multiplied by any taxable year beginning after December ryover to the following taxable year under ‘‘(II) the cost-of-living adjustment deter- 31, 2017, and before January 1, 2026, shall not section 172. mined under section 1(f)(3) for the calendar exceed 60 percent of the taxpayer’s contribu- ‘‘(3) EXCESS BUSINESS LOSS.—For purposes year in which the taxable year begins, deter- tion base for such year. of this subsection— mined by substituting ‘2017’ for ‘2016’ in sub- ‘‘(ii) CARRYOVER.—If the aggregate amount ‘‘(A) IN GENERAL.—The term ‘excess busi- paragraph (A)(ii) thereof.’’. of contributions described in clause (i) ex- ness loss’ means the excess (if any) of— (b) EFFECTIVE DATE.—The amendment ceeds the applicable limitation under clause ‘‘(i) the aggregate deductions of the tax- made by this section shall apply to taxable (i) for any taxable year described in such payer for the taxable year which are attrib- years beginning after December 31, 2017. clause, such excess shall be treated (in a utable to trades or businesses of such tax- SEC. 11022. INCREASE IN AND MODIFICATION OF manner consistent with the rules of sub- payer (determined without regard to whether CHILD TAX CREDIT. section (d)(1)) as a charitable contribution to or not such deductions are disallowed for (a) IN GENERAL.—Section 24 is amended by which clause (i) applies in each of the 5 suc- such taxable year under paragraph (1)), over adding at the end the following new sub- ceeding years in order of time. ‘‘(ii) the sum of— section: ‘‘(iii) COORDINATION WITH SUBPARAGRAPHS ‘‘(I) the aggregate gross income or gain of ‘‘(h) SPECIAL RULES FOR TAXABLE YEARS (A) AND (B).— such taxpayer for the taxable year which is 2018 THROUGH 2025.— ‘‘(I) IN GENERAL.—Contributions taken into attributable to such trades or businesses, ‘‘(1) IN GENERAL.—In the case of a taxable account under this subparagraph shall not be plus year beginning after December 31, 2017, and taken into account under subparagraph (A). ‘‘(II) $250,000 (200 percent of such amount in before January 1, 2026, this section shall be ‘‘(II) LIMITATION REDUCTION.—Subpara- the case of a joint return). applied as provided in paragraphs (2) through graphs (A) and (B) shall be applied for each ‘‘(B) ADJUSTMENT FOR INFLATION.—In the (7). taxable year described in clause (i), and each case of any taxable year beginning after De- ‘‘(2) CREDIT AMOUNT.—Subsection (a) shall taxable year to which any contribution cember 31, 2018, the $250,000 amount in sub- be applied by substituting ‘$2,000’ for ‘$1,000’. under this subparagraph is carried over paragraph (A)(ii)(II) shall be increased by an ‘‘(3) LIMITATION.—In lieu of the amount de- under clause (ii), by reducing (but not below amount equal to— termined under subsection (b)(2), the thresh- zero) the aggregate contribution limitation ‘‘(i) such dollar amount, multiplied by old amount shall be— allowed for the taxable year under each such ‘‘(ii) the cost-of-living adjustment deter- ‘‘(A) in the case of a joint return, $500,000, subparagraph by the aggregate contributions mined under section 1(f)(3) for the calendar and allowed under this subparagraph for such year in which the taxable year begins. ‘‘(B) in the case of an individual who is not taxable year.’’. If any amount as increased under the pre- married or a married individual filing a sepa- (b) EFFECTIVE DATE.—The amendment ceding sentence is not a multiple of $1,000, rate return, $250,000. made by this section shall apply to contribu- such amount shall be rounded to the nearest ‘‘(4) DEFINITION OF QUALIFYING CHILD.— tions in taxable years beginning after De- multiple of $1,000. Paragraph (1) of subsection (c) shall be ap- cember 31, 2017. ‘‘(4) APPLICATION OF SUBSECTION IN CASE OF plied by substituting ‘18’ for ‘17’. PARTNERSHIPS AND S CORPORATIONS.—In the SEC. 11024. INCREASED CONTRIBUTIONS TO ARTIAL CREDIT ALLOWED FOR CERTAIN ABLE ACCOUNTS. case of a partnership or S corporation— ‘‘(5) P ‘‘(A) this subsection shall be applied at the OTHER DEPENDENTS.— (a) INCREASE IN LIMITATION FOR CONTRIBU- partner or shareholder level, and ‘‘(A) IN GENERAL.—The credit determined TIONS FROM COMPENSATION OF INDIVIDUALS ‘‘(B) each partner’s or shareholder’s allo- under subsection (a) (after the application of WITH DISABILITIES.— cable share of the items of income, gain, de- paragraph (2)) shall be increased by $500 for (1) IN GENERAL.—Section 529A(b)(2)(B) is duction, or loss of the partnership or S cor- each dependent of the taxpayer (as defined in amended to read as follows: poration for any taxable year from trades or section 152) other than a qualifying child de- ‘‘(B) except in the case of contributions businesses attributable to the partnership or scribed in subsection (c) (after the applica- under subsection (c)(1)(C), if such contribu- S corporation shall be taken into account by tion of paragraph (4)). tion to an ABLE account would result in ag- the partner or shareholder in applying this ‘‘(B) EXCEPTION FOR CERTAIN NONCITIZENS.— gregate contributions from all contributors subsection to the taxable year of such part- Subparagraph (A) shall not apply with re- to the ABLE account for the taxable year ex- ner or shareholder with or within which the spect to any individual who would not be a ceeding the sum of— taxable year of the partnership or S corpora- dependent if subparagraph (A) of section ‘‘(i) the amount in effect under section tion ends. 152(b)(3) were applied without regard to all 2503(b) for the calendar year in which the For purposes of this paragraph, in the case of that follows ‘resident of the United States’. taxable year begins, plus an S corporation, an allocable share shall be ‘‘(6) PORTION OF CREDIT REFUNDABLE.—Sub- ‘‘(ii) in the case of any contribution by a the shareholder’s pro rata share of an item. section (d)(1)(B)(i) shall be applied by sub- designated beneficiary described in para- ‘‘(5) ADDITIONAL REPORTING.—The Sec- stituting— graph (7) before January 1, 2026, the lesser retary shall prescribe such additional report- ‘‘(A) ‘15.3 percent’ for ‘15 percent’, and of— ing requirements as the Secretary deter- ‘‘(B) ‘$0’ for ‘$3,000’. ‘‘(I) compensation (as defined by section mines appropriate to carry out the purposes ‘‘(7) SOCIAL SECURITY NUMBER REQUIRED.— 219(f)(1)) includible in the designated bene- of this subsection. No credit shall be allowed under subsection ficiary’s gross income for the preceding tax- ‘‘(6) COORDINATION WITH SECTION 469.—This (d) to a taxpayer with respect to any quali- able year, or subsection shall be applied after the applica- fying child unless the taxpayer includes the ‘‘(II) an amount equal to the poverty line tion of section 469.’’. social security number of such child on the for a one-person household, as determined (b) EFFECTIVE DATE.—The amendments return of tax for the taxable year. For pur- for the calendar year preceding the calendar made by this section shall apply to taxable poses of the preceding sentence, the term ‘so- year in which the taxable year begins.’’. years beginning after December 31, 2017. cial security number’ means a social secu- (2) ELIGIBLE DESIGNATED BENEFICIARY.— PART III—TAX BENEFITS FOR FAMILIES rity number issued to an individual by the Section 529A(b) is amended by adding at the AND INDIVIDUALS Social Security Administration, but only if end the following: SEC. 11021. INCREASE IN STANDARD DEDUCTION. the social security number is issued to a cit- ‘‘(7) SPECIAL RULES RELATED TO CONTRIBU- (a) IN GENERAL.—Subsection (c) of section izen of the United States or is issued pursu- TION LIMIT.—For purposes of paragraph 63 is amended by adding at the end the fol- ant to subclause (I) (or that portion of sub- (2)(B)(ii)— lowing new paragraph: clause (III) that relates to subclause (I)) of ‘‘(A) DESIGNATED BENEFICIARY.—A des- ‘‘(7) SPECIAL RULES FOR TAXABLE YEARS 2018 section 205(c)(2)(B)(i) of the Social Security ignated beneficiary described in this para- THROUGH 2025.—In the case of a taxable year Act.’’. graph is an employee (including an employee beginning after December 31, 2017, and before (b) EFFECTIVE DATE.—The amendments within the meaning of section 401(c)) with re- January 1, 2026— made by this section shall apply to taxable spect to whom— ‘‘(A) INCREASE IN STANDARD DEDUCTION.— years beginning after December 31, 2017. ‘‘(i) no contribution is made for the taxable Paragraph (2) shall be applied— SEC. 11023. INCREASED LIMITATION FOR CER- year to a defined contribution plan (within ‘‘(i) by substituting ‘$18,000’ for ‘$4,400’ in TAIN CHARITABLE CONTRIBUTIONS. the meaning of section 414(i)) with respect to subparagraph (B), and (a) IN GENERAL.—Section 170(b)(1) is which the requirements of section 401(a) or ‘‘(ii) by substituting ‘$12,000’ for ‘$3,000’ in amended by redesignating subparagraph (G) 403(a) are met, subparagraph (C). as subparagraph (H) and by inserting after ‘‘(ii) no contribution is made for the tax- ‘‘(B) ADJUSTMENT FOR INFLATION.— subparagraph (F) the following new subpara- able year to an annuity contract described in ‘‘(i) IN GENERAL.—Paragraph (4) shall not graph: section 403(b), and apply to the dollar amounts contained in ‘‘(G) INCREASED LIMITATION FOR CASH CON- ‘‘(iii) no contribution is made for the tax- paragraphs (2)(B) and (2)(C). TRIBUTIONS.— able year to an eligible deferred compensa- ‘‘(ii) ADJUSTMENT OF INCREASED AMOUNTS.— ‘‘(i) IN GENERAL.—In the case of any con- tion plan described in section 457(b). In the case of a taxable year beginning after tribution of cash to an organization de- ‘‘(B) POVERTY LINE.—The term ‘poverty 2018, the $18,000 and $12,000 amounts in sub- scribed in subparagraph (A), the total line’ has the meaning given such term by paragraph (A) shall each be increased by an amount of such contributions which may be section 673 of the Community Services Block amount equal to— taken into account under subsection (a) for Grant Act (42 U.S.C. 9902).’’.

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(b) ALLOWANCE OF SAVER’S CREDIT FOR (B) any subsequent taxable year beginning (ii) TREATMENT OF PLAN DISTRIBUTIONS.—If ABLE CONTRIBUTIONS BY ACCOUNT HOLDER.— before January 1, 2026. a distribution to an individual would (with- Section 25B(d)(1) is amended by striking (2) WITHHOLDING.—In the case of subsection out regard to clause (i)) be a qualified Mis- ‘‘and’’ at the end of subparagraph (B)(ii), by (a)(5), the applicable period is— sissippi River Delta flooding distribution, a striking the period at the end of subpara- (A) the portion of the first taxable year plan shall not be treated as violating any re- graph (C) and inserting ‘‘, and’’, and by in- ending after the date of the enactment of quirement of this title merely because the serting at the end the following: this Act which begins on such date, and plan treats such distribution as a qualified ‘‘(D) the amount of contributions made be- (B) any subsequent taxable year beginning Mississippi River Delta flooding distribution, fore January 1, 2026, by such individual to before January 1, 2026. unless the aggregate amount of such dis- the ABLE account (within the meaning of (d) EFFECTIVE DATE.— tributions from all plans maintained by the section 529A) of which such individual is the (1) IN GENERAL.—Except as provided in employer (and any member of any controlled designated beneficiary.’’. paragraph (2), the provisions of this section group which includes the employer) to such (c) EFFECTIVE DATE.—The amendments shall take effect on June 9, 2015. individual exceeds $100,000. made by this section shall apply to taxable (2) WITHHOLDING.—Subsection (a)(5) shall (iii) CONTROLLED GROUP.—For purposes of years beginning after the date of the enact- apply to remuneration paid after the date of clause (ii), the term ‘‘controlled group’’ ment of this Act. the enactment of this Act. means any group treated as a single em- SEC. 11025. ROLLOVERS TO ABLE PROGRAMS SEC. 11027. EXTENSION OF WAIVER OF LIMITA- ployer under subsection (b), (c), (m), or (o) of FROM 529 PROGRAMS. TIONS WITH RESPECT TO EXCLUD- section 414 of the Internal Revenue Code of (a) IN GENERAL.—Clause (i) of section ING FROM GROSS INCOME AMOUNTS 1986. RECEIVED BY WRONGFULLY INCAR- 529(c)(3)(C) is amended by striking ‘‘or’’ at (C) AMOUNT DISTRIBUTED MAY BE REPAID.— CERATED INDIVIDUALS. the end of subclause (I), by striking the pe- (i) IN GENERAL.—Any individual who re- (a) IN GENERAL.—Section 304(d) of the Pro- riod at the end of subclause (II) and inserting ceives a qualified Mississippi River Delta tecting Americans from Tax Hikes Act of ‘‘, or’’, and by adding at the end the fol- flooding distribution may, at any time dur- 2015 (26 U.S.C. 139F note) is amended by lowing: ing the 3-year period beginning on the day ‘‘(III) before January 1, 2026, to an ABLE striking ‘‘1-year’’ and inserting ‘‘2-year’’. (b) EFFECTIVE DATE.—The amendments after the date on which such distribution account (as defined in section 529A(e)(6)) of was received, make one or more contribu- the designated beneficiary or a member of made by this section shall take effect on the date of the enactment of this Act. tions in an aggregate amount not to exceed the family of the designated beneficiary. the amount of such distribution to an eligi- Subclause (III) shall not apply to so much of SEC. 11028. UNBORN CHILDREN ALLOWED AS 529 ACCOUNT BENEFICIARIES. ble retirement plan of which such individual a distribution which, when added to all other is a beneficiary and to which a rollover con- contributions made to the ABLE account for (a) IN GENERAL.—Section 529(e) is amended by adding at the end the following new para- tribution of such distribution could be made the taxable year, exceeds the limitation under section 402(c), 403(a)(4), 403(b)(8), under section 529A(b)(2)(B).’’. graph: ‘‘(6) TREATMENT OF UNBORN CHILDREN.— 408(d)(3), or 457(e)(16) of the Internal Revenue (b) EFFECTIVE DATE.—The amendments Code of 1986, as the case may be. made by this section shall apply to distribu- ‘‘(A) IN GENERAL.—Nothing shall prevent (ii) TREATMENT OF REPAYMENTS OF DIS- tions after the date of the enactment of this an unborn child from being treated as a des- TRIBUTIONS FROM ELIGIBLE RETIREMENT PLANS Act. ignated beneficiary or an individual under this section. OTHER THAN IRAS.—For purposes of this title, SEC. 11026. TREATMENT OF CERTAIN INDIVID- if a contribution is made pursuant to clause UALS PERFORMING SERVICES IN ‘‘(B) UNBORN CHILD.—For purposes of this THE SINAI PENINSULA OF EGYPT. paragraph— (i) with respect to a qualified Mississippi River Delta flooding distribution from an el- (a) IN GENERAL.—For purposes of the fol- ‘‘(i) IN GENERAL.—The term ‘unborn child’ lowing provisions of the Internal Revenue means a child in utero. igible retirement plan other than an indi- Code of 1986, with respect to the applicable ‘‘(ii) CHILD IN UTERO.—The term ‘child in vidual retirement plan, then the taxpayer period, a qualified hazardous duty area shall utero’ means a member of the species homo shall, to the extent of the amount of the con- be treated in the same manner as if it were sapiens, at any stage of development, who is tribution, be treated as having received the a combat zone (as determined under section carried in the womb.’’. qualified Mississippi River Delta flooding 112 of such Code): (b) EFFECTIVE DATE.—The amendment distribution in an eligible rollover distribu- (1) Section 2(a)(3) (relating to special rule made by this section shall apply to contribu- tion (as defined in section 402(c)(4) of the In- where deceased spouse was in missing sta- tions made after December 31, 2017. ternal Revenue Code of 1986) and as having tus). SEC. 11029. RELIEF FOR MISSISSIPPI RIVER transferred the amount to the eligible retire- (2) Section 112 (relating to the exclusion of DELTA FLOOD DISASTER AREA. ment plan in a direct trustee to trustee certain combat pay of members of the Armed (a) IN GENERAL.—For purposes of this sec- transfer within 60 days of the distribution. Forces). tion, the term ‘‘Mississippi River Delta flood (iii) TREATMENT OF REPAYMENTS FOR DIS- (3) Section 692 (relating to income taxes of disaster area’’ means any area— TRIBUTIONS FROM IRAS.—For purposes of the members of Armed Forces on death). (1) with respect to which a major disaster Internal Revenue Code of 1986, if a contribu- (4) Section 2201 (relating to members of the has been declared by the President under tion is made pursuant to clause (i) with re- spect to a qualified Mississippi River Delta Armed Forces dying in combat zone or by section 401 of the Robert T. Stafford Disaster flooding distribution from an individual re- reason of combat-zone-incurred wounds, Relief and Emergency Assistance Act before tirement plan (as defined by section etc.). September 3, 2016, by reason of severe storms 7701(a)(37) of the Internal Revenue Code of (5) Section 3401(a)(1) (defining wages relat- and flooding occurring in Louisiana during 1986), then, to the extent of the amount of ing to combat pay for members of the Armed August of 2016, or the contribution, the qualified Mississippi Forces). (2) with respect to which a major disaster River Delta flooding distribution shall be (6) Section 4253(d) (relating to the taxation has been declared by the President under treated as a distribution described in section of phone service originating from a combat section 401 of the Robert T. Stafford Disaster 408(d)(3) of such Code and as having been zone from members of the Armed Forces). Relief and Emergency Assistance Act before transferred to the eligible retirement plan in (7) Section 6013(f)(1) (relating to joint re- March 31, 2016, by reason of severe storms a direct trustee to trustee transfer within 60 turn where individual is in missing status). and flooding occurring in Louisiana, Texas, days of the distribution. (8) Section 7508 (relating to time for per- and Mississippi during March of 2016. (b) SPECIAL RULES FOR USE OF RETIREMENT (D) DEFINITIONS.—For purposes of this forming certain acts postponed by reason of FUNDS WITH RESPECT TO MISSISSIPPI DELTA paragraph— service in combat zone). AREAS DAMAGED BY 2016 FLOODING.— (i) QUALIFIED MISSISSIPPI RIVER DELTA (b) QUALIFIED HAZARDOUS DUTY AREA.—For purposes of this section, the term ‘‘qualified (1) TAX-FAVORED WITHDRAWALS FROM RE- FLOODING DISTRIBUTION.—Except as provided hazardous duty area’’ means the Sinai Pe- TIREMENT PLANS.— in subparagraph (B), the term ‘‘qualified Mis- ninsula of Egypt, if as of the date of the en- (A) IN GENERAL.—Section 72(t) of the Inter- sissippi River Delta flooding distribution’’ actment of this section any member of the nal Revenue Code of 1986 shall not apply to means— Armed Forces of the United States is enti- any qualified Mississippi River Delta flood- (I) any distribution from an eligible retire- tled to special pay under section 310 of title ing distribution. ment plan made on or after August 11, 2016, 37, United States Code (relating to special (B) AGGREGATE DOLLAR LIMITATION.— and before January 1, 2018, to an individual pay; duty subject to hostile fire or imminent (i) IN GENERAL.—For purposes of this sub- whose principal place of abode on August 11, danger), for services performed in such loca- section, the aggregate amount of distribu- 2016, was located in the portion of Mississippi tion. Such term includes such location only tions received by an individual which may be River Delta disaster area described in sub- during the period such entitlement is in ef- treated as qualified Mississippi River Delta section (a)(1) and who has sustained an eco- fect. flooding distributions for any taxable year nomic loss by reason of the severe storms (c) APPLICABLE PERIOD.— shall not exceed the excess (if any) of— and flooding giving rise to the Presidential (1) IN GENERAL.—Except as provided in (I) $100,000, over declaration described in subsection (a)(1), or paragraph (2), the applicable period is— (II) the aggregate amounts treated as (II) any distribution from an eligible re- (A) the portion of the first taxable year qualified Mississippi River Delta flooding tirement plan made on or after March 1, 2016, ending after June 9, 2015, which begins on distributions received by such individual for and before January 1, 2018, to an individual such date, and all prior taxable years. whose principal place of abode on March 1,

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2016, was located in the portion of Mississippi (1) IN GENERAL.—If an individual has a net charges of indebtedness after December 31, River Delta disaster area described in sub- disaster loss for any taxable year beginning 2017. section (a)(2) and who has sustained an eco- after December 31, 2017, and before January SEC. 11032. INCREASE IN DEDUCTION FOR nomic loss by reason of the severe storms 1, 2026— TEACHER EXPENSES. and flooding giving rise to the Presidential (A) the amount determined under section (a) IN GENERAL.—Subparagraph (D) of sec- declaration described in subsection (a)(2). 165(h)(2)(A)(ii) of the Internal Revenue Code tion 62(a)(2) is amended by striking ‘‘$250’’ (ii) ELIGIBLE RETIREMENT PLAN.—The term of 1986 shall be equal to the sum of— and inserting ‘‘$250 ($500 in the case of tax- ‘‘eligible retirement plan’’ shall have the (i) such net disaster loss, and able years beginning after December 31, 2017, meaning given such term by section (ii) so much of the excess referred to in the and before January 1, 2026)’’. 402(c)(8)(B) of the Internal Revenue Code of matter preceding clause (i) of section (b) EFFECTIVE DATE.—The amendment 1986. 165(h)(2)(A) of such Code (reduced by the made by this section shall apply to taxable (E) INCOME INCLUSION SPREAD OVER 3-YEAR amount in clause (i) of this subparagraph) as years beginning after December 31, 2017. PERIOD.— exceeds 10 percent of the adjusted gross in- PART V—DEDUCTIONS AND EXCLUSIONS (i) IN GENERAL.—In the case of any quali- come of the individual, fied Mississippi River Delta flooding dis- SEC. 11041. SUSPENSION OF DEDUCTION FOR (B) section 165(h)(1) of such Code shall be PERSONAL EXEMPTIONS. tribution, unless the taxpayer elects not to applied by substituting ‘‘$500’’ for ‘‘$500 ($100 (a) IN GENERAL.—Subsection (d) of section have this subparagraph apply for any taxable for taxable years beginning after December 151 is amended— year, any amount required to be included in 31, 2009)’’, gross income for such taxable year shall be (1) by striking ‘‘In the case of’’ in para- (C) the standard deduction determined graph (4) and inserting ‘‘Except as provided so included ratably over the 3-taxable-year under section 63(c) of such Code shall be in- period beginning with such taxable year. in paragraph (5), in the case of’’, and creased by the net disaster loss, and (2) by adding at the end the following new (ii) SPECIAL RULE.—For purposes of clause (D) section 56(b)(1)(E) of such Code shall (i), rules similar to the rules of subparagraph paragraph: not apply to so much of the standard deduc- ‘‘(5) SPECIAL RULES FOR TAXABLE YEARS 2018 (E) of section 408A(d)(3) of the Internal Rev- tion as is attributable to the increase under enue Code of 1986 shall apply. THROUGH 2025.—In the case of a taxable year subparagraph (C) of this paragraph. beginning after December 31, 2017, and before (F) SPECIAL RULES.— (2) NET DISASTER LOSS.—For purposes of (i) EXEMPTION OF DISTRIBUTIONS FROM January 1, 2026— this subsection, the term ‘‘net disaster loss’’ ‘‘(A) EXEMPTION AMOUNT.—The term ‘ex- TRUSTEE TO TRUSTEE TRANSFER AND WITH- means the excess of qualified disaster-re- HOLDING RULES.—For purposes of sections emption amount’ means zero. lated personal casualty losses over personal ‘‘(B) REFERENCES.—For purposes of any 401(a)(31), 402(f), and 3405 of the Internal Rev- casualty gains (as defined in section enue Code of 1986, qualified Mississippi River other provision of this title, the reduction of 165(h)(3)(A) of the Internal Revenue Code of the exemption amount to zero under sub- Delta flooding distributions shall not be 1986). treated as eligible rollover distributions. paragraph (A) shall not be taken into ac- (3) QUALIFIED DISASTER-RELATED PERSONAL (ii) QUALIFIED MISSISSIPPI RIVER DELTA count in determining whether a deduction is CASUALTY LOSSES.—For purposes of this para- allowed or allowable, or whether a taxpayer FLOODING DISTRIBUTIONS TREATED AS MEETING graph, the term ‘‘qualified disaster-related PLAN DISTRIBUTION REQUIREMENTS.—For pur- is entitled to a deduction, under this sec- personal casualty losses’’ means losses de- poses of the Internal Revenue Code of 1986, a tion.’’. scribed in section 165(c)(3) of the Internal qualified Mississippi River Delta flooding (b) APPLICATION TO ESTATES AND TRUSTS.— Revenue Code of 1986 which arise— distribution shall be treated as meeting the Section 642(b)(2)(C) is amended by adding at (A) in the portion of the Mississippi River requirements of sections 401(k)(2)(B)(i), the end the following new clause: Delta flood disaster area described in sub- 403(b)(7)(A)(ii), 403(b)(11), and 457(d)(1)(A) of ‘‘(iii) YEARS WHEN PERSONAL EXEMPTION section (a)(1) on or after August 11, 2016, and the Internal Revenue Code of 1986. AMOUNT IS ZERO.— which are attributable to the severe storms (2) PROVISIONS RELATING TO PLAN AMEND- ‘‘(I) IN GENERAL.—In the case of any tax- and flooding giving rise to the Presidential MENTS.— able year in which the exemption amount declaration described in subsection (a)(1), or (A) IN GENERAL.—If this paragraph applies under section 151(d) is zero, clause (i) shall be to any amendment to any plan or annuity (B) in the portion of the Mississippi River applied by substituting ‘$4,150’ for ‘the ex- contract, such plan or contract shall be Delta flood disaster area described in sub- emption amount under section 151(d)’. treated as being operated in accordance with section (a)(2) on or after March 1, 2016, and ‘‘(II) INFLATION ADJUSTMENT.—In the case the terms of the plan during the period de- which are attributable to the severe storms of any calendar year beginning after 2018, the scribed in subparagraph (B)(ii)(I). and flooding giving rise to the Presidential $4,150 amount in subparagraph (A) shall be declaration described in subsection (a)(2). (B) AMENDMENTS TO WHICH SUBSECTION AP- increased by an amount equal to— PLIES.— PART IV—EDUCATION ‘‘(aa) such dollar amount, multiplied by (i) IN GENERAL.—This paragraph shall apply SEC. 11031. TREATMENT OF STUDENT LOANS DIS- ‘‘(bb) the cost-of-living adjustment deter- to any amendment to any plan or annuity CHARGED ON ACCOUNT OF DEATH mined under section 1(f)(3) for the calendar contract which is made— OR DISABILITY. year in which the taxable year begins, deter- (I) pursuant to any provision of this sec- (a) IN GENERAL.—Section 108(f) is amended mined by substituting ‘2017’ for ‘2016’ in sub- tion, or pursuant to any regulation under by adding at the end the following new para- paragraph (A)(ii) thereof. any provision of this section; and graph: If any increase determined under the pre- (II) on or before the last day of the first ‘‘(5) DISCHARGES ON ACCOUNT OF DEATH OR ceding sentence is not a multiple of $100, plan year beginning on or after January 1, DISABILITY.— such increase shall be rounded to the next 2018, or such later date as the Secretary pre- ‘‘(A) IN GENERAL.—In the case of an indi- lowest multiple of $100.’’. scribes. vidual, gross income for any taxable year be- (c) EXCEPTION FOR WAGE WITHHOLDING In the case of a governmental plan (as de- ginning after December 31, 2017, and before RULES.—Section 3402(a) is amended by add- fined in section 414(d) of the Internal Rev- January 1, 2026, does not include any amount ing at the end the following new paragraph: enue Code of 1986), subclause (II) shall be ap- which (but for this subsection) would be in- ‘‘(3) YEARS WHEN PERSONAL EXEMPTION plied by substituting the date which is 2 cludible in gross income for such taxable AMOUNT IS ZERO.— years after the date otherwise applied under year by reasons of the discharge (in whole or ‘‘(A) IN GENERAL.—In the case of any tax- subclause (II). in part) of any loan described in subpara- able year in which the exemption amount (ii) CONDITIONS.—This paragraph shall not graph (B) if such discharge was— under section 151(d) is zero, paragraph (2) apply to any amendment unless— ‘‘(i) pursuant to subsection (a) or (d) of sec- shall be applied by substituting ‘$4,150’ for (I) during the period— tion 437 of the Higher Education Act of 1965 ‘the amount of one personal exemption pro- (aa) beginning on the date that this section or the parallel benefit under part D of title vided in section 151(b)’. or the regulation described in clause (i)(I) IV of such Act (relating to the repayment of ‘‘(B) INFLATION ADJUSTMENT.—In the case takes effect (or in the case of a plan or con- loan liability), of any calendar year beginning after 2018, the tract amendment not required by this sec- ‘‘(ii) pursuant to section 464(c)(1)(F) of such $4,150 amount in subparagraph (A) shall be tion or such regulation, the effective date Act, or increased by an amount equal to— specified by the plan); and ‘‘(iii) otherwise discharged on account of ‘‘(i) such dollar amount, multiplied by (bb) ending on the date described in clause the death or total and permanent disability ‘‘(ii) the cost-of-living adjustment deter- (i)(II) (or, if earlier, the date the plan or con- of the student. mined under section 1(f)(3) for the calendar tract amendment is adopted), ‘‘(B) LOANS DESCRIBED.—A loan is described year in which the taxable year begins, deter- the plan or contract is operated as if such in this subparagraph if such loan is— mined by substituting ‘2017’ for ‘2016’ in sub- plan or contract amendment were in effect; ‘‘(i) a student loan (as defined in paragraph paragraph (A)(ii) thereof. and (2)), or If any increase determined under the pre- (II) such plan or contract amendment ap- ‘‘(ii) a private education loan (as defined in ceding sentence is not a multiple of $100, plies retroactively for such period. section 140(7) of the Consumer Credit Protec- such increase shall be rounded to the next (c) SPECIAL RULES FOR PERSONAL CASUALTY tion Act (15 U.S.C. 1650(7))).’’. lowest multiple of $100.’’. LOSSES RELATED TO LOUISIANA SEVERE (b) EFFECTIVE DATE.—The amendment (d) EXCEPTION FOR DETERMINING PROPERTY STORMS AND FLOODING.— made by this section shall apply to dis- EXEMPT FROM LEVY.—Section 6334(d) is

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00097 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.054 S01DEPT1 S7750 CONGRESSIONAL RECORD — SENATE December 1, 2017 amended by adding at the end the following the individual or the individual’s spouse is SEC. 11047. MODIFICATION OF EXCLUSION OF new paragraph: entitled by reason of section 63(f)(1).’’. GAIN FROM SALE OF PRINCIPAL RESIDENCE. ‘‘(4) YEARS WHEN PERSONAL EXEMPTION (f) EFFECTIVE DATE.—The amendments AMOUNT IS ZERO.— made by this section shall apply to taxable (a) IN GENERAL.—Section 121 is amended by ‘‘(A) IN GENERAL.—In the case of any tax- years beginning after December 31, 2017. adding at the end the following new sub- section: able year in which the exemption amount SEC. 11042. SUSPENSION OF DEDUCTION FOR ‘‘(h) SPECIAL RULES FOR SALES OR EX- under section 151(d) is zero, paragraph (2) STATE AND LOCAL, ETC. TAXES. shall not apply and for purposes of paragraph CHANGES IN TAXABLE YEARS 2018 THROUGH (a) IN GENERAL.—Subsection (b) of section 2025.— (1) the term ‘exempt amount’ means an 164 is amended by adding at the end the fol- ‘‘(1) IN GENERAL.—In applying this section amount equal to— lowing new paragraph: ‘‘(i) the sum of the amount determined with respect to sales or exchanges after De- ‘‘(6) SUSPENSION OF INDIVIDUAL DEDUCTIONS under subparagraph (B) and the standard de- cember 31, 2017, and before January 1, 2026— FOR TAXABLE YEARS 2018 THROUGH 2025.—In the ‘‘(A) ‘8-year’ shall be substituted for ‘5- duction, divided by case of an individual and a taxable year be- ‘‘(ii) 52. year’ each place it appears in subsections (a), ginning after December 31, 2017, and before (b)(5)(C)(ii)(I), and (c)(1)(B)(i)(I) and para- ‘‘(B) AMOUNT DETERMINED.—For purposes of January 1, 2026— subparagraph (A), the amount determined graphs (7), (9), (10), and (12) of subsection (d), ‘‘(A) paragraphs (1) and (2) of subsection (a) under this subparagraph is $4,150 multiplied ‘‘(B) ‘5 years’ shall be substituted for ‘2 shall not apply to any real property or per- by the number of the taxpayer’s dependents years’ each place it appears in subsections sonal property taxes, other than taxes which for the taxable year in which the levy oc- (a), (b)(3), (b)(4), (b)(5)(C)(ii)(III), and are paid or accrued in carrying on a trade or curs. (c)(1)(B)(ii), and business or an activity described in section ‘‘(C) INFLATION ADJUSTMENT.—In the case ‘‘(C) ‘5-year’ shall be substituted for ‘2- 212, and of any taxable year beginning after 2018, the year’ in subsection (b)(3). ‘‘(B) subsection (a)(3) shall not apply to $4,150 amount in subparagraph (B) shall be ‘‘(2) EXCEPTION FOR BINDING CONTRACTS.— any State or local taxes.’’. increased by an amount equal to— Paragraph (1) shall not apply to any sale or ‘‘(i) such dollar amount, multiplied by (b) EFFECTIVE DATE.—The amendment exchange with respect to which there was a ‘‘(ii) the cost-of-living adjustment deter- made by this section shall apply to taxable written binding contract in effect before mined under section 1(f)(3) for the calendar years beginning after December 31, 2017. January 1, 2018, and at all times thereafter year in which the taxable year begins, deter- SEC. 11043. SUSPENSION OF DEDUCTION FOR before the sale or exchange.’’. mined by substituting ‘2017’ for ‘2016’ in sub- HOME EQUITY INTEREST. (b) EFFECTIVE DATE.—The amendment paragraph (A)(ii) thereof. (a) IN GENERAL.—Section 163(h)(3)(A)(ii) is made by this section shall apply to sales and If any increase determined under the pre- amended by inserting ‘‘in the case of taxable exchanges after December 31, 2017. ceding sentence is not a multiple of $100, years beginning before January 1, 2018, or SEC. 11048. SUSPENSION OF EXCLUSION FOR such increase shall be rounded to the next after December 31, 2025,’’ before ‘‘home eq- QUALIFIED BICYCLE COMMUTING lowest multiple of $100. uity indebtedness’’. REIMBURSEMENT. ‘‘(D) VERIFIED STATEMENT.—Unless the tax- (b) EFFECTIVE DATE.—The amendments (a) IN GENERAL.—Section 132(f) is amended payer submits to the Secretary a written and made by this section shall apply to taxable by adding at the end the following new para- properly verified statement specifying the years ending after December 31, 2017. graph: facts necessary to determine the proper SEC. 11044. MODIFICATION OF DEDUCTION FOR ‘‘(8) SUSPENSION OF QUALIFIED BICYCLE COM- amount under subparagraph (A), subpara- PERSONAL CASUALTY LOSSES. MUTING REIMBURSEMENT EXCLUSION.—Para- graph (A) shall be applied as if the taxpayer (a) IN GENERAL.—Subsection (h) of section graph (1)(D) shall not apply to any taxable were a married individual filing a separate 165 is amended by adding at the end the fol- year beginning after December 31, 2017, and return with no dependents.’’. lowing new paragraph: before January 1, 2026.’’. (e) PERSONS REQUIRED TO MAKE RETURNS ‘‘(5) LIMITATION FOR TAXABLE YEARS 2018 (b) EFFECTIVE DATE.—The amendment OF INCOME.—Section 6012 is amended by add- THROUGH 2025.—In the case of any loss of an made by this section shall apply to taxable ing at the end the following new subsection: individual described in subsection (c)(3) years beginning after December 31, 2017. ‘‘(f) SPECIAL RULE FOR TAXABLE YEARS 2018 which (but for this paragraph) would be de- SEC. 11049. SUSPENSION OF EXCLUSION FOR THROUGH 2025.—In the case of a taxable year ductible in a taxable year beginning after QUALIFIED MOVING EXPENSE REIM- BURSEMENT. beginning after December 31, 2017, and before December 31, 2017, and before January 1, 2026 (a) IN GENERAL.—Section 132(g) is amend- January 1, 2026, subsection (a)(1) shall not (without regard to any election under sub- ed— apply, and every individual who has gross in- section (i), such loss shall be allowed only to (1) by striking ‘‘For purposes of this sec- come for the taxable year shall be required the extent it is attributable to a Federally tion, the term’’ and inserting ‘‘For purposes to make returns with respect to income declared disaster (as defined in subsection taxes under subtitle A, except that a return of this section— (i)(5)). The preceding sentence shall not shall not be required of— ‘‘(1) IN GENERAL.—The term’’, and apply to any deduction under section 172 ‘‘(1) an individual who is not married (de- (2) by adding at the end the following new which is carried to such a taxable year from termined by applying section 7703) and who paragraph: a taxable year beginning before January 1, has gross income for the taxable year which ‘‘(2) SUSPENSION FOR TAXABLE YEARS 2018 2018.’’. does not exceed the standard deduction ap- THROUGH 2025.—Except in the case of a mem- (b) EFFECTIVE DATE.—The amendment plicable to such individual for such taxable ber of the Armed Forces of the United States made by this section shall apply to losses in- year under section 63, or on active duty who moves pursuant to a curred in taxable years beginning after De- ‘‘(2) an individual entitled to make a joint military order and incident to a permanent cember 31, 2017. return if— change of station, subsection (a)(6) shall not ‘‘(A) the gross income of such individual, SEC. 11045. SUSPENSION OF MISCELLANEOUS apply to any taxable year beginning after when combined with the gross income of ITEMIZED DEDUCTIONS. December 31, 2017, and before January 1, such individual’s spouse, for the taxable year (a) IN GENERAL.—Section 67 is amended by 2026.’’. does not exceed the standard deduction adding at the end the following new sub- (b) EFFECTIVE DATE.—The amendments which would be applicable to the taxpayer section: made by this section shall apply to taxable for such taxable year under section 63 if such ‘‘(g) SUSPENSION FOR TAXABLE YEARS 2018 years beginning after December 31, 2017. individual and such individual’s spouse made THROUGH 2025.—Notwithstanding subsection SEC. 11050. SUSPENSION OF DEDUCTION FOR a joint return, (a), no miscellaneous itemized deduction MOVING EXPENSES. ‘‘(B) such individual and such individual’s shall be allowed for any taxable year begin- (a) IN GENERAL.—Section 217 is amended by spouse have the same household as their ning after December 31, 2017, and before Jan- adding at the end the following new sub- home at the close of the taxable year, uary 1, 2026.’’. section: ‘‘(C) such individual’s spouse does not (b) EFFECTIVE DATE.—The amendment ‘‘(k) SUSPENSION OF DEDUCTION FOR TAX- make a separate return, and made by this section shall apply to taxable ABLE YEARS 2018 THROUGH 2025.—Except in ‘‘(D) neither such individual nor such indi- years beginning after December 31, 2017. the case of an individual to whom subsection vidual’s spouse is an individual described in SEC. 11046. SUSPENSION OF OVERALL LIMITA- (g) applies, this section shall not apply to section 63(c)(5) who has income (other than TION ON ITEMIZED DEDUCTIONS. any taxable year beginning after December earned income) in excess of the amount in ef- (a) IN GENERAL.—Section 68 is amended by 31, 2017, and before January 1, 2026.’’. fect under section 63(c)(5)(A). adding at the end the following new sub- (b) EFFECTIVE DATE.—The amendment The amount specified in paragraph (1) or section: made by this section shall apply to taxable (2)(A) shall be increased by the amount of 1 ‘‘(f) SECTION NOT TO APPLY.—This section years beginning after December 31, 2017. additional standard deduction (within the shall not apply to any taxable year begin- SEC. 11051. LIMITATION ON WAGERING LOSSES. meaning of section 63(c)(3)) in the case of an ning after December 31, 2017, and before Jan- (a) IN GENERAL.—Section 165(d) is amended individual entitled to such deduction by rea- uary 1, 2026.’’. by adding at the end the following: ‘‘For pur- son of section 63(f)(1)(A) (relating to individ- (b) EFFECTIVE DATE.—The amendment poses of the preceding sentence, in the case uals age 65 or more), and by the amount of made by this section shall apply to taxable of taxable years beginning after December each additional standard deduction to which years beginning after December 31, 2017. 31, 2017, and before January 1, 2026, the term

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‘losses from wagering transactions’ includes ‘‘(f) INDIVIDUALS HELD HARMLESS ON of 1986 in taxable years beginning after De- any deduction otherwise allowable under WRONGFUL LEVY, ETC. ON RETIREMENT cember 31, 2017. this chapter incurred in carrying on any wa- PLAN.— SEC. 11073. MODIFICATION OF USER FEE RE- gering transaction.’’. ‘‘(1) IN GENERAL.—If the Secretary deter- QUIREMENTS FOR INSTALLMENT (b) EFFECTIVE DATE.—The amendment mines that an individual’s account or benefit AGREEMENTS. made by this section shall apply to taxable under an eligible retirement plan (as defined (a) IN GENERAL.—Section 6159 is amended years beginning after December 31, 2017. in section 402(c)(8)(B)) has been levied upon by redesignating subsection (f) as subsection in a case to which subsection (b) or (d)(2)(A) (g) and by inserting after subsection (e) the PART VI—INCREASE IN ESTATE AND GIFT following new subsection: TAX EXEMPTION applies and property or an amount of money is returned to the individual— ‘‘(f) INSTALLMENT AGREEMENT FEES.— ‘‘(1) LIMITATION ON FEE AMOUNT.—The SEC. 11061. INCREASE IN ESTATE AND GIFT TAX ‘‘(A) the individual may contribute such EXEMPTION. amount of any fee imposed on an installment property or an amount equal to the sum of— agreement under this section may not exceed (a) IN GENERAL.—Section 2010(c)(3) is ‘‘(i) the amount of money so returned by the amount of such fee as in effect on the amended by adding at the end the following the Secretary, and date of the enactment of this subsection. new subparagraph: ‘‘(ii) interest paid under subsection (c) on ‘‘(2) WAIVER OR REIMBURSEMENT.—In the ‘‘(C) INCREASE IN BASIC EXCLUSION such amount of money, case of any taxpayer with an adjusted gross AMOUNT.—In the case of estates of decedents into such eligible retirement plan if such income, as determined for the most recent dying or gifts made after December 31, 2017, contribution is permitted by the plan, or year for which such information is available, and before January 1, 2026, subparagraph (A) into an individual retirement plan (other shall be applied by substituting ‘$10,000,000’ which does not exceed 250 percent of the ap- than an endowment contract) to which a plicable poverty level (as determined by the for ‘$5,000,000’.’’. rollover contribution of a distribution from (b) CONFORMING AMENDMENT.—Subsection Secretary)— such eligible retirement plan is permitted, ‘‘(A) if the taxpayer has agreed to make (g) of section 2001 is amended to read as fol- but only if such contribution is made not lows: payments under the installment agreement later than the due date (not including exten- by electronic payment through a debit in- ‘‘(g) MODIFICATIONS TO TAX PAYABLE.— sions) for filing the return of tax for the tax- ‘‘(1) MODIFICATIONS TO GIFT TAX PAYABLE TO strument, no fee shall be imposed on an in- able year in which such property or amount stallment agreement under this section, and REFLECT DIFFERENT TAX RATES.—For pur- of money is returned, and poses of applying subsection (b)(2) with re- ‘‘(B) if the taxpayer is unable to make pay- ‘‘(B) the Secretary shall, at the time such ments under the installment agreement by spect to 1 or more gifts, the rates of tax property or amount of money is returned, under subsection (c) in effect at the dece- electronic payment through a debit instru- notify such individual that a contribution ment, the Secretary shall, upon completion dent’s death shall, in lieu of the rates of tax described in subparagraph (A) may be made. in effect at the time of such gifts, be used of the installment agreement, pay the tax- ‘‘(2) TREATMENT AS ROLLOVER.—The dis- payer an amount equal to any such fees im- both to compute— tribution on account of the levy and any ‘‘(A) the tax imposed by chapter 12 with re- posed.’’. contribution under paragraph (1) with re- (b) EFFECTIVE DATE.—The amendments spect to such gifts, and spect to the return of such distribution shall made by this section shall apply to agree- ‘‘(B) the credit allowed against such tax be treated for purposes of this title as if such ments entered into on or after the date under section 2505, including in computing— distribution and contribution were described which is 60 days after the date of the enact- ‘‘(i) the applicable credit amount under in section 402(c), 402A(c)(3), 403(a)(4), ment of this Act. section 2505(a)(1), and 403(b)(8), 408(d)(3), 408A(d)(3), or 457(e)(16), SEC. 11074. FORM 1040SR FOR SENIORS. ‘‘(ii) the sum of the amounts allowed as a whichever is applicable; except that— (a) IN GENERAL.—The Secretary of the credit for all preceding periods under section ‘‘(A) the contribution shall be treated as Treasury (or the Secretary’s delegate) shall 2505(a)(2). having been made for the taxable year in make available a form, to be known as ‘‘(2) MODIFICATIONS TO ESTATE TAX PAYABLE which the distribution on account of the levy ‘‘Form 1040SR’’, for use by individuals to file TO REFLECT DIFFERENT BASIC EXCLUSION occurred, and the interest paid under sub- the return of tax imposed by chapter 1 of the AMOUNTS.—The Secretary shall prescribe section (c) shall be treated as earnings with- Internal Revenue Code of 1986. Such form such regulations as may be necessary or ap- in the plan after the contribution and shall shall be as similar as practicable to Form propriate to carry out this section with re- not be included in gross income, and 1040EZ, except that— spect to any difference between— ‘‘(B) such contribution shall not be taken (1) the form shall be available only to indi- ‘‘(A) the basic exclusion amount under sec- into account under section 408(d)(3)(B). viduals who have attained age 65 as of the tion 2010(c)(3) applicable at the time of the ‘‘(3) REFUND, ETC., OF INCOME TAX ON close of the taxable year, decedent’s death, and LEVY.— (2) the form may be used even if income for ‘‘(B) the basic exclusion amount under ‘‘(A) IN GENERAL.—If any amount is includ- the taxable year includes— such section applicable with respect to any ible in gross income for a taxable year by (A) social security benefits (as defined in gifts made by the decedent.’’. reason of a distribution on account of a levy section 86(d) of the Internal Revenue Code of (c) EFFECTIVE DATE.—The amendments referred to in paragraph (1) and any portion 1986), made by this section shall apply to estates of of such amount is treated as a rollover con- (B) distributions from qualified retirement decedents dying and gifts made after Decem- tribution under paragraph (2), any tax im- plans (as defined in section 4974(c) of such ber 31, 2017. posed by chapter 1 on such portion shall not Code), annuities or other such deferred pay- PART VII—TAXPAYER RIGHTS AND TAX be assessed, and if assessed shall be abated, ment arrangements, ADMINISTRATION and if collected shall be credited or refunded (C) interest and dividends, or SEC. 11071. EXTENSION OF TIME LIMIT FOR CON- as an overpayment made on the due date for (D) capital gains and losses taken into ac- TESTING IRS LEVY. filing the return of tax for such taxable year. count in determining adjusted net capital (a) EXTENSION OF TIME FOR RETURN OF ‘‘(B) EXCEPTION.—Subparagraph (A) shall gain (as defined in section 1(h)(3) of such PROPERTY SUBJECT TO LEVY.—Subsection (b) not apply to a rollover contribution under Code), and of section 6343 is amended by striking ‘‘9 this subsection which is made from an eligi- (3) the form shall be available without re- months’’ and inserting ‘‘2 years’’. ble retirement plan which is not a Roth IRA gard to the amount of any item of taxable (b) PERIOD OF LIMITATION ON SUITS.—Sub- or a designated Roth account (within the income or the total amount of taxable in- section (c) of section 6532 is amended— meaning of section 402A) to a Roth IRA or a come for the taxable year. (1) by striking ‘‘9 months’’ in paragraph (1) designated Roth account under an eligible (b) EFFECTIVE DATE.—The form required by and inserting ‘‘2 years’’, and retirement plan. subsection (a) shall be made available for taxable years beginning after the date of the (2) by striking ‘‘9-month’’ in paragraph (2) ‘‘(4) INTEREST.—Notwithstanding sub- enactment of this Act and ending before Jan- and inserting ‘‘2-year’’. section (d), interest shall be allowed under uary 1, 2026. (c) EFFECTIVE DATE.—The amendments subsection (c) in a case in which the Sec- made by this section shall apply to— retary makes a determination described in SEC. 11075. SENSE OF THE SENATE ON IMPROV- ING CUSTOMER SERVICE AND PRO- (1) levies made after the date of the enact- subsection (d)(2)(A) with respect to a levy upon an individual retirement plan. TECTIONS FOR TAXPAYERS BY REIN- ment of this Act, and STATING APPROPRIATE FUNDING (2) levies made on or before such date if the ‘‘(5) TREATMENT OF INHERITED ACCOUNTS.— LEVELS. 9-month period has not expired under section For purposes of paragraph (1)(A), section It is the sense of the Senate that politi- 6343(b) of the Internal Revenue Code of 1986 408(d)(3)(C) shall be disregarded in deter- cally motivated budget cuts— (without regard to this section) as of such mining whether an individual retirement (1) are counterproductive to deficit reduc- date. plan is a plan to which a rollover contribu- tion, tion of a distribution from the plan levied SEC. 11072. INDIVIDUALS HELD HARMLESS ON (2) diminish the ability of the Internal IMPROPER LEVY ON RETIREMENT upon is permitted.’’. Revenue Service to adequately serve tax- PLANS. (b) EFFECTIVE DATE.—The amendment payers and protect taxpayer information, (a) IN GENERAL.—Section 6343 is amended made by this section shall apply to amounts and by adding at the end the following new sub- paid under subsections (b), (c), and (d)(2)(A) (3) reduce the ability of the Internal Rev- section: of section 6343 of the Internal Revenue Code enue Service to enforce the law.

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00099 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.054 S01DEPT1 S7752 CONGRESSIONAL RECORD — SENATE December 1, 2017 SEC. 11076. RETURN PREPARATION PROGRAMS the Office of Management and Budget, in- ‘‘(aa) a county or municipal government FOR LOW-INCOME TAXPAYERS. cluding— agency, and (a) IN GENERAL.—Chapter 77 is amended by ‘‘(i) for wages or salaries of persons coordi- ‘‘(bb) an Indian tribe, as defined in section inserting after section 7526 the following new nating the activities of the program, 4(13) of the Native American Housing Assist- section: ‘‘(ii) to develop training materials, conduct ance and Self-Determination Act of 1996 (25 ‘‘SEC. 7526A. RETURN PREPARATION PROGRAMS training, and perform quality reviews of the U.S.C. 4103(13)), including any tribally des- FOR LOW-INCOME TAXPAYERS. returns for which assistance has been pro- ignated housing entity (as defined in section ‘‘(a) VOLUNTEER INCOME TAX ASSISTANCE vided under the program, and 4(22) of such Act (25 U.S.C. 4103(22))), tribal MATCHING GRANT PROGRAM.— ‘‘(iii) for equipment purchases and vehicle- subsidiary, subdivision, or other wholly ‘‘(1) ESTABLISHMENT OF PROGRAM.—The related expenses associated with remote or owned tribal entity, or Secretary, through the Internal Revenue rural tax preparation services, ‘‘(IV) a local, State, regional, or national Service, shall establish a Community Volun- ‘‘(B) outreach and educational activities coalition (with one lead organization which teer Income Tax Assistance Matching Grant described in subsection (a)(2)(C)(ii), and meets the eligibility requirements of sub- Program (hereinafter in this section referred ‘‘(C) services related to financial education clause (I), (II), or (III) acting as the applicant to as the ‘VITA grant program’). Except as and capability, asset development, and the organization). otherwise provided in this section, the VITA establishment of savings accounts in connec- ‘‘(ii) ALTERNATIVE ELIGIBLE ORGANIZA- grant program shall be administered in a tion with tax return preparation. TION.—If no eligible organization described manner which is substantially similar to the ‘‘(2) USE OF GRANTS FOR OVERHEAD EX- in clause (i) is available to assist the tar- Community Volunteer Income Tax Assist- PENSES PROHIBITED.—No grant made under geted population or community, the term ance matching grants demonstration pro- this section may be used for overhead ex- ‘eligible organization’ shall include— gram established under title I of division D penses that are not directly related to any ‘‘(I) a State government agency, and of the Consolidated Appropriations Act, 2008. qualified return preparation program. ‘‘(II) a Cooperative Extension Service of- ‘‘(2) MATCHING GRANTS.— ‘‘(c) PROMOTION AND REFERRAL.— fice. ‘‘(A) IN GENERAL.—The Secretary shall, ‘‘(1) PROMOTION.—The Secretary shall pro- ‘‘(3) LOW-INCOME TAXPAYERS.—The term subject to the availability of appropriated mote the benefits of, and encourage the use ‘low-income taxpayer’ means a taxpayer who funds, make available grants under the VITA of, tax preparation through qualified return has income for the taxable year which does grant program to provide matching funds for preparation programs through the use of not exceed an amount equal to the com- the development, expansion, or continuation mass communications, referrals, and other pleted phaseout amount under section 32(b) of qualified return preparation programs as- means. for a married couple filing a joint return sisting low-income taxpayers and members ‘‘(2) INTERNAL REVENUE SERVICE REFER- with three or more qualifying children, as of underserved populations. RALS.—The Secretary shall refer taxpayers determined in a revenue procedure or other ‘‘(B) APPLICATION.— to qualified return preparation programs re- published guidance. ‘‘(i) IN GENERAL.—Subject to clause (ii), in ceiving funding under this section. ‘‘(4) UNDERSERVED POPULATION.—The term order to be eligible for a grant under this ‘‘(3) VITA GRANTEE REFERRAL.—Qualified ‘underserved population’ includes popu- section, a qualified return preparation pro- return preparation programs receiving a lations of persons with disabilities, persons gram shall submit an application to the Sec- grant under this section are encouraged to with limited English proficiency, Native retary at such time, in such manner, and refer, as appropriate, to local or regional Americans, individuals living in rural areas, containing such information as the Sec- Low Income Taxpayer Clinics individuals members of the Armed Forces and their retary reasonably requires. who are eligible to receive services at such spouses, and the elderly.’’. ‘‘(ii) ACCURACY REVIEW.—In the case of any clinics. (b) CLERICAL AMENDMENT.—The table of qualified return preparation program which ‘‘(d) DEFINITIONS.—For purposes of this sec- sections for chapter 77 is amended by insert- was awarded a grant under this section and tion— ing after the item relating to section 7526 the was subsequently subject to a field site visit ‘‘(1) QUALIFIED RETURN PREPARATION PRO- following new item: by the Internal Revenue Service (including GRAM.—The term ‘qualified return prepara- ‘‘7526A. Return preparation programs for through the Stakeholder Partnerships, Edu- tion program’ means any program— low-income taxpayers.’’. cation, and Communication office) in which ‘‘(A) which provides assistance to individ- SEC. 11077. FREE FILE PROGRAM. it was determined that the average accuracy uals, not less than 90 percent of whom are rate for preparation of tax returns through low-income taxpayers, in preparing and fil- (a) The Secretary of the Treasury, or the such program was less than 90 percent, such ing Federal income tax returns, Secretary’s delegate, shall continue to oper- program shall not be eligible for any addi- ‘‘(B) which is administered by a qualified ate the IRS Free File Program as established tional grants under this section unless such entity, by the Internal Revenue Service and pub- program provides, as part of their applica- ‘‘(C) in which all of the volunteers who as- lished in the Federal Register on November tion, sufficient documentation regarding the sist in the preparation of Federal income tax 4, 2002 (67 Fed. Reg. 67247), including any sub- corrective measures established by such pro- returns meet the training requirements pre- sequent agreements and governing rules es- gram to address the deficiencies identified scribed by the Secretary, and tablished pursuant thereto. following the field site visit. ‘‘(D) which uses a quality review process (b) The IRS Free File Program shall con- ‘‘(C) PRIORITY.—In awarding grants under which reviews 100 percent of all returns. tinue to provide free commercial-type online this section, the Secretary shall give pri- ‘‘(2) QUALIFIED ENTITY.— individual income tax preparation and elec- ority to applications— ‘‘(A) IN GENERAL.—The term ‘qualified en- tronic filing services to the lowest 70 percent ‘‘(i) demonstrating assistance to low-in- tity’ means any entity which— of taxpayers by income. The number of tax- come taxpayers, with emphasis on outreach ‘‘(i) is an eligible organization (as de- payers eligible to receive such services each to and services for such taxpayers, scribed in subparagraph (B)), year shall be calculated by the Internal Rev- ‘‘(ii) demonstrating taxpayer outreach and ‘‘(ii) is in compliance with Federal tax fil- enue Service annually based on prior year educational activities relating to eligibility ing and payment requirements, aggregate taxpayer adjusted gross income and availability of income supports available ‘‘(iii) is not debarred or suspended from data. through the Internal Revenue Code of 1986, Federal contracts, grants, or cooperative (c) In addition to the services described in such as the earned income tax credit, and agreements, and subsection (b), and in the same manner, the ‘‘(iii) demonstrating specific outreach and ‘‘(iv) agrees to provide documentation to IRS Free File Program shall continue to focus on one or more underserved popu- substantiate any matching funds provided make available to all taxpayers (without re- lations. under the VITA grant program. gard to income) a basic, online electronic ‘‘(D) DURATION OF GRANTS.—Upon applica- ‘‘(B) ELIGIBLE ORGANIZATION.— fillable forms utility. tion of a qualified return preparation pro- ‘‘(i) IN GENERAL.—Subject to clause (ii), the (d) The IRS Free File Program shall con- gram, the Secretary is authorized to award a term ‘eligible organization’ means— tinue to work cooperatively with the private multi-year grant not to exceed 3 years. ‘‘(I) an institution of higher education sector to provide the free individual income ‘‘(3) AGGREGATE LIMITATION.—Unless other- which is described in section 102 (other than tax preparation and the electronic filing wise provided by specific appropriation, the subsection (a)(1)(C) thereof) of the Higher services described in subsections (b) and (c). Secretary shall not allocate more than Education Act of 1965 (20 U.S.C. 1088), as in (e) The IRS Free File Program shall work $30,000,000 per fiscal year (exclusive of costs effect on the date of the enactment of this cooperatively with State government agen- of administering the program) to carry out section, and which has not been disqualified cies to enhance and expand the use of the the purposes of this section. from participating in a program under title program to provide needed benefits to the ‘‘(b) USE OF FUNDS.— IV of such Act, taxpayer while reducing the cost of proc- ‘‘(1) IN GENERAL.—Qualified return prepara- ‘‘(II) an organization described in section essing returns. tion programs receiving a grant under this 501(c) of the Internal Revenue Code of 1986 (f) Nothing in this section is intended to section may use the grant for— and exempt from tax under section 501(a) of impact the continuity of services provided ‘‘(A) ordinary and necessary costs associ- such Code, under Taxpayer Assistance Centers, Tax ated with program operation in accordance ‘‘(III) a local government agency, includ- Counseling for the Elderly, and Volunteer In- with Cost Principles Circulars as set forth by ing— come Tax Assistance programs.

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SEC. 11078. ATTORNEYS’ FEES RELATING TO (b) EFFECTIVE DATE.—The amendment (6)(A) Section 56 is amended by striking AWARDS TO WHISTLEBLOWERS. made by this section shall apply to months subsections (c) and (g). (a) IN GENERAL.—Paragraph (21) of section beginning after December 31, 2018. (B) Section 847 is amended by striking the 62(a) is amended to read as follows: Subtitle B—Alternative Minimum Tax last sentence of paragraph (9). ‘‘(21) ATTORNEYS’ FEES RELATING TO AWARDS SEC. 12001. REPEAL OF TAX FOR CORPORATIONS. (C) Section 848 is amended by striking sub- TO WHISTLEBLOWERS.— (a) IN GENERAL.—Section 55(a) is amended section (i). ‘‘(A) IN GENERAL.—Any deduction allowable by striking ‘‘There’’ and inserting ‘‘In the (7) Section 58(a) is amended by striking under this chapter for attorney fees and case of a taxpayer other than a corporation, paragraph (3) and redesignating paragraph court costs paid by, or on behalf of, the tax- there’’. (4) as paragraph (3). payer in connection with any award under— (b) CONFORMING AMENDMENTS.— (8) Section 59 is amended by striking sub- ‘‘(i) section 7623(b), or (1) Section 38(c)(6) is amended by adding at sections (b) and (f). ‘‘(ii) in the case of taxable years beginning the end the following new subparagraph: (9) Section 11(d) is amended by striking after December 31, 2017, and before January ‘‘(E) CORPORATIONS.—In the case of a cor- ‘‘the taxes imposed by subsection (a) and sec- 1, 2026, any action brought under— poration, this subsection shall be applied by tion 55’’ and inserting ‘‘the tax imposed by ‘‘(I) section 21F of the Securities Exchange treating the corporation as having a ten- subsection (a)’’. Act of 1934 (15 U.S.C. 78u-6), tative minimum tax of zero.’’. (10) Section 12 is amended by striking para- ‘‘(II) a State law relating to false or fraud- (2)(A) Section 55(b)(1) is amended to read graph (7). ulent claims that meets the requirements de- as follows: (11) Section 168(k) is amended by striking scribed in section 1909(b) of the Social Secu- ‘‘(1) AMOUNT OF TENTATIVE TAX.— paragraph (4). rity Act (42 U.S.C. 1396h(b)), or ‘‘(A) IN GENERAL.—The tentative minimum (12) Section 882(a)(1) is amended by strik- ‘‘(III) section 23 of the Commodity Ex- tax for the taxable year is the sum of— ing ‘‘, 55,’’. change Act (7 U.S.C. 26). ‘‘(i) 26 percent of so much of the taxable (13) Section 962(a)(1) is amended by strik- ‘‘(B) MAY NOT EXCEED AWARD.—Subpara- excess as does not exceed $175,000, plus ing ‘‘sections 11 and 55’’ and inserting ‘‘sec- graph (A) shall not apply to any deduction in ‘‘(ii) 28 percent of so much of the taxable tion 11’’. excess of the amount includible in the tax- excess as exceeds $175,000. (14) Section 1561(a) is amended— payer’s gross income for the taxable year on The amount determined under the preceding (A) by inserting ‘‘and’’ at the end of para- account of such award.’’. sentence shall be reduced by the alternative graph (1), by striking ‘‘, and’’ at the end of (b) EFFECTIVE DATE.—The amendment minimum tax foreign tax credit for the tax- paragraph (2) and inserting a period, and by made by this section shall apply to taxable able year. striking paragraph (3), and years beginning after December 31, 2017. ‘‘(B) TAXABLE EXCESS.—For purposes of (B) by striking the last sentence. SEC. 11079. CLARIFICATION OF WHISTLEBLOWER this subsection, the term ‘taxable excess’ (15) Section 6425(c)(1)(A) is amended to AWARDS. means so much of the alternative minimum read as follows: (a) DEFINITION OF PROCEEDS.— taxable income for the taxable year as ex- ‘‘(A) the tax imposed by section 11 or (1) IN GENERAL.—Section 7623 is amended ceeds the exemption amount. 1201(a), or subchapter L of chapter 1, which- by adding at the end the following new sub- ‘‘(C) MARRIED INDIVIDUAL FILING SEPARATE ever is applicable, over’’. section: RETURN.—In the case of a married individual (16) Section 6655(e)(2) is amended by strik- ‘‘(c) PROCEEDS.—For purposes of this sec- filing a separate return, subparagraph (A) ing ‘‘and alternative minimum taxable in- tion, the term ‘proceeds’ includes— shall be applied by substituting 50 percent of come’’ each place it appears in subpara- ‘‘(1) penalties, interest, additions to tax, the dollar amount otherwise applicable graphs (A) and (B)(i). and additional amounts provided under the under clause (i) and cause (ii) thereof. For (17) Section 6655(g)(1)(A) is amended by in- internal revenue laws, and purposes of the preceding sentence, marital serting ‘‘plus’’ at the end of clause (i), by ‘‘(2) any proceeds arising from laws for status shall be determined under section striking clause (ii), and by redesignating which the Internal Revenue Service is au- 7703.’’. clause (iii) as clause (ii). thorized to administer, enforce, or inves- (B) Section 59(a) is amended— (c) EFFECTIVE DATE.—The amendments tigate, including— (i) by striking ‘‘subparagraph (A)(i) or made by this section shall apply to taxable ‘‘(A) criminal fines and civil forfeitures, (B)(i) of section 55(b)(1) (whichever applies) years beginning after December 31, 2017. and in lieu of the highest rate of tax specified in SEC. 12002. SUSPENSION OF TAX ON INDIVID- ‘‘(B) violations of reporting require- section 1 or 11 (whichever applies)’’ in para- UALS. ments.’’. graph (1)(C) and inserting ‘‘section 55(b)(1) in (a) IN GENERAL.—Section 55(a) is amended (2) CONFORMING AMENDMENTS.—Paragraphs lieu of the highest rate of tax specified in by adding at the end the following new flush (1) and (2)(A) of section 7623(b) are each section 1’’, and sentence: amended by striking ‘‘collected proceeds (in- (ii) in paragraph (2), by striking ‘‘means’’ ‘‘No tax shall be imposed by this section for cluding penalties, interest, additions to tax, and all that follows and inserting ‘‘means any taxable year beginning after December and additional amounts) resulting from the the amount determined under the first sen- 31, 2017, and before January 1, 2026, and the action’’ and inserting ‘‘proceeds collected as tence of section 55(b)(1).’’. tentative minimum tax of any taxpayer for a result of the action’’. (C) Section 897(a)(2)(A) is amended by any such taxable year shall be zero for pur- (b) AMOUNT OF PROCEEDS DETERMINED striking ‘‘section 55(b)(1)(A)’’ and inserting poses of this title.’’. WITHOUT REGARD TO AVAILABILITY.—Para- ‘‘section 55(b)(1)’’. (b) EFFECTIVE DATE.—The amendment graphs (1) and (2)(A) of section 7623(b) are (D) Section 911(f) is amended— made by this section shall apply to taxable each amended by inserting ‘‘(determined (i) in paragraph (1)(B)— years beginning after December 31, 2017. without regard to whether such proceeds are (I) by striking ‘‘section 55(b)(1)(A)(ii)’’ and SEC. 12003. CREDIT FOR PRIOR YEAR MINIMUM available to the Secretary)’’ after ‘‘in re- inserting ‘‘section 55(b)(1)(B)’’, and TAX LIABILITY. sponse to such action’’. (II) by striking ‘‘section 55(b)(1)(A)(i)’’ and (a) CREDITS TREATED AS REFUNDABLE.— (c) DISPUTED AMOUNT THRESHOLD.—Section inserting ‘‘section 55(b)(1)(A)’’, and Section 53 is amended by adding at the end 7623(b)(5)(B) is amended by striking ‘‘tax, (ii) in paragraph (2)(B), by striking ‘‘sec- the following new subsection: penalties, interest, additions to tax, and ad- tion 55(b)(1)(A)(ii)’’ each place it appears and ‘‘(e) PORTION OF CREDIT TREATED AS RE- ditional amounts’’ and inserting ‘‘proceeds’’. inserting ‘‘section 55(b)(1)(B)’’. FUNDABLE.— (d) EFFECTIVE DATE.—The amendments (3) Section 55(c)(1) is amended by striking ‘‘(1) IN GENERAL.—In the case of any tax- made by this section shall apply to informa- ‘‘, the section 936 credit allowable under sec- able year beginning in 2018, 2019, 2020, or 2021, tion provided before, on, or after the date of tion 27(b), and the Puerto Rico economic ac- the limitation under subsection (c) shall be the enactment of this Act with respect to tivity credit under section 30A’’. increased by the AMT refundable credit which a final determination for an award has (4) Section 55(d) is amended— amount for such year. not been made before such date of enact- (A) by striking paragraph (2) and redesig- ‘‘(2) AMT REFUNDABLE CREDIT AMOUNT.— ment. nating paragraphs (3) and (4) as paragraphs For purposes of paragraph (1), the AMT re- PART VIII—INDIVIDUAL MANDATE (2) and (3), respectively, fundable credit amount is an amount equal SEC. 11081. ELIMINATION OF SHARED RESPONSI- (B) in paragraph (2) (as so redesignated), by to 50 percent (100 percent in the case of a BILITY PAYMENT FOR INDIVIDUALS inserting ‘‘and’’ at the end of subparagraph taxable year beginning in 2021) of the excess FAILING TO MAINTAIN MINIMUM ES- (B), by striking ‘‘, and’’ at the end of sub- (if any) of— SENTIAL COVERAGE. paragraph (C) and inserting a period, and by ‘‘(A) the minimum tax credit determined (a) IN GENERAL.—Section 5000A(c) is striking subparagraph (D), and under subsection (b) for the taxable year, amended— (C) in paragraph (3) (as so redesignated)— over (1) in paragraph (2)(B)(iii), by striking ‘‘2.5 (i) by striking ‘‘(b)(1)(A)(i)’’ in subpara- ‘‘(B) the minimum tax credit allowed under percent’’ and inserting ‘‘Zero percent’’, and graph (B)(i) and inserting ‘‘(b)(1)(A)’’, and subsection (a) for such year (before the appli- (2) in paragraph (3)— (ii) by striking ‘‘paragraph (3)’’ in subpara- cation of this subsection for such year). (A) by striking ‘‘$695’’ in subparagraph (A) graph (B)(iii) and inserting ‘‘paragraph (2)’’. ‘‘(3) CREDIT REFUNDABLE.—For purposes of and inserting ‘‘$0’’, and (5) Section 55 is amended by striking sub- this title (other than this section), the credit (B) by striking subparagraph (D). section (e). allowed by reason of this subsection shall be

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treated as a credit allowed under subpart C (ii) in subparagraph (C), as so redesig- ‘‘(5) CROSS REFERENCE.—For limitation on (and not this subpart). nated— credit provided in paragraph (2) or (3) in the ‘‘(4) SHORT TAXABLE YEARS.—In the case of (I) by striking ‘‘subparagraph (A)(ii)’’ in case of certain controlled corporations, see any taxable year of less than 365 days, the clause (i) thereof and inserting ‘‘paragraph section 1561.’’. AMT refundable credit amount determined (1)’’, (6)(A) Section 1561, as amended by section under paragraph (2) with respect to such tax- (II) by striking ‘‘the tax imposed by sub- 12001, is amended to read as follows: able year shall be the amount which bears paragraph (A)(ii)’’ in clauses (ii) and (iv) ‘‘SEC. 1561. LIMITATION ON ACCUMULATED the same ratio to such amount determined thereof and inserting ‘‘the tax imposed by EARNINGS CREDIT IN THE CASE OF without regard to this paragraph as the num- paragraph (1) on undistributed capital gain’’, CERTAIN CONTROLLED CORPORA- ber of days in such taxable year bears to (iii) in subparagraph (E), as so redesig- TIONS. ‘‘(a) IN GENERAL.—The component mem- 365.’’. nated, by striking ‘‘subparagraph (B) or (D)’’ bers of a controlled group of corporations on (b) TREATMENT OF REFERENCES.—Section and inserting ‘‘subparagraph (A) or (C)’’, and a December 31 shall, for their taxable years 53(d) is amended by adding at the end the fol- (iv) by adding at the end the following new which include such December 31, be limited lowing new paragraph: subparagraph: for purposes of this subtitle to one $250,000 ‘‘(3) AMT TERM REFERENCES.—In the case of NDISTRIBUTED CAPITAL GAIN.—For ‘‘(F) U ($150,000 if any component member is a cor- a corporation, any references in this sub- purposes of this paragraph, the term ‘undis- section to section 55, 56, or 57 shall be treat- poration described in section 535(c)(2)(B)) tributed capital gain’ means the excess of amount for purposes of computing the accu- ed as a reference to such section as in effect the net capital gain over the deduction for before the amendments made by Tax Cuts mulated earnings credit under section dividends paid (as defined in section 561) de- 535(c)(2) and (3). Such amount shall be di- and Jobs Act.’’. termined with reference to capital gain divi- (c) CONFORMING AMENDMENT.—Section vided equally among the component mem- dends only.’’. bers of such group on such December 31 un- 1374(b)(3)(B) is amended by striking the last (L) Section 882(a)(1), as amended by section sentence thereof. less the Secretary prescribes regulations per- 12001, is amended by striking ‘‘or 1201(a)’’. mitting an unequal allocation of such (d) EFFECTIVE DATE.— (M) Section 904(b) is amended— (1) IN GENERAL.—The amendments made by amount. (i) by striking ‘‘or 1201(a)’’ in paragraph ‘‘(b) CERTAIN SHORT TAXABLE YEARS.—If a this section shall apply to taxable years be- (2)(C), ginning after December 31, 2017. corporation has a short taxable year which (ii) by striking paragraph (3)(D) and insert- does not include a December 31 and is a com- (2) CONFORMING AMENDMENT.—The amend- ing the following: ponent member of a controlled group of cor- ment made by subsection (c) shall apply to ‘‘(D) CAPITAL GAIN RATE DIFFERENTIAL.— porations with respect to such taxable year, taxable years beginning after December 31, There is a capital gain rate differential for then for purposes of this subtitle, the 2021. any year if subsection (h) of section 1 applies amount to be used in computing the accumu- Subtitle C—Business-related Provisions to such taxable year.’’, and lated earnings credit under section 535(c)(2) PART I—CORPORATE PROVISIONS (iii) by striking paragraph (3)(E) and in- and (3) of such corporation for such taxable Subpart A—20.94-percent Tax Rate serting the following: year shall be the amount specified in sub- SEC. 13001. 20.94-PERCENT CORPORATE TAX ‘‘(E) RATE DIFFERENTIAL PORTION.—The section (a) with respect to such group, di- RATE. rate differential portion of foreign source net vided by the number of corporations which (a) IN GENERAL.—Subsection (b) of section capital gain, net capital gain, or the excess are component members of such group on the 11 is amended to read as follows: of net capital gain from sources within the last day of such taxable year. For purposes ‘‘(b) AMOUNT OF TAX.—The amount of the United States over net capital gain, as the of the preceding sentence, section 1563(b) tax imposed by subsection (a) shall be 20.94 case may be, is the same proportion of such shall be applied as if such last day were sub- percent of taxable income.’’. amount as— stituted for December 31.’’. (b) CONFORMING AMENDMENTS.— ‘‘(i) the excess of— (B) The table of sections for part II of sub- (1) The following sections are each amend- ‘‘(I) the highest rate of tax set forth in sub- chapter B of chapter 5 is amended by strik- ed by striking ‘‘section 11(b)(1)’’ and insert- section (a), (b), (c), (d), or (e) of section 1 ing the item relating to section 1561 and in- ing ‘‘section 11(b)’’: (whichever applies), over serting the following new item: (A) Section 280C(c)(3)(B)(ii)(II). ‘‘(II) the alternative rate of tax determined ‘‘Sec. 1561. Limitation on accumulated earn- (B) Paragraphs (2)(B) and (6)(A)(ii) of sec- under section 1(h), bears to ings credit in the case of cer- tion 860E(e). ‘‘(ii) that rate referred to in subclause tain controlled corporations.’’. (C) Section 7874(e)(1)(B) (I).’’. (7) Section 7518(g)(6)(A) is amended— (2)(A) Part I of subchapter P of chapter 1 is (N) Section 1374(b) is amended by striking (A) by striking ‘‘With respect to the por- amended by striking section 1201 (and by paragraph (4). tion’’ and inserting ‘‘In the case of a tax- striking the item relating to such section in (O) Section 1381(b) is amended by striking payer other than a corporation, with respect the table of sections for such part). ‘‘taxes imposed by section 11 or 1201’’ and in- to the portion’’, and (B) Section 12 is amended by striking para- serting ‘‘tax imposed by section 11’’. (B) by striking ‘‘(34 percent in the case of graphs (4) and (6), and by redesignating para- (P) Sections 6425(c)(1)(A), as amended by a corporation)’’. graph (5) as paragraph (4). section 12001, and 6655(g)(1)(A)(i) are each (c) EFFECTIVE DATE.— (C) Section 453A(c)(3) is amended by strik- amended by striking ‘‘or 1201(a),’’. (1) IN GENERAL.—Except as otherwise pro- ing ‘‘or 1201 (whichever is appropriate)’’. (Q) Section 7518(g)(6)(A) is amended by vided in this subsection, the amendments (D) Section 527(b) is amended— striking ‘‘or 1201(a)’’. made by this section shall apply to taxable (i) by striking paragraph (2), and (3)(A) Section 1445(e)(1) is amended— years beginning after December 31, 2018. (ii) by striking all that precedes ‘‘is hereby (i) by striking ‘‘35 percent’’ and inserting (2) WITHHOLDING.—The amendments made imposed’’ and inserting: ‘‘the highest rate of tax in effect for the tax- by subsection (b)(3) shall apply to distribu- ‘‘(b) TAX IMPOSED.—A tax’’. able year under section 11(b)’’, and tions made after December 31, 2018. (E) Sections 594(a) is amended by striking (ii) by striking ‘‘of the gain’’ and inserting (3) CERTAIN TRANSFERS.—The amendments ‘‘taxes imposed by section 11 or 1201(a)’’ and ‘‘multiplied by the gain’’. made by subsection (b)(6) shall apply to inserting ‘‘tax imposed by section 11’’. (B) Section 1445(e)(2) is amended by strik- transfers made after December 31, 2018. (F) Section 691(c)(4) is amended by striking ing ‘‘35 percent of the amount’’ and inserting (d) NORMALIZATION REQUIREMENTS.— ‘‘1201,’’. ‘‘the highest rate of tax in effect for the tax- (1) IN GENERAL.—A normalization method (G) Section 801(a) is amended— able year under section 11(b) multiplied by of accounting shall not be treated as being (i) by striking paragraph (2), and the amount’’. used with respect to any public utility prop- (ii) by striking all that precedes ‘‘is hereby (C) Section 1445(e)(6) is amended— erty for purposes of section 167 or 168 of the imposed’’ and inserting: (i) by striking ‘‘35 percent’’ and inserting Internal Revenue Code of 1986 if the tax- ‘‘(a) TAX IMPOSED.—A tax’’. ‘‘the highest rate of tax in effect for the tax- payer, in computing its cost of service for (H) Section 831(e) is amended by striking able year under section 11(b)’’, and ratemaking purposes and reflecting oper- paragraph (1) and by redesignating para- (ii) by striking ‘‘of the amount’’ and in- ating results in its regulated books of ac- graphs (2) and (3) as paragraphs (1) and (2), serting ‘‘multiplied by the amount’’. count, reduces the excess tax reserve more respectively. (D) Section 1446(b)(2)(B) is amended by rapidly or to a greater extent than such re- (I) Sections 832(c)(5) and 834(b)(1)(D) are striking ‘‘section 11(b)(1)’’ and inserting serve would be reduced under the average each amended by striking ‘‘sec. 1201 and fol- ‘‘section 11(b)’’. rate assumption method. lowing,’’. (4) Section 852(b)(1) is amended by striking (2) ALTERNATIVE METHOD FOR CERTAIN TAX- (J) Section 852(b)(3)(A) is amended by the last sentence. PAYERS.—If, as of the first day of the taxable striking ‘‘section 1201(a)’’ and inserting ‘‘sec- (5)(A) Part I of subchapter B of chapter 5 is year that includes the date of enactment of tion 11(b)’’. amended by striking section 1551 (and by this Act— (K) Section 857(b)(3) is amended— striking the item relating to such section in (A) the taxpayer was required by a regu- (i) by striking subparagraph (A) and redes- the table of sections for such part). latory agency to compute depreciation for ignating subparagraphs (B) through (F) as (B) Section 535(c)(5) is amended to read as public utility property on the basis of an av- subparagraphs (A) through (E), respectively, follows: erage life or composite rate method, and

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(B) the taxpayer’s books and underlying ‘‘(3) PROFESSIONAL STADIUM BOND.—The (c) UNMARRIED INDIVIDUALS OTHER THAN records did not contain the vintage account term ‘professional stadium bond’ means any SURVIVING SPOUSES AND HEADS OF HOUSE- data necessary to apply the average rate as- bond issued as part of an issue any proceeds HOLDS.—The table contained in subsection sumption method, of which are used to finance or refinance cap- (c) of section 1 is amended to read as follows: the taxpayer will be treated as using a nor- ital expenditures allocable to a facility (or malization method of accounting if, with re- appurtenant real property) which, during at If taxable income is: The tax is: spect to such jurisdiction, the taxpayer uses least 5 days during any calendar year, is used Not over $9,525 ...... 10% of taxable income. the alternative method for public utility as a stadium or arena for professional sports Over $9,525 but not over property that is subject to the regulatory exhibitions, games, or training.’’. $38,700 ...... $952.50, plus 12% of the authority of that jurisdiction. (c) EFFECTIVE DATE.—The amendments excess over $9,525. Over $38,700 but not over (3) DEFINITIONS.—For purposes of this sub- made by this section shall apply to bonds $70,000 ...... $4,453.50, plus 22% of the section— issued after November 2, 2017. excess over $38,700. (A) EXCESS TAX RESERVE.—The term ‘‘ex- Over $70,000 but not over $160,000 ...... $11,339.50, plus 24% of the cess tax reserve’’ means the excess of— SA 1845. Mr. INHOFE (for himself excess over $70,000. (i) the reserve for deferred taxes (as de- and Mr. LANKFORD) submitted an Over $160,000 but not over scribed in section 168(i)(9)(A)(ii) of the Inter- $200,000 ...... $32,939.50, plus 32% of the amendment intended to be proposed by excess over $160,000. nal Revenue Code of 1986) as determined him to the bill H.R. 1, to provide for Over $200,000 but not over under the Internal Revenue Code of 1986 as in reconciliation pursuant to titles II and $426,700 ...... $45,739.50, plus 35% of the effect on the day before the date of the en- excess over $200,000. V of the concurrent resolution on the Over $426,700 ...... $125,084.50, plus 39.6% of actment of this Act, over the excess over (ii) the amount which would be the balance budget for fiscal year 2018; which was $426,700. in such reserve if the amount of such reserve ordered to lie on the table; as follows: (d) MARRIED INDIVIDUALS FILING SEPARATE were determined by assuming that the cor- On page 34, line 23, insert ‘‘In the case of RETURNS.—The table contained in subsection porate rate reductions provided in this Act any taxable year beginning after December (d) of section 1 is amended to read as follows: were in effect for all prior periods. 31, 2017, and before January 1, 2019, the pre- (B) AVERAGE RATE ASSUMPTION METHOD.— ceding sentence shall not apply to any If taxable income is: The tax is: The average rate assumption method is the trust.’’ after ‘‘estate.’’. method under which the excess in the re- Not over $9,525 ...... 10% of taxable income. Over $9,525 but not over serve for deferred taxes is reduced over the SA 1846. Mr. KAINE (for himself, Mr. $38,700 ...... $952.50, plus 12% of the remaining lives of the property as used in its MANCHIN, Mrs. MCCASKILL, and Mr. excess over $9,525. Over $38,700 but not over regulated books of account which gave rise BENNET) submitted an amendment in- to the reserve for deferred taxes. Under such $70,000 ...... $4,453.50, plus 22% of the tended to be proposed by him to the excess over $38,700. method, if timing differences for the prop- Over $70,000 but not over erty reverse, the amount of the adjustment bill H.R. 1, to provide for reconciliation $160,000 ...... $11,339.50, plus 24% of the pursuant to titles II and V of the con- excess over $70,000. to the reserve for the deferred taxes is cal- Over $160,000 but not over culated by multiplying— current resolution on the budget for $200,000 ...... $32,939.50, plus 32% of the (i) the ratio of the aggregate deferred taxes fiscal year 2018; which was ordered to excess over $160,000. Over $200,000 but not over for the property to the aggregate timing dif- lie on the table; as follows: $240,026 ...... $45,739.50, plus 35% of the ferences for the property as of the beginning Beginning on page 95, strike line 7 and all excess over $200,000. of the period in question, by Over $240,026 ...... $59,748.60, plus 39.6% of that follows through page 97, line 14 and in- the excess over (ii) the amount of the timing differences sert the following: $240,026. which reverse during such period. (C) ALTERNATIVE METHOD.—The ‘‘alter- Subtitle B—Permanent Individual Income (e) ESTATES AND TRUSTS.—The table con- native method’’ is the method in which the Tax Relief for Middle Class tained in subsection (e) of section 1 is taxpayer— SEC. 12001. AMENDMENT OF INCOME TAX BRACK- amended to read as follows: (i) computes the excess tax reserve on all ETS. public utility property included in the plant (a) MARRIED INDIVIDUALS FILING JOINT RE- If taxable income is: The tax is: TURNS AND SURVIVING SPOUSES.—The table account on the basis of the weighted average Not over $2,550 ...... 10% of taxable income. life or composite rate used to compute depre- contained in subsection (a) of section 1 is Over $2,550 but not over ciation for regulatory purposes, and amended to read as follows: $9,150 ...... $255, plus 24% of the ex- cess over $2,550. (ii) reduces the excess tax reserve ratably Over $9,150 but not over over the remaining regulatory life of the If taxable income is: The tax is: $12,700 ...... $1,839, plus 35% of the ex- property. cess over $9,150. Not over $19,050 ...... 10% of taxable income. Over $12,700 ...... $3,081.50, plus 39.6% of (4) TAX INCREASED FOR NORMALIZATION VIO- Over $19,050 but not over the excess over $12,700. LATION.—If, for any taxable year ending after $77,400 ...... $1,905, plus 12% of the ex- cess over $19,050. (f) INFLATION ADJUSTMENT.—Section the date of the enactment of this Act, the Over $77,400 but not over taxpayer does not use a normalization meth- $140,000 ...... $8,907, plus 22% of the ex- 1(f)(2)(A), as amended by this Act, is amend- od of accounting, the taxpayer’s tax for the cess over $77,400. ed by striking ‘‘1992’’ and inserting ‘‘2017’’. taxable year shall be increased by the Over $140,000 but not over (g) EFFECTIVE DATE.—The amendments $320,000 ...... $22,679, plus 24% of the made by this section shall apply to taxable amount by which it reduces its excess tax re- excess over $140,000. serve more rapidly than permitted under a Over $320,000 but not over years beginning after December 31, 2025. normalization method of accounting. $400,000 ...... $65,879, plus 32% of the SEC. 12002. CORPORATE TAX RATE. excess over $320,000. N ENERAL Over $400,000 but not over (a) I G .—Section 11(b), as amended SA 1844. Mr. LANKFORD submitted $480,050 ...... $91,479, plus 35% of the by this Act, is amended by striking ‘‘20 per- an amendment intended to be proposed excess over $400,000. cent’’ and inserting ‘‘25 percent’’. Over $480,050 ...... $119,496.50, plus 39.6% of (b) EFFECTIVE DATE.—The amendment to amendment SA 1618 proposed by Mr. the excess over $480,050. made by this section shall apply to taxable MCCONNELL (for Mr. HATCH (for himself years beginning after December 31, 2018. and Ms. MURKOWSKI)) to the bill H.R. 1, (b) HEADS OF HOUSEHOLDS.—The table con- to provide for reconciliation pursuant tained in subsection (b) of section 1 is SA 1847. Ms. CANTWELL submitted to titles II and V of the concurrent res- amended to read as follows: an amendment intended to be proposed olution on the budget for fiscal year to amendment SA 1618 proposed by Mr. If taxable income is: The tax is: 2018; which was ordered to lie on the MCCONNELL (for Mr. HATCH (for himself table; as follows: Not over $13,600 ...... 10% of taxable income. and Ms. MURKOWSKI)) to the bill H.R. 1, Over $13,600 but not over At the appropriate place, insert the fol- $51,800 ...... $1,360, plus 12% of the ex- to provide for reconciliation pursuant lowing: cess over $13,600. to titles II and V of the concurrent res- Over $51,800 but not over SEC. ll. NO TAX EXEMPT BONDS FOR PROFES- $70,000 ...... $5,944, plus 22% of the ex- olution on the budget for fiscal year SIONAL STADIUMS. cess over $51,800. 2018; which was ordered to lie on the (a) IN GENERAL.—Section 103(b), as amend- Over $70,000 but not over $160,000 ...... $9,948, plus 24% of the ex- table; as follows: ed by this Act, is further amended by adding cess over $70,000. In section 20001(b)(2), strike subparagraph at the end the following new paragraph: Over $160,000 but not over (B). ‘‘(4) PROFESSIONAL STADIUM BOND.—Any $200,000 ...... $31,548, plus 32% of the excess over $160,000. professional stadium bond.’’. Over $200,000 but not over (b) PROFESSIONAL STADIUM BOND DE- $453,350 ...... $44,348, plus 35% of the SA 1848. Ms. CANTWELL submitted FINED.—Subsection (c) of section 103 is excess over $200,000. an amendment intended to be proposed Over $453,350 ...... $133,020.50, plus 39.6% of amended by adding at the end the following the excess over to amendment SA 1618 proposed by Mr. new paragraph: $453,350. MCCONNELL (for Mr. HATCH (for himself

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ERNIZATION FUND. ‘‘(B) PAYROLL TAXES.— to titles II and V of the concurrent res- (a) PURPOSE.—The purpose of this section olution on the budget for fiscal year ‘‘(i) IN GENERAL.—For purposes of subpara- is to amend the Bipartisan Budget Act of graph (A), the term ‘payroll taxes’ means, 2018; which was ordered to lie on the 2015 (Public Law 114–74; 129 Stat. 584)— with respect to any taxpayer for any taxable table; as follows: (1) to increase national security; and year, the amount of the taxes imposed by— Strike title II and insert the following: (2) to increase the ability of the United ‘‘(I) section 1401 on the self-employment in- TITLE II States to respond to disasters. come of the taxpayer for the taxable year, (b) USE OF FUND.—Section 404(d)(2)(B) of ‘‘(II) section 3101 on wages received by the SEC. 20001. STRATEGIC PETROLEUM RESERVE the Bipartisan Budget Act of 2015 (42 U.S.C. DRAWDOWN AND SALE. taxpayer during the calendar year in which 6239 note; Public Law 114–74) is amended— (a) DRAWDOWN AND SALE.— the taxable year begins, (1) in clause (ii), by striking ‘‘and’’; (1) IN GENERAL.—Notwithstanding section ‘‘(III) section 3111 on wages paid by an em- (2) in clause (iii), by striking the period at 161 of the Energy Policy and Conservation ployer with respect to employment of the the end and inserting ‘‘; and’’; and Act (42 U.S.C. 6241), except as provided in taxpayer during the calendar year in which (3) by adding at the end the following: subsection (b), the Secretary of Energy shall the taxable year begins, ‘‘(iv) the conduct of activities to modernize draw down and sell from the Strategic Petro- ‘‘(IV) sections 3201(a) and 3211(a) on com- Strategic Petroleum Reserve facilities, in- leum Reserve 25,000,000 barrels of crude oil pensation received by the taxpayer during cluding each of the Strategic Petroleum Re- during the period of fiscal years 2026 through the calendar year in which the taxable year serve storage sites in the States of Louisiana 2027. begins, and and Texas.’’. (2) DISPOSITION OF AMOUNTS RECEIVED FROM ‘‘(V) section 3221(a) on compensation paid SALE.—The Secretary of the Treasury shall, by an employer with respect to services ren- in the year in which the sale occurs, deposit SA 1850. Mr. McCONNELL (for Mr. dered by the taxpayer during the calendar the amounts received from a sale under para- RUBIO (for himself, Mr. LEE, Mr. SASSE, year in which the taxable year begins. graph (1) in the general fund of the Treasury. and Mr. KENNEDY)) proposed an amend- ‘‘(ii) COORDINATION WITH SPECIAL REFUND OF (b) LIMITATION.—The Secretary of Energy ment to amendment SA 1618 proposed PAYROLL TAXES.—The term ‘payroll taxes’ shall not drawdown or conduct sales of crude by Mr. MCCONNELL (for Mr. HATCH (for shall not include any taxes to the extent the taxpayer is entitled to a special refund of oil under subsection (a) after the date on himself and Ms. MURKOWSKI)) to the such taxes under section 6413(c). which a total of $1,000,000,000 has been depos- bill H.R. 1, to provide for reconciliation ‘‘(iii) SPECIAL RULE.—Any amounts paid ited in the general fund of the Treasury from pursuant to titles II and V of the con- sales authorized under that subsection. pursuant to an agreement under section current resolution on the budget for 3121(l) (relating to agreements entered into SA 1849. Mr. BENNET submitted an fiscal year 2018; as follows: by American employers with respect to for- amendment intended to be proposed by Beginning on page 46, strike line 5 and all eign affiliates) which are equivalent to the him to the bill H.R. 1, to provide for that follows through page 48, line 21, and in- taxes referred to in subclause (II) or (III) of reconciliation pursuant to titles II and sert the following: clause (i) shall be treated as taxes referred to ‘‘(h) SPECIAL RULES FOR TAXABLE YEARS in such clause. V of the concurrent resolution on the ‘‘(C) EXCEPTION FOR TAXPAYERS EXCLUDING budget for fiscal year 2018; which was 2018 THROUGH 2025.— ‘‘(1) IN GENERAL.—In the case of a taxable FOREIGN EARNED INCOME.—Subparagraph (A) ordered to lie on the table; as follows: year beginning after December 31, 2017, and shall not apply to any taxpayer for any tax- Strike title II and insert the following: before January 1, 2026, this section shall be able year if such taxpayer elects to exclude TITLE II applied as provided in paragraphs (2) through any amount from gross income under section 911 for such taxable year. SEC. 20001. LIMITATIONS ON AMOUNT OF DIS- (7). ‘‘(7) SOCIAL SECURITY NUMBER REQUIRED.— TRIBUTED QUALIFIED OUTER CON- ‘‘(2) CREDIT AMOUNT.—Subsection (a) shall TINENTAL SHELF REVENUES. be applied by substituting ‘$2,000’ for ‘$1,000’. No credit shall be allowed under subsection Section 105(f)(1) of the Gulf of Mexico En- ‘‘(3) LIMITATION.—In lieu of the amount de- (d) to a taxpayer with respect to any quali- ergy Security Act of 2006 (43 U.S.C. 1331 note; termined under subsection (b)(2), the thresh- fying child unless the taxpayer includes the Public Law 109–432) is amended by striking old amount shall be— social security number of such child on the ‘‘exceed $500,000,000 for each of fiscal years ‘‘(A) in the case of a joint return, $500,000, return of tax for the taxable year. For pur- 2016 through 2055.’’ and inserting the fol- and poses of the preceding sentence, the term ‘so- lowing: ‘‘exceed— ‘‘(B) in the case of an individual who is not cial security number’ means a social secu- ‘‘(A) $500,000,000 for each of fiscal years 2016 married or a married individual filing a sepa- rity number issued to an individual by the through 2019; rate return, $250,000. Social Security Administration, but only if ‘‘(B) $650,000,000 for each of fiscal years 2020 ‘‘(4) DEFINITION OF QUALIFYING CHILD.— the social security number is issued to a cit- and 2021; and Paragraph (1) of subsection (c) shall be ap- izen of the United States or is issued pursu- ‘‘(C) $500,000,000 for each of fiscal years 2022 plied by substituting ‘18’ for ‘17’. ant to subclause (I) (or that portion of sub- through 2055.’’. ‘‘(5) PARTIAL CREDIT ALLOWED FOR CERTAIN clause (III) that relates to subclause (I)) of section 205(c)(2)(B)(i) of the Social Security SEC. 20002. STRATEGIC PETROLEUM RESERVE OTHER DEPENDENTS.— DRAWDOWN AND SALE. ‘‘(A) IN GENERAL.—The credit determined Act.’’. NCREASE IN ORPORATE AX ATE (a) DRAWDOWN AND SALE.— under subsection (a) (after the application of (b) I C T R .— (1) IN GENERAL.—Notwithstanding section paragraph (2)) shall be increased by $500 for Subsection (b) of section 11, as amended by 161 of the Energy Policy and Conservation each dependent of the taxpayer (as defined in section 13001 of this Act, is amended by Act (42 U.S.C. 6241), except as provided in section 152) other than a qualifying child de- striking ‘‘20 percent’’ and inserting ‘‘20.94 subsections (b) and (c), the Secretary of En- scribed in subsection (c) (after the applica- percent’’. ergy shall draw down and sell from the Stra- tion of paragraph (4)). (c) EFFECTIVE DATE.—The amendments tegic Petroleum Reserve 25,000,000 barrels of ‘‘(B) EXCEPTION FOR CERTAIN NONCITIZENS.— made by crude oil during the period of fiscal years Subparagraph (A) shall not apply with re- 2026 through 2027. spect to any individual who would not be a SA 1851. Mr. RUBIO (for himself, Mr. (2) DEPOSIT OF AMOUNTS RECEIVED FROM dependent if subparagraph (A) of section LEE, Mr. SASSE, and Mr. KENNEDY) sub- SALE.—Amounts received from a sale under 152(b)(3) were applied without regard to all mitted an amendment intended to be paragraph (1) shall be deposited in the gen- that follows ‘resident of the United States’. proposed by him to the bill H.R. 1, to eral fund of the Treasury during the fiscal ‘‘(6) PORTION OF CREDIT REFUNDABLE.—In provide for reconciliation pursuant to year in which the sale occurs. lieu of subsection (d), the following provi- titles II and V of the concurrent resolu- (b) EMERGENCY PROTECTION.—The Sec- sions shall apply for purposes of the credit tion on the budget for fiscal year 2018; retary of Energy shall not draw down and allowable under this section: which was ordered to lie on the table; sell crude oil under subsection (a) in a quan- ‘‘(A) IN GENERAL.—The aggregate credits tity that would limit the authority to sell allowed to a taxpayer under subpart C shall as follows: petroleum products under subsection (h) of be increased by the lesser of— Beginning on page 46, strike line 5 and all section 161 of the Energy Policy and Con- ‘‘(i) the credit which would be allowed that follows through page 48, line 21, and in- servation Act (42 U.S.C. 6241) in the full under this section without regard to this sert the following: quantity authorized by that subsection. paragraph and the limitation under section ‘‘(h) SPECIAL RULES FOR TAXABLE YEARS (c) LIMITATION.—The Secretary of Energy 26(a), or 2018 THROUGH 2025.— shall not drawdown or conduct sales of crude ‘‘(ii) the amount by which the aggregate ‘‘(1) IN GENERAL.—In the case of a taxable oil under subsection (a) after the date on amount of credits allowed by this subpart year beginning after December 31, 2017, and which a total of $1,325,000,000 has been depos- (determined without regard to this para- before January 1, 2026, this section shall be ited in the general fund of the Treasury from graph) would increase if the limitation im- applied as provided in paragraphs (2) through sales authorized under that subsection. posed by section 26(a) were increased by an (7).

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‘‘(2) CREDIT AMOUNT.—Subsection (a) shall ‘‘(iii) online educational materials, SEC. 11022. INCREASE IN AND MODIFICATION OF be applied by substituting ‘$2,000’ for ‘$1,000’. ‘‘(iv) tuition for tutoring or educational CHILD TAX CREDIT. ‘‘(3) LIMITATION.—In lieu of the amount de- classes outside of the home (but only if the (a) IN GENERAL.—Section 24 is amended— termined under subsection (b)(2), the thresh- tutor or instructor is not related to the stu- (1) by striking subsections (a) and (b) and old amount shall be— dent), inserting the following: ‘‘(A) in the case of a joint return, $500,000, ‘‘(v) dual enrollment in an institution of ‘‘(a) ALLOWANCE OF CREDIT.—There shall be and higher education, and allowed as a credit against the tax imposed ‘‘(B) in the case of an individual who is not ‘‘(vi) educational therapies for students by this chapter for the taxable year an married or a married individual filing a sepa- with disabilities, amount equal to the sum of— rate return, $250,000. in connection with a homeschool (whether ‘‘(1) with respect to each qualifying child ‘‘(4) DEFINITION OF QUALIFYING CHILD.— treated as a homeschool or a private school of the taxpayer who has attained 6 years of Paragraph (1) of subsection (c) shall be ap- for purposes of applicable State law).’’. age before the close of such taxable year and plied by substituting ‘18’ for ‘17’. (2) LIMITATION.—Section 529(e)(3)(A) is for which the taxpayer is allowed a deduc- ‘‘(5) PARTIAL CREDIT ALLOWED FOR CERTAIN amended by adding at the end the following: tion under section 151, an amount equal to OTHER DEPENDENTS.— ‘‘The amount of cash distributions from all $2,000, and ‘‘(A) IN GENERAL.—The credit determined qualified tuition programs described in sub- ‘‘(2) with respect to each qualifying child under subsection (a) (after the application of section (b)(1)(A)(ii) with respect to a bene- of the taxpayer who has not attained 6 years paragraph (2)) shall be increased by $500 for ficiary during any taxable year shall, in the of age before the close of such taxable year each dependent of the taxpayer (as defined in aggregate, include not more than $10,000 in and for which the taxpayer is allowed a de- section 152) other than a qualifying child de- expenses described in subsection (c)(7) in- duction under section 151, an amount equal scribed in subsection (c) (after the applica- curred during the taxable year.’’. to $2,500. tion of paragraph (4)). (b) EFFECTIVE DATE.—The amendments ‘‘(b) LIMITATION.— ‘‘(B) EXCEPTION FOR CERTAIN NONCITIZENS.— made by subsection (a) shall apply to con- ‘‘(1) IN GENERAL.—The amount of the credit Subparagraph (A) shall not apply with re- tributions made after December 31, 2017. allowable under subsection (a) (including spect to any individual who would not be a (c) OFFSET.— any increase pursuant to subsection (h)) dependent if subparagraph (A) of section (1) MODIFICATION OF RULES RELATING TO shall be reduced (but not below zero) by an 152(b)(3) were applied without regard to all HARDSHIP WITHDRAWALS FROM CASH OR DE- amount equal to 5 percent of the taxpayer’s that follows ‘resident of the United States’. FERRED ARRANGEMENTS.—Section 401(k) is adjusted gross income which is in excess of ‘‘(6) PORTION OF CREDIT REFUNDABLE.—Sub- amended by adding at the end the following: the threshold amount. section (d)(1)(B)(i) shall be applied by sub- ‘‘(14) SPECIAL RULES RELATING TO HARDSHIP ‘‘(2) THRESHOLD AMOUNT.— stituting— WITHDRAWALS.—For purposes of paragraph ‘‘(A) IN GENERAL.—For purposes of para- ‘‘(A) ‘15.3 percent’ for ‘15 percent’, and (2)(B)(i)(IV)— graph (1), the term ‘threshold amount’ ‘‘(B) ‘$0’ for ‘$3,000’. ‘‘(A) AMOUNTS WHICH MAY BE WITHDRAWN.— means— ‘‘(7) SOCIAL SECURITY NUMBER REQUIRED.— The following amounts may be distributed ‘‘(i) $250,000 in the case of a joint return, No credit shall be allowed under subsection upon hardship of the employee: ‘‘(ii) $200,000 in the case of an individual (d) to a taxpayer with respect to any quali- ‘‘(i) Contributions to a profit-sharing or who is not married, and fying child unless the taxpayer includes the stock bonus plan to which section 402(e)(3) ‘‘(iii) $125,000 in the case of a married indi- social security number of such child on the applies. vidual filing a separate return. return of tax for the taxable year. For pur- ‘‘(ii) Qualified nonelective contributions ‘‘(B) MARITAL STATUS.—For purposes of poses of the preceding sentence, the term ‘so- (as defined in subsection (m)(4)(C)). this paragraph, marital status shall be deter- cial security number’ means a social secu- ‘‘(iii) Qualified matching contributions de- mined under section 7703.’’, rity number issued to an individual by the scribed in paragraph (3)(D)(ii)(I). (2) in subsection (d)(1)— Social Security Administration, but only if ‘‘(iv) Earnings on any contributions de- (A) in subparagraph (A), by inserting ‘‘, the social security number is issued to a cit- scribed in clause (i), (ii), or (iii). subsection (h),’’ after ‘‘this subsection’’, and izen of the United States or is issued pursu- ‘‘(B) NO REQUIREMENT TO TAKE AVAILABLE (B) in subparagraph (B)(i)— ant to subclause (I) (or that portion of sub- LOAN.—A distribution shall not be treated as (i) by striking ‘‘15 percent’’ and inserting clause (III) that relates to subclause (I)) of failing to be made upon the hardship of an ‘‘45 percent’’, and section 205(c)(2)(B)(i) of the Social Security employee solely because the employee does (ii) by striking ‘‘as exceeds $3,000’’, and Act.’’. not take any available loan under the (3) by adding at the end the following new (b) INCREASE IN CORPORATE TAX RATE.— plan.″.’’. subsections: Subsection (b) of section 11, as amended by (2) CONFORMING AMENDMENT.—Section ‘‘(h) ADDITIONAL CREDIT FOR CERTAIN section 13001 of this Act, is amended by 401(k)(2)(B)(i)(IV) is amended to read as fol- OTHER DEPENDENTS.— striking ‘‘20 percent’’ and inserting ‘‘20.94 lows: ‘‘(1) IN GENERAL.—In the case of a taxable percent’’. ‘‘(IV) subject to the provisions of para- year beginning after December 31, 2017, and (c) EFFECTIVE DATE.—The amendments graph (14), upon hardship of the employee, before January 1, 2026, the credit determined made by or″.’’. under subsection (a) shall be increased by (3) EFFECTIVE DATE.—The amendments $500 for each dependent of the taxpayer (as SA 1852. Mr. CORNYN (for Mr. CRUZ made by this subsection shall apply to plan defined in section 152) other than a quali- (for himself, Mr. COTTON, Mr. KENNEDY, years beginning after December 31, 2017. fying child described in subsection (c). and Mr. SASSE)) proposed an amend- ‘‘(2) EXCEPTION FOR CERTAIN NON-CITIZENS.— ment to amendment SA 1618 proposed SA 1853. Mr. INHOFE (for himself Paragraph (1) shall not apply with respect to by Mr. MCCONNELL (for Mr. HATCH (for and Mr. LANKFORD) submitted an any individual who would not be a dependent himself and Ms. MURKOWSKI)) to the amendment intended to be proposed by if subparagraph (A) of section 152(b)(3) were bill H.R. 1, to provide for reconciliation him to the bill H.R. 1, to provide for applied without regard to all that follows pursuant to titles II and V of the con- reconciliation pursuant to titles II and ‘resident of the United States’. ‘‘(i) DEFINITION OF QUALIFYING CHILD.—In current resolution on the budget for V of the concurrent resolution on the the case of a taxable year beginning before fiscal year 2018; as follows: budget for fiscal year 2018; which was January 1, 2025, paragraph (1) of subsection At the end of part IV of subtitle A of title ordered to lie on the table; as follows: (c) shall be applied by substituting ‘18’ for I, insert the following: On page 35, line 9, insert ‘‘In the case of ‘17’. SEC. 11033. 529 ACCOUNT FUNDING FOR ELEMEN- any taxable year beginning after December ‘‘(j) INFLATION ADJUSTMENT.— TARY AND SECONDARY EDUCATION. 31, 2017, and before January 1, 2019, the pre- ‘‘(1) IN GENERAL.—In the case of any tax- (a) IN GENERAL.— ceding sentence shall not apply to any able year beginning after 2018, each of the (1) IN GENERAL.—Section 529(c) is amended trust.’’ after ‘‘estate.’’. dollar amounts in subsection (a) shall be in- by adding at the end the following new para- creased by an amount equal to— graph: SA 1854. Mr. BROWN (for himself, ‘‘(A) such dollar amount, multiplied by ‘‘(7) TREATMENT OF ELEMENTARY AND SEC- Mr. BENNET, Mr. DURBIN, Mr. CASEY, ‘‘(B) the cost-of-living adjustment deter- ONDARY TUITION.—Any reference in this sub- Mr. WYDEN, Mrs. MURRAY, and Mr. mined under section 1(f)(3) for the calendar section to the term ‘qualified higher edu- MENENDEZ) submitted an amendment year in which the taxable year begins, deter- cation expense’ shall include a reference to— intended to be proposed by him to the mined by substituting ‘2017’ for ‘2016’ in sub- ‘‘(A) expenses for tuition in connection bill H.R. 1, to provide for reconciliation paragraph (A)(ii) thereof. with enrollment or attendance at an elemen- pursuant to titles II and V of the con- ‘‘(2) ROUNDING.—If any increase determined tary or secondary public, private, or reli- under paragraph (1) is not a multiple of $100, gious school, and current resolution on the budget for such increase shall be rounded to the next ‘‘(B) expenses for— fiscal year 2018; which was ordered to lowest multiple of $100.’’. ‘‘(i) curriculum and curricular materials, lie on the table; as follows: (b) EFFECTIVE DATE.—The amendments ‘‘(ii) books or other instructional mate- Strike section 11022 and insert the fol- made by subsection (a) shall apply to taxable rials, lowing: years beginning after December 31, 2017.

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(c) OFFSETS.— and Ms. MURKOWSKI)) to the bill H.R. 1, ‘‘If taxable income is: The tax is: (1) ADJUSTMENT AND TERMINATION OF COR- to provide for reconciliation pursuant Over $38,700 but not over PORATE RATE.—Section 11, as amended by to titles II and V of the concurrent res- $70,000 ...... $4,453.50, plus 22% of the section 13001 of this Act, is amended— olution on the budget for fiscal year excess over $38,700. (A) in subsection (b), by striking ‘‘20 per- Over $70,000 but not over cent’’ and inserting ‘‘25 percent’’ 2018; as follows: $160,000 ...... $11,339.50, plus 24% of the Strike all after the first word and insert excess over $70,000. (B) by adding at the end the following: Over $160,000 but not over ‘‘(e) TERMINATION OF 25 PERCENT RATE.—In the following: $200,000 ...... $32,939.50, plus 32% of the the case of any taxable year beginning after TITLE I excess over $160,000. Over $200,000 but not over December 31, 2027— SEC. 11000. SHORT TITLE, ETC. $500,000 ...... $45,739.50, plus 35% of the ‘‘(1) the tax computed under subsection (a) (a) SHORT TITLE.—This title may be cited excess over $200,000. shall be computed in the same manner as as the ‘‘Tax Cuts and Jobs Act’’. Over $500,000 ...... $150,739.50, plus 38.5% of the excess over such tax was computed under subsection (b) (b) AMENDMENT OF 1986 CODE.—Except as $500,000. (as in effect on the day before the date of the otherwise expressly provided, whenever in enactment of the Tax Cuts and Jobs Act), this title an amendment or repeal is ex- ‘‘(D) MARRIED INDIVIDUALS FILING SEPARATE and pressed in terms of an amendment to, or re- RETURNS.—The following table shall be ap- ‘‘(2) this title shall be applied and adminis- peal of, a section or other provision, the ref- plied in lieu of the table contained in sub- tered as if the amendments made by section erence shall be considered to be made to a section (d): 13002 of such Act had not been enacted.’’. section or other provision of the Internal (2) ADJUSTMENT OF HIGHEST RATE BRACK- Revenue Code of 1986. ‘‘If taxable income is: The tax is: ET.— Subtitle A—Individual Tax Reform Not over $9,525 ...... 10% of taxable income. (A) JOINT RETURNS.—The last row of the PART I—TAX RATE REFORM Over $9,525 but not over table contained in section 1(j)(2)(A), as added $38,700 ...... $952.50, plus 12% of the by section 11001(a), is amended to read as fol- SEC. 11001. MODIFICATION OF RATES. excess over $9,525. lows: (a) IN GENERAL.—Section 1 is amended by Over $38,700 but not over adding at the end the following new sub- $70,000 ...... $4,453.50, plus 22% of the excess over $38,700. ‘‘Over $1,000,000 ...... $301,479, plus 39.6% of the section: Over $70,000 but not over excess over $1,000,000.’’. ‘‘(j) MODIFICATIONS FOR TAXABLE YEARS $160,000 ...... $11,339.50, plus 24% of the 2018 THROUGH 2025.— excess over $70,000. (B) HEADS OF HOUSEHOLDS.—The last row of ‘‘(1) IN GENERAL.—In the case of a taxable Over $160,000 but not over the table contained in section 1(j)(2)(B), as $200,000 ...... $32,939.50, plus 32% of the year beginning after December 31, 2017, and added by section 11001(a), is amended to read excess over $160,000. before January 1, 2026— Over $200,000 but not over as follows: ‘‘(A) subsection (i) shall not apply, and $500,000 ...... $45,739.50, plus 35% of the excess over $200,000. ‘‘Over $500,000 ...... $149,348, plus 39.6% of the ‘‘(B) this section (other than subsection (i)) Over $500,000 ...... $150,739.50, plus 38.5% of excess over $500,000.’’. shall be applied as provided in paragraphs (2) the excess over through (7). $500,000. (C) UNMARRIED INDIVIDUALS.—The last row ATE TABLES.— of the table contained in section 1(j)(2)(C), as ‘‘(2) R ‘‘(E) ESTATES AND TRUSTS.—The following added by section 11001(a), is amended to read ‘‘(A) MARRIED INDIVIDUALS FILING JOINT RE- table shall be applied in lieu of the table con- as follows: TURNS AND SURVIVING SPOUSES.—The fol- tained in subsection (e): lowing table shall be applied in lieu of the ‘‘Over $500,000 ...... $150,739.50, plus 39.6% of table contained in subsection (a): ‘‘If taxable income is: The tax is: the excess over $500,000.’’. ‘‘If taxable income is: The tax is: Not over $2,550 ...... 10% of taxable income. Over $2,550 but not over (D) MARRIED INDIVIDUALS FILING SEPARATE Not over $19,050 ...... 10% of taxable income. $9,150 ...... $255, plus 24% of the ex- RETURNS.—The last row of the table con- Over $19,050 but not over cess over $2,550. Over $9,150 but not over tained in section 1(j)(2)(D), as added by sec- $77,400 ...... $1,905, plus 12% of the ex- cess over $19,050. $12,500 ...... $1,839, plus 35% of the ex- tion 11001(a), is amended to read as follows: Over $77,400 but not over cess over $9,150. $140,000 ...... $8,907, plus 22% of the ex- Over $12,500 ...... $3,011.50, plus 38.5% of ‘‘Over $500,000 ...... $150,739.50, plus 39.6% of cess over $77,400. the excess over $12,500. the excess over Over $140,000 but not over $500,000.’’. $320,000 ...... $22,679, plus 24% of the ‘‘(F) REFERENCES TO RATE TABLES.—Any excess over $140,000. reference in this title to a rate of tax under (E) EFFECTIVE DATE.—The amendments Over $320,000 but not over subsection (c) shall be treated as a reference $400,000 ...... $65,879, plus 32% of the made by this paragraph shall apply to tax- excess over $320,000. to the corresponding rate bracket under sub- able years beginning after December 31, 2017. Over $400,000 but not over paragraph (C) of this paragraph, except that (3) GLOBAL INTANGIBLE LOW-TAXED INCOME $1,000,000 ...... $91,479, plus 35% of the the reference in section 3402(q)(1) to the third ON A COUNTRY-BY-COUNTRY BASIS.— excess over $400,000. Over $1,000,000 ...... $301,479, plus 38.5% of the lowest rate of tax applicable under sub- (A) IN GENERAL.—Section 951(a), as added excess over $1,000,000. section (c) shall be treated as a reference to by section 14201 of this Act, is amended by ‘‘(B) HEADS OF HOUSEHOLDS.—The following the fourth lowest rate of tax under subpara- adding at the end the following: graph (C). ‘‘(g) DETERMINATION OF GLOBAL INTANGIBLE table shall be applied in lieu of the table con- ‘‘(3) ADJUSTMENTS.— LOW-TAXED INCOME ON A COUNTRY-BY-COUN- tained in subsection (b): ‘‘(A) NO ADJUSTMENT IN 2018.—The tables TRY RATHER THAN AGGREGATE BASIS.— contained in paragraph (2) shall apply with- ‘‘(1) IN GENERAL.—Notwithstanding any ‘‘If taxable income is: The tax is: out adjustment for taxable years beginning other provision of this section, the global in- Not over $13,600 ...... 10% of taxable income. tangible low-taxed income of any United Over $13,600 but not over after December 31, 2017, and before January States shareholder for any taxable year shall $51,800 ...... $1,360, plus 12% of the ex- 1, 2019. cess over $13,600. ‘‘(B) SUBSEQUENT YEARS.—For taxable be determined separately with respect to Over $51,800 but not over each foreign country by taking into account $70,000 ...... $5,944, plus 22% of the ex- years beginning after December 31, 2018, the such shareholder’s pro rata share of net CFC cess over $51,800. Secretary shall prescribe tables which shall Over $70,000 but not over apply in lieu of the tables contained in para- tested income and net deemed tangible in- $160,000 ...... $9,948, plus 24% of the ex- come return which is properly allocable to cess over $70,000. graph (2) in the same manner as under para- such foreign country. Over $160,000 but not over graphs (1) and (2) of subsection (f), except $200,000 ...... $31,548, plus 32% of the that in prescribing such tables— ‘‘(2) APPLICATION.—The Secretary shall excess over $160,000. take such actions as are necessary to provide Over $200,000 but not over ‘‘(i) subsection (f)(3) shall be applied by for the application of this section, and any $500,000 ...... $44,348, plus 35% of the substituting ‘calendar year 2017’ for ‘cal- excess over $200,000. provision of this title to which this section Over $500,000 ...... $149,348, plus 38.5% of the endar year 2016’ in subparagraph (A)(ii) relates, on a country-by-country rather than excess over $500,000. thereof, an aggregate basis.’’. ‘‘(ii) subsection (f)(7)(B) shall apply to any ‘‘(C) UNMARRIED INDIVIDUALS OTHER THAN (B) EFFECTIVE DATE.—The amendment unmarried individual other than a surviving SURVIVING SPOUSES AND HEADS OF HOUSE- made by this subsection shall take effect as spouse or head of household, and HOLDS.—The following table shall be applied if included in the amendments made by sec- ‘‘(iii) subsection (f)(8) shall not apply. in lieu of the table contained in subsection tion 14201 of this Act. (c): ‘‘(4) SPECIAL RULES FOR CERTAIN CHILDREN WITH UNEARNED INCOME.— SA 1855. Mr. MCCONNELL (for Mr. N GENERAL ‘‘If taxable income is: The tax is: ‘‘(A) I .—In the case of a child to HATCH (for himself and Ms. MUR- whom subsection (g) applies for the taxable KOWSKI)) proposed an amendment to Not over $9,525 ...... 10% of taxable income. year, the rules of subparagraphs (B) and (C) Over $9,525 but not over amendment SA 1618 proposed by Mr. $38,700 ...... $952.50, plus 12% of the shall apply in lieu of the rule under sub- MCCONNELL (for Mr. HATCH (for himself excess over $9,525. section (g)(1).

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‘‘(B) MODIFICATIONS TO APPLICABLE RATE case of a married individual filing a separate ment of Labor). The values of the Chained BRACKETS.—In determining the amount of return), Consumer Price Index for All Urban Con- tax imposed by this section for the taxable ‘‘(II) in the case of an individual who is the sumers taken into account for purposes of year on a child described in subparagraph head of a household (as defined in section determining the cost-of-living adjustment (A), the income tax table otherwise applica- 2(b)), $452,400, for any calendar year under this subsection ble under this subsection to the child shall ‘‘(III) in the case of any other individual shall be the latest values so published as of be applied with the following modifications: (other than an estate or trust), $425,800, and the date on which such Bureau publishes the ‘‘(i) 24-PERCENT BRACKET.—The maximum ‘‘(IV) in the case of an estate or trust, initial value of the Chained Consumer Price taxable income which is taxed at a rate $12,700. Index for All Urban Consumers for the below 24 percent shall not be more than the ‘‘(C) INFLATION ADJUSTMENT.—In the case month of August for the preceding calendar earned taxable income of such child. of any taxable year beginning after 2018, year. ‘‘(ii) 35-PERCENT BRACKET.—The maximum each of the dollar amounts in clauses (i) and ‘‘(B) DETERMINATION FOR CALENDAR YEAR.— taxable income which is taxed at a rate (ii) of subparagraph (B) shall be increased by The C-CPI-U for any calendar year is the av- below 35 percent shall not be more than the an amount equal to— erage of the C-CPI-U as of the close of the 12- sum of— ‘‘(i) such dollar amount, multiplied by month period ending on August 31 of such ‘‘(I) the earned taxable income of such ‘‘(ii) the cost-of-living adjustment deter- calendar year.’’. child, plus mined under subsection (f)(3) for the cal- (c) APPLICATION TO PERMANENT TAX TA- ‘‘(II) the minimum taxable income for the endar year in which the taxable year begins, BLES.—Section 1(f)(2)(A) is amended by in- 35-percent bracket in the table under para- determined by substituting ‘calendar year serting ‘‘, determined by substituting ‘1992’ graph (2)(E) (as adjusted under paragraph (3)) 2017’ for ‘calendar year 2016’ in subparagraph for ‘2016’ in paragraph (3)(A)(ii)’’. for the taxable year. (A)(ii) thereof. (d) APPLICATION TO OTHER INTERNAL REV- ‘‘(iii) 38.5-PERCENT BRACKET.—The max- ‘‘(6) SECTION 15 NOT TO APPLY.—Section 15 ENUE CODE OF 1986 PROVISIONS.— imum taxable income which is taxed at a shall not apply to any change in a rate of tax (1) The following sections are each amend- rate below 38.5 percent shall not be more by reason of this subsection.’’. ed by striking ‘‘for ‘calendar year 1992’ in than the sum of— (b) DUE DILIGENCE TAX PREPARER REQUIRE- subparagraph (B)’’ and inserting ‘‘for ‘cal- ‘‘(I) the earned taxable income of such MENT WITH RESPECT TO HEAD OF HOUSEHOLD endar year 2016’ in subparagraph (A)(ii)’’: child, plus FILING STATUS.—Subsection (g) of section ‘‘(II) the minimum taxable income for the (A) Section 23(h)(2). 6695 is amended to read as follows: (B) Paragraphs (1)(A)(ii) and (2)(A)(ii) of 38.5-percent bracket in the table under para- ‘‘(g) FAILURE TO BE DILIGENT IN DETER- section 25A(h). graph (2)(E) (as adjusted under paragraph (3)) MINING ELIGIBILITY FOR CERTAIN TAX BENE- (C) Section 25B(b)(3)(B). for the taxable year. FITS.—Any person who is a tax return pre- (D) Subsection (b)(2)(B)(ii)(II), and clauses ‘‘(C) COORDINATION WITH CAPITAL GAINS parer with respect to any return or claim for (i) and (ii) of subsection (j)(1)(B), of section RATES.—For purposes of applying section 1(h) refund who fails to comply with due dili- 32. (after the modifications under paragraph gence requirements imposed by the Sec- (5))— retary by regulations with respect to deter- (E) Section 36B(f)(2)(B)(ii)(II). ‘‘(i) the maximum zero rate amount shall mining— (F) Section 41(e)(5)(C)(i). not be more than the sum of— ‘‘(1) eligibility to file as a head of house- (G) Subsections (e)(3)(D)(ii) and ‘‘(I) the earned taxable income of such hold (as defined in section 2(b)) on the re- (h)(3)(H)(i)(II) of section 42. child, plus turn, or (H) Section 45R(d)(3)(B)(ii). ‘‘(II) the amount in effect under paragraph ‘‘(2) eligibility for, or the amount of, the (I) Section 55(d)(4)(A)(ii). (5)(B)(i)(IV) for the taxable year, and credit allowable by section 24, 25A(a)(1), or (J) Section 62(d)(3)(B). ‘‘(ii) the maximum 15-percent rate amount 32, (K) Section 63(c)(4)(B). shall not be more than the sum of— shall pay a penalty of $500 for each such fail- (L) Section 125(i)(2)(B). ‘‘(I) the earned taxable income of such ure.’’. (M) Section 135(b)(2)(B)(ii). child, plus (c) EFFECTIVE DATE.—The amendments (N) Section 137(f)(2). ‘‘(II) the amount in effect under paragraph made by this section shall apply to taxable (O) Section 146(d)(2)(B). (5)(B)(ii)(IV) for the taxable year. years beginning after December 31, 2017. (P) Section 147(c)(2)(H)(ii). ‘‘(D) EARNED TAXABLE INCOME.—For pur- SEC. 11002. INFLATION ADJUSTMENTS BASED ON (Q) Section 151(d)(4)(B). poses of this paragraph, the term ‘earned CHAINED CPI. (R) Section 179(b)(6)(A)(ii). taxable income’ means, with respect to any (a) IN GENERAL.—Subsection (f) of section 1 (S) Subsections (b)(5)(C)(i)(II) and (g)(8)(B) child for any taxable year, the taxable in- is amended by striking paragraph (3) and by of section 219. come of such child reduced (but not below inserting after paragraph (2) the following (T) Section 220(g)(2). zero) by the net unearned income (as defined new paragraph: (U) Section 221(f)(1)(B). in subsection (g)(4)) of such child. ‘‘(3) COST-OF-LIVING ADJUSTMENT.—For pur- (V) Section 223(g)(1)(B). ‘‘(5) APPLICATION OF CURRENT INCOME TAX poses of this subsection— (W) Section 408A(c)(3)(D)(ii). BRACKETS TO CAPITAL GAINS BRACKETS.— ‘‘(A) IN GENERAL.—The cost-of-living ad- (X) Section 430(c)(7)(D)(vii)(II). ‘‘(A) IN GENERAL.—Section 1(h)(1) shall be justment for any calendar year is the per- (Y) Section 512(d)(2)(B). applied— centage (if any) by which— (Z) Section 513(h)(2)(C)(ii). ‘‘(i) by substituting ‘below the maximum ‘‘(i) the C-CPI-U for the preceding calendar (AA) Section 831(b)(2)(D)(ii). zero rate amount’ for ‘which would (without year, exceeds (BB) Section 877A(a)(3)(B)(i)(II). regard to this paragraph) be taxed at a rate ‘‘(ii) the CPI for calendar year 2016, multi- (CC) Section 2010(c)(3)(B)(ii). below 25 percent’ in subparagraph (B)(i), and plied by the amount determined under sub- (DD) Section 2032A(a)(3)(B). ‘‘(ii) by substituting ‘below the maximum paragraph (B). (EE) Section 2503(b)(2)(B). 15-percent rate amount’ for ‘which would ‘‘(B) AMOUNT DETERMINED.—The amount (FF) Section 4261(e)(4)(A)(ii). (without regard to this paragraph) be taxed determined under this clause is the amount (GG) Section 5000A(c)(3)(D)(ii). at a rate below 39.6 percent’ in subparagraph obtained by dividing— (HH) Section 6323(i)(4)(B). (C)(ii)(I). ‘‘(i) the C-CPI-U for calendar year 2016, by (II) Section 6334(g)(1)(B). ‘‘(B) MAXIMUM AMOUNTS DEFINED.—For pur- ‘‘(ii) the CPI for calendar year 2016. (JJ) Section 6601(j)(3)(B). poses of applying section 1(h) with the modi- ‘‘(C) SPECIAL RULE FOR ADJUSTMENTS WITH (KK) Section 6651(i)(1). fications described in subparagraph (A)— A BASE YEAR AFTER 2016.—For purposes of any (LL) Section 6652(c)(7)(A). ‘‘(i) MAXIMUM ZERO RATE AMOUNT.—The provision of this title which provides for the (MM) Section 6695(h)(1). maximum zero rate amount shall be— substitution of a year after 2016 for ‘2016’ in (NN) Section 6698(e)(1). ‘‘(I) in the case of a joint return or sur- subparagraph (A)(ii), subparagraph (A) shall (OO) Section 6699(e)(1). viving spouse, $77,200, be applied by substituting ‘the C-CPI-U for (PP) Section 6721(f)(1). ‘‘(II) in the case of an individual who is a calendar year 2016’ for ‘the CPI for calendar (QQ) Section 6722(f)(1). head of household (as defined in section 2(b)), year 2016’ and all that follows in clause (ii) (RR) Section 7345(f)(2). $51,700, thereof.’’. (SS) Section 7430(c)(1). ‘‘(III) in the case of any other individual (b) C-CPI-U.—Subsection (f) of section 1 is (TT) Section 9831(d)(2)(D)(ii)(II). (other than an estate or trust), an amount amended by striking paragraph (7), by redes- (2) Sections 41(e)(5)(C)(ii) and 68(b)(2)(B) equal to 1⁄2 of the amount in effect for the ignating paragraph (6) as paragraph (7), and are each amended— taxable year under subclause (I), and by inserting after paragraph (5) the following (A) by striking ‘‘1(f)(3)(B)’’ and inserting ‘‘(IV) in the case of an estate or trust, new paragraph: ‘‘1(f)(3)(A)(ii)’’, and $2,600. ‘‘(6) C-CPI-U.—For purposes of this sub- (B) by striking ‘‘1992’’ and inserting ‘‘2016’’. ‘‘(ii) MAXIMUM 15-PERCENT RATE AMOUNT.— section— (3) Section 42(h)(6)(G) is amended— The maximum 15-percent rate amount shall ‘‘(A) IN GENERAL.—The term ‘C-CPI-U’ (A) by striking ‘‘for ‘calendar year 1987’ ’’ be— means the Chained Consumer Price Index for in clause (i)(II) and inserting ‘‘for ‘calendar ‘‘(I) in the case of a joint return or sur- All Urban Consumers (as published by the year 2016’ in subparagraph (A)(ii) thereof’’, viving spouse, $479,000 (1⁄2 such amount in the Bureau of Labor Statistics of the Depart- and

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00107 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.053 S01DEPT1 S7760 CONGRESSIONAL RECORD — SENATE December 1, 2017 (B) by striking ‘‘if the CPI for any calendar such increase shall be increased to the near- threshold amount, paragraph (2) shall be ap- year’’ and all that follows in clause (ii) and est multiple of $100).’’. plied without regard to subparagraph (B). inserting ‘‘if the C-CPI-U for any calendar (11) Section 4161(b)(2)(C)(i)(II) is amended ‘‘(B) PHASE-IN OF LIMIT FOR CERTAIN TAX- year (as defined in section 1(f)(6)) exceeds the by striking ‘‘for ‘1992’ in subparagraph (B)’’ PAYERS.— C-CPI-U for the preceding calendar year by and inserting ‘‘for ‘2016’ in subparagraph ‘‘(i) IN GENERAL.—If— more than 5 percent, the C-CPI-U for the (A)(ii)’’. ‘‘(I) the taxable income of a taxpayer for base calendar year shall be increased such (12) Section 4980I(b)(3)(C)(v)(II) is amended any taxable year exceeds the threshold that such excess shall never be taken into by striking ‘‘for ‘1992’ in subparagraph (B)’’ amount, but does not exceed the sum of the account under clause (i). In the case of a base and inserting ‘‘for ‘2016’ in subparagraph threshold amount plus $50,000 ($100,000 in the calendar year before 2017, the C-CPI-U for (A)(ii)’’. case of a joint return), and such year shall be determined by multi- (13) Section 6039F(d) is amended by strik- ‘‘(II) the amount determined under para- plying the CPI for such year by the amount ing ‘‘subparagraph (B) thereof shall be ap- graph (2)(B) (determined without regard to determined under section 1(f)(3)(B).’’. plied by substituting ‘1995’ for ‘1992’ ’’ and in- this subparagraph) with respect to any quali- (4) Section 59(j)(2)(B) is amended by strik- serting ‘‘subparagraph (A)(ii) thereof shall be fied trade or business carried on by the tax- ing ‘‘for ‘1992’ in subparagraph (B)’’ and in- applied by substituting ‘1995’ for ‘2016’ ’’. payer is less than the amount determined serting ‘‘for ‘2016’ in subparagraph (A)(ii)’’. (14) Section 7872(g)(5) is amended to read as under paragraph (2)(A) with respect such (5) Section 132(f)(6)(A)(ii) is amended by follows: trade or business, striking ‘‘for ‘calendar year 1992’ ’’ and in- ‘‘(5) ADJUSTMENT OF LIMIT FOR INFLATION.— then paragraph (2) shall be applied with re- serting ‘‘for ‘calendar year 2016’ in subpara- In the case of any loan made during any cal- spect to such trade or business without re- graph (A)(ii) thereof’’. endar year after 1986, the dollar amount in gard to subparagraph (B) thereof and by re- (6) Section 162(o)(3) is amended by striking paragraph (2) shall be increased by an ducing the amount determined under sub- ‘‘adjusted for changes in the Consumer Price amount equal to— paragraph (A) thereof by the amount deter- Index (as defined in section 1(f)(5)) since ‘‘(A) such amount, multiplied by mined under clause (ii). 1991’’ and inserting ‘‘adjusted by increasing ‘‘(B) the cost-of-living adjustment deter- ‘‘(ii) AMOUNT OF REDUCTION.—The amount any such amount under the 1991 agreement mined under section 1(f)(3) for the calendar determined under this subparagraph is the by an amount equal to— year in which the taxable year begins, by amount which bears the same ratio to the ‘‘(A) such amount, multiplied by substituting ‘calendar year 1985’ for ‘cal- excess amount as— ‘‘(B) the cost-of-living adjustment deter- endar year 2016’ in subparagraph (A)(ii) ‘‘(I) the amount by which the taxpayer’s mined under section 1(f)(3) for the calendar thereof. taxable income for the taxable year exceeds year in which the taxable year begins, by Any increase under the preceding sentence the threshold amount, bears to substituting ‘calendar year 1990’ for ‘cal- shall be rounded to the nearest multiple of ‘‘(II) $50,000 ($100,000 in the case of a joint endar year 2016’ in subparagraph (A)(ii) $100 (or, if such increase is a multiple of $50, return). thereof’’. such increase shall be increased to the near- ‘‘(iii) EXCESS AMOUNT.—For purposes of (7) So much of clause (ii) of section est multiple of $100).’’. clause (ii), the excess amount is the excess 213(d)(10)(B) as precedes the last sentence is (e) EFFECTIVE DATE.—The amendments of— amended to read as follows: made by this section shall apply to taxable ‘‘(I) the amount determined under para- ‘‘(ii) MEDICAL CARE COST ADJUSTMENT.—For years beginning after December 31, 2017. graph (2)(A) (determined without regard to purposes of clause (i), the medical care cost PART II—DEDUCTION FOR QUALIFIED this paragraph), over adjustment for any calendar year is the per- BUSINESS INCOME OF PASS-THRU ENTI- ‘‘(II) the amount determined under para- centage (if any) by which— TIES graph (2)(B) (determined without regard to ‘‘(I) the medical care component of the C- SEC. 11011. DEDUCTION FOR QUALIFIED BUSI- this paragraph). CPI-U (as defined in section 1(f)(6)) for Au- NESS INCOME. ‘‘(4) WAGES, ETC.— gust of the preceding calendar year, exceeds (a) IN GENERAL.—Part VI of subchapter B ‘‘(A) IN GENERAL.—The term ‘W-2 wages’ ‘‘(II) such component of the CPI (as defined of chapter 1 is amended by adding at the end means, with respect to any person for any in section 1(f)(4)) for August of 1996, multi- the following new section: taxable year of such person, the amounts de- plied by the amount determined under sec- ‘‘SEC. 199A. QUALIFIED BUSINESS INCOME. scribed in paragraphs (3) and (8) of section tion 1(f)(3)(B).’’. ‘‘(a) IN GENERAL.—In the case of a taxpayer 6051(a) paid by such person with respect to (8) Subparagraph (B) of section 280F(d)(7) is other than a corporation, there shall be al- employment of employees by such person amended to read as follows: lowed as a deduction for any taxable year an during the calendar year ending during such ‘‘(B) AUTOMOBILE PRICE INFLATION ADJUST- amount equal to the lesser of— taxable year. MENT.—For purposes of this paragraph— ‘‘(1) the combined qualified business in- ‘‘(B) LIMITATION TO WAGES ATTRIBUTABLE TO ‘‘(i) IN GENERAL.—The automobile price in- come amount of the taxpayer, or QUALIFIED BUSINESS INCOME.—Such term shall flation adjustment for any calendar year is ‘‘(2) an amount equal to 23 percent of the not include any amount which is not prop- the percentage (if any) by which— excess (if any) of— erly allocable to qualified business income ‘‘(I) the C-CPI-U automobile component for ‘‘(A) the taxable income of the taxpayer for for purposes of subsection (c)(1). October of the preceding calendar year, ex- the taxable year, over ‘‘(C) RETURN REQUIREMENT.—Such term ceeds ‘‘(B) any net capital gain (as defined in sec- shall not include any amount which is not ‘‘(II) the automobile component of the CPI tion 1(h)) of the taxpayer for the taxable properly included in a return filed with the (as defined in section 1(f)(4)) for October of year. Social Security Administration on or before 1987, multiplied by the amount determined ‘‘(b) COMBINED QUALIFIED BUSINESS INCOME the 60th day after the due date (including ex- under 1(f)(3)(B). AMOUNT.—For purposes of this section— tensions) for such return. ‘‘(ii) C-CPI-U AUTOMOBILE COMPONENT.—The ‘‘(1) IN GENERAL.—The term ‘combined ‘‘(5) ACQUISITIONS, DISPOSITIONS, AND SHORT term ‘C-CPI-U automobile component’ qualified business income amount’ means, TAXABLE YEARS.—The Secretary shall pro- means the automobile component of the with respect to any taxable year, an amount vide for the application of this subsection in Chained Consumer Price Index for All Urban equal to— cases of a short taxable year or where the Consumers (as described in section 1(f)(6)).’’. ‘‘(A) the sum of the amounts determined taxpayer acquires, or disposes of, the major (9) Section 911(b)(2)(D)(ii)(II) is amended by under paragraph (2) for each qualified trade portion of a trade or business or the major striking ‘‘for ‘1992’ in subparagraph (B)’’ and or business carried on by the taxpayer, plus portion of a separate unit of a trade or busi- inserting ‘‘for ‘2016’ in subparagraph (A)(ii)’’. ‘‘(B) 23 percent of the aggregate amount of ness during the taxable year. (10) Paragraph (2) of section 1274A(d) is the qualified REIT dividends and qualified ‘‘(c) QUALIFIED BUSINESS INCOME.—For pur- amended to read as follows: cooperative dividends of the taxpayer for the poses of this section— ‘‘(2) ADJUSTMENT FOR INFLATION.—In the taxable year. ‘‘(1) IN GENERAL.—The term ‘qualified busi- case of any debt instrument arising out of a ‘‘(2) DETERMINATION OF DEDUCTIBLE AMOUNT ness income’ means, for any taxable year, sale or exchange during any calendar year FOR EACH TRADE OR BUSINESS.—The amount the net amount of qualified items of income, after 1989, each dollar amount contained in determined under this paragraph with re- gain, deduction, and loss with respect to any the preceding provisions of this section shall spect to any qualified trade or business is qualified trade or business of the taxpayer. be increased by an amount equal to— the lesser of— ‘‘(2) CARRYOVER OF LOSSES.—If the net ‘‘(A) such amount, multiplied by ‘‘(A) 23 percent of the taxpayer’s qualified amount of qualified income, gain, deduction, ‘‘(B) the cost-of-living adjustment deter- business income with respect to the qualified and loss with respect to qualified trade or mined under section 1(f)(3) for the calendar trade or business, or businesses of the taxpayer amount for any year in which the taxable year begins, by ‘‘(B) 50 percent of the W-2 wages with re- taxable year is less than zero, such amount substituting ‘calendar year 1988’ for ‘cal- spect to the qualified trade or business. shall be treated as a loss from a qualified endar year 2016’ in subparagraph (A)(ii) ‘‘(3) MODIFICATIONS TO THE WAGE LIMIT trade or business in the succeeding taxable thereof. BASED ON TAXABLE INCOME.— year. Any increase under the preceding sentence ‘‘(A) EXCEPTION FROM WAGE LIMIT.—In the ‘‘(3) QUALIFIED ITEMS OF INCOME, GAIN, DE- shall be rounded to the nearest multiple of case of any taxpayer whose taxable income DUCTION, AND LOSS.—For purposes of this sub- $100 (or, if such increase is a multiple of $50, for the taxable year does not exceed the section—

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00108 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.053 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7761

‘‘(A) IN GENERAL.—The term ‘qualified ‘‘(ii) only the applicable percentage of For purposes of clause (iii), a partner’s or items of income, gain, deduction, and loss’ qualified items of income, gain, deduction, shareholder’s allocable share of W-2 wages means items of income, gain, deduction, and or loss, and the W-2 wages, of the taxpayer shall be determined in the same manner as loss to the extent such items are— allocable to such specified service trades or the partner’s or shareholder’s allocable share ‘‘(i) effectively connected with the conduct businesses shall be taken into account in of wage expenses. For purposes of this sub- of a trade or business within the United computing the qualified business income and paragraph, in the case of an S corporation, States (within the meaning of section 864(c), W-2 wages of the taxpayer for the taxable an allocable share shall be the shareholder’s determined by substituting ‘qualified trade year for purposes of applying this section. pro rata share of an item. or business (within the meaning of section ‘‘(B) APPLICABLE PERCENTAGE.—For pur- ‘‘(B) APPLICATION TO TRUSTS AND ES- 199A)’ for ‘nonresident alien individual or a poses of subparagraph (A), the term ‘applica- TATES.—This section shall not apply to any foreign corporation’ or for ‘a foreign corpora- ble percentage’ means, with respect to any trust or estate. tion’ each place it appears), and taxable year, 100 percent reduced (not below ‘‘(C) TREATMENT OF TRADES OR BUSINESS IN ‘‘(ii) included or allowed in determining zero) by the percentage equal to the ratio PUERTO RICO.— taxable income for the taxable year. of— ‘‘(i) IN GENERAL.—In the case of any tax- ‘‘(B) EXCEPTIONS.—The following invest- ‘‘(i) the taxable income of the taxpayer for payer with qualified business income from ment items shall not be taken into account the taxable year in excess of the threshold sources within the commonwealth of Puerto as a qualified item of income, gain, deduc- amount, bears to Rico, if all such income is taxable under sec- tion, or loss: ‘‘(ii) $50,000 ($100,000 in the case of a joint tion 1 for such taxable year, then for pur- ‘‘(i) Any item of short-term capital gain, return). poses of determining the qualified business short-term capital loss, long-term capital ‘‘(e) OTHER DEFINITIONS.—For purposes of income of such taxpayer for such taxable gain, or long-term capital loss. this section— year, the term ‘United States’ shall include ‘‘(ii) Any dividend, income equivalent to a ‘‘(1) TAXABLE INCOME.—Taxable income the Commonwealth of Puerto Rico. dividend, or payment in lieu of dividends de- shall be computed without regard to the de- ‘‘(ii) SPECIAL RULE FOR APPLYING WAGE LIM- scribed in section 954(c)(1)(G). duction allowable under this section. ITATION.—In the case of any taxpayer de- ‘‘(iii) Any interest income other than in- ‘‘(2) THRESHOLD AMOUNT.— scribed in clause (i), the determination of W- terest income which is properly allocable to ‘‘(A) IN GENERAL.—The term ‘threshold 2 wages of such taxpayer with respect to any a trade or business. amount’ means $250,000 (200 percent of such qualified trade or business conducted in ‘‘(iv) Any item of gain or loss described in amount in the case of a joint return). Puerto Rico shall be made without regard to subparagraph (C) or (D) of section 954(c)(1) ‘‘(B) INFLATION ADJUSTMENT.—In the case any exclusion under section 3401(a)(8) for re- (applied by substituting ‘qualified trade or of any taxable year beginning after 2018, the muneration paid for services in Puerto Rico. business’ for ‘controlled foreign corpora- dollar amount in paragraph (1) shall be in- ‘‘(2) COORDINATION WITH MINIMUM TAX.—For tion’). creased by an amount equal to— purposes of determining alternative min- ‘‘(v) Any item of income, gain, deduction, ‘‘(i) such dollar amount, multiplied by imum taxable income under section 55, or loss taken into account under section ‘‘(ii) the cost-of-living adjustment deter- qualified business income shall be deter- 954(c)(1)(F) (determined without regard to mined under section 1(f)(3) for the calendar mined without regard to any adjustments clause (ii) thereof and other than items at- year in which the taxable year begins, deter- under sections 56 through 59. tributable to notional principal contracts en- mined by substituting ‘calendar year 2017’ ‘‘(3) DEDUCTION LIMITED TO INCOME TAXES.— tered into in transactions qualifying under for ‘calendar year 2016’ in subparagraph The deduction under subsection (a) shall section 1221(a)(7)). (A)(ii) thereof. only be allowed for purposes of this chapter. ‘‘(vi) Any amount received from an annu- If any amount as increased under the pre- ‘‘(4) REGULATIONS.—The Secretary shall ity which is not received in connection with ceding sentence is not a multiple of $1,000, prescribe such regulations as are necessary the trade or business. such amount shall be rounded to the nearest to carry out the purposes of this section, in- ‘‘(vii) Any item of deduction or loss prop- multiple of $1,000. cluding regulations— erly allocable to an amount described in any ‘‘(3) QUALIFIED REIT DIVIDEND.—The term ‘‘(A) for requiring or restricting the alloca- of the preceding clauses. ‘qualified REIT dividend’ means any divi- tion of items and wages under this section ‘‘(4) TREATMENT OF REASONABLE COMPENSA- dend from a real estate investment trust re- and such reporting requirements as the Sec- TION AND GUARANTEED PAYMENTS.—Qualified ceived during the taxable year which— retary determines appropriate, and business income shall not include— ‘‘(A) is not a capital gain dividend, as de- ‘‘(B) for the application of this section in ‘‘(A) reasonable compensation paid to the fined in section 857(b)(3), and the case of tiered entities. taxpayer by any qualified trade or business ‘‘(B) is not qualified dividend income, as ‘‘(g) DEDUCTION ALLOWED TO SPECIFIED AG- of the taxpayer for services rendered with re- defined in section 1(h)(11). RICULTURAL OR HORTICULTURAL COOPERA- spect to the trade or business, ‘‘(4) QUALIFIED COOPERATIVE DIVIDEND.— TIVES.— ‘‘(B) any guaranteed payment described in The term ‘qualified cooperative dividend’ ‘‘(1) IN GENERAL.—In the case of any tax- section 707(c) paid to a partner for services means any patronage dividend (as defined in able year of a specified agricultural or horti- rendered with respect to the trade or busi- section 1388(a)), any per-unit retain alloca- cultural cooperative beginning after Decem- ness, and tion (as defined in section 1388(f)), and any ber 31, 2018, there shall be allowed a deduc- ‘‘(C) to the extent provided in regulations, qualified written notice of allocation (as de- tion in an amount equal to the lesser of— any payment described in section 707(a) to a fined in section 1388(c)), or any similar ‘‘(A) 23 percent of the cooperative’s taxable partner for services rendered with respect to amount received from an organization de- income for the taxable year, or the trade or business. scribed in subparagraph (B)(ii), which— ‘‘(B) 50 percent of the W-2 wages of the co- ‘‘(d) QUALIFIED TRADE OR BUSINESS.—For ‘‘(A) is includible in gross income, and operative with respect to its trade or busi- purposes of this section— ‘‘(B) is received from— ness. ‘‘(1) IN GENERAL.—The term ‘qualified trade ‘‘(i) an organization or corporation de- ‘‘(2) SPECIFIED AGRICULTURAL OR HORTI- or business’ means any trade or business scribed in section 501(c)(12) or 1381(a), or CULTURAL COOPERATIVE.—For purposes of this other than a specified service trade or busi- ‘‘(ii) an organization which is governed subsection, the term ‘specified agricultural ness or the trade or business of performing under this title by the rules applicable to co- or horticultural cooperative’ means an orga- services as an employee. operatives under this title before the enact- nization to which part I of subchapter T ap- ‘‘(2) SPECIFIED SERVICE TRADE OR BUSI- ment of subchapter T. plies which is engaged in— NESS.—The term ‘specified service trade or ‘‘(f) SPECIAL RULES.— ‘‘(A) the manufacturing, production, business’ means any trade or business in- ‘‘(1) APPLICATION TO PARTNERSHIPS AND S growth, or extraction in whole or significant volving the performance of services de- CORPORATIONS.— part of any agricultural or horticultural scribed in section 1202(e)(3)(A), including in- ‘‘(A) IN GENERAL.—In the case of a partner- product, vesting and investment management, trad- ship or S corporation— ‘‘(B) the marketing of agricultural or hor- ing, or dealing in securities (as defined in ‘‘(i) this section shall be applied at the ticultural products which its patrons have so section 475(c)(2)), partnership interests, or partner or shareholder level, manufactured, produced, grown, or ex- commodities (as defined in section 475(e)(2)). ‘‘(ii) each partner or shareholder shall take tracted, or ‘‘(3) EXCEPTION FOR SPECIFIED SERVICE BUSI- into account such person’s allocable share of ‘‘(C) the provision of supplies, equipment, NESSES BASED ON TAXPAYER’S INCOME.— each qualified item of income, gain, deduc- or services to farmers or to organizations de- ‘‘(A) IN GENERAL.—If, for any taxable year, tion, and loss, and scribed in subparagraph (A) or (B). the taxable income of any taxpayer is less ‘‘(iii) each partner or shareholder shall be ‘‘(h) TERMINATION.—This section shall not than the sum of the threshold amount plus treated for purposes of subsection (b) as hav- apply to taxable years beginning after De- $50,000 ($100,000 in the case of a joint return), ing W-2 wages for the taxable year in an cember 31, 2025.’’. then— amount equal to such person’s allocable (b) APPLICATION TO PUBLICLY TRADED ‘‘(i) the exception under paragraph (1) shall share of the W-2 wages of the partnership or PARTNERSHIPS.— not apply to specified service trades or busi- S corporation for the taxable year (as deter- (1) IN GENERAL.—Section 199A(b)(1)(B), as nesses of the taxpayer for the taxable year, mined under regulations prescribed by the added by subsection (a), is amended by strik- but Secretary). ing ‘‘and qualified cooperative dividends’’

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00109 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.053 S01DEPT1 S7762 CONGRESSIONAL RECORD — SENATE December 1, 2017 and inserting ‘‘, qualified cooperative divi- ‘‘(A) subsection (j) (relating to limitation ‘‘(ii) by substituting ‘$12,000’ for ‘$3,000’ in dends, and qualified publicly traded partner- on excess farm losses of certain taxpayers) subparagraph (C). ship income’’. shall not apply, and ‘‘(B) ADJUSTMENT FOR INFLATION.— (2) QUALIFIED PUBLICLY TRADED PARTNER- ‘‘(B) any excess business loss of the tax- ‘‘(i) IN GENERAL.—Paragraph (4) shall not SHIP INCOME.—Section 199A(e), as added by payer for the taxable year shall not be al- apply to the dollar amounts contained in subsection (a), is amended by adding at the lowed. paragraphs (2)(B) and (2)(C). end the following new paragraph: ‘‘(2) DISALLOWED LOSS CARRYOVER.—Any ‘‘(ii) ADJUSTMENT OF INCREASED AMOUNTS.— ‘‘(5) QUALIFIED PUBLICLY TRADED PARTNER- loss which is disallowed under paragraph (1) In the case of a taxable year beginning after SHIP INCOME.—The term ‘qualified publicly shall be treated as a net operating loss car- 2018, the $18,000 and $12,000 amounts in sub- traded partnership income’ means, with re- ryover to the following taxable year under paragraph (A) shall each be increased by an spect to any qualified trade or business of a section 172. amount equal to— taxpayer, the sum of— ‘‘(3) EXCESS BUSINESS LOSS.—For purposes ‘‘(I) such dollar amount, multiplied by ‘‘(A) the net amount of such taxpayer’s al- of this subsection— ‘‘(II) the cost-of-living adjustment deter- locable share of each qualified item of in- ‘‘(A) IN GENERAL.—The term ‘excess busi- mined under section 1(f)(3) for the calendar come, gain, deduction, and loss (as defined in ness loss’ means the excess (if any) of— year in which the taxable year begins, deter- subsection (c)(3) and determined after the ‘‘(i) the aggregate deductions of the tax- mined by substituting ‘2017’ for ‘2016’ in sub- application of subsection (c)(4)) from a pub- payer for the taxable year which are attrib- paragraph (A)(ii) thereof.’’. licly traded partnership (as defined in sec- utable to trades or businesses of such tax- (b) EFFECTIVE DATE.—The amendment tion 7704(a)) which is not treated as a cor- payer (determined without regard to whether made by this section shall apply to taxable poration under section 7704(c), plus or not such deductions are disallowed for years beginning after December 31, 2017. ‘‘(B) any gain recognized by such taxpayer such taxable year under paragraph (1)), over upon disposition of its interest in such part- ‘‘(ii) the sum of— SEC. 11022. INCREASE IN AND MODIFICATION OF nership to the extent such gain is treated as ‘‘(I) the aggregate gross income or gain of CHILD TAX CREDIT. an amount realized from the sale or ex- such taxpayer for the taxable year which is (a) IN GENERAL.—Section 24 is amended by change of property other than a capital asset attributable to such trades or businesses, adding at the end the following new sub- under section 751(a).’’. plus section: (3) CONFORMING AMENDMENT.—Section ‘‘(II) $250,000 (200 percent of such amount in ‘‘(h) SPECIAL RULES FOR TAXABLE YEARS 199A(c)(1), as added by subsection (a), is the case of a joint return). 2018 THROUGH 2025.— amended by adding at the end the following ‘‘(B) ADJUSTMENT FOR INFLATION.—In the ‘‘(1) IN GENERAL.—In the case of a taxable new sentence: ‘‘Such term shall not include case of any taxable year beginning after De- year beginning after December 31, 2017, and any qualified publicly traded partnership in- cember 31, 2018, the $250,000 amount in sub- before January 1, 2026, this section shall be come.’’. paragraph (A)(ii)(II) shall be increased by an applied as provided in paragraphs (2), (3), (5), (c) ACCURACY-RELATED PENALTY ON DETER- amount equal to— (6), (7) and (8). In the case of taxable year be- MINATION OF APPLICABLE PERCENTAGE.—Sec- ‘‘(i) such dollar amount, multiplied by ginning after 12/31/17 and before 1/1/2025, this tion 6662(d)(1) is amended by inserting at the ‘‘(ii) the cost-of-living adjustment deter- section shall be applied as provided in para- end the following new subparagraph: mined under section 1(f)(3) for the calendar graph (4). ‘‘(C) SPECIAL RULE FOR TAXPAYERS CLAIM- year in which the taxable year begins, deter- ‘‘(2) CREDIT AMOUNT.—Subsection (a) shall ING SECTION 199A DEDUCTION.—In the case of mined by substituting ‘2017’ for ‘2016’ in sub- be applied by substituting ‘$2,000’ for ‘$1,000’. any taxpayer who claims the deduction al- paragraph (A)(ii) thereof. ‘‘(3) LIMITATION.—In lieu of the amount de- lowed under section 199A for the taxable If any amount as increased under the pre- termined under subsection (b)(2), the thresh- year, subparagraph (A) shall be applied by ceding sentence is not a multiple of $1,000, old amount shall be $500,000. substituting ‘5 percent’ for ‘10 percent’.’’. such amount shall be rounded to the nearest ‘‘(4) DEFINITION OF QUALIFYING CHILD.— (d) CONFORMING AMENDMENTS.— multiple of $1,000. Paragraph (1) of subsection (c) shall be ap- (1) Section 170(b)(2)(D) is amended by strik- ‘‘(4) APPLICATION OF SUBSECTION IN CASE OF plied by substituting ‘18’ for ‘17’. ing ‘‘, and’’ at the end of clause (iv), by re- PARTNERSHIPS AND S CORPORATIONS.—In the ‘‘(5) PARTIAL CREDIT ALLOWED FOR CERTAIN designating clause (v) as clause (vi), and by case of a partnership or S corporation— OTHER DEPENDENTS.— inserting after clause (iv) the following new ‘‘(A) this subsection shall be applied at the ‘‘(A) IN GENERAL.—The credit determined clause: partner or shareholder level, and under subsection (a) (after the application of ‘‘(v) section 199A, and’’. ‘‘(B) each partner’s or shareholder’s allo- paragraph (2)) shall be increased by $500 for (2) Section 172(d) is amended by adding at cable share of the items of income, gain, de- each dependent of the taxpayer (as defined in the end the following new paragraph: duction, or loss of the partnership or S cor- section 152) other than a qualifying child de- ‘‘(8) QUALIFIED BUSINESS INCOME DEDUC- poration for any taxable year from trades or scribed in subsection (c) (after the applica- TION.—The deduction under section 199A businesses attributable to the partnership or tion of paragraph (4)). shall not be allowed.’’. S corporation shall be taken into account by ‘‘(B) EXCEPTION FOR CERTAIN NONCITIZENS.— (3) Section 246(b)(1) is amended by insert- the partner or shareholder in applying this Subparagraph (A) shall not apply with re- ing ‘‘199A,’’ before ‘‘243(a)(1)’’. subsection to the taxable year of such part- spect to any individual who would not be a (4) Section 613(a) is amended by inserting ner or shareholder with or within which the dependent if subparagraph (A) of section ‘‘and without the deduction under section taxable year of the partnership or S corpora- 152(b)(3) were applied without regard to all 199A’’ after ‘‘and without the deduction tion ends. that follows ‘resident of the United States’. under section 199’’. For purposes of this paragraph, in the case of ‘‘(6) MAXIMUM AMOUNT OF REFUNDABLE (5) Section 613A(d)(1) is amended by redes- an S corporation, an allocable share shall be CREDIT.— ignating subparagraphs (C), (D), and (E) as the shareholder’s pro rata share of an item. ‘‘(A) IN GENERAL.—Subsection (d)(1)(A) subparagraphs (D), (E), and (F), respectively, ‘‘(5) ADDITIONAL REPORTING.—The Sec- shall be applied without regard to para- and by inserting after subparagraph (B), the retary shall prescribe such additional report- graphs (2) and (5) of this subsection. following new subparagraph: ing requirements as the Secretary deter- ‘‘(B) ADJUSTMENT FOR INFLATION.—In the ‘‘(C) any deduction allowable under section mines appropriate to carry out the purposes case of a taxable year beginning after 2017, 199A,’’. of this subsection. subsection (d)(1)(A) shall be applied as if the (6) The table of sections for part VI of sub- ‘‘(6) COORDINATION WITH SECTION 469.—This $1,000 amount in subsection (a) were in- chapter B of chapter 1 is amended by insert- subsection shall be applied after the applica- creased (but not to exceed the amount under ing at the end the following new item: tion of section 469.’’. paragraph (2) of this subsection) by an (b) EFFECTIVE DATE.—The amendments amount equal to— ‘‘Sec. 199A. Qualified business income.’’. made by this section shall apply to taxable ‘‘(i) such dollar amount, multiplied by (e) EFFECTIVE DATE.—The amendments years beginning after December 31, 2017. ‘‘(ii) the cost-of-living adjustment deter- made by this section shall apply to taxable PART III—TAX BENEFITS FOR FAMILIES mined under section 1(f)(3) for the calendar years beginning after December 31, 2017. AND INDIVIDUALS year in which the taxable year begins. SEC. 11012. LIMITATION ON LOSSES FOR TAX- SEC. 11021. INCREASE IN STANDARD DEDUCTION. Any increase determined under the preceding PAYERS OTHER THAN CORPORA- (a) IN GENERAL.—Subsection (c) of section sentence shall be rounded to the next highest TIONS. 63 is amended by adding at the end the fol- multiple of $100. (a) IN GENERAL.—Section 461 is amended by lowing new paragraph: ‘‘(7) EARNED INCOME THRESHOLD FOR RE- adding at the end the following new sub- ‘‘(7) SPECIAL RULES FOR TAXABLE YEARS 2018 FUNDABLE CREDIT.—Subsection (d)(1)(B)(i) section: THROUGH 2025.—In the case of a taxable year shall be applied by substituting ‘$2,500’ for ‘‘(l) LIMITATION ON EXCESS BUSINESS beginning after December 31, 2017, and before ‘$3,000’. LOSSES OF NONCORPORATE TAXPAYERS.— January 1, 2026— ‘‘(8) SOCIAL SECURITY NUMBER REQUIRED.— ‘‘(1) LIMITATION.—In the case of taxable ‘‘(A) INCREASE IN STANDARD DEDUCTION.— No credit shall be allowed under subsection year of a taxpayer other than a corporation Paragraph (2) shall be applied— (d) to a taxpayer with respect to any quali- beginning after December 31, 2017, and before ‘‘(i) by substituting ‘$18,000’ for ‘$4,400’ in fying child unless the taxpayer includes the January 1, 2026— subparagraph (B), and social security number of such child on the

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00110 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.053 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7763 return of tax for the taxable year. For pur- ‘‘(II) an amount equal to the poverty line (2) Section 112 (relating to the exclusion of poses of the preceding sentence, the term ‘so- for a one-person household, as determined certain combat pay of members of the Armed cial security number’ means a social secu- for the calendar year preceding the calendar Forces). rity number issued to an individual by the year in which the taxable year begins.’’. (3) Section 692 (relating to income taxes of Social Security Administration, but only if (2) RESPONSIBILITY FOR CONTRIBUTION LIMI- members of Armed Forces on death). the social security number is issued to a cit- TATION.—Paragraph (2) of section 529A(b) is (4) Section 2201 (relating to members of the izen of the United States or is issued pursu- amended by adding at the end the following: Armed Forces dying in combat zone or by ant to subclause (I) (or that portion of sub- ‘‘A designated beneficiary (or a person acting reason of combat-zone-incurred wounds, clause (III) that relates to subclause (I)) of on behalf of such beneficiary) shall maintain etc.). section 205(c)(2)(B)(i) of the Social Security adequate records for purposes of ensuring, (5) Section 3401(a)(1) (defining wages relat- Act.’’. and shall be responsible for ensuring, that ing to combat pay for members of the Armed (b) EFFECTIVE DATE.—The amendment the requirements of subparagraph (B)(ii) are Forces). made by this section shall apply to taxable met.’’ (6) Section 4253(d) (relating to the taxation years beginning after December 31, 2017. (3) ELIGIBLE DESIGNATED BENEFICIARY.— of phone service originating from a combat SEC. 11023. INCREASED LIMITATION FOR CER- Section 529A(b) is amended by adding at the zone from members of the Armed Forces). TAIN CHARITABLE CONTRIBUTIONS. end the following: (7) Section 6013(f)(1) (relating to joint re- (a) IN GENERAL.—Section 170(b)(1) is ‘‘(7) SPECIAL RULES RELATED TO CONTRIBU- turn where individual is in missing status). amended by redesignating subparagraph (G) TION LIMIT.—For purposes of paragraph (8) Section 7508 (relating to time for per- as subparagraph (H) and by inserting after (2)(B)(ii)— forming certain acts postponed by reason of subparagraph (F) the following new subpara- ‘‘(A) DESIGNATED BENEFICIARY.—A des- service in combat zone). graph: ignated beneficiary described in this para- (b) QUALIFIED HAZARDOUS DUTY AREA.—For ‘‘(G) INCREASED LIMITATION FOR CASH CON- graph is an employee (including an employee purposes of this section, the term ‘‘qualified TRIBUTIONS.— within the meaning of section 401(c)) with re- hazardous duty area’’ means the Sinai Pe- ‘‘(i) IN GENERAL.—In the case of any con- spect to whom— ninsula of Egypt, if as of the date of the en- tribution of cash to an organization de- ‘‘(i) no contribution is made for the taxable actment of this section any member of the scribed in subparagraph (A), the total year to a defined contribution plan (within Armed Forces of the United States is enti- amount of such contributions which may be the meaning of section 414(i)) with respect to tled to special pay under section 310 of title taken into account under subsection (a) for which the requirements of section 401(a) or 37, United States Code (relating to special any taxable year beginning after December 403(a) are met, pay; duty subject to hostile fire or imminent 31, 2017, and before January 1, 2026, shall not ‘‘(ii) no contribution is made for the tax- danger), for services performed in such loca- exceed 60 percent of the taxpayer’s contribu- able year to an annuity contract described in tion. Such term includes such location only tion base for such year. section 403(b), and during the period such entitlement is in ef- ‘‘(ii) CARRYOVER.—If the aggregate amount ‘‘(iii) no contribution is made for the tax- fect. of contributions described in clause (i) ex- able year to an eligible deferred compensa- (c) APPLICABLE PERIOD.— ceeds the applicable limitation under clause tion plan described in section 457(b). (1) IN GENERAL.—Except as provided in (i) for any taxable year described in such ‘‘(B) POVERTY LINE.—The term ‘poverty paragraph (2), the applicable period is— clause, such excess shall be treated (in a line’ has the meaning given such term by (A) the portion of the first taxable year manner consistent with the rules of sub- section 673 of the Community Services Block ending after June 9, 2015, which begins on section (d)(1)) as a charitable contribution to Grant Act (42 U.S.C. 9902).’’. such date, and (b) ALLOWANCE OF SAVER’S CREDIT FOR which clause (i) applies in each of the 5 suc- (B) any subsequent taxable year beginning ABLE CONTRIBUTIONS BY ACCOUNT HOLDER.— ceeding years in order of time. before January 1, 2026. Section 25B(d)(1) is amended by striking ‘‘(iii) COORDINATION WITH SUBPARAGRAPHS (2) WITHHOLDING.—In the case of subsection ‘‘and’’ at the end of subparagraph (B)(ii), by (A) AND (B).— (a)(5), the applicable period is— striking the period at the end of subpara- ‘‘(I) IN GENERAL.—Contributions taken into (A) the portion of the first taxable year account under this subparagraph shall not be graph (C) and inserting ‘‘, and’’, and by in- serting at the end the following: ending after the date of the enactment of taken into account under subparagraph (A). this Act which begins on such date, and ‘‘(II) LIMITATION REDUCTION.—For each tax- ‘‘(D) the amount of contributions made be- fore January 1, 2026, by such individual to (B) any subsequent taxable year beginning able year described in clause (i), and each before January 1, 2026. taxable year to which any contribution the ABLE account (within the meaning of section 529A) of which such individual is the (d) EFFECTIVE DATE.— under this subparagraph is carried over (1) IN GENERAL.—Except as provided in under clause (ii), subparagraph (A) shall be designated beneficiary.’’. FFECTIVE DATE.—The amendments paragraph (2), the provisions of this section applied by reducing (but not below zero) the (c) E made by this section shall apply to taxable shall take effect on June 9, 2015. contribution limitation allowed for the tax- years beginning after the date of the enact- (2) WITHHOLDING.—Subsection (a)(5) shall able year under such subparagraph by the ment of this Act. apply to remuneration paid after the date of aggregate contributions allowed under this the enactment of this Act. subparagraph for such taxable year, and sub- SEC. 11025. ROLLOVERS TO ABLE PROGRAMS FROM 529 PROGRAMS. SEC. 11027. EXTENSION OF WAIVER OF LIMITA- paragraph (B) shall be applied by treating (a) IN GENERAL.—Clause (i) of section TIONS WITH RESPECT TO EXCLUD- any reference to subparagraph (A) as a ref- 529(c)(3)(C) is amended by striking ‘‘or’’ at ING FROM GROSS INCOME AMOUNTS erence to both subparagraph (A) and this the end of subclause (I), by striking the pe- RECEIVED BY WRONGFULLY INCAR- subparagraph.’’. riod at the end of subclause (II) and inserting CERATED INDIVIDUALS. (b) EFFECTIVE DATE.—The amendment ‘‘, or’’, and by adding at the end the fol- (a) IN GENERAL.—Section 304(d) of the Pro- made by this section shall apply to contribu- lowing: tecting Americans from Tax Hikes Act of tions in taxable years beginning after De- ‘‘(III) before January 1, 2026, to an ABLE 2015 (26 U.S.C. 139F note) is amended by cember 31, 2017. account (as defined in section 529A(e)(6)) of striking ‘‘1-year’’ and inserting ‘‘2-year’’. SEC. 11024. INCREASED CONTRIBUTIONS TO the designated beneficiary or a member of (b) EFFECTIVE DATE.—The amendments ABLE ACCOUNTS. the family of the designated beneficiary. made by this section shall take effect on the (a) INCREASE IN LIMITATION FOR CONTRIBU- Subclause (III) shall not apply to so much of date of the enactment of this Act. TIONS FROM COMPENSATION OF INDIVIDUALS a distribution which, when added to all other SEC. 11028. TEMPORARY REDUCTION IN MEDICAL WITH DISABILITIES.— contributions made to the ABLE account for EXPENSE DEDUCTION FLOOR. (1) IN GENERAL.—Section 529A(b)(2)(B) is the taxable year, exceeds the limitation (a) IN GENERAL.—Subsection (f) of section amended to read as follows: under section 529A(b)(2)(B)(i).’’. 213 is amended to read as follows: ‘‘(B) except in the case of contributions (b) EFFECTIVE DATE.—The amendments ‘‘(f) SPECIAL RULES FOR 2013 THROUGH under subsection (c)(1)(C), if such contribu- made by this section shall apply to distribu- 2018.—In the case of any taxable year— tion to an ABLE account would result in ag- tions after the date of the enactment of this ‘‘(1) beginning after December 31, 2012, and gregate contributions from all contributors Act. ending before January 1, 2017, in the case of to the ABLE account for the taxable year ex- SEC. 11026. TREATMENT OF CERTAIN INDIVID- a taxpayer if such taxpayer or such tax- ceeding the sum of— UALS PERFORMING SERVICES IN payer’s spouse has attained age 65 before the ‘‘(i) the amount in effect under section THE SINAI PENINSULA OF EGYPT. close of such taxable year, and 2503(b) for the calendar year in which the (a) IN GENERAL.—For purposes of the fol- ‘‘(2) beginning after December 31, 2016, and taxable year begins, plus lowing provisions of the Internal Revenue ending before January 1, 2019, in the case of ‘‘(ii) in the case of any contribution by a Code of 1986, with respect to the applicable any taxpayer, designated beneficiary described in para- period, a qualified hazardous duty area shall subsection (a) shall be applied with respect graph (7) before January 1, 2026, the lesser be treated in the same manner as if it were to a taxpayer by substituting ‘7.5 percent’ for of— a combat zone (as determined under section ‘10 percent’.’’. ‘‘(I) compensation (as defined by section 112 of such Code): (b) MINIMUM TAX PREFERENCE NOT TO 219(f)(1)) includible in the designated bene- (1) Section 2(a)(3) (relating to special rule APPLY.—Section 56(b)(1)(B) is amended by ficiary’s gross income for the taxable year, where deceased spouse was in missing sta- adding at the end the following new sen- or tus). tence:‘‘This subparagraph shall not apply to

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00111 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.053 S01DEPT1 S7764 CONGRESSIONAL RECORD — SENATE December 1, 2017 taxable years beginning after December 31, fined by section 7701(a)(37) of the Internal (I) during the period— 2016, and ending before January 1, 2019’’. Revenue Code of 1986), then, to the extent of (aa) beginning on the date that this section (c) EFFECTIVE DATE.—The amendment the amount of the contribution, the qualified or the regulation described in clause (i)(I) made by this section shall apply to taxable 2016 disaster distribution shall be treated as takes effect (or in the case of a plan or con- years beginning after December 31, 2016. a distribution described in section 408(d)(3) of tract amendment not required by this sec- SEC. 11029. RELIEF FOR 2016 DISASTER AREAS. such Code and as having been transferred to tion or such regulation, the effective date (a) IN GENERAL.—For purposes of this sec- the eligible retirement plan in a direct trust- specified by the plan); and tion, the term ‘‘2016 disaster area’’ means ee to trustee transfer within 60 days of the (bb) ending on the date described in clause any area with respect to which a major dis- distribution. (i)(II) (or, if earlier, the date the plan or con- aster has been declared by the President (D) DEFINITIONS.—For purposes of this tract amendment is adopted), under section 401 of the Robert T. Stafford paragraph— the plan or contract is operated as if such Disaster Relief and Emergency Assistance (i) QUALIFIED 2016 DISASTER DISTRIBUTION.— plan or contract amendment were in effect; Act during calendar year 2016. Except as provided in subparagraph (B), the and term ‘‘qualified 2016 disaster distribution’’ (II) such plan or contract amendment ap- (b) SPECIAL RULES FOR USE OF RETIREMENT means any distribution from an eligible re- plies retroactively for such period. FUNDS WITH RESPECT TO AREAS DAMAGED BY tirement plan made on or after January 1, (c) SPECIAL RULES FOR PERSONAL CASUALTY 2016 DISASTERS.— 2016, and before January 1, 2018, to an indi- LOSSES RELATED TO 2016 MAJOR DISASTER.— (1) TAX-FAVORED WITHDRAWALS FROM RE- vidual whose principal place of abode at any (1) IN GENERAL.—If an individual has a net TIREMENT PLANS.— time during calendar year 2016 was located in disaster loss for any taxable year beginning (A) IN GENERAL.—Section 72(t) of the Inter- a disaster area described in subsection (a) after December 31, 2017, and before January nal Revenue Code of 1986 shall not apply to and who has sustained an economic loss by 1, 2026— any qualified 2016 disaster distribution. reason of the events giving rise to the Presi- (A) the amount determined under section (B) AGGREGATE DOLLAR LIMITATION.— dential declaration described in subsection 165(h)(2)(A)(ii) of the Internal Revenue Code (i) IN GENERAL.—For purposes of this sub- (a) which was applicable to such area. of 1986 shall be equal to the sum of— section, the aggregate amount of distribu- (ii) ELIGIBLE RETIREMENT PLAN.—The term (i) such net disaster loss, and tions received by an individual which may be ‘‘eligible retirement plan’’ shall have the (ii) so much of the excess referred to in the treated as qualified 2016 disaster distribu- meaning given such term by section matter preceding clause (i) of section tions for any taxable year shall not exceed 402(c)(8)(B) of the Internal Revenue Code of 165(h)(2)(A) of such Code (reduced by the the excess (if any) of— 1986. amount in clause (i) of this subparagraph) as (I) $100,000, over (E) INCOME INCLUSION SPREAD OVER 3-YEAR exceeds 10 percent of the adjusted gross in- (II) the aggregate amounts treated as PERIOD.— come of the individual, qualified 2016 disaster distributions received (i) IN GENERAL.—In the case of any quali- (B) section 165(h)(1) of such Code shall be by such individual for all prior taxable years. fied 2016 disaster distribution, unless the tax- applied by substituting ‘‘$500’’ for ‘‘$500 ($100 (ii) TREATMENT OF PLAN DISTRIBUTIONS.—If payer elects not to have this subparagraph for taxable years beginning after December a distribution to an individual would (with- apply for any taxable year, any amount re- 31, 2009)’’, out regard to clause (i)) be a qualified 2016 quired to be included in gross income for (C) the standard deduction determined disaster distribution, a plan shall not be such taxable year shall be so included rat- under section 63(c) of such Code shall be in- treated as violating any requirement of this ably over the 3-taxable-year period begin- creased by the net disaster loss, and title merely because the plan treats such dis- ning with such taxable year. (D) section 56(b)(1)(E) of such Code shall tribution as a qualified 2016 disaster distribu- (ii) SPECIAL RULE.—For purposes of clause not apply to so much of the standard deduc- tion, unless the aggregate amount of such (i), rules similar to the rules of subparagraph tion as is attributable to the increase under distributions from all plans maintained by (E) of section 408A(d)(3) of the Internal Rev- subparagraph (C) of this paragraph. the employer (and any member of any con- enue Code of 1986 shall apply. (2) NET DISASTER LOSS.—For purposes of trolled group which includes the employer) (F) SPECIAL RULES.— this subsection, the term ‘‘net disaster loss’’ to such individual exceeds $100,000. (i) EXEMPTION OF DISTRIBUTIONS FROM means the excess of qualified disaster-re- (iii) CONTROLLED GROUP.—For purposes of TRUSTEE TO TRUSTEE TRANSFER AND WITH- lated personal casualty losses over personal clause (ii), the term ‘‘controlled group’’ HOLDING RULES.—For purposes of sections casualty gains (as defined in section means any group treated as a single em- 401(a)(31), 402(f), and 3405 of the Internal Rev- 165(h)(3)(A) of the Internal Revenue Code of ployer under subsection (b), (c), (m), or (o) of enue Code of 1986, qualified 2016 disaster dis- 1986). section 414 of the Internal Revenue Code of tribution shall not be treated as eligible roll- (3) QUALIFIED DISASTER-RELATED PERSONAL 1986. over distributions. CASUALTY LOSSES.—For purposes of this para- (C) AMOUNT DISTRIBUTED MAY BE REPAID.— (ii) QUALIFIED 2016 DISASTER DISTRIBUTIONS graph, the term ‘‘qualified disaster-related (i) IN GENERAL.—Any individual who re- TREATED AS MEETING PLAN DISTRIBUTION RE- personal casualty losses’’ means losses de- ceives a qualified 2016 disaster distribution QUIREMENTS.—For purposes of the Internal scribed in section 165(c)(3) of the Internal may, at any time during the 3-year period Revenue Code of 1986, a qualified 2016 dis- Revenue Code of 1986 which arise in a dis- beginning on the day after the date on which aster distribution shall be treated as meet- aster area described in subsection (a) on or such distribution was received, make one or ing the requirements of sections after January 1, 2016, and which are attrib- more contributions in an aggregate amount 401(k)(2)(B)(i), 403(b)(7)(A)(ii), 403(b)(11), and utable to the events giving rise to the Presi- not to exceed the amount of such distribu- 457(d)(1)(A) of the Internal Revenue Code of dential declaration described in subsection tion to an eligible retirement plan of which 1986. (a) which was applicable to such area. such individual is a beneficiary and to which (2) PROVISIONS RELATING TO PLAN AMEND- PART IV—EDUCATION a rollover contribution of such distribution MENTS.— SEC. 11031. TREATMENT OF STUDENT LOANS DIS- could be made under section 402(c), 403(a)(4), (A) IN GENERAL.—If this paragraph applies CHARGED ON ACCOUNT OF DEATH 403(b)(8), 408(d)(3), or 457(e)(16) of the Internal to any amendment to any plan or annuity OR DISABILITY. Revenue Code of 1986, as the case may be. contract, such plan or contract shall be (a) IN GENERAL.—Section 108(f) is amended (ii) TREATMENT OF REPAYMENTS OF DIS- treated as being operated in accordance with by adding at the end the following new para- TRIBUTIONS FROM ELIGIBLE RETIREMENT PLANS the terms of the plan during the period de- graph: OTHER THAN IRAS.—For purposes of the Inter- scribed in subparagraph (B)(ii)(I). ‘‘(5) DISCHARGES ON ACCOUNT OF DEATH OR nal Revenue Code of 1986, if a contribution is (B) AMENDMENTS TO WHICH SUBSECTION AP- DISABILITY.— made pursuant to clause (i) with respect to a PLIES.— ‘‘(A) IN GENERAL.—In the case of an indi- qualified 2016 disaster distribution from an (i) IN GENERAL.—This paragraph shall apply vidual, gross income for any taxable year be- eligible retirement plan other than an indi- to any amendment to any plan or annuity ginning after December 31, 2017, and before vidual retirement plan, then the taxpayer contract which is made— January 1, 2026, does not include any amount shall, to the extent of the amount of the con- (I) pursuant to any provision of this sec- which (but for this subsection) would be in- tribution, be treated as having received the tion, or pursuant to any regulation under cludible in gross income for such taxable qualified 2016 disaster distribution in an eli- any provision of this section; and year by reasons of the discharge (in whole or gible rollover distribution (as defined in sec- (II) on or before the last day of the first in part) of any loan described in subpara- tion 402(c)(4) of the Internal Revenue Code of plan year beginning on or after January 1, graph (B) if such discharge was— 1986) and as having transferred the amount 2018, or such later date as the Secretary pre- ‘‘(i) pursuant to subsection (a) or (d) of sec- to the eligible retirement plan in a direct scribes. tion 437 of the Higher Education Act of 1965 trustee to trustee transfer within 60 days of In the case of a governmental plan (as de- or the parallel benefit under part D of title the distribution. fined in section 414(d) of the Internal Rev- IV of such Act (relating to the repayment of (iii) TREATMENT OF REPAYMENTS FOR DIS- enue Code of 1986), subclause (II) shall be ap- loan liability), TRIBUTIONS FROM IRAS.—For purposes of the plied by substituting the date which is 2 ‘‘(ii) pursuant to section 464(c)(1)(F) of such Internal Revenue Code of 1986, if a contribu- years after the date otherwise applied under Act, or tion is made pursuant to clause (i) with re- subclause (II). ‘‘(iii) otherwise discharged on account of spect to a qualified 2016 disaster distribution (ii) CONDITIONS.—This paragraph shall not the death or total and permanent disability from an individual retirement plan (as de- apply to any amendment unless— of the student.

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‘‘(B) LOANS DESCRIBED.—A loan is described year in which the taxable year begins, deter- earned income) in excess of the amount in ef- in this subparagraph if such loan is— mined by substituting ‘2017’ for ‘2016’ in sub- fect under section 63(c)(5)(A).’’. ‘‘(i) a student loan (as defined in paragraph paragraph (A)(ii) thereof. (f) EFFECTIVE DATE.—The amendments (2)), or If any increase determined under the pre- made by this section shall apply to taxable ‘‘(ii) a private education loan (as defined in ceding sentence is not a multiple of $100, years beginning after December 31, 2017. section 140(7) of the Consumer Credit Protec- such increase shall be rounded to the next SEC. 11042. SUSPENSION OF DEDUCTION FOR tion Act (15 U.S.C. 1650(7))).’’. lowest multiple of $100.’’. STATE AND LOCAL, ETC. TAXES. (b) EFFECTIVE DATE.—The amendment (d) EXCEPTION FOR DETERMINING PROPERTY (a) IN GENERAL.—Subsection (b) of section made by this section shall apply to dis- EXEMPT FROM LEVY.—Section 6334(d) is 164 is amended by adding at the end the fol- charges of indebtedness after December 31, amended by adding at the end the following lowing new paragraph: 2017. new paragraph: ‘‘(6) SUSPENSION OF INDIVIDUAL DEDUCTIONS FOR TAXABLE YEARS 2018 THROUGH 2025.—In the SEC. 11032. INCREASE IN DEDUCTION FOR ‘‘(4) YEARS WHEN PERSONAL EXEMPTION case of an individual and a taxable year be- TEACHER EXPENSES. AMOUNT IS ZERO.— ginning after December 31, 2017, and before (a) IN GENERAL.—Subparagraph (D) of sec- ‘‘(A) IN GENERAL.—In the case of any tax- tion 62(a)(2) is amended by striking ‘‘$250’’ able year in which the exemption amount January 1, 2026— ‘‘(A) foreign real property taxes (other and inserting ‘‘$250 ($500 in the case of tax- under section 151(d) is zero, paragraph (2) than taxes which are paid or accrued in car- able years beginning after December 31, 2017, shall not apply and for purposes of paragraph rying on a trade or business or an activity and before January 1, 2026)’’. (1) the term ‘exempt amount’ means an described in section 212) shall not be taken (b) EFFECTIVE DATE.—The amendment amount equal to— into account under subsection (a)(1), made by this section shall apply to taxable ‘‘(i) the sum of the amount determined ‘‘(B) the aggregate amount of taxes (other years beginning after December 31, 2017. under subparagraph (B) and the standard de- than taxes which are paid or accrued in car- PART V—DEDUCTIONS AND EXCLUSIONS duction, divided by rying on a trade or business or an activity ‘‘(ii) 52. SEC. 11041. SUSPENSION OF DEDUCTION FOR described in section 212) taken into account PERSONAL EXEMPTIONS. ‘‘(B) AMOUNT DETERMINED.—For purposes of subparagraph (A), the amount determined under subsection (a)(1) for any taxable year (a) IN GENERAL.—Subsection (d) of section shall not exceed $10,000 ($5,000 in the case of 151 is amended— under this subparagraph is $4,150 multiplied by the number of the taxpayer’s dependents a married individual filing a separate re- (1) by striking ‘‘In the case of’’ in para- turn), graph (4) and inserting ‘‘Except as provided for the taxable year in which the levy oc- curs. ‘‘(C) subsection (a)(2) shall only apply to in paragraph (5), in the case of’’, and taxes which are paid or accrued in carrying (2) by adding at the end the following new ‘‘(C) INFLATION ADJUSTMENT.—In the case of any taxable year beginning after 2018, the on a trade or business or an activity de- paragraph: scribed in section 212, ‘‘(5) SPECIAL RULES FOR TAXABLE YEARS 2018 $4,150 amount in subparagraph (B) shall be increased by an amount equal to— ‘‘(D) subsection (a)(3) shall not apply to THROUGH 2025.—In the case of a taxable year State and local taxes, and beginning after December 31, 2017, and before ‘‘(i) such dollar amount, multiplied by ‘‘(ii) the cost-of-living adjustment deter- ‘‘(E) paragraph (5) shall not apply.’’. January 1, 2026— (b) EFFECTIVE DATE.—The amendment ‘‘(A) EXEMPTION AMOUNT.—The term ‘ex- mined under section 1(f)(3) for the calendar made by this section shall apply to taxable emption amount’ means zero. year in which the taxable year begins, deter- years beginning after December 31, 2017. mined by substituting ‘2017’ for ‘2016’ in sub- ‘‘(B) REFERENCES.—For purposes of any SEC. 11043. SUSPENSION OF DEDUCTION FOR other provision of this title, the reduction of paragraph (A)(ii) thereof. HOME EQUITY INTEREST. the exemption amount to zero under sub- If any increase determined under the pre- (a) IN GENERAL.—Section 163(h)(3)(A)(ii) is paragraph (A) shall not be taken into ac- ceding sentence is not a multiple of $100, amended by inserting ‘‘in the case of taxable count in determining whether a deduction is such increase shall be rounded to the next years beginning before January 1, 2018, or allowed or allowable, or whether a taxpayer lowest multiple of $100. after December 31, 2025,’’ before ‘‘home eq- is entitled to a deduction, under this sec- ‘‘(D) VERIFIED STATEMENT.—Unless the tax- uity indebtedness’’. tion.’’. payer submits to the Secretary a written and (b) EFFECTIVE DATE.—The amendment (b) APPLICATION TO ESTATES AND TRUSTS.— properly verified statement specifying the made by this section shall apply to taxable Section 642(b)(2)(C) is amended by adding at facts necessary to determine the proper years ending after December 31, 2017. the end the following new clause: amount under subparagraph (A), subpara- SEC. 11044. MODIFICATION OF DEDUCTION FOR ‘‘(iii) YEARS WHEN PERSONAL EXEMPTION graph (A) shall be applied as if the taxpayer PERSONAL CASUALTY LOSSES. AMOUNT IS ZERO.— were a married individual filing a separate (a) IN GENERAL.—Subsection (h) of section ‘‘(I) IN GENERAL.—In the case of any tax- return with no dependents.’’. 165 is amended by adding at the end the fol- able year in which the exemption amount (e) PERSONS REQUIRED TO MAKE RETURNS lowing new paragraph: under section 151(d) is zero, clause (i) shall be OF INCOME.—Section 6012 is amended by add- ‘‘(5) LIMITATION FOR TAXABLE YEARS 2018 applied by substituting ‘$4,150’ for ‘the ex- ing at the end the following new subsection: THROUGH 2025.—In the case of an individual, emption amount under section 151(d)’. ‘‘(f) SPECIAL RULE FOR TAXABLE YEARS 2018 any loss described in subsection (c)(3) which ‘‘(II) INFLATION ADJUSTMENT.—In the case THROUGH 2025.—In the case of a taxable year (but for this paragraph) would be deductible of any calendar year beginning after 2018, the beginning after December 31, 2017, and before in a taxable year beginning after December $4,150 amount in subparagraph (A) shall be January 1, 2026, subsection (a)(1) shall not 31, 2017, and before January 1, 2026, shall be increased by an amount equal to— apply, and every individual who has gross in- allowed only to the extent it is attributable ‘‘(aa) such dollar amount, multiplied by come for the taxable year shall be required to a Federally declared disaster (as defined ‘‘(bb) the cost-of-living adjustment deter- to make returns with respect to income in subsection (i)(5)). The preceding sentence mined under section 1(f)(3) for the calendar taxes under subtitle A, except that a return shall not apply to any deduction under sec- year in which the taxable year begins, deter- shall not be required of— tion 172 which is carried to such a taxable mined by substituting ‘2017’ for ‘2016’ in sub- ‘‘(1) an individual who is not married (de- year from a taxable year beginning before paragraph (A)(ii) thereof. termined by applying section 7703) and who January 1, 2018.’’. If any increase determined under the pre- has gross income for the taxable year which (b) EFFECTIVE DATE.—The amendment ceding sentence is not a multiple of $100, does not exceed the standard deduction ap- made by this section shall apply to losses in- such increase shall be rounded to the next plicable to such individual for such taxable curred in taxable years beginning after De- lowest multiple of $100.’’. year under section 63, or cember 31, 2017. (c) EXCEPTION FOR WAGE WITHHOLDING ‘‘(2) an individual entitled to make a joint SEC. 11045. SUSPENSION OF MISCELLANEOUS ITEMIZED DEDUCTIONS. RULES.—Section 3402(a) is amended by add- return if— (a) IN GENERAL.—Section 67 is amended by ing at the end the following new paragraph: ‘‘(A) the gross income of such individual, adding at the end the following new sub- ‘‘(3) YEARS WHEN PERSONAL EXEMPTION when combined with the gross income of section: AMOUNT IS ZERO.— such individual’s spouse, for the taxable year ‘‘(g) SUSPENSION FOR TAXABLE YEARS 2018 ‘‘(A) IN GENERAL.—In the case of any tax- does not exceed the standard deduction THROUGH 2025.—Notwithstanding subsection able year in which the exemption amount which would be applicable to the taxpayer (a), no miscellaneous itemized deduction under section 151(d) is zero, paragraph (2) for such taxable year under section 63 if such shall be allowed for any taxable year begin- shall be applied by substituting ‘$4,150’ for individual and such individual’s spouse made ning after December 31, 2017, and before Jan- ‘the amount of one personal exemption pro- a joint return, uary 1, 2026.’’. vided in section 151(b)’. ‘‘(B) such individual and such individual’s (b) EFFECTIVE DATE.—The amendment ‘‘(B) INFLATION ADJUSTMENT.—In the case spouse have the same household as their made by this section shall apply to taxable of any calendar year beginning after 2018, the home at the close of the taxable year, years beginning after December 31, 2017. $4,150 amount in subparagraph (A) shall be ‘‘(C) such individual’s spouse does not SEC. 11046. SUSPENSION OF OVERALL LIMITA- increased by an amount equal to— make a separate return, and TION ON ITEMIZED DEDUCTIONS. ‘‘(i) such dollar amount, multiplied by ‘‘(D) neither such individual nor such indi- (a) IN GENERAL.—Section 68 is amended by ‘‘(ii) the cost-of-living adjustment deter- vidual’s spouse is an individual described in adding at the end the following new sub- mined under section 1(f)(3) for the calendar section 63(c)(5) who has income (other than section:

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‘‘(f) SECTION NOT TO APPLY.—This section SEC. 11051. LIMITATION ON WAGERING LOSSES. SEC. 11072. MODIFICATION OF USER FEE RE- shall not apply to any taxable year begin- (a) IN GENERAL.—Section 165(d) is amended QUIREMENTS FOR INSTALLMENT ning after December 31, 2017, and before Jan- by adding at the end the following: ‘‘For pur- AGREEMENTS. uary 1, 2026.’’. poses of the preceding sentence, in the case (a) IN GENERAL.—Section 6159 is amended (b) EFFECTIVE DATE.—The amendments of taxable years beginning after December by redesignating subsection (f) as subsection made by this section shall apply to taxable 31, 2017, and before January 1, 2026, the term (g) and by inserting after subsection (e) the years beginning after December 31, 2017. ‘losses from wagering transactions’ includes following new subsection: ‘‘(f) INSTALLMENT AGREEMENT FEES.— SEC. 11047. MODIFICATION OF EXCLUSION OF any deduction otherwise allowable under ‘‘(1) LIMITATION ON FEE AMOUNT.—The GAIN FROM SALE OF PRINCIPAL this chapter incurred in carrying on any wa- amount of any fee imposed on an installment RESIDENCE. gering transaction.’’. (a) IN GENERAL.—Section 121 is amended by agreement under this section may not exceed (b) EFFECTIVE DATE.—The amendment adding at the end the following new sub- the amount of such fee as in effect on the made by this section shall apply to taxable section: date of the enactment of this subsection. years beginning after December 31, 2017. ‘‘(h) SPECIAL RULES FOR SALES OR EX- ‘‘(2) WAIVER OR REIMBURSEMENT.—In the CHANGES IN TAXABLE YEARS 2018 THROUGH PART VI—INCREASE IN ESTATE AND GIFT case of any taxpayer with an adjusted gross 2025.— TAX EXEMPTION income, as determined for the most recent ‘‘(1) IN GENERAL.—In applying this section SEC. 11061. INCREASE IN ESTATE AND GIFT TAX year for which such information is available, with respect to sales or exchanges after De- EXEMPTION. which does not exceed 250 percent of the ap- cember 31, 2017, and before January 1, 2026— (a) IN GENERAL.—Section 2010(c)(3) is plicable poverty level (as determined by the ‘‘(A) ‘8-year’ shall be substituted for ‘5- amended by adding at the end the following Secretary)— year’ each place it appears in subsections (a), new subparagraph: ‘‘(A) if the taxpayer has agreed to make (b)(5)(C)(ii)(I), and (c)(1)(B)(i)(I) and para- ‘‘(C) INCREASE IN BASIC EXCLUSION payments under the installment agreement graphs (7), (9), (10), and (12) of subsection (d), AMOUNT.—In the case of estates of decedents by electronic payment through a debit in- ‘‘(B) ‘5 years’ shall be substituted for ‘2 dying or gifts made after December 31, 2017, strument, no fee shall be imposed on an in- years’ each place it appears in subsections and before January 1, 2026, subparagraph (A) stallment agreement under this section, and (a), (b)(3), (b)(4), (b)(5)(C)(ii)(III), and shall be applied by substituting ‘$10,000,000’ ‘‘(B) if the taxpayer is unable to make pay- (c)(1)(B)(ii), and for ‘$5,000,000’.’’. ments under the installment agreement by ‘‘(C) ‘5-year’ shall be substituted for ‘2- (b) CONFORMING AMENDMENT.—Subsection electronic payment through a debit instru- year’ in subsection (b)(3). (g) of section 2001 is amended to read as fol- ment, the Secretary shall, upon completion ‘‘(2) EXCEPTION FOR BINDING CONTRACTS.— lows: of the installment agreement, pay the tax- Paragraph (1) shall not apply to any sale or ‘‘(g) MODIFICATIONS TO TAX PAYABLE.— payer an amount equal to any such fees im- exchange with respect to which there was a ‘‘(1) MODIFICATIONS TO GIFT TAX PAYABLE TO posed.’’. written binding contract in effect before REFLECT DIFFERENT TAX RATES.—For pur- (b) EFFECTIVE DATE.—The amendments January 1, 2018, and at all times thereafter poses of applying subsection (b)(2) with re- made by this section shall apply to agree- before the sale or exchange.’’. spect to 1 or more gifts, the rates of tax ments entered into on or after the date (b) EFFECTIVE DATE.—The amendment under subsection (c) in effect at the dece- which is 60 days after the date of the enact- made by this section shall apply to sales and dent’s death shall, in lieu of the rates of tax ment of this Act. exchanges after December 31, 2017. in effect at the time of such gifts, be used SEC. 11073. ATTORNEYS’ FEES RELATING TO SEC. 11048. SUSPENSION OF EXCLUSION FOR both to compute— AWARDS TO WHISTLEBLOWERS. QUALIFIED BICYCLE COMMUTING ‘‘(A) the tax imposed by chapter 12 with re- (a) IN GENERAL.—Paragraph (21) of section REIMBURSEMENT. spect to such gifts, and 62(a) is amended to read as follows: (a) IN GENERAL.—Section 132(f) is amended ‘‘(B) the credit allowed against such tax ‘‘(21) ATTORNEYS’ FEES RELATING TO AWARDS by adding at the end the following new para- TO WHISTLEBLOWERS.— graph: under section 2505, including in computing— ‘‘(i) the applicable credit amount under ‘‘(A) IN GENERAL.—Any deduction allowable ‘‘(8) SUSPENSION OF QUALIFIED BICYCLE COM- section 2505(a)(1), and under this chapter for attorney fees and MUTING REIMBURSEMENT EXCLUSION.—Para- ‘‘(ii) the sum of the amounts allowed as a court costs paid by, or on behalf of, the tax- graph (1)(D) shall not apply to any taxable payer in connection with any award under— year beginning after December 31, 2017, and credit for all preceding periods under section 2505(a)(2). ‘‘(i) section 7623(b), or before January 1, 2026.’’. ‘‘(ii) any action brought under— (b) EFFECTIVE DATE.—The amendment ‘‘(2) MODIFICATIONS TO ESTATE TAX PAYABLE ‘‘(I) section 21F of the Securities Exchange made by this section shall apply to taxable TO REFLECT DIFFERENT BASIC EXCLUSION Act of 1934 (15 U.S.C. 78u-6), years beginning after December 31, 2017. AMOUNTS.—The Secretary shall prescribe such regulations as may be necessary or ap- ‘‘(II) a State false claims act, including a SEC. 11049. SUSPENSION OF EXCLUSION FOR State false claims act with qui tam provi- QUALIFIED MOVING EXPENSE REIM- propriate to carry out this section with re- BURSEMENT. spect to any difference between— sions, or (a) IN GENERAL.—Section 132(g) is amend- ‘‘(A) the basic exclusion amount under sec- ‘‘(III) section 23 of the Commodity Ex- ed— tion 2010(c)(3) applicable at the time of the change Act (7 U.S.C. 26). (1) by striking ‘‘For purposes of this sec- decedent’s death, and ‘‘(B) MAY NOT EXCEED AWARD.—Subpara- tion, the term’’ and inserting ‘‘For purposes ‘‘(B) the basic exclusion amount under graph (A) shall not apply to any deduction in of this section— such section applicable with respect to any excess of the amount includible in the tax- ‘‘(1) IN GENERAL.—The term’’, and gifts made by the decedent.’’. payer’s gross income for the taxable year on (2) by adding at the end the following new (c) EFFECTIVE DATE.—The amendments account of such award.’’. paragraph: made by this section shall apply to estates of (b) EFFECTIVE DATE.—The amendment made by this section shall apply to taxable ‘‘(2) SUSPENSION FOR TAXABLE YEARS 2018 decedents dying and gifts made after Decem- years beginning after December 31, 2017. THROUGH 2025.—Except in the case of a mem- ber 31, 2017. SEC. 11074. CLARIFICATION OF WHISTLEBLOWER ber of the Armed Forces of the United States PART VII—TAXPAYER RIGHTS AND TAX on active duty who moves pursuant to a AWARDS. ADMINISTRATION (a) DEFINITION OF PROCEEDS.— military order and incident to a permanent SEC. 11071. EXTENSION OF TIME LIMIT FOR CON- (1) IN GENERAL.—Section 7623 is amended change of station, subsection (a)(6) shall not TESTING IRS LEVY. by adding at the end the following new sub- apply to any taxable year beginning after (a) EXTENSION OF TIME FOR RETURN OF section: December 31, 2017, and before January 1, PROPERTY SUBJECT TO LEVY.—Subsection (b) ‘‘(c) PROCEEDS.—For purposes of this sec- 2026.’’. of section 6343 is amended by striking ‘‘9 tion, the term ‘proceeds’ includes— (b) EFFECTIVE DATE.—The amendments made by this section shall apply to taxable months’’ and inserting ‘‘2 years’’. ‘‘(1) penalties, interest, additions to tax, years beginning after December 31, 2017. (b) PERIOD OF LIMITATION ON SUITS.—Sub- and additional amounts provided under the section (c) of section 6532 is amended— internal revenue laws, and SEC. 11050. SUSPENSION OF DEDUCTION FOR MOVING EXPENSES. (1) by striking ‘‘9 months’’ in paragraph (1) ‘‘(2) any proceeds arising from laws for (a) IN GENERAL.—Section 217 is amended by and inserting ‘‘2 years’’, and which the Internal Revenue Service is au- adding at the end the following new sub- (2) by striking ‘‘9-month’’ in paragraph (2) thorized to administer, enforce, or inves- section: and inserting ‘‘2-year’’. tigate, including— ‘‘(k) SUSPENSION OF DEDUCTION FOR TAX- (c) EFFECTIVE DATE.—The amendments ‘‘(A) criminal fines and civil forfeitures, ABLE YEARS 2018 THROUGH 2025.—Except in made by this section shall apply to— and the case of an individual to whom subsection (1) levies made after the date of the enact- ‘‘(B) violations of reporting require- (g) applies, this section shall not apply to ment of this Act, and ments.’’. any taxable year beginning after December (2) levies made on or before such date if the (2) CONFORMING AMENDMENTS.—Paragraphs 31, 2017, and before January 1, 2026.’’. 9-month period has not expired under section (1) and (2)(A) of section 7623(b) are each (b) EFFECTIVE DATE.—The amendment 6343(b) of the Internal Revenue Code of 1986 amended by striking ‘‘collected proceeds (in- made by this section shall apply to taxable (without regard to this section) as of such cluding penalties, interest, additions to tax, years beginning after December 31, 2017. date. and additional amounts) resulting from the

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action’’ and inserting ‘‘proceeds collected as Subtitle C—Business-related Provisions ‘‘(E) RATE DIFFERENTIAL PORTION.—The a result of the action’’. PART I—CORPORATE PROVISIONS rate differential portion of foreign source net (b) AMOUNT OF PROCEEDS DETERMINED SEC. 13001. 20-PERCENT CORPORATE TAX RATE. capital gain, net capital gain, or the excess WITHOUT REGARD TO AVAILABILITY.—Para- (a) IN GENERAL.—Subsection (b) of section of net capital gain from sources within the graphs (1) and (2)(A) of section 7623(b) are 11 is amended to read as follows: United States over net capital gain, as the each amended by inserting ‘‘(determined ‘‘(b) AMOUNT OF TAX.—The amount of the case may be, is the same proportion of such without regard to whether such proceeds are tax imposed by subsection (a) shall be 20 per- amount as— available to the Secretary)’’ after ‘‘in re- cent of taxable income.’’. ‘‘(i) the excess of— sponse to such action’’. (b) CONFORMING AMENDMENTS.— ‘‘(I) the highest rate of tax set forth in sub- (c) DISPUTED AMOUNT THRESHOLD.—Section (1) The following sections are each amend- section (a), (b), (c), (d), or (e) of section 1 7623(b)(5)(B) is amended by striking ‘‘tax, ed by striking ‘‘section 11(b)(1)’’ and insert- (whichever applies), over penalties, interest, additions to tax, and ad- ing ‘‘section 11(b)’’: ‘‘(II) the alternative rate of tax determined ditional amounts’’ and inserting ‘‘proceeds’’. (A) Section 280C(c)(3)(B)(ii)(II). under section 1(h), bears to (d) EFFECTIVE DATE.—The amendments (B) Paragraphs (2)(B) and (6)(A)(ii) of sec- ‘‘(ii) that rate referred to in subclause made by this section shall apply to informa- tion 860E(e). (I).’’. tion provided before, on, or after the date of (C) Section 7874(e)(1)(B). (N) Section 1374(b) is amended by striking the enactment of this Act with respect to (2)(A) Part I of subchapter P of chapter 1 is paragraph (4). which a final determination for an award has amended by striking section 1201 (and by (O) Section 1381(b) is amended by striking not been made before such date of enact- striking the item relating to such section in ‘‘taxes imposed by section 11 or 1201’’ and in- ment. the table of sections for such part). serting ‘‘tax imposed by section 11’’. (B) Section 12 is amended by striking para- PART VIII—INDIVIDUAL MANDATE (P) Sections 6425(c)(1)(A) and graphs (4) and (6), and by redesignating para- 6655(g)(1)(A)(i) are each amended by striking SEC. 11081. ELIMINATION OF SHARED RESPONSI- graph (5) as paragraph (4). ‘‘or 1201(a),’’. BILITY PAYMENT FOR INDIVIDUALS (C) Section 453A(c)(3) is amended by strik- (Q) Section 7518(g)(6)(A) is amended by FAILING TO MAINTAIN MINIMUM ES- ing ‘‘or 1201 (whichever is appropriate)’’. SENTIAL COVERAGE. striking ‘‘or 1201(a)’’. (D) Section 527(b) is amended— (3)(A) Section 1445(e)(1) is amended— (a) IN GENERAL.—Section 5000A(c) is (i) by striking paragraph (2), and amended— (i) by striking ‘‘35 percent’’ and inserting (ii) by striking all that precedes ‘‘is hereby ‘‘the highest rate of tax in effect for the tax- (1) in paragraph (2)(B)(iii), by striking ‘‘2.5 imposed’’ and inserting: able year under section 11(b)’’, and percent’’ and inserting ‘‘Zero percent’’, and ‘‘(b) TAX IMPOSED.—A tax’’. (2) in paragraph (3)— (E) Sections 594(a) is amended by striking (ii) by striking ‘‘of the gain’’ and inserting (A) by striking ‘‘$695’’ in subparagraph (A) ‘‘taxes imposed by section 11 or 1201(a)’’ and ‘‘multiplied by the gain’’. and inserting ‘‘$0’’, and inserting ‘‘tax imposed by section 11’’. (B) Section 1445(e)(2) is amended by strik- (B) by striking subparagraph (D). (F) Section 691(c)(4) is amended by striking ing ‘‘35 percent of the amount’’ and inserting (b) EFFECTIVE DATE.—The amendments ‘‘1201,’’. ‘‘the highest rate of tax in effect for the tax- made by this section shall apply to months (G) Section 801(a) is amended— able year under section 11(b) multiplied by beginning after December 31, 2018. (i) by striking paragraph (2), and the amount’’. (C) Section 1445(e)(6) is amended— Subtitle B—Alternative Minimum Tax (ii) by striking all that precedes ‘‘is hereby imposed’’ and inserting: (i) by striking ‘‘35 percent’’ and inserting SEC. 12001. INCREASED EXEMPTION FOR INDI- ‘‘(a) TAX IMPOSED.—A tax’’. ‘‘the highest rate of tax in effect for the tax- VIDUALS. (H) Section 831(e) is amended by striking able year under section 11(b)’’, and (a) INCREASED EXEMPTION.—Section 55(d) is paragraph (1) and by redesignating para- (ii) by striking ‘‘of the amount’’ and in- amended by adding at the end the following graphs (2) and (3) as paragraphs (1) and (2), serting ‘‘multiplied by the amount’’. new paragraph: respectively. (D) Section 1446(b)(2)(B) is amended by ‘‘(5) SPECIAL RULE FOR TAXABLE YEARS BE- (I) Sections 832(c)(5) and 834(b)(1)(D) are striking ‘‘section 11(b)(1)’’ and inserting GINNING AFTER 2017 AND BEFORE 2026.— each amended by striking ‘‘sec. 1201 and fol- ‘‘section 11(b)’’. ‘‘(A) IN GENERAL.—In the case of any tax- lowing,’’. (4) Section 852(b)(1) is amended by striking able year beginning after December 31, 2017, (J) Section 852(b)(3)(A) is amended by the last sentence. and before January 1, 2026— striking ‘‘section 1201(a)’’ and inserting ‘‘sec- (5)(A) Part I of subchapter B of chapter 5 is ‘‘(i) paragraph (1) shall be applied— tion 11(b)’’. amended by striking section 1551 (and by ‘‘(I) by substituting ‘$109,400’ for ‘$78,750’ in (K) Section 857(b)(3) is amended— striking the item relating to such section in subparagraph (A), and (i) by striking subparagraph (A) and redes- the table of sections for such part). ‘‘(II) by substituting ‘$70,300’ for ‘$50,600’ in ignating subparagraphs (B) through (F) as (B) Section 535(c)(5) is amended to read as subparagraph (B), and subparagraphs (A) through (E), respectively, follows: ‘‘(ii) paragraph (3) shall be applied— (ii) in subparagraph (C), as so redesig- ‘‘(5) CROSS REFERENCE.—For limitation on ‘‘(I) by substituting ‘$208,400’ for ‘$150,000’ nated— credit provided in paragraph (2) or (3) in the in subparagraph (A), (I) by striking ‘‘subparagraph (A)(ii)’’ in case of certain controlled corporations, see ‘‘(II) by substituting ‘$156,300’ for ‘$112,500’ clause (i) thereof and inserting ‘‘paragraph section 1561.’’. in subparagraph (B), and (1)’’, (6)(A) Section 1561(a) is amended— ‘‘(III) in the case of a taxpayer described in (II) by striking ‘‘the tax imposed by sub- (i) by striking paragraph (1) and redesig- paragraph (1)(D), without regard to the sub- paragraph (A)(ii)’’ in clauses (ii) and (iv) nating paragraphs (2) and (3) as paragraphs stitution under subclause (I). thereof and inserting ‘‘the tax imposed by (1) and (2), respectively, ‘‘(B) INFLATION ADJUSTMENT.— paragraph (1) on undistributed capital gain’’, (ii) by striking ‘‘amounts specified in para- ‘‘(i) IN GENERAL.—In the case of any tax- (iii) in subparagraph (E), as so redesig- graph (1) and the amount specified in para- able year beginning in a calendar year after nated, by striking ‘‘subparagraph (B) or (D)’’ graph (3)’’ and inserting ‘‘the amount speci- 2018, the amounts described in clause (ii) and inserting ‘‘subparagraph (A) or (C)’’, and fied in paragraph (2)’’, shall each be increased by an amount equal (iv) by adding at the end the following new (iii) by striking ‘‘The amounts specified in to— subparagraph: paragraph (2)’’ and inserting ‘‘The amounts ‘‘(I) such dollar amount, multiplied by ‘‘(F) UNDISTRIBUTED CAPITAL GAIN.—For specified in paragraph (1)’’, ‘‘(II) the cost-of-living adjustment deter- purposes of this paragraph, the term ‘undis- (iv) by striking the third sentence in the mined under section 1(f)(3) for the calendar tributed capital gain’ means the excess of flush language, and year in which the taxable year begins, deter- the net capital gain over the deduction for (v) by striking ‘‘under paragraph (3)’’ and mined by substituting ‘calendar year 2017’ dividends paid (as defined in section 561) de- inserting ‘‘under paragraph (2)’’. for ‘calendar year 2016’ in subparagraph termined with reference to capital gain divi- (B) The first sentence of section 1561(b) is (A)(ii) thereof. dends only.’’. amended to read as follows: ‘‘If a corporation ‘‘(ii) AMOUNTS DESCRIBED.—The amounts (L) Section 882(a)(1) is amended by striking has a short taxable year which does not in- described in this clause are the $109,400 ‘‘, 55, or 1201(a)’’ and inserting ‘‘or 55’’. clude a December 31 and is a component amount in subparagraph (A)(i)(I), the $70,300 (M) Section 904(b) is amended— member of a controlled group of corpora- amount in subparagraph (A)(i)(II), the (i) by striking ‘‘or 1201(a)’’ in paragraph tions with respect to such taxable year, then $208,400 amount in subparagraph (A)(ii)(I), (2)(C), for purposes of this subtitle the amount to and the $156,300 amount in subparagraph (ii) by striking paragraph (3)(D) and insert- be used in computing the accumulated earn- (A)(ii)(II). ing the following: ings credit under section 535(c)(2) and (3) of ‘‘(iii) ROUNDING.—Any increased amount ‘‘(D) CAPITAL GAIN RATE DIFFERENTIAL.— such corporation for such taxable year shall determined under clause (i) shall be rounded There is a capital gain rate differential for be the amount specified in subsection (a)(1) to the nearest multiple of $100.’’. any year if subsection (h) of section 1 applies divided by the number of corporations which (b) EFFECTIVE DATE.—The amendments to such taxable year.’’, and are component members of such group on the made by this section shall apply to taxable (iii) by striking paragraph (3)(E) and in- last day of such taxable year.’’ years beginning after December 31, 2017. serting the following: (7) Section 7518(g)(6)(A) is amended—

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00115 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.053 S01DEPT1 S7768 CONGRESSIONAL RECORD — SENATE December 1, 2017 (A) by striking ‘‘With respect to the por- (ii) reduces the excess tax reserve ratably (ii) in subparagraph (B), by inserting ‘‘($100 tion’’ and inserting ‘‘In the case of a tax- over the remaining regulatory life of the in the case of any increase in the amount payer other than a corporation, with respect property. under paragraph (5)(A))’’ after ‘‘$10,000’’. to the portion’’, and (4) TAX INCREASED FOR NORMALIZATION VIO- (b) SECTION 179 PROPERTY TO INCLUDE (B) by striking ‘‘(34 percent in the case of LATION.—If, for any taxable year ending after QUALIFIED REAL PROPERTY.— a corporation)’’. the date of the enactment of this Act, the (1) IN GENERAL.—Subparagraph (B) of sec- (c) EFFECTIVE DATE.— taxpayer does not use a normalization meth- tion 179(d)(1) is amended to read as follows: (1) IN GENERAL.—Except as otherwise pro- od of accounting, the taxpayer’s tax for the ‘‘(B) which is— vided in this subsection, the amendments taxable year shall be increased by the ‘‘(i) section 1245 property (as defined in sec- made by this section shall apply to taxable amount by which it reduces its excess tax re- tion 1245(a)(3)), or years beginning after December 31, 2018. serve more rapidly than permitted under a ‘‘(ii) at the election of the taxpayer, quali- (2) WITHHOLDING.—The amendments made normalization method of accounting. fied real property (as defined in subsection by subsection (b)(3) shall apply to distribu- SEC. 13002. REDUCTION IN DIVIDEND RECEIVED (f)), and’’. tions made after December 31, 2018. DEDUCTIONS TO REFLECT LOWER (2) QUALIFIED REAL PROPERTY DEFINED.— (3) CERTAIN TRANSFERS.—The amendments CORPORATE INCOME TAX RATES. Subsection (f) of section 179 is amended to made by subsection (b)(6) shall apply to (a) DIVIDENDS RECEIVED BY CORPORA- read as follows: transfers made after December 31, 2018. TIONS.— ‘‘(f) QUALIFIED REAL PROPERTY.—For pur- (d) NORMALIZATION REQUIREMENTS.— (1) IN GENERAL.—Section 243(a)(1) is amend- poses of this section, the term ‘qualified real (1) IN GENERAL.—A normalization method ed by striking ‘‘70 percent’’ and inserting ‘‘50 property’ means— of accounting shall not be treated as being percent’’. ‘‘(1) any qualified improvement property used with respect to any public utility prop- (2) DIVIDENDS FROM 20-PERCENT OWNED COR- described in section 168(e)(6), and erty for purposes of section 167 or 168 of the PORATIONS.—Section 243(c)(1) is amended— ‘‘(2) any of the following improvements to Internal Revenue Code of 1986 if the tax- (A) by striking ‘‘80 percent’’ and inserting nonresidential real property placed in serv- payer, in computing its cost of service for ‘‘65 percent’’, and ice after the date such property was first ratemaking purposes and reflecting oper- (B) by striking ‘‘70 percent’’ and inserting placed in service: ating results in its regulated books of ac- ‘‘50 percent’’. ‘‘(A) Roofs. count, reduces the excess tax reserve more (3) CONFORMING AMENDMENT.—The heading ‘‘(B) Heating, ventilation, and air-condi- rapidly or to a greater extent than such re- for section 243(c) is amended by striking tioning property. serve would be reduced under the average ‘‘RETENTION OF 80-PERCENT DIVIDEND RE- ‘‘(C) Fire protection and alarm systems. rate assumption method. CEIVED DEDUCTION’’ and inserting ‘‘IN- ‘‘(D) Security systems.’’. (2) ALTERNATIVE METHOD FOR CERTAIN TAX- CREASED PERCENTAGE’’. (c) REPEAL OF EXCLUSION FOR CERTAIN PAYERS.—If, as of the first day of the taxable (b) DIVIDENDS RECEIVED FROM FSC.—Sec- PROPERTY.—The last sentence of section year that includes the date of enactment of tion 245(c)(1)(B) is amended— 179(d)(1) is amended by inserting ‘‘(other this Act— (1) by striking ‘‘70 percent’’ and inserting than paragraph (2) thereof)’’ after ‘‘section (A) the taxpayer was required by a regu- ‘‘50 percent’’, and 50(b)’’. latory agency to compute depreciation for (2) by striking ‘‘80 percent’’ and inserting (d) EFFECTIVE DATE.—The amendments public utility property on the basis of an av- ‘‘65 percent’’. made by this section shall apply to property erage life or composite rate method, and (c) LIMITATION ON AGGREGATE AMOUNT OF placed in service in taxable years beginning (B) the taxpayer’s books and underlying DEDUCTIONS.—Section 246(b)(3) is amended— after December 31, 2017. records did not contain the vintage account (1) by striking ‘‘80 percent’’ in subpara- SEC. 13102. MODIFICATIONS OF GROSS RECEIPTS data necessary to apply the average rate as- graph (A) and inserting ‘‘65 percent’’, and TEST FOR USE OF CASH METHOD OF sumption method, (2) by striking ‘‘70 percent’’ in subpara- ACCOUNTING BY CORPORATIONS the taxpayer will be treated as using a nor- graph (B) and inserting ‘‘50 percent’’. AND PARTNERSHIPS. malization method of accounting if, with re- (d) REDUCTION IN DEDUCTION WHERE PORT- (a) MODIFICATIONS OF GROSS RECEIPTS spect to such jurisdiction, the taxpayer uses FOLIO STOCK IS DEBT-FINANCED.—Section TEST.— the alternative method for public utility 246A(a)(1) is amended— (1) IN GENERAL.—So much of section 448(c) property that is subject to the regulatory (1) by striking ‘‘70 percent’’ and inserting as precedes paragraph (2) is amended to read authority of that jurisdiction. ‘‘50 percent’’, and as follows: (3) DEFINITIONS.—For purposes of this sub- (2) by striking ‘‘80 percent’’ and inserting ‘‘(c) GROSS RECEIPTS TEST.— section— ‘‘65 percent’’. ‘‘(1) IN GENERAL.—A corporation or part- (A) EXCESS TAX RESERVE.—The term ‘‘ex- (e) INCOME FROM SOURCES WITHIN THE nership meets the gross receipts test of this cess tax reserve’’ means the excess of— UNITED STATES.—Section 861(a)(2) is amend- subsection for any taxable year if the aver- (i) the reserve for deferred taxes (as de- ed— age annual gross receipts of such entity for scribed in section 168(i)(9)(A)(ii) of the Inter- (1) by striking ‘‘100/70th’’ and inserting the 3-taxable-year period ending with the nal Revenue Code of 1986) as determined ‘‘100/50th’’ in subparagraph (B), and taxable year which precedes such taxable under the Internal Revenue Code of 1986 as in (2) in the flush sentence at the end— year does not exceed the applicable dollar effect on the day before the date of the en- (A) by striking ‘‘100/80th’’ and inserting limit.’’. actment of this Act, over ‘‘100/65th’’, and (2) APPLICABLE DOLLAR LIMIT.—Subsection (ii) the amount which would be the balance (B) by striking ‘‘100/70th’’ and inserting (c) of section 448 is amended by adding at the in such reserve if the amount of such reserve ‘‘100/50th’’. end the following new paragraph: were determined by assuming that the cor- (f) EFFECTIVE DATE.—The amendments ‘‘(4) APPLICABLE DOLLAR LIMIT.— porate rate reductions provided in this Act made by this section shall apply to taxable ‘‘(A) IN GENERAL.—The applicable dollar were in effect for all prior periods. years beginning after December 31, 2018. limit is $15,000,000. (B) AVERAGE RATE ASSUMPTION METHOD.— PART II—SMALL BUSINESS REFORMS ‘‘(B) ADJUSTMENT FOR INFLATION.—In the The average rate assumption method is the SEC. 13101. MODIFICATIONS OF RULES FOR EX- case of any taxable year beginning after De- method under which the excess in the re- PENSING DEPRECIABLE BUSINESS cember 31, 2018, the $15,000,000 amount under serve for deferred taxes is reduced over the ASSETS. subparagraph (A) shall be increased by an remaining lives of the property as used in its (a) INCREASE IN LIMITATION.— amount equal to— regulated books of account which gave rise (1) DOLLAR LIMITATION.—Section 179(b)(1) is ‘‘(i) such dollar amount, multiplied by to the reserve for deferred taxes. Under such amended by striking ‘‘$500,000’’ and inserting ‘‘(ii) the cost-of-living adjustment deter- method, if timing differences for the prop- ‘‘$1,000,000’’. mined under section 1(f)(3) for the calendar erty reverse, the amount of the adjustment (2) REDUCTION IN LIMITATION.—Section year in which the taxable year begins, by to the reserve for the deferred taxes is cal- 179(b)(2) is amended by striking ‘‘$2,000,000’’ substituting ‘calendar year 2017’ for ‘cal- culated by multiplying— and inserting ‘‘$2,500,000’’. endar year 2016’ in subparagraph (A)(ii) (i) the ratio of the aggregate deferred taxes (3) INFLATION ADJUSTMENTS.— thereof. for the property to the aggregate timing dif- (A) IN GENERAL.—Subparagraph (A) of sec- If any amount as increased under the pre- ferences for the property as of the beginning tion 179(b)(6), as amended by section 11002(d), ceding sentence is not a multiple of $1,000, of the period in question, by is amended— such amount shall be rounded to the next (ii) the amount of the timing differences (i) by striking ‘‘2015’’ and inserting ‘‘2018’’, lowest multiple of $1,000.’’. which reverse during such period. and (3) CHANGE IN METHOD OF ACCOUNTING.— (C) ALTERNATIVE METHOD.—The ‘‘alter- (ii) in clause (ii), by striking ‘‘calendar Paragraph (7) of section 448(d) is amended— native method’’ is the method in which the year 2014’’ and inserting ‘‘calendar year (A) by striking ‘‘In the case of’’ and all taxpayer— 2017’’. that follows up to subparagraph (A) and in- (i) computes the excess tax reserve on all (B) SPORT UTILITY VEHICLES.—Section serting: ‘‘If a taxpayer changes its method of public utility property included in the plant 179(b)(6) is amended— accounting because the taxpayer is prohib- account on the basis of the weighted average (i) in subparagraph (A), by striking ‘‘para- ited from using the cash receipts and dis- life or composite rate used to compute depre- graphs (1) and (2)’’ and inserting ‘‘paragraphs bursement method of accounting by reason ciation for regulatory purposes, and (1), (2), and (5)(A)’’, and of subsection (a) or is no longer prohibited

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from using such method by reason of such (1) IN GENERAL.—Section 471 is amended by because this section does not apply to the subsection—’’, and redesignating subsection (c) as subsection (d) taxpayer by reason of the exception under (B) by inserting ‘‘and’’ at the end of sub- and by inserting after subsection (b) the fol- paragraph (3) or this section applies to the paragraph (A), by striking ‘‘, and’’ at the end lowing new subsection: taxpayer because such exception no longer of subparagraph (B) and inserting a period, ‘‘(c) SMALL BUSINESS TAXPAYERS NOT RE- applies to the taxpayer— and by striking subparagraph (C). QUIRED TO USE INVENTORIES.— ‘‘(A) such change shall be treated as initi- (4) CONFORMING AMENDMENT.—Paragraph ‘‘(1) IN GENERAL.—A qualified taxpayer ated by the taxpayer, and (3) of section 448(b) is amended to read as fol- shall not be required to use inventories ‘‘(B) such change shall be treated as made lows: under this section for a taxable year. with the consent of the Secretary.’’. ‘‘(3) ENTITIES SATISFYING GROSS RECEIPTS ‘‘(2) TREATMENT OF TAXPAYERS NOT USING (b) EFFECTIVE DATE.—The amendments TEST.—Paragraphs (1) and (2) of subsection INVENTORIES.—A qualified taxpayer who is made by this section shall apply to taxable (a) shall not apply to any corporation or not required under this subsection to use in- years beginning after December 31, 2017. partnership for any taxable year if such enti- ventories with respect to any property for a taxable year beginning after December 31, SEC. 13105. INCREASE IN GROSS RECEIPTS TEST ty meets the gross receipts test of subsection FOR CONSTRUCTION CONTRACT EX- (c) for the taxable year.’’. 2017, may treat such property— CEPTION TO PERCENTAGE OF COM- (b) APPLICATION OF MODIFICATIONS TO ‘‘(A) as a non-incidental material or sup- PLETION METHOD. ply, or FARMING CORPORATIONS.— (a) INCREASE.— ‘‘(B) in a manner which conforms to the (1) IN GENERAL.—Paragraph (1) of section (1) IN GENERAL.—Section 460(e)(1)(B) is taxpayer’s method for accounting for such 447(d) is amended to read as follows: amended— property in— ‘‘(1) IN GENERAL.—A corporation meets the (A) in the matter preceding clause (i), by ‘‘(i) an applicable financial statement (as requirements of this subsection for any tax- inserting ‘‘(other than a tax shelter prohib- defined in section 451(b)(3)), or able year with respect to its gross receipts if ited from using the cash receipts and dis- ‘‘(ii) in the case of a taxpayer that does not the corporation meets the gross receipts test bursements method of accounting under sec- have an applicable financial statement, their of section 448(c) for the taxable year.’’. tion 448(a)(3))’’ after ‘‘taxpayer’’, and books and records used for purposes of deter- (2) FAMILY CORPORATIONS.—Paragraph (2) of (B) by striking clause (ii) and inserting the mining tax imposed by this title. section 447(d) is amended— following: ‘‘(3) QUALIFIED TAXPAYER.—For purposes of (A) by striking subparagraph (A) and in- ‘‘(ii) who meets the gross receipts test of this subsection, the term ‘qualified taxpayer’ serting the following: section 448(c) for the taxable year in which means, with respect to any taxable year, a ‘‘(A) IN GENERAL.—In the case of a family such contract is entered into (or, in the case taxpayer who meets the gross receipts test of corporation, in applying section 448(c) for of a sole proprietorship, who would meet section 448(c) for the taxable year (or, in the purposes of paragraph (1)— such test if such proprietorship were a cor- case of a sole proprietorship, who would ‘‘(i) paragraph (1) of section 448(c) shall be poration).’’. meet such test if such proprietorship were a applied by substituting the applicable family (2) CONFORMING AMENDMENTS.— corporation). Such term shall not include a corporation limit for the applicable dollar (A) Section 460(e) is amended by striking tax shelter prohibited from using the cash limit, and paragraphs (2) and (3) and by redesignating receipts and disbursements method of ac- ‘‘(ii) the rules of subparagraph (B) shall paragraphs (4) through (6) as paragraphs (2) counting under section 448(a)(3). apply in computing gross receipts.’’, through (4), respectively. ‘‘(4) COORDINATION WITH SECTION 481.—If a (B) in subparagraph (B)(i), by striking ‘‘the (B) The last sentence of section 56(a)(3) is taxpayer changes its method of accounting last sentence of paragraph (1)’’ and inserting amended by striking ‘‘section 460(e)(6)’’ and because the taxpayer is not required to use ‘‘paragraph (2) of section 448(c)’’, and inserting ‘‘section 460(e)(4)’’. inventories by reason of paragraph (1) or is (C) by adding at the end the following new (b) COORDINATION WITH SECTION 481.—Sec- subparagraph: required to use inventories because such paragraph no longer applies to the tax- tion 460(e), as amended by subsection (a), is ‘‘(D) APPLICABLE FAMILY CORPORATION payer— amended by adding at the end the following: LIMIT.— ‘‘(A) such change shall be treated as initi- ‘‘(5) COORDINATION WITH SECTION 481.—If a ‘‘(i) IN GENERAL.—The applicable family taxpayer changes its method of accounting corporation limit is $25,000,000. ated by the taxpayer, and ‘‘(B) such change shall be treated as made because subsections (a), (b), (c)(1), and (c)(2) ‘‘(ii) ADJUSTMENT FOR INFLATION.—In the with the consent of the Secretary.’’. do not apply by reason of the exception case of any taxable year beginning after De- under paragraph (1)(B) or such subsections (2) CONFORMING AMENDMENT.—Subsection cember 31, 2018, the $25,000,000 amount under apply to the taxpayer because such exception clause (i) shall be increased by an amount (c) of section 263A is amended by adding at the end the following new paragraph: no longer applies to the taxpayer— equal to— ‘‘(A) such change shall be treated as initi- ‘‘(I) such dollar amount, multiplied by ‘‘(8) EXCLUSION FROM INVENTORY RULES.— Nothing in this section shall require the use ated by the taxpayer, ‘‘(II) the cost-of-living adjustment deter- ‘‘(B) such change shall be treated as made mined under section 1(f)(3) for the calendar of inventories for any taxable year by a qualified taxpayer (within the meaning of with the consent of the Secretary, and year in which the taxable year begins, by ‘‘(C) such change shall be permitted only substituting ‘calendar year 2017’ for ‘cal- section 471(c)(3)) who is not required to use inventories under section 471 for such tax- on a cut-off basis for all similarly classified endar year 2016’ in subparagraph (A)(ii) contracts entered into on or after the year of thereof. able year.’’. (b) EFFECTIVE DATE.—The amendments change and no adjustments under section If any amount as increased under the pre- made by this section shall apply to taxable 481(a) shall be made.’’. ceding sentence is not a multiple of $1,000, years beginning after December 31, 2017. (c) EFFECTIVE DATE.—The amendment such amount shall be rounded to the next SEC. 13104. MODIFICATION OF RULES FOR UNI- made by this section shall apply to contracts lowest multiple of $1,000.’’. FORM CAPITALIZATION OF CERTAIN entered into after December 31, 2017, in tax- (3) EXCEPTION FOR CERTAIN CORPORATIONS.— EXPENSES. able years ending after such date. Subsection (c) of section 447 is amended by (a) IN GENERAL.—Section 263A(b) is amend- inserting ‘‘for any taxable year’’ after ‘‘not PART III—COST RECOVERY AND ed by striking all that follows paragraph (1) ACCOUNTING METHODS being a corporation’’. and inserting the following new paragraphs: (4) CHANGE IN METHOD OF ACCOUNTING.—Sec- ‘‘(2) PROPERTY ACQUIRED FOR RESALE.—Real Subpart A—Cost Recovery tion 447(f) is amended— or personal property described in section SEC. 13201. TEMPORARY 100-PERCENT EXPENS- (A) by striking ‘‘In the case of’’ and all 1221(a)(1) which is acquired by the taxpayer ING FOR CERTAIN BUSINESS AS- that follows up to paragraph (1) and insert- for resale. SETS. ing the following: ‘‘If a taxpayer changes its ‘‘(3) EXCEPTION FOR SMALL BUSINESSES.— (a) INCREASED EXPENSING.— method of accounting because the taxpayer This section shall not apply to any taxpayer (1) IN GENERAL.—Section 168(k) is amend- is required to use an accrual method of ac- who meets the gross receipts test under sec- ed— counting by reason of subsection (a) or is no tion 448(c) for the taxable year (or, in the (A) in paragraph (1)(A), by striking ‘‘50 per- longer required to use such method by rea- case of a sole proprietorship, who would cent’’ and inserting ‘‘the applicable percent- son of such subsection—’’, and meet such test if such proprietorship were a age’’, and (B) by striking paragraph (2) and inserting corporation), other than a tax shelter pro- (B) in paragraph (5)(A)(i), by striking ‘‘50 the following: hibited from using the cash receipts and dis- percent’’ and inserting ‘‘the applicable per- ‘‘(2) such change shall be treated as initi- bursements method of accounting under sec- centage’’. ated by the taxpayer, and’’. tion 448(a)(3). (2) APPLICABLE PERCENTAGE.—Paragraph (6) (c) EFFECTIVE DATE.—The amendments ‘‘(4) FILMS, SOUND RECORDINGS, BOOKS, of section 168(k) is amended to read as fol- made by this section shall apply to taxable ETC.—For purposes of this subsection, the lows: years beginning after December 31, 2017. term ‘tangible personal property’ shall in- ‘‘(6) APPLICABLE PERCENTAGE.—For pur- SEC. 13103. CLARIFICATION OF INVENTORY AC- clude a film, sound recording, video tape, poses of this subsection— COUNTING RULES FOR SMALL BUSI- book, or similar property. ‘‘(A) IN GENERAL.—Except as otherwise pro- NESSES. ‘‘(5) COORDINATION WITH SECTION 481.—If a vided in this paragraph, the term ‘applicable (a) CLARIFICATION OF INVENTORY RULES.— taxpayer changes its method of accounting percentage’ means—

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‘‘(i) in the case of property placed in serv- in a trade or business described in clause (iv) (1) IN GENERAL.—Section 280F(d)(4)(A) is ice after September 27, 2017, and before Janu- of section 163(j)(7)(A).’’. amended— ary 1, 2023, 100 percent, (d) SPECIAL RULE.—Section 168(k), as (A) by inserting ‘‘and’’ at the end of clause ‘‘(ii) in the case of property placed in serv- amended by subsection (c), is amended by (iii), ice after December 31, 2022, and before Janu- adding at the end the following new para- (B) by striking clause (iv), and ary 1, 2024, 80 percent, graph: (C) by redesignating clause (v) as clause ‘‘(iii) in the case of property placed in serv- ‘‘(9) SPECIAL RULE FOR PROPERTY PLACED IN (iv). ice after December 31, 2023, and before Janu- SERVICE DURING CERTAIN PERIODS.— (2) CONFORMING AMENDMENT.—Section ary 1, 2025, 60 percent, ‘‘(A) IN GENERAL.—In the case of qualified 280F(d)(4) is amended by striking subpara- ‘‘(iv) in the case of property placed in serv- property placed in service by the taxpayer graph (B) and by redesignating subparagraph ice after December 31, 2024, and before Janu- during the first taxable year ending after (C) as subparagraph (B). ary 1, 2026, 40 percent, and September 27, 2017, if the taxpayer elects to (c) EFFECTIVE DATE.—The amendments ‘‘(v) in the case of property placed in serv- have this paragraph apply for such taxable made by this section shall apply to property ice after December 31, 2025, and before Janu- year, paragraphs (1)(A) and (5)(A)(i) shall be placed in service after December 31, 2017, in ary 1, 2027, 20 percent. applied by substituting ‘50 percent’ for ‘the taxable years ending after such date. ‘‘(B) RULE FOR PROPERTY WITH LONGER PRO- applicable percentage’. SEC. 13203. MODIFICATIONS OF TREATMENT OF DUCTION PERIODS.—In the case of property de- ‘‘(B) FORM OF ELECTION.—Any election CERTAIN FARM PROPERTY. scribed in paragraph (2)(B) or (C), the term under this paragraph shall be made at such (a) TREATMENT OF CERTAIN FARM PROPERTY ‘applicable percentage’ means— time and in such form and manner as the AS 5-YEAR PROPERTY.—Clause (vii) of section ‘‘(i) in the case of property placed in serv- Secretary may prescribe.’’. 168(e)(3)(B) is amended by striking ‘‘after De- ice after September 27, 2017, and before Janu- (e) COORDINATION WITH SECTION 280F.—Sec- cember 31, 2008, and which is placed in serv- ary 1, 2024, 100 percent, tion 168(k)(2)(F) is amended by striking ice before January 1, 2010’’ and inserting ‘‘(ii) in the case of property placed in serv- clause (iii). ‘‘after December 31, 2017’’. (f) QUALIFIED FILM AND TELEVISION AND ice after December 31, 2023, and before Janu- (b) REPEAL OF REQUIRED USE OF 150-PER- LIVE THEATRICAL PRODUCTIONS.— ary 1, 2025, 80 percent, CENT DECLINING BALANCE METHOD.—Section ‘‘(iii) in the case of property placed in serv- (1) IN GENERAL.—Clause (i) of section 168(b)(2) is amended by striking subpara- ice after December 31, 2024, and before Janu- 168(k)(2)(A), as amended by section 13204, is graph (B) and by redesignating subpara- ary 1, 2026, 60 percent, amended— graphs (C) and (D) as subparagraphs (B) and ‘‘(iv) in the case of property placed in serv- (A) in subclause (II), by striking ‘‘or’’, (C), respectively. (B) in subclause (III), by adding ‘‘or’’ after ice after December 31, 2025, and before Janu- (c) EFFECTIVE DATE.—The amendments ary 1, 2027, 40 percent, and the comma, and made by this section shall apply to property ‘‘(v) in the case of property placed in serv- (C) by adding at the end the following: placed in service after December 31, 2017, in ice after December 31, 2026, and before Janu- ‘‘(IV) which is a qualified film or television taxable years ending after such date. ary 1, 2028, 20 percent. production (as defined in subsection (d) of section 181) for which a deduction would SEC. 13204. APPLICABLE RECOVERY PERIOD FOR ‘‘(C) RULE FOR PLANTS BEARING FRUITS AND REAL PROPERTY. have been allowable under section 181 with- NUTS.—In the case of a specified plant de- (a) RESIDENTIAL RENTAL PROPERTY AND out regard to subsections (a)(2) and (g) of scribed in paragraph (5), the term ‘applicable NONRESIDENTIAL REAL PROPERTY.— such section or this subsection, or percentage’ means— (1) REDUCTION OF RECOVERY PERIOD.—The ‘‘(V) which is a qualified live theatrical ‘‘(i) in the case of a plant which is planted table contained in section 168(c) is amend- production (as defined in subsection (e) of or grafted after September 27, 2017, and be- ed— section 181) for which a deduction would fore January 1, 2023, 100 percent, (A) by striking ‘‘27.5 years’’ and inserting have been allowable under section 181 with- ‘‘(ii) in the case of a plant which is planted ‘‘25 years’’, and out regard to subsections (a)(2) and (g) of or grafted after December 31, 2022, and before (B) by striking ‘‘39 years’’ and inserting ‘‘25 such section or this subsection,’’. January 1, 2024, 80 percent, years’’. (2) PRODUCTION PLACED IN SERVICE.—Para- ‘‘(iii) in the case of a plant which is plant- (2) STATUTORY RECOVERY PERIOD.—The graph (2) of section 168(k) is amended by add- ed or grafted after December 31, 2023, and be- table contained in section 467(e)(3)(A) is ing at the end the following: fore January 1, 2025, 60 percent, amended— ‘‘(H) PRODUCTION PLACED IN SERVICE.—For ‘‘(iv) in the case of a plant which is planted (A) by inserting ‘‘(other than residential purposes of subparagraph (A)— or grafted after December 31, 2024, and before rental property and nonresidential real prop- ‘‘(i) a qualified film or television produc- January 1, 2026, 40 percent, and erty)’’ after ‘‘15-year and 20-year property’’, tion shall be considered to be placed in serv- ‘‘(v) in the case of a plant which is planted and ice at the time of initial release or broad- or grafted after December 31, 2025, and before (B) by striking ‘‘19 years’’ and inserting ‘‘25 cast, and January 1, 2027, 20 percent.’’. years’’. ‘‘(ii) a qualified live theatrical production (3) CONFORMING AMENDMENT.—Paragraph (3) CONFORMING AMENDMENT.—Clause (ii) of shall be considered to be placed in service at (5) of section 168(k) is amended by striking section 168(e)(2)(B) is amended by striking the time of the initial live staged perform- subparagraph (F). ‘‘27.5 years’’ and inserting ‘‘25 years’’. ance.’’. (b) EXTENSION.— (b) IMPROVEMENTS TO REAL PROPERTY.— (g) EFFECTIVE DATES.—The amendments (1) IN GENERAL.—Section 168(k) is amend- made by this section shall apply to property (1) CLASSIFICATION OF QUALIFIED IMPROVE- ed— placed in service, and specified plants plant- MENT PROPERTY AS 10-YEAR PROPERTY.—Sub- (A) in paragraph (2)— ed or grafted after, after September 27, 2017, paragraph (D) of section 168(e)(3) is amend- (i) in subparagraph (A)(iii), clauses (i)(III) in taxable years ending after such date. ed— and (ii) of subparagraph (B), and subpara- (A) in clause (iii), by striking ‘‘and’’, graph (E)(i), by striking ‘‘January 1, 2020’’ SEC. 13202. MODIFICATIONS TO DEPRECIATION LIMITATIONS ON LUXURY AUTO- (B) in clause (iv), by striking the period each place it appears and inserting ‘‘January MOBILES AND PERSONAL USE PROP- and inserting ‘‘, and’’, and 1, 2027’’, and ERTY. (C) by adding at the end the following new (ii) in subparagraph (B)— (a) LUXURY AUTOMOBILES.— clause: (I) in clause (i)(II), by striking ‘‘January 1, (1) IN GENERAL.—280F(a)(1)(A) is amended— ‘‘(v) any qualified improvement property 2021’’ and inserting ‘‘January 1, 2028’’, and (A) in clause (i), by striking ‘‘$2,560’’ and described in subsection (e)(6).’’. (II) in the heading of clause (ii), by strik- inserting ‘‘$10,000’’, (2) ELIMINATION OF QUALIFIED LEASEHOLD ing ‘‘PRE-JANUARY 1, 2020’’ and inserting ‘‘PRE- (B) in clause (ii), by striking ‘‘$4,100’’ and IMPROVEMENT, QUALIFIED RESTAURANT, AND JANUARY 1, 2027’’, and inserting ‘‘$16,000’’, QUALIFIED RETAIL IMPROVEMENT PROPERTY.— (B) in paragraph (5)(A), by striking ‘‘Janu- (C) in clause (iii), by striking ‘‘$2,450’’ and Subsection (e) of section 168 is amended— ary 1, 2020’’ and inserting ‘‘January 1, 2027’’. inserting ‘‘$9,600’’, and (A) in subparagraph (E) of paragraph (3)— (2) CONFORMING AMENDMENTS.— (D) in clause (iv), by striking ‘‘$1,475’’ and (i) by striking clauses (iv), (v), and (ix), (A) Clause (ii) of section 460(c)(6)(B) is inserting ‘‘$5,760’’. (ii) in clause (vii), by inserting ‘‘and’’ at amended by striking ‘‘January 1, 2020 (Janu- (2) CONFORMING AMENDMENTS.— the end, ary 1, 2021’’ and inserting ‘‘January 1, 2027 (A) Clause (ii) of section 280F(a)(1)(B) is (iii) in clause (viii), by striking ‘‘, and’’ and (January 1, 2028’’. amended by striking ‘‘$1,475’’ in the text and inserting a period, and (B) The heading of section 168(k) is amend- heading and inserting ‘‘$5,760’’. (iv) by redesignating clauses (vi), (vii), and ed by striking ‘‘ACQUIRED AFTER DECEMBER (B) Paragraph (7) of section 280F(d) is (viii), as so amended, as clauses (iv), (v), and 31, 2007, AND BEFORE JANUARY 1, 2020’’. amended— (vi), respectively, and (c) EXCEPTION FOR PUBLIC UTILITIES.—Sec- (i) in subparagraph (A), by striking ‘‘1988’’ (B) by striking paragraphs (6), (7), and (8). tion 168(k) is amended by adding at the end and inserting ‘‘2018’’, and (3) APPLICATION OF STRAIGHT LINE METHOD the following new paragraph: (ii) in subparagraph (B)(i)(II), by striking TO QUALIFIED IMPROVEMENT PROPERTY.—Para- ‘‘(8) EXCEPTION FOR CERTAIN PROPERTY.— ‘‘1987’’ and inserting ‘‘2017’’. graph (3) of section 168(b) is amended— The term ‘qualified property’ shall not in- (b) REMOVAL OF COMPUTER EQUIPMENT (A) by striking subparagraphs (G), (H), and clude any property which is primarily used FROM LISTED PROPERTY.— (I), and

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00118 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.053 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7771 (B) by inserting after subparagraph (F) the ments made by subsection (b)(4)(A) shall abandonment and such amortization deduc- following new subparagraph: apply to taxable years beginning after De- tion shall continue with respect to such ex- ‘‘(G) Qualified improvement property de- cember 31, 2017. penditures.’’. scribed in subsection (e)(6).’’. SEC. 13205. USE OF ALTERNATIVE DEPRECIATION (b) CHANGE IN METHOD OF ACCOUNTING.— (4) ALTERNATIVE DEPRECIATION SYSTEM.— SYSTEM FOR ELECTING FARMING The amendments made by subsection (a) (A) ELECTING REAL PROPERTY TRADE OR BUSINESSES. shall be treated as a change in method of ac- BUSINESS.—Subsection (g) of section 168 is (a) IN GENERAL.—Section 168(g)(1), as counting for purposes of section 481 of the In- amended— amended by section 13204, is amended by ternal Revenue Code of 1986 and— (i) in paragraph (1)— striking ‘‘and’’ at the end of subparagraph (1) such change shall be treated as initi- (I) in subparagraph (D), by striking ‘‘and’’ (E), by inserting ‘‘and’’ at the end of sub- ated by the taxpayer, at the end, paragraph (F), and by inserting after sub- (2) such change shall be treated as made (II) in subparagraph (E), by inserting paragraph (F) the following new subpara- with the consent of the Secretary, and ‘‘and’’ at the end, and graph: (3) such change shall be applied only on a (III) by inserting after subparagraph (E) ‘‘(G) any property with a recovery period cut-off basis for any research or experi- the following new subparagraph: of 10 years or more which is held by an elect- mental expenditures paid or incurred in tax- ‘‘(F) any property described in paragraph ing farming business (as defined in section able years beginning after December 31, 2025, (8),’’, and 163(j)(7)(C)),’’. and no adjustments under section 481(a) shall (ii) by adding at the end the following new (b) EFFECTIVE DATE.—The amendments be made. paragraph: made by this section shall apply to taxable (c) CLERICAL AMENDMENT.—The table of ‘‘(8) ELECTING REAL PROPERTY TRADE OR years beginning after December 31, 2017. sections for part VI of subchapter B of chap- BUSINESS.—The property described in this SEC. 13206. AMORTIZATION OF RESEARCH AND ter 1 is amended by striking the item relat- paragraph shall consist of any nonresidential EXPERIMENTAL EXPENDITURES. ing to section 174 and inserting the following real property, residential rental property, (a) IN GENERAL.—Section 174 is amended to new item: and qualified improvement property held by read as follows: ‘‘Sec. 174. Amortization of research and ex- an electing real property trade or business perimental expenditures.’’. (as defined in 163(j)(7)(B)).’’. ‘‘SEC. 174. AMORTIZATION OF RESEARCH AND EX- PERIMENTAL EXPENDITURES. (d) CONFORMING AMENDMENTS.— (B) QUALIFIED IMPROVEMENT PROPERTY.— ‘‘(a) IN GENERAL.—In the case of a tax- (1) Section 41(d)(1)(A) is amended by strik- The table contained in subparagraph (B) of ing ‘‘expenses under section 174’’ and insert- section 168(g)(3) is amended— payer’s specified research or experimental ing ‘‘specified research or experimental ex- (i) by inserting after the item relating to expenditures for any taxable year— penditures under section 174’’. subparagraph (D)(ii) the following new item: ‘‘(1) except as provided in paragraph (2), no ‘‘(D)(v) ...... 20’’. deduction shall be allowed for such expendi- (2) Subsection (c) of section 280C is amend- , and tures, and ed— (ii) by striking the item relating to sub- ‘‘(2) the taxpayer shall— (A) by striking paragraph (1) and inserting paragraph (E)(iv) and all that follows ‘‘(A) charge such expenditures to capital the following: through the item relating to subparagraph account, and ‘‘(1) IN GENERAL.—If— (E)(ix) and inserting the following: ‘‘(B) be allowed an amortization deduction ‘‘(A) the amount of the credit determined ‘‘(E)(iv) ...... 20 of such expenditures ratably over the 5-year for the taxable year under section 41(a)(1), (E)(v) ...... 30 period (15-year period in the case of any spec- exceeds (E)(vi) ...... 35’’. ified research or experimental expenditures ‘‘(B) the amount allowable as a deduction (C) APPLICABLE RECOVERY PERIOD FOR RESI- which are attributable to foreign research for such taxable year for qualified research DENTIAL RENTAL PROPERTY.—The table con- (within the meaning of section 41(d)(4)(F))) expenses or basic research expenses, tained in subparagraph (C) of section beginning with the midpoint of the taxable the amount chargeable to capital account for 168(g)(2) is amended by striking clauses (iii) year in which such expenditures are paid or the taxable year for such expenses shall be and (iv) and inserting the following: incurred. reduced by the amount of such excess.’’, ‘‘(iii) Residential rental prop- ‘‘(b) SPECIFIED RESEARCH OR EXPERIMENTAL (B) by striking paragraph (2), erty ...... 30 years EXPENDITURES.—For purposes of this section, (C) by redesignating paragraphs (3) (as (iv) Nonresidential real prop- the term ‘specified research or experimental amended by this Act) and (4) as paragraphs erty ...... 40 years expenditures’ means, with respect to any (2) and (3), respectively, and (v) Any railroad grading or tun- taxable year, research or experimental ex- (D) in paragraph (2), as redesignated by nel bore or water utility prop- penditures which are paid or incurred by the subparagraph (C), by striking ‘‘paragraphs erty ...... 50 years’’. taxpayer during such taxable year in connec- (1) and (2)’’ and inserting ‘‘paragraph (1)’’. (5) CONFORMING AMENDMENTS.— tion with the taxpayer’s trade or business. (e) EFFECTIVE DATE.—The amendments (A) Clause (i) of section 168(k)(2)(A) is ‘‘(c) SPECIAL RULES.— made by this section shall apply to amounts amended— ‘‘(1) LAND AND OTHER PROPERTY.—This sec- (i) in subclause (II), by inserting ‘‘or’’ after paid or incurred in taxable years beginning tion shall not apply to any expenditure for the comma, after December 31, 2025. the acquisition or improvement of land, or (ii) in subclause (III), by striking ‘‘or’’ at SEC. 13207. EXPENSING OF CERTAIN COSTS OF for the acquisition or improvement of prop- the end, and REPLANTING CITRUS PLANTS LOST erty to be used in connection with the re- BY REASON OF CASUALTY. (iii) by striking subclause (IV). search or experimentation and of a character (B) Section 168 is amended— (a) IN GENERAL.—Section 263A(d)(2) is (i) in subsection (e), as amended by para- which is subject to the allowance under sec- amended by adding at the end the following graph (2)(B), by adding at the end the fol- tion 167 (relating to allowance for deprecia- new subparagraph: lowing: tion, etc.) or section 611 (relating to allow- ‘‘(C) SPECIAL TEMPORARY RULE FOR CITRUS ance for depletion); but for purposes of this PLANTS LOST BY REASON OF CASUALTY ‘‘(6) QUALIFIED IMPROVEMENT PROPERTY.— .— section allowances under section 167, and al- ‘‘(A) IN GENERAL.—The term ‘qualified im- ‘‘(i) IN GENERAL.—In the case of the re- provement property’ means any improve- lowances under section 611, shall be consid- planting of citrus plants, subparagraph (A) ment to an interior portion of a building ered as expenditures. shall apply to amounts paid or incurred by a which is nonresidential real property if such ‘‘(2) EXPLORATION EXPENDITURES.—This sec- person (other than the taxpayer described in improvement is placed in service after the tion shall not apply to any expenditure paid subparagraph (A)) if— date such building was first placed in serv- or incurred for the purpose of ascertaining ‘‘(I) the taxpayer described in subpara- ice. the existence, location, extent, or quality of graph (A) has an equity interest of not less ‘‘(B) CERTAIN IMPROVEMENTS NOT IN- any deposit of ore or other mineral (includ- than 50 percent in the replanted citrus plants CLUDED.—Such term shall not include any ing oil and gas). at all times during the taxable year in which improvement for which the expenditure is ‘‘(3) SOFTWARE DEVELOPMENT.—For pur- such amounts were paid or incurred and such attributable to— poses of this section, any amount paid or in- other person holds any part of the remaining ‘‘(i) the enlargement of the building, curred in connection with the development equity interest, or ‘‘(ii) any elevator or escalator, or of any software shall be treated as a research ‘‘(II) such other person acquired the en- ‘‘(iii) the internal structural framework of or experimental expenditure. tirety of such taxpayer’s equity interest in the building.’’. ‘‘(d) TREATMENT UPON DISPOSITION, RETIRE- the land on which the lost or damaged citrus (ii) in subsection (k), by striking paragraph MENT, OR ABANDONMENT.—If any property plants were located at the time of such loss (3). with respect to which specified research or or damage, and the replanting is on such (c) EFFECTIVE DATE.— experimental expenditures are paid or in- land. (1) IN GENERAL.—Except as provided in curred is disposed, retired, or abandoned dur- ‘‘(ii) TERMINATION.—Clause (i) shall not paragraph (2), the amendments made by this ing the period during which such expendi- apply to any cost paid or incurred after the section shall apply to property placed in tures are allowed as an amortization deduc- date which is 10 years after the date of the service after December 31, 2017. tion under this section, no deduction shall be enactment of the Tax Cuts and Jobs Act.’’. (2) AMENDMENTS RELATED TO ELECTING REAL allowed with respect to such expenditures on (b) EFFECTIVE DATE.—The amendment PROPERTY TRADE OR BUSINESS.—The amend- account of such disposition, retirement, or made by this section shall apply to costs

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00119 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.053 S01DEPT1 S7772 CONGRESSIONAL RECORD — SENATE December 1, 2017 paid or incurred after the date of the enact- ‘‘(C) a financial statement filed by the tax- ‘‘(iii) which is for goods, services, or such ment of this Act. payer with any other regulatory or govern- other items as may be identified by the Sec- Subpart B—Accounting Methods mental body specified by the Secretary, but retary for purposes of this clause. SEC. 13221. CERTAIN SPECIAL RULES FOR TAX- only if there is no statement of the taxpayer ‘‘(B) EXCLUSIONS.—Except as otherwise ABLE YEAR OF INCLUSION. described in subparagraph (A) or (B). provided by the Secretary, such term shall (a) INCLUSION NOT LATER THAN FOR FINAN- ‘‘(4) ALLOCATION OF TRANSACTION PRICE.— not include— CIAL ACCOUNTING PURPOSES.—Section 451 is For purposes of this subsection, in the case ‘‘(i) rent, amended by redesignating subsections (b) of a contract which contains multiple per- ‘‘(ii) insurance premiums governed by sub- through (i) as subsections (c) through (j), re- formance obligations, the allocation of the chapter L, spectively, and by inserting after subsection transaction price to each performance obli- ‘‘(iii) payments with respect to financial (a) the following new subsection: gation shall be equal to the amount allo- instruments, ‘‘(b) INCLUSION NOT LATER THAN FOR FINAN- cated to each performance obligation for ‘‘(iv) payments with respect to warranty or CIAL ACCOUNTING PURPOSES.— purposes of including such item in revenue in guarantee contracts under which a third ‘‘(1) INCOME TAKEN INTO ACCOUNT IN FINAN- the applicable financial statement of the party is the primary obligor, CIAL STATEMENT.— taxpayer. ‘‘(v) payments subject to section 871(a), 881, ‘‘(A) IN GENERAL.—In the case of a taxpayer ‘‘(5) GROUP OF ENTITIES.—For purposes of 1441, or 1442, the taxable income of which is computed paragraph (1), if the financial results of a ‘‘(vi) payments in property to which sec- under an accrual method of accounting, the taxpayer are reported on the applicable fi- tion 83 applies, and all events test with respect to any item of nancial statement (as defined in paragraph ‘‘(vii) any other payment identified by the gross income (or portion thereof) shall not be (3)) for a group of entities, such statement Secretary for purposes of this subparagraph. treated as met any later than when such may be treated as the applicable financial ‘‘(C) RECEIPT.—For purposes of this sub- item (or portion thereof) is taken into ac- statement of the taxpayer.’’. section, an item of gross income is received count as revenue in— (b) TREATMENT OF ADVANCE PAYMENTS.— by the taxpayer if it is actually or construc- ‘‘(i) an applicable financial statement of Section 451, as amended by subsection (a), is tively received, or if it is due and payable to the taxpayer, or amended by redesignating subsections (c) the taxpayer. through (j) as subsections (d) through (k), re- ‘‘(ii) such other financial statement as the ‘‘(D) ALLOCATION OF TRANSACTION PRICE.— spectively, and by inserting after subsection Secretary may specify for purposes of this For purposes of this subsection, rules similar (b) the following new subsection: subsection. to subsection (b)(4) shall apply.’’. ‘‘(c) TREATMENT OF ADVANCE PAYMENTS.— (c) EFFECTIVE DATE.—The amendments ‘‘(B) EXCEPTION.—This paragraph shall not ‘‘(1) IN GENERAL.—A taxpayer which com- made by this section shall apply to taxable apply to— putes taxable income under the accrual years beginning after December 31, 2017. ‘‘(i) a taxpayer which does not have a fi- method of accounting, and receives any ad- (d) COORDINATION WITH SECTION 481.— nancial statement described in clause (i) or vance payment during the taxable year, (1) IN GENERAL.—In the case of any quali- (ii) of subparagraph (A) for a taxable year, or shall— fied change in method of accounting for the ‘‘(ii) any item of gross income in connec- ‘‘(A) except as provided in subparagraph taxpayer’s first taxable year beginning after tion with a mortgage servicing contract. (B), include such advance payment in gross December 31, 2017— ‘‘(C) ALL EVENTS TEST.—For purposes of income for such taxable year, or (A) such change shall be treated as initi- this section, the all events test is met with ‘‘(B) if the taxpayer elects the application ated by the taxpayer, and respect to any item of gross income if all the of this subparagraph with respect to the cat- (B) such change shall be treated as made events have occurred which fix the right to egory of advance payments to which such ad- with the consent of the Secretary of the receive such income and the amount of such vance payment belongs, the taxpayer shall— Treasury. income can be determined with reasonable ‘‘(i) to the extent that any portion of such (2) QUALIFIED CHANGE IN METHOD OF AC- accuracy. advance payment is required under sub- COUNTING.—For purposes of this subsection, ‘‘(2) COORDINATION WITH SPECIAL METHODS section (b) to be included in gross income in the term ‘‘qualified change in method of ac- OF ACCOUNTING.—Paragraph (1) shall not the taxable year in which such payment is counting’’ means any change in method of apply with respect to any item of gross in- received, so include such portion, and accounting which— come for which the taxpayer uses a special ‘‘(ii) include the remaining portion of such (A) is required by the amendments made method of accounting provided under any advance payment in gross income in the tax- by this section, or other provision of this chapter, other than able year following the taxable year in which (B) was prohibited under the Internal Rev- any provision of part V of subchapter P (ex- such payment is received. enue Code of 1986 prior to such amendments cept as provided in clause (ii) of paragraph ‘‘(2) ELECTION.— and is permitted under such Code after such (1)(B)). ‘‘(A) IN GENERAL.—Except as otherwise pro- amendments. ‘‘(3) APPLICABLE FINANCIAL STATEMENT.— vided in this paragraph, the election under (e) SPECIAL RULES FOR ORIGINAL ISSUE DIS- For purposes of this subsection, the term paragraph (1)(B) shall be made at such time, COUNT.—Notwithstanding subsection (c), in ‘applicable financial statement’ means— in such form and manner, and with respect the case of income from a debt instrument ‘‘(A) a financial statement which is cer- to such categories of advance payments, as having original issue discount— tified as being prepared in accordance with the Secretary may provide. (1) the amendments made by this section generally accepted accounting principles and ‘‘(B) PERIOD TO WHICH ELECTION APPLIES.— shall apply to taxable years beginning after which is— An election under paragraph (1)(B) shall be December 31, 2018, and ‘‘(i) a 10–K (or successor form), or annual effective for the taxable year with respect to (2) the period for taking into account any statement to shareholders, required to be which it is first made and for all subsequent adjustments under section 481 by reason of a filed by the taxpayer with the United States taxable years, unless the taxpayer secures qualified change in method of accounting (as Securities and Exchange Commission, the consent of the Secretary to revoke such defined in subsection (d)) shall be 6 years. ‘‘(ii) an audited financial statement of the election. For purposes of this title, the com- PART IV—BUSINESS-RELATED taxpayer which is used for— putation of taxable income under an election EXCLUSIONS AND DEDUCTIONS ‘‘(I) credit purposes, made under paragraph (1)(B) shall be treated SEC. 13301. LIMITATION ON DEDUCTION FOR IN- ‘‘(II) reporting to shareholders, partners, as a method of accounting. TEREST. or other proprietors, or to beneficiaries, or ‘‘(3) TAXPAYERS CEASING TO EXIST.—Except (a) IN GENERAL.—Section 163(j) is amended ‘‘(III) any other substantial nontax pur- as otherwise provided by the Secretary, the to read as follows: pose, election under paragraph (1)(B) shall not ‘‘(j) LIMITATION ON BUSINESS INTEREST.— but only if there is no statement of the tax- apply with respect to advance payments re- ‘‘(1) IN GENERAL.—The amount allowed as a payer described in clause (i), or ceived by the taxpayer during a taxable year deduction under this chapter for any taxable ‘‘(iii) filed by the taxpayer with any other if such taxpayer ceases to exist during (or year for business interest shall not exceed Federal agency for purposes other than Fed- with the close of) such taxable year. the sum of— eral tax purposes, but only if there is no ‘‘(4) ADVANCE PAYMENT.—For purposes of ‘‘(A) the business interest income of such statement of the taxpayer described in this subsection— taxpayer for such taxable year, plus clause (i) or (ii), ‘‘(A) IN GENERAL.—The term ‘advance pay- ‘‘(B) 30 percent of the adjusted taxable in- ‘‘(B) a financial statement which is made ment’ means any payment— come of such taxpayer for such taxable year. on the basis of international financial re- ‘‘(i) the full inclusion of which in the gross The amount determined under subparagraph porting standards and is filed by the tax- income of the taxpayer for the taxable year (B) shall not be less than zero. payer with an agency of a foreign govern- of receipt is a permissible method of ac- ‘‘(2) CARRYFORWARD OF DISALLOWED BUSI- ment which is equivalent to the United counting under this section (determined NESS INTEREST.—The amount of any business States Securities and Exchange Commission without regard to this subsection), interest not allowed as a deduction for any and which has reporting standards not less ‘‘(ii) any portion of which is included in taxable year by reason of paragraph (1) shall stringent than the standards required by revenue by the taxpayer in a financial state- be treated as business interest paid or ac- such Commission, but only if there is no ment described in clause (i) or (ii) of sub- crued in the succeeding taxable year. statement of the taxpayer described in sub- section (b)(1)(A) for a subsequent taxable ‘‘(3) EXEMPTION FOR CERTAIN SMALL BUSI- paragraph (A), or year, and NESSES.—In the case of any taxpayer (other

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00120 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.053 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7773 than a tax shelter prohibited from using the of the excess (if any) of the amount of the ‘‘(i) a farming business (as defined in sec- cash receipts and disbursements method of basis reduction under subclause (I) over the tion 263A(e)(4)) which makes an election accounting under section 448(a)(3)) which portion of any excess business interest allo- under this subparagraph, or meets the gross receipts test of section 448(c) cated to the partner under clause (i)(II) ‘‘(ii) any trade or business of a specified ag- for any taxable year, paragraph (1) shall not which has previously been treated under ricultural or horticultural cooperative (as apply to such taxpayer for such taxable year. clause (ii) as business interest paid or ac- defined in section 199A(g)(2)) with respect to In the case of any taxpayer which is not a crued by the partner. The preceding sentence which the cooperative makes an election corporation or a partnership, the gross re- shall also apply to transfers of the partner- under this subparagraph. ceipts test of section 448(c) shall be applied ship interest (including by reason of death) Any such election shall be made at such time in the same manner as if such taxpayer were in a transaction in which gain is not recog- and in such manner as the Secretary shall a corporation or partnership. nized in whole or in part. No deduction shall prescribe, and, once made, shall be irrev- ‘‘(4) APPLICATION TO PARTNERSHIPS, ETC.— be allowed to the transferor or transferee ocable. ‘‘(A) IN GENERAL.—In the case of any part- under this chapter for any excess business ‘‘(8) ADJUSTED TAXABLE INCOME.—For pur- nership— interest resulting in a basis increase under poses of this subsection, the term ‘adjusted ‘‘(i) this subsection shall be applied at the this subclause. taxable income’ means the taxable income of partnership level and any deduction for busi- ‘‘(C) EXCESS TAXABLE INCOME.—The term the taxpayer— ness interest shall be taken into account in ‘excess taxable income’ means, with respect ‘‘(A) computed without regard to— determining the non-separately stated tax- to any partnership, the amount which bears ‘‘(i) any item of income, gain, deduction, or able income or loss of the partnership, and the same ratio to the partnership’s adjusted loss which is not properly allocable to a ‘‘(ii) the adjusted taxable income of each taxable income as— trade or business, partner of such partnership— ‘‘(i) the excess (if any) of— ‘‘(ii) any business interest or business in- ‘‘(I) shall be determined without regard to ‘‘(I) the amount determined for the part- terest income, such partner’s distributive share of any nership under paragraph (1)(B), over ‘‘(iii) the amount of any net operating loss items of income, gain, deduction, or loss of ‘‘(II) the amount (if any) by which the deduction under section 172, and such partnership, and business interest of the partnership exceeds ‘‘(iv) the amount of any deduction allowed ‘‘(II) shall be increased by such partner’s the business interest income of the partner- under section 199 or 199A, and distributive share of such partnership’s ex- ship, bears to ‘‘(B) computed with such other adjust- cess taxable income. ‘‘(ii) the amount determined for the part- ments as provided by the Secretary. For purposes of clause (ii)(II), a partner’s dis- nership under paragraph (1)(B). ‘‘(9) CROSS REFERENCES.— tributive share of partnership excess taxable ‘‘(D) APPLICATION TO S CORPORATIONS.— ‘‘(A) For requirement that an electing real income shall be determined in the same Rules similar to the rules of subparagraphs property trade or business use the alter- manner as the partner’s distributive share of (A) and (C) shall apply with respect to any S native depreciation system, see section nonseparately stated taxable income or loss corporation and its shareholders. 168(g)(1)(F). of the partnership. ‘‘(5) BUSINESS INTEREST.—For purposes of ‘‘(B) For requirement that an electing ‘‘(B) SPECIAL RULES FOR CARRYFORWARDS.— this subsection, the term ‘business interest’ farming business use the alternative depre- ‘‘(i) IN GENERAL.—The amount of any busi- means any interest paid or accrued on in- ciation system, see section 168(g)(1)(G).’’. ness interest not allowed as a deduction to a debtedness properly allocable to a trade or (b) TREATMENT OF CARRYFORWARD OF DIS- partnership for any taxable year by reason of business. Such term shall not include invest- ALLOWED BUSINESS INTEREST IN CERTAIN COR- paragraph (1) for any taxable year— ment interest (within the meaning of sub- PORATE ACQUISITIONS.— ‘‘(I) shall not be treated under paragraph section (d)). (1) IN GENERAL.—Section 381(c) is amended (2) as business interest paid or accrued by ‘‘(6) BUSINESS INTEREST INCOME.—For pur- by inserting after paragraph (19) the fol- the partnership in the succeeding taxable poses of this subsection, the term ‘business lowing new paragraph: year, and interest income’ means the amount of inter- ‘‘(20) CARRYFORWARD OF DISALLOWED BUSI- ‘‘(II) shall, subject to clause (ii), be treated est includible in the gross income of the tax- NESS INTEREST.—The carryover of disallowed as excess business interest which is allocated payer for the taxable year which is properly business interest described in section to each partner in the same manner as the allocable to a trade or business. Such term 163(j)(2) to taxable years ending after the non-separately stated taxable income or loss shall not include investment income (within date of distribution or transfer.’’. of the partnership. the meaning of subsection (d)). (2) APPLICATION OF LIMITATION.—Section ‘‘(ii) TREATMENT OF EXCESS BUSINESS INTER- ‘‘(7) TRADE OR BUSINESS.—For purposes of 382(d) is amended by adding at the end the EST ALLOCATED TO PARTNERS.—If a partner is this subsection— following new paragraph: allocated any excess business interest from a ‘‘(A) IN GENERAL.—The term ‘trade or busi- ‘‘(3) APPLICATION TO CARRYFORWARD OF DIS- partnership under clause (i) for any taxable ness’ shall not include— ALLOWED INTEREST.—The term ‘pre-change year— ‘‘(i) the trade or business of performing loss’ shall include any carryover of dis- ‘‘(I) such excess business interest shall be services as an employee, allowed interest described in section 163(n) treated as business interest paid or accrued ‘‘(ii) any electing real property trade or under rules similar to the rules of paragraph by the partner in the next succeeding tax- business, (1).’’. able year in which the partner is allocated ‘‘(iii) any electing farming business, or (3) CONFORMING AMENDMENT.—Section excess taxable income from such partner- ‘‘(iv) the trade or business of the fur- 382(k)(1) is amended by inserting after the ship, but only to the extent of such excess nishing or sale of— first sentence the following: ‘‘Such term taxable income, and ‘‘(I) electrical energy, water, or sewage dis- shall include any corporation entitled to use ‘‘(II) any portion of such excess business posal services, a carryforward of disallowed interest de- interest remaining after the application of ‘‘(II) gas or steam through a local distribu- scribed in section 381(c)(20).’’. subclause (I) shall, subject to the limitations tion system, or (c) EFFECTIVE DATE.—The amendments of subclause (I), be treated as business inter- ‘‘(III) transportation of gas or steam by made by this section shall apply to taxable est paid or accrued in succeeding taxable pipeline, years beginning after December 31, 2017. years. if the rates for such furnishing or sale, as the SEC. 13302. MODIFICATION OF NET OPERATING For purposes of applying this paragraph, ex- case may be, have been established or ap- LOSS DEDUCTION. cess taxable income allocated to a partner proved by a State or political subdivision (a) LIMITATION ON DEDUCTION.— from a partnership for any taxable year shall thereof, by any agency or instrumentality of (1) IN GENERAL.—Section 172(a) is amended not be taken into account under paragraph the United States, by a public service or pub- to read as follows: (1)(A) with respect to any business interest lic utility commission or other similar body ‘‘(a) DEDUCTION ALLOWED.—There shall be other than excess business interest from the of any State or political subdivision thereof, allowed as a deduction for the taxable year partnership until all such excess business in- or by the governing or ratemaking body of an amount equal to the lesser of— terest for such taxable year and all preceding an electric cooperative. ‘‘(1) the aggregate of the net operating loss taxable years has been treated as paid or ac- ‘‘(B) ELECTING REAL PROPERTY TRADE OR carryovers to such year, plus the net oper- crued under clause (ii). BUSINESS.—For purposes of this paragraph, ating loss carrybacks to such year, or ‘‘(iii) BASIS ADJUSTMENTS.— the term ‘electing real property trade or ‘‘(2) 90 percent (80 percent in the case of ‘‘(I) IN GENERAL.—The adjusted basis of a business’ means any trade or business which taxable years beginning after December 31, partner in a partnership interest shall be re- is described in section 469(c)(7)(C) and which 2022) of taxable income computed without re- duced (but not below zero) by the amount of makes an election under this subparagraph. gard to the deduction allowable under this excess business interest allocated to the Any such election shall be made at such time section. partner under clause (i)(II). and in such manner as the Secretary shall For purposes of this subtitle, the term ‘net ‘‘(II) SPECIAL RULE FOR DISPOSITIONS.—If a prescribe, and, once made, shall be irrev- operating loss deduction’ means the deduc- partner disposes of a partnership interest, ocable. tion allowed by this subsection.’’. the adjusted basis of the partner in the part- ‘‘(C) ELECTING FARMING BUSINESS.—For pur- (2) COORDINATION OF LIMITATION WITH nership interest shall be increased imme- poses of this paragraph, the term ‘electing CARRYBACKS AND CARRYOVERS.—Section diately before the disposition by the amount farming business’ means— 172(b)(2) is amended by striking ‘‘shall be

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00121 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.053 S01DEPT1 S7774 CONGRESSIONAL RECORD — SENATE December 1, 2017 computed—’’ and all that follows and insert- ment of the Tax Cuts and Jobs Act)’’ after ‘‘Sec. 1031. Exchange of real property held ing ‘‘shall— ‘‘as defined in section 172(f)’’. for productive use or invest- ‘‘(A) be computed with the modifications (d) TREATMENT OF CERTAIN INSURANCE ment.’’. specified in subsection (d) other than para- LOSSES.— (c) EFFECTIVE DATE.— graphs (1), (4), and (5) thereof, and by deter- (1) TREATMENT OF CARRYFORWARDS AND (1) IN GENERAL.—Except as otherwise pro- mining the amount of the net operating loss CARRYBACKS.—Section 172(b)(1), as amended vided in this subsection, the amendments deduction without regard to the net oper- by subsections (b)(2) and (c)(1), is amended made by this section shall apply to ex- ating loss for the loss year or for any taxable by adding at the end the following new sub- changes completed after December 31, 2017. year thereafter, paragraph: (2) TRANSITION RULE.—The amendments ‘‘(B) not be considered to be less than zero, ‘‘(C) INSURANCE COMPANIES.—In the case of made by this section shall not apply to any and an insurance company (as defined in section exchange if— ‘‘(C) not exceed the amount determined 816(a)) other than a life insurance company, (A) the property disposed of by the tax- under subsection (a)(2) for such prior taxable the net operating loss for any taxable year— payer in the exchange is disposed of on or be- year.’’. ‘‘(i) shall be a net operating loss carryback fore December 31 2017, or (3) CONFORMING AMENDMENT.—Section to each of the 2 taxable years preceding the (B) the property received by the taxpayer 172(d)(6) is amended by striking ‘‘and’’ at the taxable year of such loss, and in the exchange is received on or before De- end of subparagraph (A), by striking the pe- ‘‘(ii) shall be a net operating loss carryover cember 31, 2017. riod at the end of subparagraph (B) and in- to each of the 20 taxable years following the serting ‘‘; and’’, and by adding at the end the taxable year of the loss.’’. SEC. 13304. LIMITATION ON DEDUCTION BY EM- following new subparagraph: PLOYERS OF EXPENSES FOR FRINGE XEMPTION FROM LIMITATION (2) E .—Section BENEFITS. ‘‘(C) subsection (a)(2) shall be applied by 172, as amended by subsection (c)(2)(A), is substituting ‘real estate investment trust amended by redesignating subsection (f) as (a) NO DEDUCTION ALLOWED FOR ENTERTAIN- taxable income (as defined in section subsection (g) and inserting after subsection MENT EXPENSES.— 857(b)(2) but without regard to the deduction (e) the following new subsection: (1) IN GENERAL.—Section 274(a) is amend- for dividends paid (as defined in section 561))’ ed— for ‘taxable income’.’’. ‘‘(f) SPECIAL RULE FOR INSURANCE COMPA- NIES.—In the case of an insurance company (A) in paragraph (1)(A), by striking ‘‘un- (b) REPEAL OF NET OPERATING LOSS less’’ and all that follows through ‘‘trade or CARRYBACK; INDEFINITE CARRYFORWARD.— (as defined in section 816(a)) other than a life insurance company— business,’’, (1) IN GENERAL.—Section 172(b)(1)(A) is (B) by striking the flush sentence at the amended— ‘‘(1) the amount of the deduction allowed under subsection (a) shall be the aggregate of end of paragraph (1), and (A) by striking ‘‘shall be a net operating (C) by striking paragraph (2)(C). loss carryback to each of the 2 taxable the net operating loss carryovers to such year, plus the net operating loss carrybacks (2) CONFORMING AMENDMENTS.— years’’ in clause (i) and inserting ‘‘except as (A) Section 274(d) is amended— otherwise provided in this paragraph, shall to such year, and (i) by striking paragraph (2) and redesig- not be a net operating loss carryback to any ‘‘(2) subparagraph (C) of subsection (b)(2) nating paragraphs (3) and (4) as paragraphs taxable year’’, and shall not apply.’’. (2) and (3), respectively, and (B) by striking ‘‘to each of the 20 taxable (e) EFFECTIVE DATE.— (ii) in the flush text following paragraph years’’ in clause (ii) and inserting ‘‘to each (1) NET OPERATING LOSS LIMITATION.—The (3) (as so redesignated)— taxable year’’. amendments made by subsections (a) and (I) by striking ‘‘, entertainment, amuse- (2) CONFORMING AMENDMENT.—Section (d)(2) shall apply to losses arising in taxable ment, recreation, or use of the facility or 172(b)(1) is amended by striking subpara- years beginning after December 31, 2017. property,’’ in item (B), and graphs (B) through (F). (2) CARRYFORWARDS AND CARRYBACKS.—The (II) by striking ‘‘(D) the business relation- (c) TREATMENT OF FARMING LOSSES.— amendments made by subsections (b), (c), ship to the taxpayer of persons entertained, (1) ALLOWANCE OF CARRYBACKS.—Section and (d)(1) shall apply to net operating losses using the facility or property, or receiving 172(b)(1), as amended by subsection (b)(2), is arising in taxable years ending after Decem- the gift’’ and inserting ‘‘(D) the business re- amended by adding at the end the following ber 31, 2017. new subparagraph: lationship to the taxpayer of the person re- SEC. 13303. LIKE-KIND EXCHANGES OF REAL ceiving the benefit’’, ‘‘(B) FARMING LOSSES.— PROPERTY. ‘‘(i) IN GENERAL.—In the case of any por- (B) Section 274 is amended by striking sub- tion of a net operating loss for the taxable (a) IN GENERAL.—Section 1031(a)(1) is section (l). year which is a farming loss with respect to amended by striking ‘‘property’’ each place (C) Section 274(n) is amended by striking the taxpayer, such loss shall be a net oper- it appears and inserting ‘‘real property’’. ‘‘AND ENTERTAINMENT’’ in the heading. ating loss carryback to each of the 2 taxable (b) CONFORMING AMENDMENTS.— (D) Section 274(n)(1) is amended to read as years preceding the taxable year of such loss. (1)(A) Paragraph (2) of section 1031(a) is follows: ‘‘(ii) FARMING LOSS.—For purposes of this amended to read as follows: ‘‘(1) IN GENERAL.—The amount allowable as section, the term ‘farming loss’ means the ‘‘(2) EXCEPTION FOR REAL PROPERTY HELD a deduction under this chapter for any ex- lesser of— FOR SALE.—This subsection shall not apply pense for food or beverages shall not exceed ‘‘(I) the amount which would be the net op- to any exchange of real property held pri- 50 percent of the amount of such expense erating loss for the taxable year if only in- marily for sale.’’. which would (but for this paragraph) be al- come and deductions attributable to farming (B) Section 1031 is amended by striking lowable as a deduction under this chapter.’’. businesses (as defined in section 263A(e)(4)) subsection (i). (E) Section 274(n)(2) is amended— are taken into account, or (2) Section 1031 is amended by striking sub- (i) in subparagraph (B), by striking ‘‘in the ‘‘(II) the amount of the net operating loss section (e). case of an expense for food or beverages,’’, for such taxable year. (3) Section 1031, as amended by paragraph (ii) by striking subparagraph (C) and redes- ‘‘(iii) COORDINATION WITH PARAGRAPH (2).— (2), is amended by inserting after subsection ignating subparagraphs (D) and (E) as sub- For purposes of applying paragraph (2), a (d) the following new subsection: paragraphs (C) and (D), respectively, farming loss for any taxable year shall be ‘‘(e) APPLICATION TO CERTAIN PARTNER- (iii) by striking ‘‘of subparagraph (E)’’ the treated as a separate net operating loss for SHIPS.—For purposes of this section, an in- last sentence and inserting ‘‘of subparagraph such taxable year to be taken into account terest in a partnership which has in effect a (D)’’, and after the remaining portion of the net oper- valid election under section 761(a) to be ex- (iv) by striking ‘‘in subparagraph (D)’’ in ating loss for such taxable year. cluded from the application of all of sub- the last sentence and inserting ‘‘in subpara- ‘‘(iv) ELECTION.—Any taxpayer entitled to chapter K shall be treated as an interest in graph (C)’’. a 2-year carryback under clause (i) from any each of the assets of such partnership and (F) Clause (iv) of section 7701(b)(5)(A) is loss year may elect not to have such clause not as an interest in a partnership.’’. amended to read as follows: apply to such loss year. Such election shall (4) Section 1031(h) is amended to read as ‘‘(iv) a professional athlete who is tempo- be made in such manner as prescribed by the follows: rarily in the United States to compete in a Secretary and shall be made by the due date ‘‘(h) SPECIAL RULES FOR FOREIGN REAL sports event— (including extensions of time) for filing the PROPERTY.—Real property located in the ‘‘(I) which is organized for the primary taxpayer’s return for the taxable year of the United States and real property located out- purpose of benefiting an organization which net operating loss. Such election, once made side the United States are not property of a is described in section 501(c)(3) and exempt for any taxable year, shall be irrevocable for like kind.’’. from tax under section 501(a), such taxable year.’’. (5) The heading of section 1031 is amended ‘‘(II) all of the net proceeds of which are (2) CONFORMING AMENDMENTS.— by striking ‘‘PROPERTY’’ and inserting ‘‘REAL contributed to such organization, and, (A) Section 172 is amended by striking sub- PROPERTY’’. ‘‘(III) which utilizes volunteers for sub- sections (f), (g), and (h), and by redesignating (6) The table of sections for part III of sub- stantially all of the work performed in car- subsection (i) as subsection (f). chapter O of chapter 1 is amended by strik- rying out such event.’’. (B) Section 537(b)(4) is amended by insert- ing the item relating to section 1031 and in- (b) ONLY 50 PERCENT OF EXPENSES FOR ing ‘‘(as in effect before the date of enact- serting the following new item: MEALS PROVIDED ON OR NEAR BUSINESS

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00122 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.053 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7775

PREMISES ALLOWED AS DEDUCTION.—Para- and (2), is amended by striking section 199 DERS.—Paragraph (1) shall not apply to any graph (2) of section 274(n), as amended by (and by striking the item relating to such amount paid or incurred by reason of any subsection (a), is amended— section in the table of sections for such order of a court in a suit in which no govern- (1) by striking subparagraph (B), part). ment or governmental entity is a party. (2) by redesignating subparagraphs (C) and (b) CONFORMING AMENDMENTS.— ‘‘(4) EXCEPTION FOR TAXES DUE.—Paragraph (D) as subparagraphs (B) and (C), respec- (1) Sections 74(d)(2)(B), 86(b)(2)(A), (1) shall not apply to any amount paid or in- tively, 135(c)(4)(A), 137(b)(3)(A), 219(g)(3)(A)(ii), curred as taxes due. (3) by striking ‘‘of subparagraph (D)’’ in 221(b)(2)(C), 222(b)(2)(C), 246(b)(1), and ‘‘(5) TREATMENT OF CERTAIN NONGOVERN- the last sentence and inserting ‘‘of subpara- 469(i)(3)(F)(iii) are each amended by striking MENTAL REGULATORY ENTITIES.—For purposes graph (C)’’, and ‘‘199,’’. of this subsection, the following nongovern- (4) by striking ‘‘in subparagraph (C)’’ in (2) Section 170(b)(2)(D), as amended by sec- mental entities shall be treated as govern- the last sentence and inserting ‘‘in subpara- tion 11011, is amended by striking clause (iv) mental entities: graph (B)’’. and by redesignating clauses (v) and (vi) as ‘‘(A) Any nongovernmental entity which (c) TREATMENT OF TRANSPORTATION BENE- redesignating clauses (iv) as clause (v), re- exercises self-regulatory powers (including FITS.—Section 274, as amended by subsection spectively. imposing sanctions) in connection with a (a), is amended— (3) Section 172(d) is amended by striking qualified board or exchange (as defined in (1) in subsection (a)— paragraph (7). section 1256(g)(7)). (A) in the heading, by striking ‘‘OR RECRE- (4) Section 613(a) is amended by striking ‘‘(B) To the extent provided in regulations, ATION’’ and inserting ‘‘RECREATION, OR QUALI- ‘‘and without the deduction under section any nongovernmental entity which exercises FIED TRANSPORTATION FRINGES’’, and 199’’. self-regulatory powers (including imposing (B) by adding at the end the following new (5) Section 613A(d)(1) is amended by strik- sanctions) as part of performing an essential paragraph: ing subparagraph (B) and by redesignating governmental function.’’. ‘‘(4) QUALIFIED TRANSPORTATION FRINGES.— subparagraphs (C), (D), and (E) as subpara- (2) EFFECTIVE DATE.—The amendment No deduction shall be allowed under this graphs (B), (C), and (D). made by this subsection shall apply to chapter for the expense of any qualified (c) EFFECTIVE DATE.— amounts paid or incurred on or after the transportation fringe (as defined in section (1) IN GENERAL.—Except as provided in date of the enactment of this Act, except 132(f)) provided to an employee of the tax- paragraph (2), the amendments made by this that such amendments shall not apply to payer.’’, and section shall apply to taxable years begin- amounts paid or incurred under any binding (2) by inserting after subsection (k) the fol- ning after December 31, 2018. order or agreement entered into before such lowing new subsection: (2) EARLIER TERMINATION FOR CERTAIN TAX- date. Such exception shall not apply to an ‘‘(l) TRANSPORTATION AND COMMUTING BEN- PAYERS.—The amendment made by para- order or agreement requiring court approval EFITS.—No deduction shall be allowed under graphs (1) and (2) of subsection (a) shall this chapter for any expense incurred for apply to taxable years beginning after De- unless the approval was obtained before such providing any transportation, or any pay- cember 31, 2017. date. EPORTING OF EDUCTIBLE MOUNTS ment or reimbursement, to an employee of SEC. 13306. DENIAL OF DEDUCTION FOR CERTAIN (b) R D A .— the taxpayer in connection with travel be- FINES, PENALTIES, AND OTHER (1) IN GENERAL.—Subpart B of part III of tween the employee’s residence and place of AMOUNTS. subchapter A of chapter 61 is amended by in- employment, except as necessary for ensur- (a) DENIAL OF DEDUCTION.— serting after section 6050W the following new ing the safety of the employee.’’. (1) IN GENERAL.—Subsection (f) of section section: (d) ELIMINATION OF DEDUCTION FOR MEALS 162 is amended to read as follows: ‘‘SEC. 6050X. INFORMATION WITH RESPECT TO PROVIDED AT CONVENIENCE OF EMPLOYER.— ‘‘(f) FINES, PENALTIES, AND OTHER CERTAIN FINES, PENALTIES, AND Section 274, as amended by subsection (c), is AMOUNTS.— OTHER AMOUNTS. amended— ‘‘(1) IN GENERAL.—Except as provided in the ‘‘(a) REQUIREMENT OF REPORTING.— (1) by redesignating subsection (o) as sub- following paragraphs of this subsection, no ‘‘(1) IN GENERAL.—The appropriate official section (p), and deduction otherwise allowable shall be al- of any government or any entity described in (2) by inserting after subsection (n) the fol- lowed under this chapter for any amount section 162(f)(5) which is involved in a suit or lowing new subsection: paid or incurred (whether by suit, agree- agreement described in paragraph (2) shall ‘‘(o) MEALS PROVIDED AT CONVENIENCE OF ment, or otherwise) to, or at the direction of, make a return in such form as determined by EMPLOYER.—No deduction shall be allowed a government or governmental entity in re- the Secretary setting forth— under this chapter for— lation to the violation of any law or the in- ‘‘(A) the amount required to be paid as a ‘‘(1) any expense for the operation of a fa- vestigation or inquiry by such government result of the suit or agreement to which cility described in section 132(e)(2), and any or entity into the potential violation of any paragraph (1) of section 162(f) applies, expense for food or beverages, including law. ‘‘(B) any amount required to be paid as a under section 132(e)(1), associated with such ‘‘(2) EXCEPTION FOR AMOUNTS CONSTITUTING result of the suit or agreement which con- facility, or RESTITUTION OR PAID TO COME INTO COMPLI- stitutes restitution or remediation of prop- ‘‘(2) any expense for meals described in sec- ANCE WITH LAW.— erty, and tion 119(a).’’. ‘‘(A) IN GENERAL.—Paragraph (1) shall not ‘‘(C) any amount required to be paid as a (e) EFFECTIVE DATE.— apply to any amount that— result of the suit or agreement for the pur- (1) IN GENERAL.—Except as provided in ‘‘(i) the taxpayer establishes— paragraph (2), the amendments made by this pose of coming into compliance with any law ‘‘(I) constitutes restitution (including re- which was violated or involved in the inves- section shall apply to amounts incurred or mediation of property) for damage or harm paid after December 31, 2017. tigation or inquiry. which was or may be caused by the violation ‘‘(2) SUIT OR AGREEMENT DESCRIBED.— (2) EFFECTIVE DATE FOR ELIMINATION OF DE- of any law or the potential violation of any ‘‘(A) IN GENERAL.—A suit or agreement is DUCTION FOR MEALS PROVIDED AT CONVENIENCE law, or described in this paragraph if— OF EMPLOYER.—The amendments made by ‘‘(II) is paid to come into compliance with ‘‘(i) it is— subsection (d) shall apply to amounts in- any law which was violated or otherwise in- curred or paid after December 31, 2025. ‘‘(I) a suit with respect to a violation of volved in the investigation or inquiry de- any law over which the government or entity SEC. 13305. REPEAL OF DEDUCTION FOR INCOME scribed in paragraph (1), has authority and with respect to which ATTRIBUTABLE TO DOMESTIC PRO- ‘‘(ii) is identified as restitution or as an DUCTION ACTIVITIES. there has been a court order, or amount paid to come into compliance with (a) REPEAL.— ‘‘(II) an agreement which is entered into such law, as the case may be, in the court (1) TAXPAYERS OTHER THAN CORPORA- with respect to a violation of any law over order or settlement agreement, and TIONS.—Section 199 is amended by adding at which the government or entity has author- ‘‘(iii) in the case of any amount of restitu- the end the following new subsection: ity, or with respect to an investigation or in- ‘‘(e) PARTIAL TERMINATION FOR TAXPAYERS tion for failure to pay any tax imposed under quiry by the government or entity into the OTHER THAN CORPORATIONS.—In the case of a this title in the same manner as if such potential violation of any law over which taxpayer other than a C corporation, this amount were such tax, would have been al- such government or entity has authority, section shall not apply to any taxable year lowed as a deduction under this chapter if it and beginning after December 31, 2017.’’. had been timely paid. ‘‘(ii) the aggregate amount involved in all (2) CERTAIN SPECIAL RULES FOR COOPERA- The identification under clause (ii) alone court orders and agreements with respect to TIVES.—Section 199(d)(3) is amended by add- shall not be sufficient to make the establish- the violation, investigation, or inquiry is ing at the end the following new subpara- ment required under clause (i). $600 or more. graph: ‘‘(B) LIMITATION.—Subparagraph (A) shall ‘‘(B) ADJUSTMENT OF REPORTING THRESH- ‘‘(G) PARTIAL TERMINATION.—Subpara- not apply to any amount paid or incurred as OLD.—The Secretary shall adjust the $600 graphs (A) and (B) shall not apply to any tax- reimbursement to the government or entity amount in subparagraph (A)(ii) as necessary able year beginning after December 31, for the costs of any investigation or litiga- in order to ensure the efficient administra- 2017.’’. tion. tion of the internal revenue laws. (3) TOTAL REPEAL.—Part VI of subchapter ‘‘(3) EXCEPTION FOR AMOUNTS PAID OR IN- ‘‘(3) TIME OF FILING.—The return required B of chapter 1, as amended by paragraphs (1) CURRED AS THE RESULT OF CERTAIN COURT OR- under this subsection shall be filed at the

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00123 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.053 S01DEPT1 S7776 CONGRESSIONAL RECORD — SENATE December 1, 2017 time the agreement is entered into, as deter- (2) by inserting after section 1060 the fol- son so engaged, in (directly or indirectly) mined by the Secretary. lowing new section: providing substantial services described in ‘‘(b) STATEMENTS TO BE FURNISHED TO INDI- ‘‘SEC. 1061. PARTNERSHIP INTERESTS HELD IN paragraph (1) for such partnership or any ap- VIDUALS INVOLVED IN THE SETTLEMENT.— CONNECTION WITH PERFORMANCE plicable trade or business. Every person required to make a return OF SERVICES. ‘‘(d) TRANSFER OF APPLICABLE PARTNER- under subsection (a) shall furnish to each ‘‘(a) IN GENERAL.—If one or more applica- SHIP INTEREST TO RELATED PERSON.— person who is a party to the suit or agree- ble partnership interests are held by a tax- ‘‘(1) IN GENERAL.—If a taxpayer transfers ment a written statement showing— payer at any time during the taxable year, any applicable partnership interest, directly ‘‘(1) the name of the government or entity, the excess (if any) of— or indirectly, to a person related to the tax- and ‘‘(1) the taxpayer’s net long-term capital payer, the taxpayer shall include in gross in- ‘‘(2) the information supplied to the Sec- gain with respect to such interests for such come (as short term capital gain) the excess retary under subsection (a)(1). taxable year, over (if any) of— The written statement required under the ‘‘(2) the taxpayer’s net long-term capital ‘‘(A) so much of the taxpayer’s long-term preceding sentence shall be furnished to the gain with respect to such interests for such capital gains with respect to such interest person at the same time the government or taxable year computed by applying para- for such taxable year attributable to the sale entity provides the Secretary with the infor- graphs (3) and (4) of sections 1222 by sub- or exchange of any asset held for not more mation required under subsection (a). stituting ‘3 years’ for ‘1 year’, than 3 years as is allocable to such interest, ‘‘(c) APPROPRIATE OFFICIAL DEFINED.—For shall be treated as short-term capital gain, over purposes of this section, the term ‘appro- notwithstanding section 83 or any election in ‘‘(B) any amount treated as short term priate official’ means the officer or employee effect under section 83(b). capital gain under subsection (a) with re- having control of the suit, investigation, or ‘‘(b) SPECIAL RULE.—To the extent pro- spect to the transfer of such interest. inquiry or the person appropriately des- vided by the Secretary, subsection (a) shall ‘‘(2) RELATED PERSON.—For purposes of this ignated for purposes of this section.’’. not apply to income or gain attributable to paragraph, a person is related to the tax- (2) CONFORMING AMENDMENT.—The table of any asset not held for portfolio investment payer if— sections for subpart B of part III of sub- on behalf of third party investors. ‘‘(A) the person is a member of the tax- chapter A of chapter 61 is amended by insert- ‘‘(c) APPLICABLE PARTNERSHIP INTEREST.— payer’s family within the meaning of section ing after the item relating to section 6050W For purposes of this section— 318(a)(1), or the following new item: ‘‘(1) IN GENERAL.—Except as provided in ‘‘(B) the person performed a service within ‘‘Sec. 6050X. Information with respect to this paragraph or paragraph (4), the term the current calendar year or the preceding certain fines, penalties, and ‘applicable partnership interest’ means any three calendar years in any applicable trade other amounts.’’. interest in a partnership which, directly or or business in which or for which the tax- (3) EFFECTIVE DATE.—The amendments indirectly, is transferred to (or is held by) payer performed a service. made by this subsection shall apply to the taxpayer in connection with the perform- ‘‘(e) REPORTING.—The Secretary shall re- amounts paid or incurred on or after the ance of substantial services by the taxpayer, quire such reporting (at the time and in the date of the enactment of this Act, except or any other related person, in any applica- manner prescribed by the Secretary) as is that such amendments shall not apply to ble trade or business. The previous sentence necessary to carry out the purposes of this amounts paid or incurred under any binding shall not apply to an interest held by a per- section. order or agreement entered into before such son who is employed by another entity that ‘‘(f) REGULATIONS.—The Secretary shall date. Such exception shall not apply to an is conducting a trade or business (other than issue such regulations or other guidance as order or agreement requiring court approval an applicable trade or business) and only is necessary or appropriate to carry out the unless the approval was obtained before such provides services to such other entity. purposes of this section’’. date. ‘‘(2) APPLICABLE TRADE OR BUSINESS.—The (b) CLERICAL AMENDMENT.—The table of SEC. 13307. DENIAL OF DEDUCTION FOR SETTLE- term ‘applicable trade or business’ means sections for part IV of subchapter O of chap- MENTS SUBJECT TO NONDISCLO- any activity conducted on a regular, contin- ter 1 is amended by striking the item relat- SURE AGREEMENTS PAID IN CON- uous, and substantial basis which, regardless ing to 1061 and inserting the following new NECTION WITH SEXUAL HARASS- of whether the activity is conducted in one items: MENT OR SEXUAL ABUSE. or more entities, consists, in whole or in ‘‘Sec. 1061. Partnership interests held in (a) DENIAL OF DEDUCTION.—Section 162 is part, of— connection with performance of amended by redesignating subsection (q) as ‘‘(A) raising or returning capital, and services. subsection (r) and by inserting after sub- ‘‘(B) either— ‘‘Sec. 1062. Cross references.’’. section (p) the following new subsection: ‘‘(i) investing in (or disposing of) specified (c) EFFECTIVE DATE.—The amendments ‘‘(q) PAYMENTS RELATED TO SEXUAL HAR- assets (or identifying specified assets for made by this section shall apply to taxable ASSMENT AND SEXUAL ABUSE.—No deduction years beginning after December 31, 2017. shall be allowed under this chapter for— such investing or disposition), or ‘‘(1) any settlement or payment related to ‘‘(ii) developing specified assets. SEC. 13311. PROHIBITION ON CASH, GIFT CARDS, sexual harassment or sexual abuse if such ‘‘(3) SPECIFIED ASSET.—The term ‘specified AND OTHER NON-TANGIBLE PER- asset’ means securities (as defined in section SONAL PROPERTY AS EMPLOYEE settlement or payment is subject to a non- ACHIEVEMENT AWARDS. disclosure agreement, or 475(c)(2) without regard to the last sentence thereof), commodities (as defined in section (a) IN GENERAL.—Subparagraph (A) of sec- ‘‘(2) attorney’s fees related to such a set- tion 274(j)(3) is amended— tlement or payment.’’. 475(e)(2)), real estate held for rental or in- vestment, cash or cash equivalents, options (1) by striking ‘‘The term’’ and inserting (b) EFFECTIVE DATE.—The amendments the following: made by this section shall apply to amounts or derivative contracts with respect to any of the foregoing, and an interest in a part- ‘‘(i) IN GENERAL.—The term’’. paid or incurred after the date of the enact- (2) by redesignating clauses (i), (ii), and ment of this Act. nership to the extent of the partnership’s proportionate interest in any of the fore- (iii) as subclauses (I), (II), and (III), respec- SEC. 13309. REPEAL OF DEDUCTION FOR LOCAL tively, and conforming the margins accord- LOBBYING EXPENSES. going. ‘‘(4) EXCEPTIONS.—The term ‘applicable ingly, and (a) IN GENERAL.—Section 162(e) is amended (3) by adding at the end the following new by striking paragraphs (2) and (7) and by re- partnership interest’ shall not include— ‘‘(A) any interest in a partnership directly clause: designating paragraphs (3), (4), (5), (6), and (8) ‘‘(ii) TANGIBLE PERSONAL PROPERTY.—For as paragraphs (2), (3), (4), (5), and (6), respec- or indirectly held by a corporation, or ‘‘(B) any capital interest in the partnership purposes of clause (i), the term ‘tangible per- tively. sonal property’ shall not include— (b) CONFORMING AMENDMENT.—Section which provides the taxpayer with a right to share in partnership capital commensurate ‘‘(I) cash, cash equivalents, gift cards, gift 6033(e)(1)(B)(ii) is amended by striking ‘‘sec- coupons, or gift certificates (other than ar- tion 162(e)(5)(B)(ii)’’ and inserting ‘‘section with— ‘‘(i) the amount of capital contributed (de- rangements conferring only the right to se- 162(e)(4)(B)(ii)’’. lect and receive tangible personal property (c) EFFECTIVE DATE.—The amendments termined at the time of receipt of such part- from a limited array of such items pre-se- made by this section shall apply to amounts nership interest), or lected or pre-approved by the employer), or paid or incurred on or after the date of the ‘‘(ii) the value of such interest subject to ‘‘(II) vacations, meals, lodging, tickets to enactment of this Act. tax under section 83 upon the receipt or vest- ing of such interest. theater or sporting events, stocks, bonds, SEC. 13310. RECHARACTERIZATION OF CERTAIN other securities, and other similar items.’’. GAINS IN THE CASE OF PARTNER- ‘‘(5) THIRD PARTY INVESTOR.—The term (b) EFFECTIVE DATE.—The amendments SHIP PROFITS INTERESTS HELD IN ‘third party investor’ means a person who— CONNECTION WITH PERFORMANCE ‘‘(A) holds an interest in the partnership made by this section shall apply to amounts OF INVESTMENT SERVICES. which does not constitute property held in paid or incurred after December 31, 2017. (a) IN GENERAL.—Part IV of subchapter O connection with an applicable trade or busi- SEC. 13312. FLOOR PLAN FINANCING. of chapter 1 is amended— ness; and (a) APPLICATION OF INTEREST LIMITATION.— (1) by redesignating section 1061 as section ‘‘(B) is not (and has not been) actively en- (1) IN GENERAL.—Section 163(j), as amended 1062, and gaged, and is (and was) not related to a per- by section 13301, is amended—

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00124 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.053 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7777 (A) in paragraph (1), by striking ‘‘plus’’ at ‘‘(i) paragraphs (1) and (2) shall not apply, not later than 180 days after the date of the the end of subparagraph (A), by striking the and enactment of this Act, period at the end of subparagraph (B) and in- ‘‘(ii) the amount of the credit under sec- the amendments made by this section shall serting ‘‘, plus’’, and by inserting after sub- tion 45C(a) shall be the amount determined apply to such expenditures paid or incurred paragraph (B) the following new subpara- under subparagraph (B). after the end of the taxable year in which graph: ‘‘(B) AMOUNT OF REDUCED CREDIT.—The the 24-month period referred to in subpara- ‘‘(C) the floor plan financing interest of amount of credit determined under this sub- graph (B) ends. such taxpayer for such taxable year.’’, and paragraph for any taxable year shall be the SEC. 13403. EMPLOYER CREDIT FOR PAID FAMILY (B) in paragraph (4)(C)(i)(II), by inserting amount equal to the excess of— AND MEDICAL LEAVE. ‘‘, reduced by the floor plan financing inter- ‘‘(i) the amount of credit determined under (a) IN GENERAL.— est,’’ after ‘‘business interest of the partner- section 45C(a) without regard to this para- (1) ALLOWANCE OF CREDIT.—Subpart D of ship’’, and graph, over part IV of subchapter A of chapter 1 is (C) by redesignating paragraph (9) as para- ‘‘(ii) the product of— amended by adding at the end the following graph (10) and inserting after paragraph (8) ‘‘(I) the amount described in clause (i), and new section: the following new paragraph: ‘‘(II) the maximum rate of tax under sec- ‘‘SEC. 45S. EMPLOYER CREDIT FOR PAID FAMILY ‘‘(9) FLOOR PLAN FINANCING INTEREST DE- tion 11(b). AND MEDICAL LEAVE. FINED.—For purposes of this subsection— ‘‘(C) ELECTION.—An election under this ‘‘(a) ESTABLISHMENT OF CREDIT.— ‘‘(A) IN GENERAL.—The term ‘floor plan fi- paragraph for any taxable year shall be made ‘‘(1) IN GENERAL.—For purposes of section nancing interest’ means interest paid or ac- not later than the time for filing the return 38, in the case of an eligible employer, the crued on floor plan financing indebtedness. of tax for such year (including extensions), paid family and medical leave credit is an ‘‘(B) FLOOR PLAN FINANCING INDEBTED- shall be made on such return, and shall be amount equal to the applicable percentage of NESS.—The term ‘floor plan financing indebt- made in such manner as the Secretary shall the amount of wages paid to qualifying em- edness’ means indebtedness— prescribe. Such an election, once made, shall ployees during any period in which such em- ‘‘(i) used to finance the acquisition of be irrevocable.’’. ployees are on family and medical leave. motor vehicles held for sale or lease, and (c) EFFECTIVE DATE.—The amendments ‘‘(ii) secured by the inventory so acquired. made by this section shall apply to taxable ‘‘(2) APPLICABLE PERCENTAGE.—For pur- poses of paragraph (1), the term ‘applicable ‘‘(C) MOTOR VEHICLE.—The term ‘motor ve- years beginning after December 31, 2017. hicle’ means a motor vehicle that is any of SEC. 13402. REHABILITATION CREDIT LIMITED TO percentage’ means 12.5 percent increased the following: CERTIFIED HISTORIC STRUCTURES. (but not above 25 percent) by 0.25 percentage ‘‘(i) An automobile. (a) IN GENERAL.—Subsection (a) of section points for each percentage point by which ‘‘(ii) A truck. 47 is amended to read as follows: the rate of payment (as described under sub- ‘‘(iii) A recreational vehicle. ‘‘(a) GENERAL RULE.— section (c)(1)(B)) exceeds 50 percent. ‘‘(iv) A motorcycle. ‘‘(1) IN GENERAL.—For purposes of section ‘‘(b) LIMITATION.— ‘‘(v) Any self-propelled vehicle designed for 46, for any taxable year during the 5-year pe- ‘‘(1) IN GENERAL.—The credit allowed under transporting persons or property on a public riod beginning in the taxable year in which subsection (a) with respect to any employee street, highway, or road. a qualified rehabilitated building is placed in for any taxable year shall not exceed an ‘‘(vi) A boat. service, the rehabilitation credit for such amount equal to the product of the normal ‘‘(vii) Farm machinery or equipment.’’. year is an amount equal to the ratable share hourly wage rate of such employee for each hour (or fraction thereof) of actual services (2) EFFECTIVE DATE.—The amendments for such year. made by this subsection shall apply to tax- ‘‘(2) RATABLE SHARE.—For purposes of performed for the employer and the number able years beginning after December 31, 2017. paragraph (1), the ratable share for any tax- of hours (or fraction thereof) for which fam- (b) EXCEPTION FROM 100 PERCENT EXPENS- able year during the period described in such ily and medical leave is taken. ING.— paragraph is the amount equal to 20 percent ‘‘(2) NON-HOURLY WAGE RATE.—For purposes (1) IN GENERAL.—Paragraph (6) of section of the qualified rehabilitation expenditures of paragraph (1), in the case of any employee 168(k), as added by section 13201(a)(4), is with respect to the qualified rehabilitated who is not paid on an hourly wage rate, the amended— building, as allocated ratably to each year wages of such employee shall be prorated to (A) by striking ‘‘shall not include any during such period.’’. an hourly wage rate under regulations estab- property’’ and inserting ‘‘shall not include— (b) CONFORMING AMENDMENTS.— lished by the Secretary. ‘‘(A) any property’’, and (1) Section 47(c) is amended— ‘‘(3) MAXIMUM AMOUNT OF LEAVE SUBJECT TO (B) by adding at the end the following new (A) in paragraph (1)— CREDIT.—The amount of family and medical subparagraph: (i) in subparagraph (A), by amending leave that may be taken into account with ‘‘(B) any property used in a trade or busi- clause (iii) to read as follows: respect to any employee under subsection (a) ness that has had floor plan financing in- ‘‘(iii) such building is a certified historic for any taxable year shall not exceed 12 debtedness (as defined in paragraph (9) of structure, and’’, weeks. section 163(j)), if the floor plan financing in- (ii) by striking subparagraph (B), and ‘‘(c) ELIGIBLE EMPLOYER.—For purposes of terest related to such indebtedness was (iii) by redesignating subparagraphs (C) this section— taken into account under paragraph (1)(C) of and (D) as subparagraphs (B) and (C), respec- ‘‘(1) IN GENERAL.—The term ‘eligible em- such section.’’. tively, and ployer’ means any employer who has in place (2) EFFECTIVE DATE.—The amendments (B) in paragraph (2)(B), by amending clause a policy that meets the following require- made by this subsection shall apply to prop- (iv) to read as follows: ments: erty placed in service after September 27, ‘‘(iv) CERTIFIED HISTORIC STRUCTURE.—Any ‘‘(A) The policy provides— 2017, in taxable years ending after such date. expenditure attributable to the rehabilita- ‘‘(i) in the case of a qualifying employee SEC. 13313. ELIMINATION OF DEDUCTION FOR tion of a qualified rehabilitated building un- who is not a part-time employee (as defined LIVING EXPENSES INCURRED BY less the rehabilitation is a certified rehabili- in section 4980E(d)(4)(B)), not less than 2 MEMBERS OF CONGRESS. tation (within the meaning of subparagraph weeks of annual paid family and medical (a) IN GENERAL.—Subsection (a) of section (C)).’’. leave, and 162 is amended in the matter following para- (2) Paragraph (4) of section 145(d) is amend- ‘‘(ii) in the case of a qualifying employee graph (3) by striking ‘‘in excess of $3,000’’. ed— who is a part-time employee, an amount of (b) EFFECTIVE DATE.—The amendment (A) by striking ‘‘of section 47(c)(1)(C)’’ each annual paid family and medical leave that is made by this section shall apply to taxable place it appears and inserting ‘‘of section not less than an amount which bears the years beginning after the date of the enact- 47(c)(1)(B)’’, and same ratio to the amount of annual paid ment of this Act. (B) by striking ‘‘section 47(c)(1)(C)(i)’’ and family and medical leave that is provided to PART V—BUSINESS CREDITS inserting ‘‘section 47(c)(1)(B)(i)’’. a qualifying employee described in clause (i) Subpart A—General Provisions (c) EFFECTIVE DATE.— as— N GENERAL SEC. 13401. MODIFICATION OF ORPHAN DRUG (1) I .—Except as provided in ‘‘(I) the number of hours the employee is CREDIT. paragraph (2), the amendments made by this expected to work during any week, bears to (a) CREDIT RATE.—Subsection (a) of section section shall apply to amounts paid or in- ‘‘(II) the number of hours an equivalent 45C is amended by striking ‘‘50 percent’’ and curred after December 31, 2017. qualifying employee described in clause (i) is inserting ‘‘27.5 percent’’. (2) TRANSITION RULE.—In the case of quali- expected to work during the week. (b) ELECTION OF REDUCED CREDIT.—Sub- fied rehabilitation expenditures with respect ‘‘(B) The policy requires that the rate of section (b) of section 280C is amended by re- to any building— payment under the program is not less than designating paragraph (3) as paragraph (4) (A) owned or leased by the taxpayer during 50 percent of the wages normally paid to and by inserting after paragraph (2) the fol- the entirety of the period after December 31, such employee for services performed for the lowing new paragraph: 2017, and employer. ‘‘(3) ELECTION OF REDUCED CREDIT.— (B) with respect to which the 24-month pe- ‘‘(2) SPECIAL RULE FOR CERTAIN EMPLOY- ‘‘(A) IN GENERAL.—In the case of any tax- riod selected by the taxpayer under section ERS.— able year for which an election is made 47(c)(1)(B) of the Internal Revenue Code of ‘‘(A) IN GENERAL.—An added employer shall under this paragraph— 1986 (as amended by subsection (b)) begins not be treated as an eligible employer unless

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such employer provides paid family and med- ‘‘(g) WAGES.—For purposes of this section, placed in service after the date of the enact- ical leave in compliance with a policy which the term ‘wages’ has the meaning given such ment of this Act. ensures that the employer— term by subsection (b) of section 3306 (deter- PART VI—PROVISIONS RELATED TO ‘‘(i) will not interfere with, restrain, or mined without regard to any dollar limita- SPECIFIC ENTITIES AND INDUSTRIES deny the exercise of or the attempt to exer- tion contained in such section). Such term Subpart A—Partnership Provisions cise, any right provided under the policy, shall not include any amount taken into ac- SEC. 13501. TREATMENT OF GAIN OR LOSS OF and count for purposes of determining any other FOREIGN PERSONS FROM SALE OR ‘‘(ii) will not discharge or in any other credit allowed under this subpart. EXCHANGE OF INTERESTS IN PART- manner discriminate against any individual ‘‘(h) ELECTION TO HAVE CREDIT NOT NERSHIPS ENGAGED IN TRADE OR for opposing any practice prohibited by the APPLY.— BUSINESS WITHIN THE UNITED policy. ‘‘(1) IN GENERAL.—A taxpayer may elect to STATES. ‘‘(B) ADDED EMPLOYER; ADDED EMPLOYEE.— have this section not apply for any taxable (a) IN GENERAL.—Section 864(c) is amended For purposes of this paragraph— year. by adding at the end the following: ‘‘(i) ADDED EMPLOYEE.—The term ‘added ‘‘(2) OTHER RULES.—Rules similar to the ‘‘(8) GAIN OR LOSS OF FOREIGN PERSONS employee’ means a qualifying employee who rules of paragraphs (2) and (3) of section 51(j) FROM SALE OR EXCHANGE OF CERTAIN PART- is not covered by title I of the Family and shall apply for purposes of this subsection. NERSHIP INTERESTS.— Medical Leave Act of 1993, as amended. ‘‘(i) TERMINATION.—This section shall not ‘‘(A) IN GENERAL.—Notwithstanding any ‘‘(ii) ADDED EMPLOYER.—The term ‘added apply to wages paid in taxable years begin- other provision of this subtitle, if a non- employer’ means an eligible employer (deter- ning after December 31, 2019.’’. resident alien individual or foreign corpora- mined without regard to this paragraph), (b) CREDIT PART OF GENERAL BUSINESS tion owns, directly or indirectly, an interest whether or not covered by that title I, who CREDIT.—Section 38(b) is amended by strik- in a partnership which is engaged in any offers paid family and medical leave to added ing ‘‘plus’’ at the end of paragraph (35), by trade or business within the United States, employees. striking the period at the end of paragraph gain or loss on the sale or exchange of all (or ‘‘(3) AGGREGATION RULE.—All persons which (36) and inserting ‘‘, plus’’, and by adding at any portion of) such interest shall be treated are treated as a single employer under sub- the end the following new paragraph: as effectively connected with the conduct of sections (a) and (b) of section 52 shall be ‘‘(37) in the case of an eligible employer (as such trade or business to the extent such treated as a single taxpayer. defined in section 45S(c)), the paid family gain or loss does not exceed the amount de- ‘‘(4) TREATMENT OF BENEFITS MANDATED OR and medical leave credit determined under termined under subparagraph (B). ‘‘(B) AMOUNT TREATED AS EFFECTIVELY CON- PAID FOR BY STATE OR LOCAL GOVERNMENTS.— section 45S(a).’’. For purposes of this section, any leave which (c) CREDIT ALLOWED AGAINST AMT.—Sub- NECTED.—The amount determined under this is paid by a State or local government or re- paragraph (B) of section 38(c)(4) is amended subparagraph with respect to any partner- quired by State or local law shall not be by redesignating clauses (ix) through (xi) as ship interest sold or exchanged— taken into account in determining the clauses (x) through (xii), respectively, and by ‘‘(i) in the case of any gain on the sale or exchange of the partnership interest, is— amount of paid family and medical leave inserting after clause (viii) the following new ‘‘(I) the portion of the partner’s distribu- provided by the employer. clause: tive share of the amount of gain which would ‘‘(5) NO INFERENCE.—Nothing in this sub- ‘‘(ix) the credit determined under section have been effectively connected with the section shall be construed as subjecting an 45S,’’. conduct of a trade or business within the employer to any penalty, liability, or other (d) CONFORMING AMENDMENTS.— United States if the partnership had sold all consequence (other than ineligibility for the (1) DENIAL OF DOUBLE BENEFIT.—Section of its assets at their fair market value as of credit allowed by reason of subsection (a) or 280C(a) is amended by inserting ‘‘45S(a),’’ the date of the sale or exchange of such in- recapturing the benefit of such credit) for after ‘‘45P(a),’’. terest, or failure to comply with the requirements of (2) ELECTION TO HAVE CREDIT NOT APPLY.— ‘‘(II) zero if no gain on such deemed sale this subsection. Section 6501(m) is amended by inserting would have been so effectively connected, ‘‘(d) QUALIFYING EMPLOYEES.—For purposes ‘‘45S(h),’’ after ‘‘45H(g),’’. and of this section, the term ‘qualifying em- (3) CLERICAL AMENDMENT.—The table of ‘‘(ii) in the case of any loss on the sale or ployee’ means any employee (as defined in sections for subpart D of part IV of sub- exchange of the partnership interest, is— section 3(e) of the Fair Labor Standards Act chapter A of chapter 1 is amended by adding ‘‘(I) the portion of the partner’s distribu- of 1938, as amended) who— at the end the following new item: tive share of the amount of loss on the ‘‘(1) has been employed by the employer for ‘‘Sec. 45S. Employer credit for paid family 1 year or more, and deemed sale described in clause (i)(I) which and medical leave.’’. would have been so effectively connected, or ‘‘(2) for the preceding year, had compensa- (e) EFFECTIVE DATE.—The amendments ‘‘(II) zero if no loss on such deemed sale tion not in excess of an amount equal to 60 made by this section shall apply to wages would be have been so effectively connected. percent of the amount applicable for such paid in taxable years beginning after Decem- For purposes of this subparagraph, a part- year under clause (i) of section 414(q)(1)(B). ber 31, 2017. ‘‘(e) FAMILY AND MEDICAL LEAVE.— ner’s distributive share of gain or loss on the ‘‘(1) IN GENERAL.—Except as provided in Subpart B—Provisions Relating to Low- deemed sale shall be determined in the same paragraph (2), for purposes of this section, income Housing Credit manner as such partner’s distributive share the term ‘family and medical leave’ means SEC. 13411. TREATMENT OF VETERANS’ PREF- of the non-separately stated taxable income leave for any 1 or more of the purposes de- ERENCE AS NOT VIOLATING GEN- or loss of such partnership. scribed under subparagraph (A), (B), (C), (D), ERAL PUBLIC USE REQUIREMENTS. ‘‘(C) COORDINATION WITH UNITED STATES or (E) of paragraph (1), or paragraph (3), of (a) IN GENERAL.—Subparagraph (C) of sec- REAL PROPERTY INTERESTS.—If a partnership section 102(a) of the Family and Medical tion 42(g)(9) is amended to read as follows: described in subparagraph (A) holds any Leave Act of 1993, as amended, whether the ‘‘(C) who are veterans of the Armed United States real property interest (as de- leave is provided under that Act or by a pol- Forces.’’. fined in section 897(c)) at the time of the sale icy of the employer. (b) EFFECTIVE DATE.—The amendment or exchange of the partnership interest, then made by this section shall apply to buildings ‘‘(2) EXCLUSION.—If an employer provides the gain or loss treated as effectively con- paid leave as vacation leave, personal leave, placed in service before, on, or after the date nected income under subparagraph (A) shall or medical or sick leave (other than leave of the enactment of this Act. be reduced by the amount so treated with re- specifically for 1 or more of the purposes re- SEC. 13412. INCREASE IN CREDIT FOR CERTAIN spect to such United States real property in- ferred to in paragraph (1)), that paid leave RURAL HOUSING. terest under section 897. shall not be considered to be family and med- (a) IN GENERAL.—Section 42(d)(5)(B) is ‘‘(D) SALE OR EXCHANGE.—For purposes of ical leave under paragraph (1). amended by adding at the end the following this paragraph, an individual or corporation ‘‘(3) DEFINITIONS.—In this subsection, the new clause: shall be treated as having sold or exchanged terms ‘vacation leave’, ‘personal leave’, and ‘‘(vi) CERTAIN NEW BUILDINGS IN RURAL any interest in a partnership if, under any ‘medical or sick leave’ mean those 3 types of AREAS.—For purposes of clause (i), a building provision of this subtitle, gain or loss is real- leave, within the meaning of section 102(d)(2) described in subsection (b)(1)(B)(i) which is ized from the sale or exchange of such inter- of that Act. located in a rural area (as defined in section est. ‘‘(f) DETERMINATIONS MADE BY SECRETARY 520 of the Housing Act of 1949) shall be treat- ‘‘(E) SECRETARIAL AUTHORITY.—The Sec- OF TREASURY.—For purposes of this section, ed in the same manner as a new building lo- retary shall prescribe such regulations as the any determination as to whether an em- cated in a difficult development area which Secretary determines appropriate for the ap- ployer or an employee satisfies the applica- is designated for purposes of this subpara- plication of this paragraph, including regula- ble requirements for an eligible employer (as graph.’’. tions which provide that, notwithstanding described in subsection (c)) or qualifying em- (b) OFFSET.—Section 42(d)(5)(B)(i) is subparagraph (D), this paragraph applies in a ployee (as described in subsection (d)), re- amended by striking ‘‘130 percent’’ both case even if gain or loss from a sale or ex- spectively, shall be made by the Secretary places it appears in subclauses (I) and (II) change would not be realized under any based on such information, to be provided by and inserting ‘‘125 percent’’. other provision of this subtitle.’’. the employer, as the Secretary determines to (c) EFFECTIVE DATE.—The amendments (b) WITHHOLDING REQUIREMENTS.—Section be necessary or appropriate. made by this section shall apply to buildings 1446 is amended by redesignating subsection

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(f) as subsection (g) and by inserting after ‘‘(1) IN GENERAL.—For purposes of this sec- arising in taxable years beginning after De- subsection (e) the following: tion, a partnership has a substantial built-in cember 31, 2017. ‘‘(f) SPECIAL RULES FOR WITHHOLDING ON loss with respect to a transfer of an interest SEC. 13512. REPEAL OF SMALL LIFE INSURANCE SALES OF PARTNERSHIP INTERESTS.— in the partnership if— COMPANY DEDUCTION. ‘‘(1) IN GENERAL.—Except as provided in ‘‘(A) the partnership’s adjusted basis in the (a) IN GENERAL.—Part I of subchapter L of partnership property exceeds by more than this subsection, if any portion of the gain (if chapter 1 is amended by striking section 806 $250,000 the fair market value of such prop- any) on any disposition of an interest in a (and by striking the item relating to such erty, or partnership would be treated under section section in the table of sections for such ‘‘(B) the transferee partner would be allo- 864(c)(8) as effectively connected with the part). conduct of a trade or business within the cated a loss of more than $250,000 if the part- (b) CONFORMING AMENDMENTS.— United States, the transferee shall be re- nership assets were sold for cash equal to (1) Section 453B(e) is amended— quired to deduct and withhold a tax equal to their fair market value immediately after (A) by striking ‘‘(as defined in section 10 percent of the amount realized on the dis- such transfer.’’. 806(b)(3))’’ in paragraph (2)(B), and position. (b) EFFECTIVE DATE.—The amendments (B) by adding at the end the following new ‘‘(2) EXCEPTION IF NONFOREIGN AFFIDAVIT made by this section shall apply to transfers paragraph: FURNISHED.— of partnership interests after December 31, ‘‘(3) NONINSURANCE BUSINESS.— ‘‘(A) IN GENERAL.—No person shall be re- 2017. ‘‘(A) IN GENERAL.—For purposes of this sub- quired to deduct and withhold any amount SEC. 13503. CHARITABLE CONTRIBUTIONS AND section, the term ‘noninsurance business’ under paragraph (1) with respect to any dis- FOREIGN TAXES TAKEN INTO AC- means any activity which is not an insur- position if the transferor furnishes to the COUNT IN DETERMINING LIMITA- TION ON ALLOWANCE OF PARTNER’S ance business. transferee an affidavit by the transferor SHARE OF LOSS. ‘‘(B) CERTAIN ACTIVITIES TREATED AS INSUR- stating, under penalty of perjury, the trans- (a) IN GENERAL.—Subsection (d) of section ANCE BUSINESSES.—For purposes of subpara- feror’s United States taxpayer identification 704 is amended— graph (A), any activity which is not an in- number and that the transferor is not a for- (1) by striking ‘‘A partner’s distributive surance business shall be treated as an insur- eign person. share’’ and inserting the following: ance business if— ‘‘(B) FALSE AFFIDAVIT.—Subparagraph (A) ‘‘(1) IN GENERAL.—A partner’s distributive ‘‘(i) it is of a type traditionally carried on shall not apply to any disposition if— share’’, by life insurance companies for investment ‘‘(i) the transferee has actual knowledge (2) by striking ‘‘Any excess of such loss’’ purposes, but only if the carrying on of such that the affidavit is false, or the transferee and inserting the following: activity (other than in the case of real es- receives a notice (as described in section ‘‘(2) CARRYOVER.—Any excess of such loss’’, tate) does not constitute the active conduct 1445(d)) from a transferor’s agent or trans- and of a trade or business, or feree’s agent that such affidavit or state- (3) by adding at the end the following new ‘‘(ii) it involves the performance of admin- ment is false, or paragraph: istrative services in connection with plans ‘‘(ii) the Secretary by regulations requires ‘‘(3) SPECIAL RULES.— providing life insurance, pension, or accident the transferee to furnish a copy of such affi- ‘‘(A) IN GENERAL.—In determining the and health benefits.’’. davit or statement to the Secretary and the amount of any loss under paragraph (1), (2) Section 465(c)(7)(D)(v)(II) is amended by transferee fails to furnish a copy of such affi- there shall be taken into account the part- striking ‘‘section 806(b)(3)’’ and inserting davit or statement to the Secretary at such ner’s distributive share of amounts described ‘‘section 453B(e)(3)’’. time and in such manner as required by such in paragraphs (4) and (6) of section 702(a). (3) Section 801(a)(2) is amended by striking regulations. ‘‘(B) EXCEPTION.—In the case of a chari- subparagraph (C). ‘‘(C) RULES FOR AGENTS.—The rules of sec- table contribution of property whose fair (4) Section 804 is amended by striking tion 1445(d) shall apply to a transferor’s market value exceeds its adjusted basis, sub- ‘‘means—’’ and all that follows and inserting agent or transferee’s agent with respect to paragraph (A) shall not apply to the extent ‘‘means the general deductions provided in any affidavit described in subparagraph (A) of the partner’s distributive share of such ex- section 805.’’. in the same manner as such rules apply with cess.’’. (5) Section 805(a)(4)(B), as amended by this respect to the disposition of a United States (b) EFFECTIVE DATE.—The amendments Act, is amended by striking clause (i) and by real property interest under such section. made by this section shall apply to partner- redesignating clauses (ii), (iii), and (iv) as ‘‘(3) AUTHORITY OF SECRETARY TO PRESCRIBE ship taxable years beginning after December clauses (i), (ii), and (iii), respectively. REDUCED AMOUNT.—At the request of the 31, 2017. (6) Section 805(b)(2)(A), as amended by this transferor or transferee, the Secretary may Subpart B—Insurance Reforms Act, is amended by striking clause (iii) and prescribe a reduced amount to be withheld SEC. 13511. NET OPERATING LOSSES OF LIFE IN- by redesignating clauses (iv) and (v) as under this section if the Secretary deter- SURANCE COMPANIES. clauses (iii) and (iv), respectively. mines that to substitute such reduced (a) IN GENERAL.—Section 805(b) is amended (7) Section 842(c) is amended by striking amount will not jeopardize the collection of by striking paragraph (4) and by redesig- paragraph (1) and by redesignating para- the tax imposed under this title with respect nating paragraph (5) as paragraph (4). graphs (2) and (3) as paragraphs (1) and (2), to gain treated under section 864(c)(8) as ef- (b) CONFORMING AMENDMENTS.— respectively. fectively connected with the conduct of a (1) Part I of subchapter L of chapter 1 is (8) Section 953(b)(1), as amended by section trade or business with in the United States. amended by striking section 810 (and by 13511, is amended by striking subparagraph ‘‘(4) PARTNERSHIP TO WITHHOLD AMOUNTS striking the item relating to such section in (A) and by redesignating subparagraphs (B) NOT WITHHELD BY THE TRANSFEREE.—If a the table of sections for such part). and (C) as subparagraphs (A) and (B), respec- transferee fails to withhold any amount re- (2)(A) Part III of subchapter L of chapter 1 tively. quired to be withheld under paragraph (1), is amended by striking section 844 (and by (c) EFFECTIVE DATE.—The amendments the partnership shall be required to deduct striking the item relating to such section in made by this section shall apply to taxable and withhold from distributions to the trans- the table of sections for such part). years beginning after December 31, 2017. feree a tax in an amount equal to the (B) Section 831(b)(3) is amended by striking amount the transferee failed to withhold ‘‘except as provided in section 844,’’ SEC. 13513. ADJUSTMENT FOR CHANGE IN COM- (plus interest under this title on such (3) Section 381 is amended by striking sub- PUTING RESERVES. amount). section (d). (a) IN GENERAL.—Paragraph (1) of section ‘‘(5) DEFINITIONS.—Any term used in this (4) Section 805(a)(4)(B)(ii) is amended to 807(f) is amended to read as follows: subsection which is also used under section read as follows: ‘‘(1) TREATMENT AS CHANGE IN METHOD OF 1445 shall have the same meaning as when ‘‘(ii) the deduction allowed under section ACCOUNTING.—If the basis for determining used in such section. 172,’’. any item referred to in subsection (c) as of ‘‘(6) REGULATIONS.—The Secretary shall (5) Section 805(a) is amended by striking the close of any taxable year differs from the prescribe such regulations as may be nec- paragraph (5). basis for such determination as of the close essary to carry out the purposes of this sub- (6) Section 805(b)(2)(A)(iv) is amended to of the preceding taxable year, then so much section, including regulations providing for read as follows: of the difference between— exceptions from the provisions of this sub- ‘‘(iv) any net operating loss carryback to ‘‘(A) the amount of the item at the close of section.’’. the taxable year under section 172, and’’. the taxable year, computed on the new basis, (c) EFFECTIVE DATE.—The amendments (7) Section 953(b)(1)(B) is amended to read and made by this section shall apply to sales and as follows: ‘‘(B) the amount of the item at the close of exchanges on or after November 27, 2017. ‘‘(B) So much of section 805(a)(8) as relates the taxable year, computed on the old basis, SEC. 13502. MODIFY DEFINITION OF SUBSTAN- to the deduction allowed under section 172.’’. as is attributable to contracts issued before TIAL BUILT-IN LOSS IN THE CASE OF (8) Section 1351(i)(3) is amended by striking the taxable year shall be taken into account TRANSFER OF PARTNERSHIP INTER- ‘‘or the operations loss deduction under sec- under section 481 as adjustments attrib- EST. tion 810,’’. utable to a change in method of accounting (a) IN GENERAL.—Paragraph (1) of section (c) EFFECTIVE DATE.—The amendments initiated by the taxpayer and made with the 743(d) is to read as follows: made by this section shall apply to losses consent of the Secretary.’’.

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(b) EFFECTIVE DATE.—The amendments surance or group accident and health insur- ‘‘(A) QUALIFIED SUPPLEMENTAL BENEFITS made by this section shall apply to taxable ance which are established and maintained TREATED SEPARATELY.—For purposes of this years beginning after December 31, 2017. for the provision of insurance on retired part, the amount of the life insurance re- SEC. 13514. REPEAL OF SPECIAL RULE FOR DIS- lives, for premium stabilization, or a com- serve for any qualified supplemental benefit TRIBUTIONS TO SHAREHOLDERS bination thereof. shall be computed separately as though such FROM PRE-1984 POLICYHOLDERS For purposes of paragraph (3), the appro- benefit were under a separate contract. SURPLUS ACCOUNT. priate rate of interest is the highest rate or ‘‘(B) QUALIFIED SUPPLEMENTAL BENEFIT.— (a) IN GENERAL.—Subpart D of part I of rates permitted to be used to discount the For purposes of this paragraph, the term subchapter L is amended by striking section obligations by the National Association of ‘qualified supplemental benefit’ means any 815 (and by striking the item relating to such Insurance Commissioners as of the date the supplemental benefit described in subpara- section in the table of sections for such sub- reserve is determined. In no case shall the graph (C) if— part). amount determined under paragraph (3) for ‘‘(i) there is a separately identified pre- (b) CONFORMING AMENDMENT.—Section 801 mium or charge for such benefit, and is amended by striking subsection (c). any contract be less than the net surrender value of such contract. For purposes of para- ‘‘(ii) any net surrender value under the (c) EFFECTIVE DATE.—The amendments graph (2) and section 805(a)(1), the amount of contract attributable to any other benefit is made by this section shall apply to taxable not available to fund such benefit. years beginning after December 31, 2017. the unpaid losses (other than losses on life insurance contracts) shall be the amount of ‘‘(C) SUPPLEMENTAL BENEFITS.—For pur- (d) PHASED INCLUSION OF REMAINING BAL- poses of this paragraph, the supplemental ANCE OF POLICYHOLDERS SURPLUS AC- the discounted unpaid losses as defined in section 846.’’. benefits described in this subparagraph are COUNTS.—In the case of any stock life insur- any— ance company which has a balance (deter- (2) Section 807(d) is amended— (A) by striking paragraphs (1), (2), (4), and ‘‘(i) guaranteed insurability, mined as of the close of such company’s last ‘‘(ii) accidental death or disability benefit, taxable year beginning before January 1, (5), (B) by redesignating paragraph (6) as para- ‘‘(iii) convertibility, 2018) in an existing policyholders surplus ac- ‘‘(iv) disability waiver benefit, or count (as defined in section 815 of the Inter- graph (4), (C) by inserting before paragraph (3) the ‘‘(v) other benefit prescribed by regula- nal Revenue Code of 1986, as in effect before tions, its repeal), the tax imposed by section 801 of following new paragraphs: such Code for the first 8 taxable years begin- ‘‘(1) DETERMINATION OF RESERVE.— which is supplemental to a contract for ning after December 31, 2017, shall be the ‘‘(A) IN GENERAL.—For purposes of this which there is a reserve described in sub- amount which would be imposed by such sec- part (other than section 816), the amount of section (c).’’, and tion for such year on the sum of— the life insurance reserves for any contract (D) by adding at the end the following new (1) life insurance company taxable income (other than a contract to which subpara- paragraph: for such year (within the meaning of such graph (B) applies) shall be the greater of— ‘‘(6) REPORTING RULES.—The Secretary section 801 but not less than zero), plus ‘‘(i) the net surrender value of such con- shall require reporting (at such time and in tract, or such manner as the Secretary shall pre- (2) 1⁄8 of such balance. ‘‘(ii) 92.87 percent of the reserve deter- scribe) with respect to the opening balance SEC. 13515. MODIFICATION OF PRORATION RULES FOR PROPERTY AND CAS- mined under paragraph (2). and closing balance of reserves and with re- UALTY INSURANCE COMPANIES. ‘‘(B) VARIABLE CONTRACTS.—For purposes spect to the method of computing reserves (a) IN GENERAL.—Section 832(b)(5)(B) is of this part (other than section 816), the for purposes of determining income.’’. amended— amount of the life insurance reserves for a (4) Section 7702 is amended— (1) by striking ‘‘15 percent’’ and inserting variable contract shall be equal to the sum (A) by striking clause (i) of subsection ‘‘the applicable percentage’’, and of— (c)(3)(B) and inserting the following: (2) by inserting at the end the following ‘‘(i) the greater of— ‘‘(i) reasonable mortality charges which new sentence: ‘‘For purposes of this subpara- ‘‘(I) the net surrender value of such con- meet the requirements prescribed in regula- graph, the applicable percentage is 5.25 per- tract, or tions to be promulgated by the Secretary or cent divided by the highest rate in effect ‘‘(II) the portion of the reserve that is sep- that do not exceed the mortality charges under section 11(b).’’. arately accounted for under section 817, plus specified in the prevailing commissioners’ (b) EFFECTIVE DATE.—The amendments ‘‘(ii) 92.87 percent of the excess (if any) of standard tables as defined in subsection made by this section shall apply to taxable the reserve determined under paragraph (2) (f)(10),’’ and years beginning after December 31, 2017. over the amount in clause (i). (B) by adding at the end of subsection (f) SEC. 13516. REPEAL OF SPECIAL ESTIMATED TAX ‘‘(C) STATUTORY CAP.—In no event shall the the following new paragraph: PAYMENTS. reserves determined under subparagraphs (A) ‘‘(10) PREVAILING COMMISSIONERS’ STANDARD (a) IN GENERAL.—Part III of subchapter L or (B) for any contract as of any time exceed TABLES.—For purposes of subsection of chapter 1 is amended by striking section the amount which would be taken into ac- (c)(3)(B)(i), the term ‘prevailing commis- 847 (and by striking the item relating to such count with respect to such contract as of sioners’ standard tables’ means the most re- section in the table of sections for such such time in determining statutory reserves cent commissioners’ standard tables pre- part). (as defined in paragraph (4)). scribed by the National Association of Insur- (b) EFFECTIVE DATE.—The amendments ‘‘(2) AMOUNT OF RESERVE.—The amount of ance Commissioners which are permitted to made by this section shall apply to taxable the reserve determined under this paragraph be used in computing reserves for that type years beginning after December 31, 2017. with respect to any contract shall be deter- of contract under the insurance laws of at SEC. 13517. COMPUTATION OF LIFE INSURANCE mined by using the tax reserve method appli- least 26 States when the contract was issued. TAX RESERVES. cable to such contract.’’, If the prevailing commissioners’ standard ta- (a) IN GENERAL.— (D) by striking ‘‘(as of the date of bles as of the beginning of any calendar year (1) COMPUTATION OF RESERVES.—Section issuance)’’ in paragraph (3)(A)(iv)(I) and in- (hereinafter in this paragraph referred to as 807(c) is amended to read as follows: serting ‘‘(as of the date the reserve is deter- the ‘year of change’) are different from the ‘‘(c) ITEMS TAKEN INTO ACCOUNT.—The mined)’’, prevailing commissioners’ standard tables as items referred to in subsections (a) and (b) (E) by striking ‘‘as of the date of the of the beginning of the preceding calendar are as follows— issuance of’’ in paragraph (3)(A)(iv)(II) and year, the issuer may use the prevailing com- ‘‘(1) The life insurance reserves (as defined inserting ‘‘as of the date the reserve is deter- missioners’ standard tables as of the begin- in section 816(b)). mined for’’, ning of the preceding calendar year with re- ‘‘(2) The unearned premiums and unpaid (F) by striking ‘‘in effect on the date of the spect to any contract issued after the change losses included in total reserves under sec- issuance of the contract’’ in paragraph and before the close of the 3-year period be- tion 816(c)(2). (3)(B)(i) and inserting ‘‘applicable to the con- ginning on the first day of the year of ‘‘(3) The amounts (discounted at the appro- tract and in effect as of the date the reserve change.’’. priate rate of interest) necessary to satisfy is determined’’, and (b) CONFORMING AMENDMENTS.— the obligations under insurance and annuity (G) by striking ‘‘in effect on the date of the (1) Section 808 is amended by adding at the contracts, but only if such obligations do not issuance of the contract’’ in paragraph end the following new subsection: involve (at the time with respect to which (3)(B)(ii) and inserting ‘‘applicable to the ‘‘(g) PREVAILING STATE ASSUMED INTEREST the computation is made under this para- contract and in effect as of the date the re- RATE.—For purposes of this subchapter— graph) life, accident, or health contin- serve is determined’’. ‘‘(1) IN GENERAL.—The term ‘prevailing gencies. (3) Section 807(e) is amended— State assumed interest rate’ means, with re- ‘‘(4) Dividend accumulations, and other (A) by striking paragraphs (2) and (5), spect to any contract, the highest assumed amounts, held at interest in connection with (B) by redesignating paragraphs (3), (4), (6), interest rate permitted to be used in com- insurance and annuity contracts. and (7) as paragraphs (2), (3), (4), and (5), re- puting life insurance reserves for insurance ‘‘(5) Premiums received in advance, and li- spectively, contracts or annuity contracts (as the case abilities for premium deposit funds. (C) by amending paragraph (2) (as so redes- may be) under the insurance laws of at least ‘‘(6) Reasonable special contingency re- ignated) to read as follows: 26 States. For purposes of the preceding sen- serves under contracts of group term life in- ‘‘(2) QUALIFIED SUPPLEMENTAL BENEFITS.— tence, the effect of nonforfeiture laws of a

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State on interest rates for reserves shall not (c) EFFECTIVE DATE.—The amendments ‘‘(C) the policy number of such contract. be taken into account. made by this section shall apply to taxable ‘‘(2) STATEMENT TO BE FURNISHED TO PER- ‘‘(2) WHEN RATE DETERMINED.—The pre- years beginning after December 31, 2017. SONS WITH RESPECT TO WHOM INFORMATION IS vailing State assumed interest rate with re- SEC. 13519. CAPITALIZATION OF CERTAIN POLICY REQUIRED.—Every person required to make a spect to any contract shall be determined as ACQUISITION EXPENSES. return under this subsection shall furnish to of the beginning of the calendar year in (a) IN GENERAL.— each person whose name is required to be set which the contract was issued.’’. (1) Section 848(a)(2) is amended by striking forth in such return a written statement (2) Paragraph (1) of section 811(d) is amend- ‘‘120-month’’ and inserting ‘‘180-month’’. showing— ed by striking ‘‘the greater of the prevailing (2) Section 848(c)(1) is amended by striking ‘‘(A) the name, address, and phone number State assumed interest rate or applicable ‘‘1.75 percent’’ and inserting ‘‘2.1 percent’’. of the information contact of the person re- Federal interest rate in effect under section (3) Section 848(c)(2) is amended by striking quired to make such return, and 807’’ and inserting ‘‘the interest rate in effect ‘‘2.05 percent’’ and inserting ‘‘2.46 percent’’. ‘‘(B) the information required to be shown under section 808(g)’’. (4) Section 848(c)(3) is amended by striking on such return with respect to each seller (3) Subparagraph (A) of section 846(f)(6) is ‘‘7.7 percent’’ and inserting ‘‘9.24 percent’’. whose name is required to be set forth in amended by striking ‘‘except that’’ and all (b) CONFORMING AMENDMENTS.—Section such return. that follows and inserting ‘‘except that the 848(b)(1) is amended by striking ‘‘120-month’’ ‘‘(c) REQUIREMENT OF REPORTING WITH RE- limitation of subsection (a)(3) shall apply, and inserting ‘‘180-month’’. SPECT TO REPORTABLE DEATH BENEFITS.— and’’. (c) EFFECTIVE DATE.— ‘‘(1) IN GENERAL.—Every person who makes (4) Subparagraph (B) of section 954(i)(5) is (1) IN GENERAL.—The amendments made by a payment of reportable death benefits dur- amended by striking ‘‘shall apply, and’’. this section shall apply to net premiums for ing any taxable year shall make a return for (c) EFFECTIVE DATE.— taxable years beginning after December 31, such taxable year (at such time and in such (1) IN GENERAL.—The amendments made by 2017. manner as the Secretary shall prescribe) set- this section shall apply to taxable years be- (2) TRANSITION RULE.—Specified policy ac- ting forth— ginning after December 31, 2017. quisition expenses first required to be cap- ‘‘(A) the name, address, and TIN of the per- (2) TRANSITION RULE.—For the first taxable italized in a taxable year beginning before son making such payment, year beginning after December 31, 2017, the January 1, 2018, will continue to be allowed ‘‘(B) the name, address, and TIN of each re- reserve with respect to any contract (as de- as a deduction ratably over the 120-month cipient of such payment, termined under section 807(d)(2) of the Inter- period beginning with the first month in the ‘‘(C) the date of each such payment, nal Revenue Code of 1986) at the end of the second half of such taxable year. ‘‘(D) the gross amount of each such pay- preceding taxable year shall be determined SEC. 13520. TAX REPORTING FOR LIFE SETTLE- ment, and as if the amendments made by this section MENT TRANSACTIONS. ‘‘(E) such person’s estimate of the invest- had applied to such reserve in such preceding (a) IN GENERAL.—Subpart B of part III of ment in the contract (as defined in section taxable year. subchapter A of chapter 61, as amended by 72(e)(6)) with respect to the buyer. (3) TRANSITION RELIEF.— section 13306, is amended by adding at the ‘‘(2) STATEMENT TO BE FURNISHED TO PER- (A) IN GENERAL.—If— end the following new section: SONS WITH RESPECT TO WHOM INFORMATION IS (i) the reserve determined under section ‘‘SEC. 6050Y. RETURNS RELATING TO CERTAIN REQUIRED.—Every person required to make a 807(d)(2) of the Internal Revenue Code of 1986 LIFE INSURANCE CONTRACT TRANS- return under this subsection shall furnish to (determined without regard to the amend- ACTIONS. each person whose name is required to be set ‘‘(a) REQUIREMENT OF REPORTING OF CER- ments made by this section) with respect to forth in such return a written statement TAIN PAYMENTS.— any contract as of the close of the year pre- showing— ‘‘(1) IN GENERAL.—Every person who ac- ceding the first taxable year beginning after ‘‘(A) the name, address, and phone number quires a life insurance contract or any inter- December 31, 2017, differs from of the information contact of the person re- est in a life insurance contract in a report- (ii) the reserve which would have been de- quired to make such return, and able policy sale during any taxable year termined with respect to such contract as of ‘‘(B) the information required to be shown shall make a return for such taxable year (at the close of such taxable year under such on such return with respect to each recipient such time and in such manner as the Sec- section determined without regard to para- of payment whose name is required to be set retary shall prescribe) setting forth— graph (2), forth in such return. ‘‘(A) the name, address, and TIN of such ‘‘(d) DEFINITIONS.—For purposes of this sec- then the difference between the amount of person, tion: the reserve described in clause (i) and the ‘‘(B) the name, address, and TIN of each re- ‘‘(1) PAYMENT.—The term ‘payment’ amount of the reserve described in clause (ii) cipient of payment in the reportable policy means, with respect to any reportable policy shall be taken into account under the meth- sale, sale, the amount of cash and the fair market od provided in subparagraph (B). ‘‘(C) the date of such sale, value of any consideration transferred in the (B) METHOD.—The method provided in this ‘‘(D) the name of the issuer of the life in- sale. subparagraph is as follows: surance contract sold and the policy number ‘‘(2) REPORTABLE POLICY SALE.—The term (i) If the amount determined under sub- of such contract, and ‘reportable policy sale’ has the meaning paragraph (A)(i) exceeds the amount deter- ‘‘(E) the amount of each payment. given such term in section 101(a)(3)(B). mined under subparagraph (A)(ii), 1/8 of such ‘‘(2) STATEMENT TO BE FURNISHED TO PER- ‘‘(3) ISSUER.—The term ‘issuer’ means any excess shall be taken into account, for each SONS WITH RESPECT TO WHOM INFORMATION IS life insurance company that bears the risk of the 8 succeeding taxable years, as a deduc- REQUIRED.—Every person required to make a with respect to a life insurance contract on tion under section 805(a)(2) or 832(c)(4) of return under this subsection shall furnish to the date any return or statement is required such Code, as applicable. each person whose name is required to be set to be made under this section. (ii) If the amount determined under sub- forth in such return a written statement ‘‘(4) REPORTABLE DEATH BENEFITS.—The paragraph (A)(ii) exceeds the amount deter- showing— term ‘reportable death benefits’ means mined under subparagraph (A)(i), 1/8 of such ‘‘(A) the name, address, and phone number amounts paid by reason of the death of the excess shall be included in gross income, for of the information contact of the person re- insured under a life insurance contract that each of the 8 succeeding taxable years, under quired to make such return, and has been transferred in a reportable policy section 803(a)(2) or 832(b)(1)(C) of such Code, ‘‘(B) the information required to be shown sale.’’. as applicable. on such return with respect to such person, (b) CLERICAL AMENDMENT.—The table of SEC. 13518. MODIFICATION OF RULES FOR LIFE except that in the case of an issuer of a life sections for subpart B of part III of sub- INSURANCE PRORATION FOR PUR- insurance contract, such statement is not re- chapter A of chapter 61, as amended by sec- POSES OF DETERMINING THE DIVI- quired to include the information specified tion 13306, is amended by inserting after the DENDS RECEIVED DEDUCTION. in paragraph (1)(E). item relating to section 6050X the following (a) IN GENERAL.—Section 812 is amended to ‘‘(b) REQUIREMENT OF REPORTING OF SELL- new item: read as follows: ER’S BASIS IN LIFE INSURANCE CONTRACTS.— ‘‘Sec. 6050Y. Returns relating to certain life ‘‘SEC. 812. DEFINITION OF COMPANY’S SHARE ‘‘(1) IN GENERAL.—Upon receipt of the AND POLICYHOLDER’S SHARE. insurance contract trans- statement required under subsection (a)(2) or ‘‘(a) COMPANY’S SHARE.—For purposes of actions.’’. section 805(a)(4), the term ‘company’s share’ upon notice of a transfer of a life insurance (c) CONFORMING AMENDMENTS.— means, with respect to any taxable year be- contract to a foreign person, each issuer of a (1) Subsection (d) of section 6724 is amend- ginning after December 31, 2017, 70 percent. life insurance contract shall make a return ed— ‘‘(b) POLICYHOLDER’S SHARE.—For purposes (at such time and in such manner as the Sec- (A) by striking ‘‘or’’ at the end of clause of section 807, the term ‘policyholder’s share’ retary shall prescribe) setting forth— (xxiv) of paragraph (1)(B), by striking ‘‘and’’ means, with respect to any taxable year be- ‘‘(A) the name, address, and TIN of the at the end of clause (xxv) of such paragraph ginning after December 31, 2017, 30 percent.’’. seller who transfers any interest in such con- and inserting ‘‘or’’, and by inserting after (b) CONFORMING AMENDMENT.—Section tract in such sale, such clause (xxv) the following new clause: 817A(e)(2) is amended by striking ‘‘, ‘‘(B) the investment in the contract (as de- ‘‘(xxvi) section 6050Y (relating to returns 807(d)(2)(B), and 812’’ and inserting ‘‘and fined in section 72(e)(6)) with respect to such relating to certain life insurance contract 807(d)(2)(B)’’. seller, and transactions), and’’, and

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00129 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.053 S01DEPT1 S7782 CONGRESSIONAL RECORD — SENATE December 1, 2017 (B) by striking ‘‘or’’ at the end of subpara- Subpart C—Banks and Financial Instruments refunding bonds issued after December 31, graph (HH) of paragraph (2), by striking the SEC. 13531. LIMITATION ON DEDUCTION FOR 2017. period at the end of subparagraph (II) of such FDIC PREMIUMS. SEC. 13533. COST BASIS OF SPECIFIED SECURI- paragraph and inserting ‘‘, or’’, and by in- (a) IN GENERAL.—Section 162, as amended TIES DETERMINED WITHOUT RE- serting after such subparagraph (II) the fol- by sections 13307 and 13308, is amended by re- GARD TO IDENTIFICATION. lowing new subparagraph: designating subsection (s) as subsection (t) (a) IN GENERAL.—Section 1012 is amended ‘‘(JJ) subsection (a)(2), (b)(2), or (c)(2) of and by inserting after subsection (r) the fol- by adding at the end the following new sub- section 6050Y (relating to returns relating to lowing new subsection: section: certain life insurance contract trans- ‘‘(s) DISALLOWANCE OF FDIC PREMIUMS ‘‘(e) COST BASIS OF SPECIFIED SECURITIES actions).’’. PAID BY CERTAIN LARGE FINANCIAL INSTITU- DETERMINED WITHOUT REGARD TO IDENTIFICA- (2) Section 6047 is amended— TIONS.— TION.— (A) by redesignating subsection (g) as sub- ‘‘(1) IN GENERAL.—No deduction shall be al- ‘‘(1) IN GENERAL.—Unless the Secretary section (h), lowed for the applicable percentage of any permits the use of an average basis method (B) by inserting after subsection (f) the fol- FDIC premium paid or incurred by the tax- for determining cost, in the case of the sale, lowing new subsection: payer. exchange, or other disposition of a specified ‘‘(g) INFORMATION RELATING TO LIFE INSUR- ‘‘(2) EXCEPTION FOR SMALL INSTITUTIONS.— security (within the meaning of section ANCE CONTRACT TRANSACTIONS.—This section Paragraph (1) shall not apply to any tax- 6045(g)(3)(B)), the basis (and holding period) shall not apply to any information which is payer for any taxable year if the total con- of such security shall be determined on a required to be reported under section solidated assets of such taxpayer (deter- first-in first-out basis. 6050Y.’’, and mined as of the close of such taxable year) do ‘‘(2) EXCEPTION.—In the case of a sale, ex- (C) by adding at the end of subsection (h), not exceed $10,000,000,000. change, or other disposition of a specified se- as so redesignated, the following new para- ‘‘(3) APPLICABLE PERCENTAGE.—For pur- curity by a regulated investment company graph: poses of this subsection, the term ‘applicable (as defined in section 851(a)), paragraph (1) ‘‘(4) For provisions requiring reporting of percentage’ means, with respect to any tax- shall not apply.’’. information relating to certain life insur- payer for any taxable year, the ratio (ex- (b) CONFORMING AMENDMENTS.— ance contract transactions, see section pressed as a percentage but not greater than (1) Section 1012(c)(1) is amended by strik- 6050Y.’’. 100 percent) which— ing ‘‘the conventions prescribed by regula- (d) EFFECTIVE DATE.—The amendments ‘‘(A) the excess of— tions under this section’’ and inserting ‘‘the made by this section shall apply to— ‘‘(i) the total consolidated assets of such method applicable for determining the cost (1) reportable policy sales (as defined in taxpayer (determined as of the close of such of such security’’. section 6050Y(d)(2) of the Internal Revenue taxable year), over (2) Section 1012(c)(2)(A) is amended by in- Code of 1986 (as added by subsection (a)) after ‘‘(ii) $10,000,000,000, bears to serting ‘‘(as in effect prior to the enactment December 31, 2017, and ‘‘(B) $40,000,000,000. of the Tax Cuts and Jobs Act)’’ after ‘‘this (2) reportable death benefits (as defined in ‘‘(4) FDIC PREMIUMS.—For purposes of this section’’. section 6050Y(d)(4) of such Code (as added by subsection, the term ‘FDIC premium’ means (3) Section 6045(g)(2)(B)(i)(I) is amended by subsection (a)) paid after December 31, 2017. any assessment imposed under section 7(b) of striking ‘‘unless the customer notifies the SEC. 13521. CLARIFICATION OF TAX BASIS OF the Federal Deposit Insurance Act (12 U.S.C. broker by means of making an adequate LIFE INSURANCE CONTRACTS. 1817(b)). identification of the stock sold or trans- (a) CLARIFICATION WITH RESPECT TO AD- ‘‘(5) TOTAL CONSOLIDATED ASSETS.—For pur- ferred’’. JUSTMENTS.—Paragraph (1) of section 1016(a) poses of this subsection, the term ‘total con- (c) EFFECTIVE DATE.—The amendments is amended by striking subparagraph (A) and solidated assets’ has the meaning given such made by this section shall apply to sales, ex- all that follows and inserting the following: term under section 165 of the Dodd-Frank changes, and other dispositions after Decem- ‘‘(A) for— Wall Street Reform and Consumer Protec- ber 31, 2017. ‘‘(i) taxes or other carrying charges de- tion Act (12 U.S.C. 5365). Subpart D—S Corporations scribed in section 266; or ‘‘(6) AGGREGATION RULE.— SEC. 13541. EXPANSION OF QUALIFYING BENE- ‘‘(ii) expenditures described in section 173 ‘‘(A) IN GENERAL.—Members of an expanded FICIARIES OF AN ELECTING SMALL (relating to circulation expenditures), affiliated group shall be treated as a single BUSINESS TRUST. for which deductions have been taken by the taxpayer for purposes of applying this sub- (a) NO LOOK-THROUGH FOR ELIGIBILITY PUR- taxpayer in determining taxable income for section. POSES.—Section 1361(c)(2)(B)(v) is amended the taxable year or prior taxable years; or ‘‘(B) EXPANDED AFFILIATED GROUP.— by adding at the end the following new sen- ‘‘(B) for mortality, expense, or other rea- ‘‘(i) IN GENERAL.—For purposes of this tence: ‘‘This clause shall not apply for pur- sonable charges incurred under an annuity paragraph, the term ‘expanded affiliated poses of subsection (b)(1)(C).’’. or life insurance contract;’’. group’ means an affiliated group as defined (b) EFFECTIVE DATE.—The amendment (b) EFFECTIVE DATE.—The amendment in section 1504(a), determined— made by this section shall take effect on made by this section shall apply to trans- ‘‘(I) by substituting ‘more than 50 percent’ January 1, 2018. actions entered into after August 25, 2009. for ‘at least 80 percent’ each place it appears, SEC. 13542. CHARITABLE CONTRIBUTION DEDUC- SEC. 13522. EXCEPTION TO TRANSFER FOR VALU- and TION FOR ELECTING SMALL BUSI- ABLE CONSIDERATION RULES. ‘‘(II) without regard to paragraphs (2) and NESS TRUSTS. (a) IN GENERAL.—Section 641(c)(2) is (a) IN GENERAL.—Subsection (a) of section (3) of section 1504(b). amended by inserting after subparagraph (D) 101 is amended by inserting after paragraph ‘‘(ii) CONTROL OF NON-CORPORATE ENTI- the following new subparagraph: (2) the following new paragraph: TIES.—A partnership or any other entity ‘‘(E)(i) Section 642(c) shall not apply. ‘‘(3) EXCEPTION TO VALUABLE CONSIDERATION (other than a corporation) shall be treated as ‘‘(ii) For purposes of section 170(b)(1)(G), RULES FOR COMMERCIAL TRANSFERS.— a member of an expanded affiliated group if adjusted gross income shall be computed in ‘‘(A) IN GENERAL.—The second sentence of such entity is controlled (within the mean- the same manner as in the case of an indi- paragraph (2) shall not apply in the case of a ing of section 954(d)(3)) by members of such vidual, except that the deductions for costs transfer of a life insurance contract, or any group (including any entity treated as a which are paid or incurred in connection interest therein, which is a reportable policy member of such group by reason of this with the administration of the trust and sale. clause).’’. ‘‘(B) REPORTABLE POLICY SALE.—For pur- (b) EFFECTIVE DATE.—The amendments which would not have been incurred if the poses of this paragraph, the term ‘reportable made by this section shall apply to taxable property were not held in such trust shall be policy sale’ means the acquisition of an in- years beginning after December 31, 2017. treated as allowable in arriving at adjusted terest in a life insurance contract, directly SEC. 13532. REPEAL OF ADVANCE REFUNDING gross income.’’. or indirectly, if the acquirer has no substan- BONDS. (b) EFFECTIVE DATE.—The amendment tial family, business, or financial relation- (a) IN GENERAL.—Paragraph (1) of section made by this section shall apply to taxable ship with the insured apart from the 149(d) is amended by striking ‘‘as part of an years beginning after December 31, 2017. acquirer’s interest in such life insurance con- issue described in paragraph (2), (3), or (4).’’ SEC. 13543. MODIFICATION OF TREATMENT OF S tract. For purposes of the preceding sen- and inserting ‘‘to advance refund another CORPORATION CONVERSIONS TO C tence, the term ‘indirectly’ applies to the ac- bond.’’. CORPORATIONS. quisition of an interest in a partnership, (b) CONFORMING AMENDMENTS.— (a) ADJUSTMENTS ATTRIBUTABLE TO CONVER- trust, or other entity that holds an interest (1) Section 149(d) is amended by striking SION FROM S CORPORATION TO C CORPORA- in the life insurance contract.’’. paragraphs (2), (3), (4), and (6) and by redesig- TION.—Section 481 is amended by adding at (b) CONFORMING AMENDMENT.—Paragraph nating paragraphs (5) and (7) as paragraphs the end the following new sub-section: (1) of section 101(a) is amended by striking (2) and (3). ‘‘(d) ADJUSTMENTS ATTRIBUTABLE TO CON- ‘‘paragraph (2)’’ and inserting ‘‘paragraphs (2) Section 148(f)(4)(C) is amended by strik- VERSION FROM S CORPORATION TO C CORPORA- (2) and (3)’’. ing clause (xiv) and by redesignating clauses TION.—(1) IN GENERAL.—In the case of an eli- (c) EFFECTIVE DATE.—The amendments (xv) to (xvii) as clauses (xiv) to (xvi). gible terminated S corporation, any increase made by this section shall apply to transfers (c) EFFECTIVE DATE.—The amendments in tax under this chapter by reason of an ad- after December 31, 2017. made by this section shall apply to advance justment required

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by subsection (a)(2), and which is attrib- (c) EXPANSION OF APPLICABLE EMPLOYER.— ‘‘(2) COVERED EMPLOYEE.—For purposes of utable to such corporation’s revocation de- (1) IN GENERAL.—Section 162(m)(2) is this section, the term ‘covered employee’ scribed in paragraph (2)(A)(ii), shall be taken amended to read as follows: means any employee (including any former into account ratably during the 6-taxable ‘‘(2) PUBLICLY HELD CORPORATION.—For pur- employee) of an applicable tax-exempt orga- year period beginning with the year of poses of this subsection, the term ‘publicly nization if the employee— change.’’ held corporation’ means any corporation ‘‘(A) is one of the 5 highest compensated (b) IN GENERAL.—Section 1371 is amended which is an issuer (as defined in section 3 of employees of the organization for the tax- by adding at the end the following new sub- the Securities Exchange Act of 1934 (15 able year, or section: U.S.C. 78c))— ‘‘(B) was a covered employee of the organi- ‘‘(f) CASH DISTRIBUTIONS FOLLOWING POST- ‘‘(A) the securities of which are required to zation (or any predecessor) for any preceding TERMINATION TRANSITION PERIOD.— be registered under section 12 of such Act (15 taxable year beginning after December 31, ‘‘(1) IN GENERAL.—In the case of a distribu- U.S.C. 78l), or 2016. tion of money by an eligible terminated S ‘‘(B) that is required to file reports under ‘‘(3) REMUNERATION.—For purposes of this corporation after the post-termination tran- section 15(d) of such Act (15 U.S.C. 78o(d)).’’. section, the term ‘remuneration’ means sition period, the accumulated adjustments (2) CONFORMING AMENDMENT.—Section wages (as defined in section 3401(a)), except account shall be allocated to such distribu- 162(m)(3), as amended by subsection (b), is that such term shall not include any des- tion, and the distribution shall be chargeable amended by adding at the end the following ignated Roth contribution (as defined in sec- to accumulated earnings and profits, in the flush sentence: tion 402A(c)) and shall include amounts re- same ratio as the amount of such accumu- quired to be included in gross income under lated adjustments account bears to the ‘‘Such term shall include any employee who section 457(f). amount of such accumulated earnings and would be described in subparagraph (B) if the ‘‘(4) REMUNERATION FROM RELATED ORGANI- profits. reporting described in such subparagraph ZATIONS.— ‘‘(2) ELIGIBLE TERMINATED S CORPORATION.— were required as so described.’’. ‘‘(A) IN GENERAL.—Remuneration of a cov- For purposes of this subsection, the term ‘el- (d) SPECIAL RULE FOR REMUNERATION PAID igible terminated S corporation’ means any TO BENEFICIARIES, ETC.—Paragraph (4) of sec- ered employee by an applicable tax-exempt C corporation— tion 162(m), as amended by subsection (a), is organization shall include any remuneration ‘‘(A) which— amended by adding at the end the following paid with respect to employment of such em- ‘‘(i) was an S corporation on the day before new subparagraph: ployee by any related person or govern- the date of the enactment of the Tax Cuts ‘‘(F) SPECIAL RULE FOR REMUNERATION PAID mental entity. and Jobs Act, and TO BENEFICIARIES, ETC.—Remuneration shall ‘‘(B) RELATED ORGANIZATIONS.—A person or ‘‘(ii) during the 2-year period beginning on not fail to be applicable employee remunera- governmental entity shall be treated as re- the date of such enactment makes a revoca- tion merely because it is includible in the in- lated to an applicable tax-exempt organiza- tion of its election under section 1362(a), and come of, or paid to, a person other than the tion if such person or governmental entity— ‘‘(B) the owners of the stock of which, de- covered employee, including after the death ‘‘(i) controls, or is controlled by, the orga- termined on the date such revocation is of the covered employee.’’. nization, made, are the same owners (and in identical (e) EFFECTIVE DATE.— ‘‘(ii) is controlled by one or more persons proportions) as on the date of such enact- (1) IN GENERAL.—Except as provided in which control the organization, ment.’’. paragraph (2), the amendments made by this ‘‘(iii) is a supported organization (as de- (c) EFFECTIVE DATE.—The amendments section shall apply to taxable years begin- fined in section 509(f)(3)) during the taxable made by this section shall apply to distribu- ning after December 31, 2017. year with respect to the organization, tions after the date of the enactment of this (2) EXCEPTION FOR BINDING CONTRACTS.— ‘‘(iv) is a supporting organization described Act. The amendments made by this section shall in section 509(a)(3) during the taxable year with respect to the organization, or PART VII—EMPLOYMENT not apply to remuneration which is pursuant to a written binding contract which was in ‘‘(v) in the case of an organization which is Subpart A—Compensation effect on November 2, 2017, and which was a voluntary employees’ beneficiary associa- SEC. 13601. MODIFICATION OF LIMITATION ON not modified in any material respect on or tion described in section 501(c)(9), estab- EXCESSIVE EMPLOYEE REMUNERA- lishes, maintains, or makes contributions to TION. after such date. such voluntary employees’ beneficiary asso- (a) REPEAL OF PERFORMANCE-BASED COM- SEC. 13602. EXCISE TAX ON EXCESS TAX-EXEMPT ciation. PENSATION AND COMMISSION EXCEPTIONS FOR ORGANIZATION EXECUTIVE COM- PENSATION. ‘‘(C) LIABILITY FOR TAX.—In any case in LIMITATION ON EXCESSIVE EMPLOYEE REMU- which remuneration from more than one em- NERATION.— (a) IN GENERAL.—Subchapter D of chapter ployer is taken into account under this para- (1) IN GENERAL.—Paragraph (4) of section 42 is amended by adding at the end the fol- 162(m) is amended by striking subparagraphs lowing new section: graph in determining the tax imposed by (B) and (C) and by redesignating subpara- ‘‘SEC. 4960. TAX ON EXCESS TAX-EXEMPT ORGANI- subsection (a), each such employer shall be graphs (D), (E), (F), and (G) as subparagraphs ZATION EXECUTIVE COMPENSATION. liable for such tax in an amount which bears (B), (C), (D), and (E), respectively. ‘‘(a) TAX IMPOSED.—There is hereby im- the same ratio to the total tax determined under subsection (a) with respect to such re- (2) CONFORMING AMENDMENTS.— posed a tax equal to 20 percent of the sum (A) Paragraphs (5)(E) and (6)(D) of section of— muneration as— 162(m) are each amended by striking ‘‘sub- ‘‘(1) so much of the remuneration paid ‘‘(i) the amount of remuneration paid by paragraphs (B), (C), and (D)’’ and inserting (other than any excess parachute payment) such employer with respect to such em- ‘‘subparagraph (B)’’. by an applicable tax-exempt organization for ployee, bears to (B) Paragraphs (5)(G) and (6)(G) of section the taxable year with respect to employment ‘‘(ii) the amount of remuneration paid by 162(m) are each amended by striking ‘‘(F) of any covered employee in excess of all such employers to such employee. and (G)’’ and inserting ‘‘(D) and (E)’’. $1,000,000, plus ‘‘(5) EXCESS PARACHUTE PAYMENT.—For pur- (b) MODIFICATION OF DEFINITION OF COV- ‘‘(2) any excess parachute payment paid by poses of determining the tax imposed by sub- ERED EMPLOYEES.—Paragraph (3) of section such an organization to any covered em- section (a)(2)— 162(m) is amended— ployee. ‘‘(A) IN GENERAL.—The term ‘excess para- (1) in subparagraph (A), by striking ‘‘as of For purposes of the preceding sentence, re- chute payment’ means an amount equal to the close of the taxable year, such employee muneration shall be treated as paid when the excess of any parachute payment over is the chief executive officer of the taxpayer there is no substantial risk of forfeiture of the portion of the base amount allocated to or is’’ and inserting ‘‘such employee is the the rights to such remuneration. such payment. principal executive officer or principal finan- ‘‘(b) LIABILITY FOR TAX.—The employer ‘‘(B) PARACHUTE PAYMENT.—The term cial officer of the taxpayer at any time dur- shall be liable for the tax imposed under sub- ‘parachute payment’ means any payment in ing the taxable year, or was’’, section (a). the nature of compensation to (or for the (2) in subparagraph (B)— ‘‘(c) DEFINITIONS AND SPECIAL RULES.—For benefit of) a covered employee if— (A) by striking ‘‘4’’ and inserting ‘‘3’’, and purposes of this section— ‘‘(i) such payment is contingent on such (B) by striking ‘‘(other than the chief exec- ‘‘(1) APPLICABLE TAX-EXEMPT ORGANIZA- employee’s separation from employment utive officer)’’ and inserting ‘‘(other than TION.—The term ‘applicable tax-exempt orga- with the employer, and any individual described in subparagraph nization’ means any organization which for ‘‘(ii) the aggregate present value of the (A))’’, and the taxable year— payments in the nature of compensation to (3) by striking ‘‘or’’ at the end of subpara- ‘‘(A) is exempt from taxation under section (or for the benefit of) such individual which graph (A), by striking the period at the end 501(a), are contingent on such separation equals or of subparagraph (B) and inserting ‘‘, or’’, and ‘‘(B) is a farmers’ cooperative organization exceeds an amount equal to 3 times the base by adding at the end the following: described in section 521(b)(1), amount. ‘‘(C) was a covered employee of the tax- ‘‘(C) has income excluded from taxation Such term does not include any payment de- payer (or any predecessor) for any preceding under section 115(1), or scribed in section 280G(b)(6) (relating to ex- taxable year beginning after December 31, ‘‘(D) is a political organization described in emption for payments under qualified plans) 2016.’’. section 527(e)(1). or any payment made under or to an annuity

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00131 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.053 S01DEPT1 S7784 CONGRESSIONAL RECORD — SENATE December 1, 2017 contract described in section 403(b) or a plan ‘‘(II) in settlement of a restricted stock ‘‘(iii) who bears a relationship described in described in section 457(b). unit, and section 318(a)(1) to any individual described ‘‘(C) BASE AMOUNT.—Rules similar to the ‘‘(ii) such option or restricted stock unit in subclause (I) or (II) of clause (ii), or rules of 280G(b)(3) shall apply for purposes of was granted by the corporation— ‘‘(iv) who was for any of the 10 preceding determining the base amount. ‘‘(I) in connection with the performance of taxable years one of the 4 highest com- ‘‘(D) PROPERTY TRANSFERS; PRESENT services as an employee, and pensated officers of such corporation, deter- VALUE.—Rules similar to the rules of para- ‘‘(II) during a calendar year in which such mined with respect to each such taxable year graphs (3) and (4) of section 280G(d) shall corporation was an eligible corporation. on the basis of the shareholder disclosure apply. ‘‘(B) LIMITATION.—The term ‘qualified rules for compensation under the Securities ‘‘(6) COORDINATION WITH DEDUCTION LIMITA- stock’ shall not include any stock if the em- Exchange Act of 1934 (as if such rules applied TION.—Remuneration the deduction for ployee may sell such stock to, or otherwise to such corporation). which is not allowed by reason of section receive cash in lieu of stock from, the cor- ‘‘(4) ELECTION.— 162(m) shall not be taken into account for poration at the time that the rights of the ‘‘(A) TIME FOR MAKING ELECTION.—An elec- purposes of this section. employee in such stock first become trans- tion with respect to qualified stock shall be ‘‘(d) REGULATIONS.—The Secretary shall ferable or not subject to a substantial risk of made under this subsection no later than 30 prescribe such regulations as may be nec- forfeiture. days after the first date the rights of the em- ployee in such stock are transferable or are essary to prevent avoidance of the tax under ‘‘(C) ELIGIBLE CORPORATION.—For purposes this section, including regulations pre- of subparagraph (A)(ii)(II)— not subject to a substantial risk of for- feiture, whichever occurs earlier, and shall venting employees from being misclassified ‘‘(i) IN GENERAL.—The term ‘eligible cor- be made in a manner similar to the manner as contractors or from being compensated poration’ means, with respect to any cal- in which an election is made under sub- through a pass-through or other entity to endar year, any corporation if— section (b). avoid such tax.’’. ‘‘(I) no stock of such corporation (or any ‘‘(B) LIMITATIONS.—No election may be (b) CLERICAL AMENDMENT.—The table of predecessor of such corporation) is readily made under this section with respect to any sections for subchapter D of chapter 42 is tradable on an established securities market qualified stock if— amended by adding at the end the following (as determined under paragraph (1)(B)(iii)) new item: ‘‘(i) the qualified employee has made an during any preceding calendar year, and election under subsection (b) with respect to ‘‘Sec. 4960. Tax on excess tax-exempt organi- ‘‘(II) such corporation has a written plan such qualified stock, zation executive compensa- under which, in such calendar year, not less ‘‘(ii) any stock of the corporation which tion.’’. than 80 percent of all employees who provide issued the qualified stock is readily tradable (c) EFFECTIVE DATE.—The amendments services to such corporation in the United on an established securities market (as de- made by this section shall apply to taxable States (or any possession of the United termined under paragraph (1)(B)(iii)) at any years beginning after December 31, 2017. States) are granted stock options, or re- time before the election is made, or SEC. 13603. TREATMENT OF QUALIFIED EQUITY stricted stock units, with the same rights ‘‘(iii) such corporation purchased any of its GRANTS. and privileges to receive qualified stock. outstanding stock in the calendar year pre- (a) IN GENERAL.—Section 83 is amended by ‘‘(ii) SAME RIGHTS AND PRIVILEGES.—For ceding the calendar year which includes the adding at the end the following new sub- purposes of clause (i)(II)— first date the rights of the employee in such section: ‘‘(I) except as provided in subclauses (II) stock are transferable or are not subject to a ‘‘(i) QUALIFIED EQUITY GRANTS.— and (III), the determination of rights and substantial risk of forfeiture, unless— ‘‘(1) IN GENERAL.—For purposes of this sub- privileges with respect to stock shall be ‘‘(I) not less than 25 percent of the total title— made in a similar manner as under section dollar amount of the stock so purchased is ‘‘(A) TIMING OF INCLUSION.—If qualified 423(b)(5), deferral stock, and stock is transferred to a qualified employee ‘‘(II) employees shall not fail to be treated ‘‘(II) the determination of which individ- who makes an election with respect to such as having the same rights and privileges to uals from whom deferral stock is purchased stock under this subsection, subsection (a) receive qualified stock solely because the is made on a reasonable basis. shall be applied by including the amount de- number of shares available to all employees ‘‘(C) DEFINITIONS AND SPECIAL RULES RE- termined under such subsection with respect is not equal in amount, so long as the num- LATED TO LIMITATION ON STOCK REDEMP- to such stock in income of the employee in ber of shares available to each employee is TIONS.— the taxable year determined under subpara- more than a de minimis amount, and ‘‘(i) DEFERRAL STOCK.—For purposes of this graph (B) in lieu of the taxable year de- ‘‘(III) rights and privileges with respect to paragraph, the term ‘deferral stock’ means scribed in subsection (a). the exercise of an option shall not be treated stock with respect to which an election is in ‘‘(B) TAXABLE YEAR DETERMINED.—The tax- as the same as rights and privileges with re- effect under this subsection. able year determined under this subpara- spect to the settlement of a restricted stock ‘‘(ii) DEFERRAL STOCK WITH RESPECT TO ANY graph is the taxable year of the employee unit. INDIVIDUAL NOT TAKEN INTO ACCOUNT IF INDI- which includes the earliest of— ‘‘(iii) EMPLOYEE.—For purposes of clause VIDUAL HOLDS DEFERRAL STOCK WITH LONGER ‘‘(i) the first date such qualified stock be- (i)(II), the term ‘employee’ shall not include DEFERRAL PERIOD.—Stock purchased by a comes transferable (including, solely for pur- any employee described in section 4980E(d)(4) corporation from any individual shall not be poses of this clause, becoming transferable or any excluded employee. treated as deferral stock for purposes of sub- to the employer), ‘‘(iv) SPECIAL RULE FOR CALENDAR YEARS paragraph (B)(iii) if such individual (imme- ‘‘(ii) the date the employee first becomes BEFORE 2018.—In the case of any calendar year diately after such purchase) holds any defer- an excluded employee, beginning before January 1, 2018, clause ral stock with respect to which an election ‘‘(iii) the first date on which any stock of (i)(II) shall be applied without regard to has been in effect under this subsection for a the corporation which issued the qualified whether the rights and privileges with re- longer period than the election with respect stock becomes readily tradable on an estab- spect to the qualified stock are the same. to the stock so purchased. lished securities market (as determined by ‘‘(3) QUALIFIED EMPLOYEE; EXCLUDED EM- ‘‘(iii) PURCHASE OF ALL OUTSTANDING DE- the Secretary, but not including any market PLOYEE.—For purposes of this subsection— FERRAL STOCK.—The requirements of sub- unless such market is recognized as an estab- ‘‘(A) IN GENERAL.—The term ‘qualified em- clauses (I) and (II) of subparagraph (B)(iii) lished securities market by the Secretary for ployee’ means any individual who— shall be treated as met if the stock so pur- purposes of a provision of this title other ‘‘(i) is not an excluded employee, and chased includes all of the corporation’s out- than this subsection), ‘‘(ii) agrees in the election made under this standing deferral stock. ‘‘(iv) the date that is 5 years after the first subsection to meet such requirements as are ‘‘(iv) REPORTING.—Any corporation which date the rights of the employee in such stock determined by the Secretary to be necessary has outstanding deferral stock as of the be- are transferable or are not subject to a sub- to ensure that the withholding requirements ginning of any calendar year and which pur- stantial risk of forfeiture, whichever occurs of the corporation under chapter 24 with re- chases any of its outstanding stock during earlier, or spect to the qualified stock are met. such calendar year shall include on its re- ‘‘(v) the date on which the employee re- ‘‘(B) EXCLUDED EMPLOYEE.—The term ‘ex- turn of tax for the taxable year in which, or vokes (at such time and in such manner as cluded employee’ means, with respect to any with which, such calendar year ends the the Secretary provides) the election under corporation, any individual— total dollar amount of its outstanding stock this subsection with respect to such stock. ‘‘(i) who was a 1-percent owner (within the so purchased during such calendar year and ‘‘(2) QUALIFIED STOCK.— meaning of section 416(i)(1)(B)(ii)) at any such other information as the Secretary re- ‘‘(A) IN GENERAL.—For purposes of this sub- time during the 10 preceding calendar years, quires for purposes of administering this section, the term ‘qualified stock’ means, ‘‘(ii) who is or has been at any prior time— paragraph. with respect to any qualified employee, any ‘‘(I) the chief executive officer of such cor- ‘‘(5) CONTROLLED GROUPS.—For purposes of stock in a corporation which is the employer poration or an individual acting in such a ca- this subsection, all persons treated as a sin- of such employee, if— pacity, or gle employer under section 414(b) shall be ‘‘(i) such stock is received— ‘‘(II) the chief financial officer of such cor- treated as 1 corporation. ‘‘(I) in connection with the exercise of an poration or an individual acting in such a ca- ‘‘(6) NOTICE REQUIREMENT.—Any corpora- option, or pacity, tion which transfers qualified stock to a

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qualified employee shall, at the time that (or (2) EXCLUSION FROM DEFINITION OF NON- (b) EFFECTIVE DATE.—The amendments a reasonable period before) an amount at- QUALIFIED DEFERRED COMPENSATION PLAN.— made by this section shall apply to taxable tributable to such stock would (but for this Subsection (d) of section 409A is amended by years beginning after December 31, 2017. subsection) first be includible in the gross in- adding at the end the following new para- SEC. 13612. MODIFICATION OF RULES APPLICA- come of such employee— graph: BLE TO LENGTH OF SERVICE AWARD ‘‘(A) certify to such employee that such ‘‘(7) TREATMENT OF QUALIFIED STOCK.—An PLANS. stock is qualified stock, and arrangement under which an employee may (a) MAXIMUM DEFERRAL AMOUNT.—Clause ‘‘(B) notify such employee— receive qualified stock (as defined in section (ii) of section 457(e)(11)(B) is amended by ‘‘(i) that the employee may be eligible to 83(i)(2)) shall not be treated as a nonqualified striking ‘‘$3,000’’ and inserting ‘‘$6,000’’. elect to defer income on such stock under deferred compensation plan solely because of (b) COST OF LIVING ADJUSTMENT.—Subpara- graph (B) of section 457(e)(11) is amended by this subsection, and an employee’s election, or ability to make adding at the end the following: ‘‘(ii) that, if the employee makes such an an election, to defer recognition of income ‘‘(iii) COST OF LIVING ADJUSTMENT.—In the election— under section 83(i).’’. case of taxable years beginning after Decem- ‘‘(I) the amount of income recognized at (d) INFORMATION REPORTING.—Section ber 31, 2017, the Secretary shall adjust the the end of the deferral period will be based 6051(a) is amended by striking ‘‘and’’ at the $6,000 amount under clause (ii) at the same on the value of the stock at the time at end of paragraph (14)(B), by striking the pe- time and in the same manner as under sec- which the rights of the employee in such riod at the end of paragraph (15) and insert- tion 415(d), except that the base period shall stock first become transferable or not sub- ing a comma, and by inserting after para- be the calendar quarter beginning July 1, ject to substantial risk of forfeiture, not- graph (15) the following new paragraphs: 2016, and any increase under this paragraph withstanding whether the value of the stock ‘‘(16) the amount includible in gross in- that is not a multiple of $500 shall be round- has declined during the deferral period, come under subparagraph (A) of section ed to the next lowest multiple of $500.’’. ‘‘(II) the amount of such income recognized 83(i)(1) with respect to an event described in (c) APPLICATION OF LIMITATION ON ACCRU- at the end of the deferral period will be sub- subparagraph (B) of such section which oc- ALS.—Subparagraph (B) of section 457(e)(11), ject to withholding under section 3401(i) at curs in such calendar year, and as amended by subsection (b), is amended by the rate determined under section 3402(t), ‘‘(17) the aggregate amount of income adding at the end the following: and which is being deferred pursuant to elections ‘‘(iv) SPECIAL RULE FOR APPLICATION OF LIM- ‘‘(III) the responsibilities of the employee under section 83(i), determined as of the ITATION ON ACCRUALS FOR CERTAIN PLANS.—In (as determined by the Secretary under para- close of the calendar year.’’. the case of a plan described in subparagraph graph (3)(A)(ii)) with respect to such with- (e) PENALTY FOR FAILURE OF EMPLOYER TO (A)(ii) which is a defined benefit plan (as de- holding. PROVIDE NOTICE OF TAX CONSEQUENCES.—Sec- fined in section 414(j)), the limitation under ‘‘(7) RESTRICTED STOCK UNITS.—This section tion 6652 is amended by adding at the end the clause (ii) shall apply to the actuarial (other than this subsection), including any following new subsection: present value of the aggregate amount of election under subsection (b), shall not apply ‘‘(p) FAILURE TO PROVIDE NOTICE UNDER length of service awards accruing with re- to restricted stock units.’’. SECTION 83(i).—In the case of each failure to spect to any year of service. Such actuarial (b) WITHHOLDING.— provide a notice as required by section present value with respect to any year shall (1) TIME OF WITHHOLDING.—Section 3401 is 83(i)(6), at the time prescribed therefor, un- be calculated using reasonable actuarial as- amended by adding at the end the following less it is shown that such failure is due to sumptions and methods, assuming payment new subsection: reasonable cause and not to willful neglect, will be made under the most valuable form of ‘‘(i) QUALIFIED STOCK FOR WHICH AN ELEC- there shall be paid, on notice and demand of payment under the plan with payment com- TION ISINEFFECT UNDER SECTION 83(i).—For the Secretary and in the same manner as mencing at the later of the earliest age at purposes of subsection (a), qualified stock (as tax, by the person failing to provide such no- which unreduced benefits are payable under defined in section 83(i)) with respect to which tice, an amount equal to $100 for each such the plan or the participant’s age at the time an election is made under section 83(i) shall failure, but the total amount imposed on of the calculation.’’. be treated as wages— such person for all such failures during any (d) EFFECTIVE DATE.—The amendments ‘‘(1) received on the earliest date described calendar year shall not exceed $50,000.’’. made by this section shall apply to taxable in section 83(i)(1)(B), and (f) EFFECTIVE DATES.— years beginning after December 31, 2017. ‘‘(2) in an amount equal to the amount in- (1) IN GENERAL.—Except as provided in SEC. 13613. EXTENDED ROLLOVER PERIOD FOR cluded in income under section 83 for the paragraph (2), the amendments made by this PLAN LOAN OFFSET AMOUNTS. taxable year which includes such date.’’. section shall apply to stock attributable to (a) IN GENERAL.—Paragraph (3) of section (2) AMOUNT OF WITHHOLDING.—Section 3402 options exercised, or restricted stock units 402(c) is amended by redesignating subpara- is amended by adding at the end the fol- settled, after December 31, 2017. graph (B) as subparagraph (C) and by insert- lowing new subsection: (2) REQUIREMENT TO PROVIDE NOTICE.—The ing after subparagraph (A) the following new ‘‘(t) RATE OF WITHHOLDING FOR CERTAIN amendments made by subsection (e) shall subparagraph: ‘‘(B) ROLLOVER OF CERTAIN PLAN LOAN OFF- STOCK.—In the case of any qualified stock (as apply to failures after December 31, 2017. SET AMOUNTS.— defined in section 83(i)(2)) with respect to (g) TRANSITION RULE.—Until such time as which an election is made under section the Secretary (or the Secretary’s delegate) ‘‘(i) IN GENERAL.—In the case of an eligible rollover distribution of a qualified plan loan 83(i)— issues regulations or other guidance for pur- offset amount, the requirements of subpara- ‘‘(1) the rate of tax under subsection (a) poses of implementing the requirements of graph (A) shall be treated as met if such shall not be less than the maximum rate of paragraph (2)(C)(i)(II) of section 83(i) of the transfer occurs on or before the due date (in- tax in effect under section 1, and Internal Revenue Code of 1986 (as added by cluding extensions) for filing the return of ‘‘(2) such stock shall be treated for pur- this section), or the requirements of para- tax for the taxable year in which such poses of section 3501(b) in the same manner graph (6) of such section, a corporation shall amount is treated as distributed from a as a non-cash fringe benefit.’’. be treated as being in compliance with such qualified employer plan. (c) COORDINATION WITH OTHER DEFERRED requirements (respectively) if such corpora- ‘‘(ii) QUALIFIED PLAN LOAN OFFSET COMPENSATION RULES.— tion complies with a reasonable good faith AMOUNT.—For purposes of this subparagraph, (1) ELECTION TO APPLY DEFERRAL TO STATU- interpretation of such requirements. the term ‘qualified plan loan offset amount’ TORY OPTIONS.— SEC. 13604. INCREASE IN EXCISE TAX RATE FOR means a plan loan offset amount which is (A) INCENTIVE STOCK OPTIONS.—Section STOCK COMPENSATION OF INSID- treated as distributed from a qualified em- 422(b) is amended by adding at the end the ERS IN EXPATRIATED CORPORA- ployer plan to a participant or beneficiary following: ‘‘Such term shall not include any TIONS. solely by reason of— (a) IN GENERAL.—Section 4985(a)(1) is option if an election is made under section ‘‘(I) the termination of the qualified em- amended by striking ‘‘section 1(h)(1)(C)’’ and 83(i) with respect to the stock received in ployer plan, or inserting ‘‘section 1(h)(1)(D)’’. connection with the exercise of such op- ‘‘(II) the failure to meet the repayment tion.’’. (b) EFFECTIVE DATE.—The amendment terms of the loan from such plan because of (B) EMPLOYEE STOCK PURCHASE PLANS.— made by this section shall apply to corpora- the severance from employment of the par- Section 423 is amended— tions first becoming expatriated corpora- ticipant. tions (as defined in section 4985 of the Inter- (i) by adding at the end of subsection (a) ‘‘(iii) PLAN LOAN OFFSET AMOUNT.—For pur- the following flush sentence: nal Revenue Code of 1986) after the date of poses of clause (ii), the term ‘plan loan offset ‘‘The preceding sentence shall not apply to enactment of this Act. amount’ means the amount by which the any share of stock with respect to which an Subpart B—Retirement Plans participant’s accrued benefit under the plan election is made under section 83(i).’’, and SEC. 13611. REPEAL OF SPECIAL RULE PERMIT- is reduced in order to repay a loan from the (ii) in subsection (b)(5), by striking ‘‘and’’ TING RECHARACTERIZATION OF plan. before ‘‘the plan’’ and by inserting ‘‘, and the ROTH IRA CONTRIBUTIONS AS TRA- ‘‘(iv) LIMITATION.—This subparagraph shall rules of section 83(i) shall apply in deter- DITIONAL IRA CONTRIBUTIONS. not apply to any plan loan offset amount un- mining which employees have a right to (a) IN GENERAL.—Section 408A(d) is amend- less such plan loan offset amount relates to make an election under such section’’ before ed by striking paragraph (6) and by redesig- a loan to which section 72(p)(1) does not the semicolon at the end. nating paragraph (7) as paragraph (6). apply by reason of section 72(p)(2).

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‘‘(v) QUALIFIED EMPLOYER PLAN.—For pur- zation’ means, with respect to an edu- designating subparagraph (E) as subpara- poses of this subsection, the term ‘qualified cational institution, any organization graph (D). employer plan’ has the meaning given such which— (b) EFFECTIVE DATE.—The amendments term by section 72(p)(4).’’. ‘‘(A) controls, or is controlled by, such in- made by this section shall apply to contribu- (b) CONFORMING AMENDMENT.—Subpara- stitution, tions made in taxable years beginning after graph (A) of section 402(c)(3) is amended by ‘‘(B) is controlled by 1 or more persons December 31, 2016. striking ‘‘subparagraph (B)’’ and inserting which also control such institution, or PART IX—OTHER PROVISIONS ‘‘(C) is a supported organization (as defined ‘‘subparagraphs (B) and (C)’’. Subpart A—Craft Beverage Modernization (c) EFFECTIVE DATE.—The amendments in section 509(f)(3)), or an organization de- and Tax Reform made by this section shall apply to plan loan scribed in section 509(a)(3), during the tax- offset amounts which are treated as distrib- able year with respect to such institution.’’. SEC. 13801. PRODUCTION PERIOD FOR BEER, WINE, AND DISTILLED SPIRITS. uted in taxable years beginning after Decem- (b) CLERICAL AMENDMENT.—The table of ber 31, 2017. subchapters for chapter 42 is amended by (a) IN GENERAL.—Section 263A(f) is amend- adding at the end the following new item: ed— PART VIII—EXEMPT ORGANIZATIONS (1) by redesignating paragraph (4) as para- ‘‘SUBCHAPTER H—EXCISE TAX BASED ON IN- SEC. 13701. EXCISE TAX BASED ON INVESTMENT graph (5), and VESTMENT INCOME OF PRIVATE COLLEGES AND INCOME OF PRIVATE COLLEGES (2) by inserting after paragraph (3) the fol- UNIVERSITIES’’. AND UNIVERSITIES. lowing new paragraph: (c) EFFECTIVE DATE.—The amendments (a) IN GENERAL.—Chapter 42 is amended by ‘‘(4) EXEMPTION FOR AGING PROCESS OF made by this section shall apply to taxable adding at the end the following new sub- BEER, WINE, AND DISTILLED SPIRITS.— years beginning after December 31, 2017. chapter: ‘‘(A) IN GENERAL.—For purposes of this sub- ‘‘Subchapter H—Excise Tax Based on Invest- SEC. 13702. UNRELATED BUSINESS TAXABLE IN- section, the production period shall not in- COME SEPARATELY COMPUTED FOR ment Income of Private Colleges and Uni- EACH TRADE OR BUSINESS ACTIV- clude the aging period for— versities ITY. ‘‘(i) beer (as defined in section 5052(a)), ‘‘Sec. 4968. Excise tax based on investment (a) IN GENERAL.—Subsection (a) of section ‘‘(ii) wine (as described in section 5041(a)), income of private colleges and 512 is amended by adding at the end the fol- or universities. lowing new paragraph: ‘‘(iii) distilled spirits (as defined in section ‘‘SEC. 4968. EXCISE TAX BASED ON INVESTMENT ‘‘(6) SPECIAL RULE FOR ORGANIZATION WITH 5002(a)(8)), except such spirits that are unfit INCOME OF PRIVATE COLLEGES MORE THAN 1 UNRELATED TRADE OR BUSI- for use for beverage purposes. AND UNIVERSITIES. NESS.—In the case of any organization with ‘‘(B) TERMINATION.—This paragraph shall ‘‘(a) TAX IMPOSED.—There is hereby im- more than 1 unrelated trade or business— not apply to interest costs paid or accrued posed on each applicable educational institu- ‘‘(A) unrelated business taxable income, in- after December 31, 2019.’’. tion for the taxable year a tax equal to 1.4 cluding for purposes of determining any net (b) CONFORMING AMENDMENT.—Paragraph percent of the net investment income of such operating loss deduction, shall be computed (5)(B)(ii) of section 263A(f), as redesignated institution for the taxable year. separately with respect to each such trade or by this section, is amended by inserting ‘‘ex- ‘‘(b) APPLICABLE EDUCATIONAL INSTITU- business and without regard to subsection cept as provided in paragraph (4),’’ before TION.—For purposes of this subchapter— (b)(12), ‘‘ending on the date’’. ‘‘(1) IN GENERAL.—The term ‘applicable ‘‘(B) the unrelated business taxable income (c) EFFECTIVE DATE.—The amendments educational institution’ means an eligible of such organization shall be the sum of the made by this section shall apply to interest educational institution (as defined in section unrelated business taxable income so com- costs paid or accrued in calendar years be- 25A(f)(2))— puted with respect to each such trade or ginning after December 31, 2017. ‘‘(A) which had at least 500 tuition-paying business, less a specific deduction under sub- SEC. 13802. REDUCED RATE OF EXCISE TAX ON students during the preceding taxable year, section (b)(12), and BEER. ‘‘(B) which participated in and received ‘‘(C) for purposes of subparagraph (B), un- (a) IN GENERAL.—Paragraph (1) of section funds through a program described in section related business taxable income with respect 5051(a) is amended to read as follows: 25A(f)(2)(B) during the preceding taxable to any such trade or business shall not be ‘‘(1) IN GENERAL.— year, less than zero.’’. ‘‘(A) IMPOSITION OF TAX.—A tax is hereby ‘‘(C) which is not described in the first sen- (b) EFFECTIVE DATE.— imposed on all beer brewed or produced, and tence of section 511(a)(2)(B) (relating to (1) IN GENERAL.—Except to the extent pro- removed for consumption or sale, within the State colleges and universities), and vided in paragraph (2), the amendment made United States, or imported into the United ‘‘(D) the aggregate fair market value of the by this section shall apply to taxable years States. Except as provided in paragraph (2), assets of which at the end of the preceding beginning after December 31, 2017. the rate of such tax shall be the amount de- taxable year (other than those assets which (2) CARRYOVERS OF NET OPERATING termined under this paragraph. are used directly in carrying out the institu- LOSSES.—If any net operating loss arising in ‘‘(B) RATE.—Except as provided in subpara- tion’s exempt purpose) is at least $500,000 per a taxable year beginning before January 1, graph (C), the rate of tax shall be $18 for per student of the institution. 2018, is carried over to a taxable year begin- barrel. ‘‘(2) STUDENTS.—For purposes of paragraph ning on or after such date— ‘‘(C) SPECIAL RULE.—In the case of beer re- (1), the number of students of an institution (A) subparagraph (A) of section 512(a)(6) of moved after December 31, 2017, and before shall be based on the daily average number the Internal Revenue Code of 1986, as added January 1, 2020, the rate of tax shall be— of full-time students attending such institu- by this Act, shall not apply to such net oper- ‘‘(i) $16 on the first 6,000,000 barrels of tion (with part-time students taken into ac- ating loss, and beer— count on a full-time student equivalent (B) the unrelated business taxable income ‘‘(I) brewed by the brewer and removed basis). of the organization, after the application of during the calendar year for consumption or ‘‘(c) NET INVESTMENT INCOME.—For pur- subparagraph (B) of such section, shall be re- sale, or poses of this section, net investment income duced by the amount of such net operating ‘‘(II) imported by the importer into the shall be determined under rules similar to loss. United States during the calendar year, and the rules of section 4940(c). SEC. 13703. REPEAL OF DEDUCTION FOR ‘‘(ii) $18 on any barrels of beer to which ‘‘(d) ASSETS AND NET INVESTMENT INCOME AMOUNTS PAID IN EXCHANGE FOR clause (i) does not apply. COLLEGE ATHLETIC EVENT SEAT- OF RELATED ORGANIZATIONS.— ING RIGHTS. ‘‘(D) BARREL.—For purposes of this section, ‘‘(1) IN GENERAL.—For purposes of sub- (a) IN GENERAL.—Section 170(l) is amend- a barrel shall contain not more than 31 gal- sections (b)(1)(C) and (c), assets and net in- ed— lons of beer, and any tax imposed under this vestment income of any related organization (1) by striking paragraph (1) and inserting section shall be applied at a like rate for any with respect to an educational institution the following: other quantity or for fractional parts of a shall be treated as assets and net investment ‘‘(1) IN GENERAL.—No deduction shall be al- barrel.’’. income, respectively, of the educational in- lowed under this section for any amount de- (b) REDUCED RATE FOR CERTAIN DOMESTIC stitution, except that— scribed in paragraph (2).’’, and PRODUCTION.—Subparagraph (A) of section ‘‘(A) no such amount shall be taken into (2) in paragraph (2)(B), by striking ‘‘such 5051(a)(2) is amended— account with respect to more than 1 edu- amount would be allowable as a deduction (1) in the heading, by striking ‘‘$7 A BAR- cational institution, and under this section but for the fact that’’. REL’’, and ‘‘(B) unless such organization is controlled (b) EFFECTIVE DATE.—The amendments (2) by inserting ‘‘($3.50 in the case of beer by such institution or is described in section made by this section shall apply to contribu- removed after December 31, 2017, and before 509(a)(3) with respect to such institution for tions made in taxable years beginning after January 1, 2020)’’ after ‘‘$7’’. the taxable year, assets and net investment December 31, 2017. (c) APPLICATION OF REDUCED TAX RATE FOR income which are not intended or available SEC. 13704. REPEAL OF SUBSTANTIATION EXCEP- FOREIGN MANUFACTURERS AND IMPORTERS.— for the use or benefit of the educational in- TION IN CASE OF CONTRIBUTIONS Subsection (a) of section 5051 is amended— stitution shall not be taken into account. REPORTED BY DONEE. (1) in subparagraph (C)(i)(II) of paragraph ‘‘(2) RELATED ORGANIZATION.—For purposes (a) IN GENERAL.—Section 170(f)(8) is amend- (1), as amended by subsection (a), by insert- of this subsection, the term ‘related organi- ed by striking subparagraph (D) and by re- ing ‘‘but only if the importer is an electing

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00134 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.053 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7787 importer under paragraph (4) and the barrels section. Under regulations prescribed by the SEC. 13804. REDUCED RATE OF EXCISE TAX ON have been assigned to the importer pursuant Secretary, principles similar to the prin- CERTAIN WINE. to such paragraph’’ after ‘‘during the cal- ciples of the preceding two sentences shall be (a) IN GENERAL.—Section 5041(c) is amend- endar year’’, and applied to a group of brewers under common ed by adding at the end the following new (2) by adding at the end the following new control where one or more of the brewers is paragraph: paragraph: not a corporation. ‘‘(8) SPECIAL RULE FOR 2018 AND 2019.— ‘‘(4) REDUCED TAX RATE FOR FOREIGN MANU- ‘‘(B) FOREIGN MANUFACTURERS AND IMPORT- ‘‘(A) IN GENERAL.—In the case of wine re- FACTURERS AND IMPORTERS.— ERS.—For purposes of paragraph (4), in the moved after December 31, 2017, and before ‘‘(A) IN GENERAL.—In the case of any bar- case of a controlled group, the 6,000,000 bar- January 1, 2020, paragraphs (1) and (2) shall rels of beer which have been brewed or pro- rel quantity specified in paragraph (1)(C)(i) not apply and there shall be allowed as a duced outside of the United States and im- shall be applied to the controlled group and credit against any tax imposed by this title ported into the United States, the rate of tax apportioned among the members of such (other than chapters 2, 21, and 22) an amount applicable under clause (i) of paragraph group in such manner as the Secretary shall equal to the sum of— (1)(C) (referred to in this paragraph as the by regulations prescribe. For purposes of the ‘‘(i) $1 per wine gallon on the first 30,000 ‘reduced tax rate’) may be assigned by the preceding sentence, the term ‘controlled wine gallons of wine, plus brewer (provided that the brewer makes an group’ has the meaning given such term ‘‘(ii) 90 cents per wine gallon on the first election described in subparagraph (B)(ii)) to under subparagraph (A). Under regulations 100,000 wine gallons of wine to which clause any electing importer of such barrels pursu- prescribed by the Secretary, principles simi- (i) does not apply, plus ant to the requirements established by the lar to the principles of the preceding two ‘‘(iii) 53.5 cents per wine gallon on the first Secretary under subparagraph (B). sentences shall be applied to a group of brew- 620,000 wine gallons of wine to which clauses ‘‘(B) ASSIGNMENT.—The Secretary shall, ers under common control where one or more (i) and (ii) do not apply, through such rules, regulations, and proce- of the brewers is not a corporation. which are produced by the producer and re- dures as are determined appropriate, estab- ‘‘(C) SINGLE TAXPAYER.—Pursuant to rules moved during the calendar year for consump- lish procedures for assignment of the reduced issued by the Secretary, two or more entities tion or sale, or which are imported by the tax rate provided under this paragraph, (whether or not under common control) that importer into the United States during the which shall include— produce beer marketed under a similar calendar year. ‘‘(i) a limitation to ensure that the number brand, license, franchise, or other arrange- ‘‘(B) ADJUSTMENT OF CREDIT FOR HARD of barrels of beer for which the reduced tax ment shall be treated as a single taxpayer CIDER.—In the case of wine described in sub- rate has been assigned by a brewer— for purposes of the application of this sub- section (b)(6), subparagraph (A) of this para- ‘‘(I) to any importer does not exceed the section.’’. graph shall be applied— number of barrels of beer brewed or produced (e) EFFECTIVE DATE.—The amendments ‘‘(i) in clause (i) of such subparagraph, by by such brewer during the calendar year made by this section shall apply to beer re- which were imported into the United States substituting ‘6.2 cents’ for ‘$1’, moved after December 31, 2017. ‘‘(ii) in clause (ii) of such subparagraph, by by such importer, and SEC. 13803. TRANSFER OF BEER BETWEEN BOND- ‘‘(II) to all importers does not exceed the substituting ‘5.6 cents’ for ‘90 cents’, and ED FACILITIES. ‘‘(iii) in clause (iii) of such subparagraph, 6,000,000 barrels to which the reduced tax (a) IN GENERAL.—Section 5414 is amended— by substituting ‘3.3 cents’ for ‘53.5 cents’.’’, rate applies, (1) by striking ‘‘Beer may be removed’’ and (b) CONTROLLED GROUP AND SINGLE TAX- ‘‘(ii) procedures that allow the election of inserting ‘‘(a) IN GENERAL.—Beer may be re- PAYER RULES.—Paragraph (4) of section a brewer to assign and an importer to receive moved’’, and 5041(c) is amended by striking ‘‘section the reduced tax rate provided under this (2) by adding at the end the following: 5051(a)(2)(B)’’ and inserting ‘‘section paragraph, ‘‘(b) TRANSFER OF BEER BETWEEN BONDED ‘‘(iii) requirements that the brewer provide FACILITIES.— 5051(a)(5)’’. any information as the Secretary determines ‘‘(1) IN GENERAL.—Beer may be removed (c) ALLOWANCE OF CREDIT FOR FOREIGN necessary and appropriate for purposes of from one bonded brewery to another bonded MANUFACTURERS AND IMPORTERS.—Sub- carrying out this paragraph, and brewery, without payment of tax, and may section (c) of section 5041, as amended by ‘‘(iv) procedures that allow for revocation be mingled with beer at the receiving brew- subsection (a), is amended— of eligibility of the brewer and the importer ery, subject to such conditions, including (1) in subparagraph (A) of paragraph (8), by for the reduced tax rate provided under this payment of the tax, and in such containers, inserting ‘‘but only if the importer is an paragraph in the case of any erroneous or as the Secretary by regulations shall pre- electing importer under paragraph (9) and fraudulent information provided under scribe, which shall include— the wine gallons of wine have been assigned clause (iii) which the Secretary deems to be ‘‘(A) any removal from one brewery to an- to the importer pursuant to such paragraph’’ material to qualifying for such reduced rate. other brewery belonging to the same brewer, after ‘‘into the United States during the cal- ‘‘(C) CONTROLLED GROUP.—For purposes of ‘‘(B) any removal from a brewery owned by endar year’’, and this section, any importer making an elec- one corporation to a brewery owned by an- (2) by adding at the end the following new tion described in subparagraph (B)(ii) shall other corporation when— paragraph: be deemed to be a member of the controlled ‘‘(i) one such corporation owns the control- ‘‘(9) ALLOWANCE OF CREDIT FOR FOREIGN group of the brewer, as described under para- ling interest in the other such corporation, MANUFACTURERS AND IMPORTERS.— graph (5).’’. or ‘‘(A) IN GENERAL.—In the case of any wine (d) CONTROLLED GROUP AND SINGLE TAX- ‘‘(ii) the controlling interest in each such gallons of wine which have been produced PAYER RULES.—Subsection (a) of section 5051, corporation is owned by the same person or outside of the United States and imported as amended by this section, is amended— persons, and into the United States, the credit allowable (1) in paragraph (2)— ‘‘(C) any removal from one brewery to an- under paragraph (8) (referred to in this para- (A) by striking subparagraph (B), and other brewery when— graph as the ‘tax credit’) may be assigned by (B) by redesignating subparagraph (C) as ‘‘(i) the proprietors of transferring and re- the person who produced such wine (referred subparagraph (B), and ceiving premises are independent of each to in this paragraph as the ‘foreign pro- (2) by adding at the end the following new other and neither has a proprietary interest, ducer’), provided that such person makes an paragraph: directly or indirectly, in the business of the election described in subparagraph (B)(ii), to ‘‘(5) CONTROLLED GROUP AND SINGLE TAX- other, and any electing importer of such wine gallons PAYER RULES.— ‘‘(ii) the transferor has divested itself of all pursuant to the requirements established by ‘‘(A) IN GENERAL.—Except as provided in interest in the beer so transferred and the the Secretary under subparagraph (B). subparagraph (B), in the case of a controlled transferee has accepted responsibility for ‘‘(B) ASSIGNMENT.—The Secretary shall, group, the 6,000,000 barrel quantity specified payment of the tax. through such rules, regulations, and proce- in paragraph (1)(C)(i) and the 2,000,000 barrel ‘‘(2) TRANSFER OF LIABILITY FOR TAX.—For dures as are determined appropriate, estab- quantity specified in paragraph (2)(A) shall purposes of paragraph (1)(C), such relief from lish procedures for assignment of the tax be applied to the controlled group, and the liability shall be effective from the time of credit provided under this paragraph, which 6,000,000 barrel quantity specified in para- removal from the transferor’s bonded prem- shall include— graph (1)(C)(i) and the 60,000 barrel quantity ises, or from the time of divestment of inter- ‘‘(i) a limitation to ensure that the number specified in paragraph (2)(A) shall be appor- est, whichever is later. of wine gallons of wine for which the tax tioned among the brewers who are members ‘‘(3) TERMINATION.—This subsection shall credit has been assigned by a foreign pro- of such group in such manner as the Sec- not apply to any calendar quarter beginning ducer— retary or their delegate shall by regulations after December 31, 2019.’’. ‘‘(I) to any importer does not exceed the prescribe. For purposes of the preceding sen- (b) REMOVAL FROM BREWERY BY PIPELINE.— number of wine gallons of wine produced by tence, the term ‘controlled group’ has the Section 5412 is amended by inserting ‘‘pursu- such foreign producer during the calendar meaning assigned to it by subsection (a) of ant to section 5414 or’’ before ‘‘by pipeline’’. year which were imported into the United section 1563, except that for such purposes (c) EFFECTIVE DATE.—The amendments States by such importer, and the phrase ‘more than 50 percent’ shall be made by this section shall apply to any cal- ‘‘(II) to all importers does not exceed the substituted for the phrase ‘at least 80 per- endar quarters beginning after December 31, 750,000 wine gallons of wine to which the tax cent’ in each place it appears in such sub- 2017. credit applies,

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00135 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.053 S01DEPT1 S7788 CONGRESSIONAL RECORD — SENATE December 1, 2017 ‘‘(ii) procedures that allow the election of SEC. 13807. REDUCED RATE OF EXCISE TAX ON dures as are determined appropriate, estab- a foreign producer to assign and an importer CERTAIN DISTILLED SPIRITS. lish procedures for assignment of the reduced to receive the tax credit provided under this (a) IN GENERAL.—Section 5001 is amended tax rate provided under this paragraph, paragraph, by redesignating subsection (c) as subsection which shall include— ‘‘(iii) requirements that the foreign pro- (d) and by inserting after subsection (b) the ‘‘(i) a limitation to ensure that the number ducer provide any information as the Sec- following new subsection: of proof gallons of distilled spirits for which retary determines necessary and appropriate ‘‘(c) REDUCED RATE FOR 2018 AND 2019.— the reduced tax rate has been assigned by a for purposes of carrying out this paragraph, ‘‘(1) IN GENERAL.—In the case of a distilled distilled spirits operation— spirits operation, the otherwise applicable and ‘‘(I) to any importer does not exceed the tax rate under subsection (a)(1) shall be— ‘‘(iv) procedures that allow for revocation number of proof gallons produced by such op- ‘‘(A) $2.70 per proof gallon on the first of eligibility of the foreign producer and the eration during the calendar year which were 100,000 proof gallons of distilled spirits, and importer for the tax credit provided under imported into the United States by such im- ‘‘(B) $13.34 per proof gallon on the first this paragraph in the case of any erroneous porter, and 22,130,000 of proof gallons of distilled spirits or fraudulent information provided under ‘‘(II) to all importers does not exceed the to which subparagraph (A) does not apply, clause (iii) which the Secretary deems to be 22,230,000 proof gallons of distilled spirits to material to qualifying for such credit. which have been distilled or processed by which the reduced tax rate applies, ‘‘(C) CONTROLLED GROUP.—For purposes of such operation and removed during the cal- ‘‘(ii) procedures that allow the election of this section, any importer making an elec- endar year for consumption or sale, or which a distilled spirits operation to assign and an tion described in subparagraph (B)(ii) shall have been imported by the importer into the importer to receive the reduced tax rate pro- be deemed to be a member of the controlled United States during the calendar year. vided under this paragraph, group of the foreign producer, as described ‘‘(2) CONTROLLED GROUPS.— ‘‘(iii) requirements that the distilled spir- under paragraph (4).’’. ‘‘(A) IN GENERAL.—In the case of a con- its operation provide any information as the (d) EFFECTIVE DATE.—The amendments trolled group, the proof gallon quantities Secretary determines necessary and appro- made by this section shall apply to wine re- specified under subparagraphs (A) and (B) of priate for purposes of carrying out this para- moved after December 31, 2017. paragraph (1) shall be applied to such group graph, and SEC. 13805. ADJUSTMENT OF ALCOHOL CONTENT and apportioned among the members of such ‘‘(iv) procedures that allow for revocation LEVEL FOR APPLICATION OF EXCISE group in such manner as the Secretary or TAX RATES. of eligibility of the distilled spirits operation their delegate shall by regulations prescribe. and the importer for the reduced tax rate (a) IN GENERAL.—Paragraphs (1) and (2) of ‘‘(B) DEFINITION.—For purposes of subpara- section 5041(b) are each amended by inserting provided under this paragraph in the case of graph (A), the term ‘controlled group’ shall any erroneous or fraudulent information pro- ‘‘(16 percent in the case of wine removed have the meaning given such term by sub- after December 31, 2017, and before January vided under clause (iii) which the Secretary section (a) of section 1563, except that ‘more deems to be material to qualifying for such 1, 2020’’ after ‘‘14 percent’’. than 50 percent’ shall be substituted for ‘at (b) EFFECTIVE DATE.—The amendments reduced rate. least 80 percent’ each place it appears in made by this section shall apply to wine re- ‘‘(C) CONTROLLED GROUP.— such subsection. moved after December 31, 2017. ‘‘(i) IN GENERAL.—For purposes of this sec- ‘‘(C) RULES FOR NON-CORPORATIONS.—Under tion, any importer making an election de- SEC. 13806. DEFINITION OF MEAD AND LOW AL- regulations prescribed by the Secretary, COHOL BY VOLUME WINE. scribed in subparagraph (B)(ii) shall be principles similar to the principles of sub- (a) IN GENERAL.—Section 5041 is amended— deemed to be a member of the controlled (1) in subsection (a), by striking ‘‘Still paragraphs (A) and (B) shall be applied to a group of the distilled spirits operation, as de- wines’’ and inserting ‘‘Subject to subsection group under common control where one or scribed under paragraph (2). more of the persons is not a corporation. (h), still wines’’, and ‘‘(ii) APPORTIONMENT.—For purposes of this (2) by adding at the end the following new ‘‘(D) SINGLE TAXPAYER.—Pursuant to rules paragraph, in the case of a controlled group, subsection: issued by the Secretary, two or more entities rules similar to section 5051(a)(5)(B) shall ‘‘(h) MEAD AND LOW ALCOHOL BY VOLUME (whether or not under common control) that apply.’’. WINE.— produce distilled spirits marketed under a (d) EFFECTIVE DATE.—The amendments ‘‘(1) IN GENERAL.—For purposes of sub- similar brand, license, franchise, or other ar- made by this section shall apply to distilled sections (a) and (b)(1), mead and low alcohol rangement shall be treated as a single tax- spirits removed after December 31, 2017. by volume wine shall be deemed to be still payer for purposes of the application of this SEC. 13808. BULK DISTILLED SPIRITS. wines containing not more than 16 percent of subsection. (a) IN GENERAL.—Section 5212 is amended alcohol by volume. ‘‘(3) TERMINATION.—This subsection shall by adding at the end the following sentence: ‘‘(2) DEFINITIONS.— not apply to distilled spirits removed after ‘‘In the case of distilled spirits transferred in ‘‘(A) MEAD.—For purposes of this section, December 31, 2019.’’. bond after December 31, 2017, and before Jan- the term ‘mead’ means a wine— (b) CONFORMING AMENDMENT.—Section uary 1, 2020, this section shall be applied ‘‘(i) containing not more than 0.64 gram of 7652(f)(2) is amended by striking ‘‘section without regard to whether distilled spirits carbon dioxide per hundred milliliters of 5001(a)(1)’’ and inserting ‘‘subsection (a)(1) of are bulk distilled spirits.’’. wine, except that the Secretary shall by reg- section 5001, determined as if subsection (b) EFFECTIVE DATE.—The amendments ulations prescribe such tolerances to this (c)(1) of such section did not apply’’. made by this section shall apply distilled limitation as may be reasonably necessary in (c) APPLICATION OF REDUCED TAX RATE FOR spirits transferred in bond after December 31, good commercial practice, FOREIGN MANUFACTURERS AND IMPORTERS.— 2017. Subsection (c) of section 5001, as added by ‘‘(ii) which is derived solely from honey Subpart B—Miscellaneous Provisions subsection (a), is amended— and water, SEC. 13821. MODIFICATION OF TAX TREATMENT ‘‘(iii) which contains no fruit product or (1) in paragraph (1), by inserting ‘‘but only if the importer is an electing importer under OF ALASKA NATIVE CORPORATIONS fruit flavoring, and AND SETTLEMENT TRUSTS. paragraph (3) and the proof gallons of dis- ‘‘(iv) which contains less than 8.5 percent (a) EXCLUSION FOR ANCSA PAYMENTS AS- tilled spirits have been assigned to the im- alcohol by volume. SIGNED TO ALASKA NATIVE SETTLEMENT ‘‘(B) LOW ALCOHOL BY VOLUME WINE.—For porter pursuant to such paragraph’’ after TRUSTS.— purposes of this section, the term ‘low alco- ‘‘into the United States during the calendar (1) IN GENERAL.—Part III of subchapter B of hol by volume wine’ means a wine— year’’, and chapter 1 is amended by inserting before sec- ‘‘(i) containing not more than 0.64 gram of (2) by redesignating paragraph (3) as para- tion 140 the following new section: graph (4) and by inserting after paragraph (2) carbon dioxide per hundred milliliters of ‘‘SEC. 139G. ASSIGNMENTS TO ALASKA NATIVE wine, except that the Secretary shall by reg- the following new paragraph: SETTLEMENT TRUSTS. ulations prescribe such tolerances to this ‘‘(3) REDUCED TAX RATE FOR FOREIGN MANU- ‘‘(a) IN GENERAL.—In the case of a Native limitation as may be reasonably necessary in FACTURERS AND IMPORTERS.— Corporation, gross income shall not include good commercial practice, ‘‘(A) IN GENERAL.—In the case of any proof the value of any payments that would other- ‘‘(ii) which is derived— gallons of distilled spirits which have been wise be made, or treated as being made, to ‘‘(I) primarily from grapes, or produced outside of the United States and such Native Corporation pursuant to, or as ‘‘(II) from grape juice concentrate and imported into the United States, the rate of required by, any provision of the Alaska Na- water, tax applicable under paragraph (1) (referred tive Claims Settlement Act (43 U.S.C. 1601 et ‘‘(iii) which contains no fruit product or to in this paragraph as the ‘reduced tax seq.), including any payment that would oth- fruit flavoring other than grape, and rate’) may be assigned by the distilled sprits erwise be made to a Village Corporation pur- ‘‘(iv) which contains less than 8.5 percent operation (provided that such operation suant to section 7(j) of the Alaska Native alcohol by volume. makes an election described in subparagraph Claims Settlement Act (43 U.S.C. 1606(j)), ‘‘(3) TERMINATION.—This subsection shall (B)(ii)) to any electing importer of such provided that any such payments— not apply to wine removed after December proof gallons pursuant to the requirements ‘‘(1) are assigned in writing to a Settle- 31, 2019.’’. established by the Secretary under subpara- ment Trust, and (b) EFFECTIVE DATE.—The amendments graph (B). ‘‘(2) were not received by such Native Cor- made by this section shall apply to wine re- ‘‘(B) ASSIGNMENT.—The Secretary shall, poration prior to the assignment described in moved after December 31, 2017. through such rules, regulations, and proce- paragraph (1).

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00136 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.053 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7789

‘‘(b) INCLUSION IN GROSS INCOME.—In the section apply for such taxable year on the in- section may be revoked pursuant to a timely case of a Settlement Trust which has been come tax return or an amendment or supple- filed amendment or supplement to the in- assigned payments described in subsection ment to the return of the Native Corpora- come tax return of such Settlement Trust. (a), gross income shall include such pay- tion, with such election to have effect solely ‘‘(C) CERTAIN DISPOSITIONS.— ments when received by such Settlement for such taxable year. ‘‘(i) IN GENERAL.—In the case of any prop- Trust pursuant to the assignment and shall ‘‘(2) REVOCATION.—Any election made by a erty for which an election is in effect under have the same character as if such payments Native Corporation pursuant to this sub- this subsection and which is disposed of were received by the Native Corporation. section may be revoked pursuant to a timely within the first taxable year subsequent to ‘‘(c) AMOUNT AND SCOPE OF ASSIGNMENT.— filed amendment or supplement to the in- the taxable year in which such property was The amount and scope of any assignment come tax return of such Native Corporation. contributed to the Settlement Trust— under subsection (a) shall be described with ‘‘(f) ADDITIONAL RULES.— ‘‘(I) this section shall be applied as if the reasonable particularity and may either be ‘‘(1) EARNINGS AND PROFITS.—Notwith- election under this subsection had not been in a percentage of one or more such pay- standing section 646(d)(2), in the case of a made, ments or in a fixed dollar amount. Native Corporation which claims a deduction ‘‘(II) any income or gain which would have ‘‘(d) DURATION OF ASSIGNMENT; under this section for any taxable year, the been included in the year of contribution REVOCABILITY.—Any assignment under sub- earnings and profits of such Native Corpora- under subsection (f)(3) but for the taxpayer’s section (a) shall specify— tion for such taxable year shall be reduced election under this subsection shall be in- ‘‘(1) a duration either in perpetuity or for by the amount of such deduction. cluded in income for the taxable year of such a period of time, and ‘‘(2) GAIN OR LOSS.—No gain or loss shall be contribution, and ‘‘(2) whether such assignment is revocable. recognized by the Native Corporation with ‘‘(III) the Settlement Trust shall pay any ‘‘(e) PROHIBITION ON DEDUCTION.—Notwith- respect to a contribution of property for increase in tax resulting from such inclu- standing section 247, no deduction shall be which a deduction is allowed under this sec- sion, including any applicable interest, and allowed to a Native Corporation for purposes tion. increased by 10 percent of the amount of of any amounts described in subsection (a). ‘‘(3) INCOME.—Subject to subsection (g), a such increase with interest. ‘‘(f) DEFINITIONS.—For purposes of this sec- Settlement Trust shall include in income the ‘‘(ii) ASSESSMENT.—Notwithstanding sec- tion, the terms ‘Native Corporation’ and amount of any deduction allowed under this tion 6501(a), any amount described in sub- ‘Settlement Trust’ have the same meaning section in the taxable year in which the Set- clause (III) of clause (i) may be assessed, or given such terms under section 646(h).’’. tlement Trust actually receives such con- a proceeding in court with respect to such tribution. (2) CONFORMING AMENDMENT.—The table of amount may be initiated without assess- ‘‘(4) PERIOD.—The holding period under sec- sections for part III of subchapter B of chap- ment, within 4 years after the date on which tion 1223 of the Settlement Trust shall in- ter 1 is amended by inserting before the item the return making the election under this clude the period the property was held by the relating to section 140 the following new subsection for such property was filed.’’. item: Native Corporation. (2) CONFORMING AMENDMENT.—The table of ‘‘(5) BASIS.—The basis that a Settlement ‘‘Sec. 139G. Assignments to Alaska Native sections for part VIII of subchapter B of Trust has for which a deduction is allowed Settlement Trusts.’’. chapter 1 is amended by inserting before the under this section shall be equal to the lesser (3) EFFECTIVE DATE.—The amendments item relating to section 248 the following of— made by this subsection shall apply to tax- new item: able years beginning after December 31, 2016. ‘‘(A) the adjusted basis of the Native Cor- ‘‘Sec. 247. Contributions to Alaska Native (b) DEDUCTION OF CONTRIBUTIONS TO ALAS- poration in such property immediately be- Settlement Trusts.’’. KA NATIVE SETTLEMENT TRUSTS.— fore such contribution, or (3) EFFECTIVE DATE.— (1) IN GENERAL.—Part VIII of subchapter B ‘‘(B) the fair market value of the property of chapter 1 is amended by inserting before immediately before such contribution. (A) IN GENERAL.—The amendments made section 248 the following new section: ‘‘(6) PROHIBITION.—No deduction shall be by this subsection shall apply to taxable years for which the period of limitation on ‘‘SEC. 247. CONTRIBUTIONS TO ALASKA NATIVE allowed under this section with respect to SETTLEMENT TRUSTS. any contributions made to a Settlement refund or credit under section 6511 of the In- ‘‘(a) IN GENERAL.—In the case of a Native Trust which are in violation of subsection ternal Revenue Code of 1986 has not expired. Corporation, there shall be allowed a deduc- (a)(2) or (c)(2) of section 39 of the Alaska Na- (B) ONE-YEAR WAIVER OF STATUTE OF LIMI- tion for any contributions made by such Na- tive Claims Settlement Act (43 U.S.C. 1629e). TATIONS.—If the period of limitation on a tive Corporation to a Settlement Trust (re- ‘‘(g) ELECTION BY SETTLEMENT TRUST TO credit or refund resulting from the amend- gardless of whether an election under section DEFER INCOME RECOGNITION.— ments made by paragraph (1) expires before 646 is in effect for such Settlement Trust) for ‘‘(1) IN GENERAL.—In the case of a contribu- the end of the 1-year period beginning on the which the Native Corporation has made an tion which consists of property other than date of the enactment of this Act, refund or annual election under subsection (e). cash, a Settlement Trust may elect to defer credit of such overpayment (to the extent at- ‘‘(b) AMOUNT OF DEDUCTION.—The amount recognition of any income related to such tributable to such amendments) may, never- of the deduction under subsection (a) shall be property until the sale or exchange of such theless, be made or allowed if claim therefor equal to— property, in whole or in part, by the Settle- is filed before the close of such 1-year period. ‘‘(1) in the case of a cash contribution (re- ment Trust. (c) INFORMATION REPORTING FOR DEDUCT- gardless of the method of payment, including ‘‘(2) TREATMENT.—In the case of property IBLE CONTRIBUTIONS TO ALASKA NATIVE SET- currency, coins, money order, or check), the described in paragraph (1), any income or TLEMENT TRUSTS.— amount of such contribution, or gain realized on the sale or exchange of such (1) IN GENERAL.—Section 6039H is amend- ‘‘(2) in the case of a contribution not de- property shall be treated as— ed— scribed in paragraph (1), the lesser of— ‘‘(A) for such amount of the income or gain (A) in the heading, by striking ‘‘SPON- ‘‘(A) the Native Corporation’s adjusted as is equal to or less than the amount of in- SORING’’, and basis in the property contributed, or come which would be included in income at (B) by adding at the end the following new ‘‘(B) the fair market value of the property the time of contribution under subsection subsection: contributed. (f)(3) but for the taxpayer’s election under ‘‘(e) DEDUCTIBLE CONTRIBUTIONS BY NATIVE ‘‘(c) LIMITATION AND CARRYOVER.— this subsection, ordinary income, and CORPORATIONS TO ALASKA NATIVE SETTLE- ‘‘(1) IN GENERAL.—Subject to paragraph (2), ‘‘(B) for any amounts of the income or gain MENT TRUSTS.— the deduction allowed under subsection (a) which are in excess of the amount of income ‘‘(1) IN GENERAL.—Any Native Corporation for any taxable year shall not exceed the which would be included in income at the (as defined in subsection (m) of section 3 of taxable income (as determined without re- time of contribution under subsection (f)(3) the Alaska Native Claims Settlement Act (43 gard to such deduction) of the Native Cor- but for the taxpayer’s election under this U.S.C. 1602(m))) which has made a contribu- poration for the taxable year in which the subsection, having the same character as if tion to a Settlement Trust (as defined in contribution was made. this subsection did not apply. subsection (t) of such section) to which an ‘‘(2) CARRYOVER.—If the aggregate amount ‘‘(3) ELECTION.— election under subsection (e) of section 247 of contributions described in subsection (a) ‘‘(A) IN GENERAL.—For each taxable year, a applies shall provide such Settlement Trust for any taxable year exceeds the limitation Settlement Trust may elect to apply this with a statement regarding such election not under paragraph (1), such excess shall be subsection for any property described in later than January 31 of the calendar year treated as a contribution described in sub- paragraph (1) which was contributed during subsequent to the calendar year in which the section (a) in each of the 15 succeeding years such year. Any property to which the elec- contribution was made. in order of time. tion applies shall be identified and described ‘‘(2) CONTENT OF STATEMENT.—The state- ‘‘(d) DEFINITIONS.—For purposes of this sec- with reasonable particularity on the income ment described in paragraph (1) shall in- tion, the terms ‘Native Corporation’ and tax return or an amendment or supplement clude— ‘Settlement Trust’ have the same meaning to the return of the Settlement Trust, with ‘‘(A) the total amount of contributions to given such terms under section 646(h). such election to have effect solely for such which the election under subsection (e) of ‘‘(e) MANNER OF MAKING ELECTION.— taxable year. section 247 applies, ‘‘(1) IN GENERAL.—For each taxable year, a ‘‘(B) REVOCATION.—Any election made by a ‘‘(B) for each contribution, whether such Native Corporation may elect to have this Settlement Trust pursuant to this sub- contribution was in cash,

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00137 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.053 S01DEPT1 S7790 CONGRESSIONAL RECORD — SENATE December 1, 2017 ‘‘(C) for each contribution which consists ‘‘Subchapter Z—Opportunity Zones ‘‘SEC. 1400Z–2. SPECIAL RULES FOR CAPITAL of property other than cash, the date that ‘‘Sec. 1400Z–1. Designation. GAINS INVESTED IN OPPORTUNITY such property was acquired by the Native ‘‘Sec. 1400Z–2. Special rules for capital gains ZONES. Corporation and the adjusted basis and fair invested in opportunity zones. ‘‘(a) IN GENERAL.—In the case of gain from market value of such property on the date ‘‘SEC. 1400Z–1. DESIGNATION. the sale to, or exchange with, an unrelated such property was contributed to the Settle- ‘‘(a) QUALIFIED OPPORTUNITY ZONE DE- person of any property held by the taxpayer, ment Trust, FINED.—For the purposes of this subchapter, at the election of the taxpayer— ‘‘(D) the date on which each contribution the term ‘qualified opportunity zone’ means ‘‘(1) gross income for the taxable year shall was made to the Settlement Trust, and a population census tract that is a low-in- not include so much of such gain as does not ‘‘(E) such information as the Secretary de- come community that is designated as a exceed the aggregate amount invested by the termines to be necessary or appropriate for qualified opportunity zone. taxpayer in a qualified opportunity fund dur- the identification of each contribution and ‘‘(b) DESIGNATION.— ing the 180-day period beginning on the date the accurate inclusion of income relating to ‘‘(1) IN GENERAL.—For purposes of sub- of such sale or exchange, such contributions by the Settlement section (a), a population census tract that is ‘‘(2) the amount of gain excluded by para- Trust.’’. a low-income community is designated as a graph (1) shall be included in gross income as (2) CONFORMING AMENDMENT.—The item re- qualified opportunity zone if— provided by subsection (b), and lating to section 6039H in the table of sec- ‘‘(A) not later than the end of the deter- ‘‘(3) subsection (c) shall apply. tions for subpart A of part III of subchapter mination period, the governor of the State in No election may be made under the pre- A of chapter 61 is amended to read as follows: which the tract is located— ceding sentence with respect to a sale or ex- ‘‘Sec. 6039H. Information With Respect to ‘‘(i) nominates the tract for designation as change if an election previously made with Alaska Native Settlement a qualified opportunity zone, and respect to such sale or exchange is in effect. Trusts and Native Corpora- ‘‘(ii) notifies the Secretary in writing of ‘‘(b) DEFERRAL OF GAIN INVESTED IN OPPOR- tions.’’. such nomination, and TUNITY ZONE PROPERTY.— (3) EFFECTIVE DATE.—The amendments ‘‘(B) the Secretary certifies such nomina- ‘‘(1) YEAR OF INCLUSION.—Gain to which made by this subsection shall apply to tax- tion and designates such tract as a qualified subsection (a)(2) applies shall be included in able years beginning after December 31, 2016. opportunity zone before the end of the con- income in the taxable year which includes sideration period. SEC. 13822. AMOUNTS PAID FOR AIRCRAFT MAN- the earlier of— AGEMENT SERVICES. ‘‘(2) EXTENSION OF PERIODS.—A governor ‘‘(A) the date on which such investment is (a) IN GENERAL.—Subsection (e) of section may request that the Secretary extend ei- sold or exchanged, or 4261 is amended by adding at the end the fol- ther the determination or consideration pe- ‘‘(B) December 31, 2026. lowing new paragraph: riod, or both (determined without regard to ‘‘(2) AMOUNT INCLUDIBLE.— ‘‘(5) AMOUNTS PAID FOR AIRCRAFT MANAGE- this subparagraph), for an additional 30 days. ‘‘(A) IN GENERAL.—The amount of gain in- ‘‘(c) OTHER DEFINITIONS.—For purposes of MENT SERVICES.— cluded in gross income under subsection this subsection— ‘‘(A) IN GENERAL.—No tax shall be imposed (a)(1) shall be the excess of— ‘‘(1) LOW-INCOME COMMUNITIES.—The term by this section or section 4271 on any ‘‘(i) the lesser of the amount of gain ex- ‘low-income community’ has the same mean- amounts paid by an aircraft owner for air- cluded under paragraph (1) or the fair mar- ing as when used in section 45D(e). craft management services related to— ket value of the property as determined as of ‘‘(2) DEFINITION OF PERIODS.— ‘‘(i) maintenance and support of the air- the date described in paragraph (1), over ‘‘(A) CONSIDERATION PERIOD.—The term craft owner’s aircraft, or ‘‘(ii) the taxpayer’s basis in the invest- ‘consideration period’ means the 30-day pe- ‘‘(ii) flights on the aircraft owner’s air- ment. riod beginning on the date on which the Sec- craft. ‘‘(B) DETERMINATION OF BASIS.— retary receives notice under subsection ‘‘(B) AIRCRAFT MANAGEMENT SERVICES.—For ‘‘(i) IN GENERAL.—Except as otherwise pro- (b)(1)(A)(ii), as extended under subsection purposes of subparagraph (A), the term ‘air- vided in this clause or subsection (c), the (b)(2). craft management services’ includes— taxpayer’s basis in the investment shall be ‘‘(B) DETERMINATION PERIOD.—The term ‘‘(i) assisting an aircraft owner with ad- zero. ‘determination period’ means the 90-day pe- ministrative and support services, such as ‘‘(ii) INCREASE FOR GAIN RECOGNIZED UNDER riod beginning on the date of the enactment scheduling, flight planning, and weather SUBSECTION (a)(2).—The basis in the invest- of the Tax Cuts and Jobs Act, as extended forecasting, ment shall be increased by the amount of under subsection (b)(2). ‘‘(ii) obtaining insurance, gain recognized by reason of subsection (a)(2) ‘‘(3) STATE.—For purposes of this section, ‘‘(iii) maintenance, storage and fueling of with respect to such property. the term ‘State’ includes any possession of aircraft, ‘‘(iii) INVESTMENTS HELD FOR 5 YEARS.—In the United States. ‘‘(iv) hiring, training, and provision of pi- the case of any investment held for at least ‘‘(d) NUMBER OF DESIGNATIONS.— lots and crew, 5 years, the basis of such investment shall be ‘‘(1) IN GENERAL.—Except as provided by increased by an amount equal to 10 percent ‘‘(v) establishing and complying with safe- paragraph (2), the number of population cen- of the amount of gain deferred by reason of ty standards, and sus tracts in a State that may be designated subsection (a)(1). ‘‘(vi) such other services as are necessary as qualified opportunity zones under this ‘‘(iv) INVESTMENTS HELD FOR 7 YEARS.—In to support flights operated by an aircraft section may not exceed 25 percent of the the case of any investment held by the tax- owner. number of low-income communities in the ESSEE TREATED AS AIRCRAFT OWNER.— payer for at least 7 years, in addition to any ‘‘(C) L State. ‘‘(i) IN GENERAL.—For purposes of this adjustment made under clause (iii), the basis ‘‘(2) EXCEPTION.—If the number of low-in- of such property shall be increased by an paragraph, the term ‘aircraft owner’ includes come communities in a State is less than 100, amount equal to 5 percent of the amount of a person who leases the aircraft other than then a total of 25 of such tracts may be des- gain deferred by reason of subsection (a)(1). under a disqualified lease. ignated as qualified opportunity zones. ‘‘(ii) DISQUALIFIED LEASE.—For purposes of ‘‘(e) DESIGNATION OF TRACTS CONTIGUOUS ‘‘(c) SPECIAL RULE FOR INVESTMENTS HELD clause (i), the term ‘disqualified lease’ means WITH LOW-INCOME COMMUNITIES.— FOR AT LEAST 10 YEARS.—In the case of any a lease from a person providing aircraft man- ‘‘(1) IN GENERAL.—A population census investment held by the taxpayer for at least agement services with respect to such air- tract that is not a low-income community 10 years and with respect to which the tax- craft (or a related person (within the mean- may be designated as a qualified opportunity payer makes an election under this clause, ing of section 465(b)(3)(C)) to the person pro- zone under this section if— the basis of such property shall be equal to viding such services), if such lease is for a ‘‘(A) the tract is contiguous with the low- the fair market value of such investment on term of 31 days or less. income community that is designated as a the date that the investment is sold or ex- ‘‘(D) PRO RATA ALLOCATION.—In the case of qualified opportunity zone, and changed. amounts paid to any person which (but for ‘‘(B) the median family income of the tract ‘‘(d) QUALIFIED OPPORTUNITY FUND.—For this subsection) are subject to the tax im- does not exceed 125 percent of the median purposes of this section— posed by subsection (a), a portion of which family income of the low-income community ‘‘(1) QUALIFIED OPPORTUNITY FUND.—The consists of amounts described in subpara- with which the tract is contiguous. term ‘qualified opportunity fund’ means any graph (A), this paragraph shall apply on a ‘‘(2) LIMITATION.—Not more than 5 percent investment vehicle which is organized as a pro rata basis only to the portion which con- of the population census tracts designated in corporation or a partnership for the purpose sists of amounts described in such subpara- a State as a qualified opportunity zone may of investing in qualified opportunity zone graph.’’. be designated under paragraph (1). property (other than another qualified op- (b) EFFECTIVE DATE.—The amendment ‘‘(f) PERIOD FOR WHICH DESIGNATION ISIN portunity fund) that holds at least 90 percent made by this section shall apply to amounts EFFECT.—A designation as a qualified oppor- of its assets in qualified opportunity zone paid after the date of the enactment of this tunity zone shall remain in effect for the pe- property, determined— Act. riod beginning on the date of the designation ‘‘(A) on the last day of the first 6-month SEC. 13823. OPPORTUNITY ZONES. and ending at the close of the 10th calendar period of the taxable year of the fund, and (a) IN GENERAL.—Chapter 1 is amended by year beginning on or after such date of des- ‘‘(B) on the last day of the taxable year of adding at the end the following: ignation. the fund.

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‘‘(2) QUALIFIED OPPORTUNITY ZONE PROP- ‘‘(A) IN GENERAL.—The term ‘qualified op- (b) BASIS ADJUSTMENTS.—Section 1016(a) is ERTY.— portunity zone business’ means a trade or amended by striking ‘‘and’’ at the end of ‘‘(A) IN GENERAL.—The term ‘qualified op- business— paragraph (36), by striking the period at the portunity zone property’ means property ‘‘(i) in which substantially all of the tan- end of paragraph (37) and inserting ‘‘, and’’, which is— gible property owned or leased by the tax- and by inserting after paragraph (37) the fol- ‘‘(i) qualified opportunity zone stock, payer is qualified opportunity zone business lowing: ‘‘(ii) qualified opportunity zone partner- property, ‘‘(38) to the extent provided in subsections ship interest, or ‘‘(ii) which satisfies the requirements of (b)(2) and (c) of section 1400Z–2.’’. ‘‘(iii) qualified opportunity zone business paragraphs (2), (4), and (8) of section 1397C(b), (c) CLERICAL AMENDMENT.—The table of property. and subchapters for chapter 1 is amended by add- ‘‘(B) QUALIFIED OPPORTUNITY ZONE STOCK.— ‘‘(iii) which is not described in section ing at the end the following new item: ‘‘(i) IN GENERAL.—Except as provided in 144(c)(6)(B). ‘‘SUBCHAPTER Z. OPPORTUNITY ZONES’’. ‘‘(B) SPECIAL RULE.—For purposes of sub- clause (ii), the term ‘qualified opportunity (d) EFFECTIVE DATE.—The amendments zone stock’ means any stock in a domestic paragraph (A), tangible property that ceases to be a qualified opportunity zone business made by this section shall take effect on the corporation if— date of the enactment of this Act. ‘‘(I) such stock is acquired by the taxpayer property shall continue to be treated as a Subtitle D—International Tax Provisions after December 31, 2017, at its original issue qualified opportunity zone business property (directly or through an underwriter) from for the lesser of— PART I—OUTBOUND TRANSACTIONS ‘‘(i) 5 years after the date on which such the corporation solely in exchange for cash, Subpart A—Establishment of Participation tangible property ceases to be so qualified, ‘‘(II) as of the time such stock was issued, Exemption System for Taxation of Foreign or such corporation was a qualified opportunity Income ‘‘(ii) the date on which such tangible prop- zone business (or, in the case of a new cor- erty is no longer held by the qualified oppor- SEC. 14101. DEDUCTION FOR FOREIGN-SOURCE poration, such corporation was being orga- tunity zone business. PORTION OF DIVIDENDS RECEIVED nized for purposes of being a qualified oppor- BY DOMESTIC CORPORATIONS FROM tunity zone business), and ‘‘(e) APPLICABLE RULES.— SPECIFIED 10-PERCENT OWNED FOR- ‘‘(III) during substantially all of the tax- ‘‘(1) TREATMENT OF INVESTMENTS WITH EIGN CORPORATIONS. payer’s holding period for such stock, such MIXED FUNDS.—In the case of any investment (a) IN GENERAL.—Part VIII of subchapter B corporation qualified as a qualified oppor- in a qualified opportunity fund only a por- of chapter 1 is amended by inserting after tunity zone business. tion of which consists of investments of gain section 245 the following new section: to which an election under subsection (a)(1) ‘‘(ii) REDEMPTIONS.—A rule similar to the ‘‘SEC. 245A. DEDUCTION FOR FOREIGN SOURCE- is in effect— rule of section 1202(c)(3) shall apply for pur- PORTION OF DIVIDENDS RECEIVED ‘‘(A) such investment shall be treated as 2 poses of this paragraph. BY DOMESTIC CORPORATIONS FROM separate investments, consisting of— SPECIFIED 10-PERCENT OWNED FOR- ‘‘(C) QUALIFIED OPPORTUNITY ZONE PART- ‘‘(i) one investment that only includes EIGN CORPORATIONS. NERSHIP INTEREST.—The term ‘qualified op- amounts to which the election under sub- portunity zone partnership interest’ means ‘‘(a) IN GENERAL.—In the case of any divi- section (a)(1) applies, and any capital or profits interest in a domestic dend received from a specified 10-percent ‘‘(ii) a separate investment consisting of owned foreign corporation by a domestic cor- partnership if— other amounts, and poration which is a United States share- ‘‘(i) such interest is acquired by the tax- ‘‘(B) subsections (a), (b), and (c) shall only holder with respect to such foreign corpora- payer after December 31, 2017, from the part- apply to the investment described in sub- tion, there shall be allowed as a deduction an nership solely in exchange for cash, paragraph (A)(i). amount equal to the foreign-source portion ‘‘(ii) as of the time such interest was ac- ‘‘(2) RELATED PERSONS.—For purposes of of such dividend. quired, such partnership was a qualified op- this section, persons are related to each ‘‘(b) SPECIFIED 10-PERCENT OWNED FOREIGN portunity zone business (or, in the case of a other if such persons are described in section CORPORATION.—For purposes of this section— new partnership, such partnership was being 267(b) or 707(b)(1), determined by substituting ‘‘(1) IN GENERAL.—The term ‘specified 10- organized for purposes of being a qualified ‘20 percent’ for ‘50 percent’ each place it oc- percent owned foreign corporation’ means opportunity zone business), and curs in such sections. any foreign corporation with respect to ‘‘(iii) during substantially all of the tax- ‘‘(3) DECEDENTS.—In the case of a decedent, which any domestic corporation is a United payer’s holding period for such interest, such amounts recognized under this section shall, States shareholder with respect to such cor- partnership qualified as a qualified oppor- if not properly includible in the gross income poration. tunity zone business. of the decedent, be includible in gross in- ‘‘(2) EXCLUSION OF PASSIVE FOREIGN INVEST- ‘‘(D) QUALIFIED OPPORTUNITY ZONE BUSINESS come as provided by section 691. MENT COMPANIES.—Such term shall not in- PROPERTY.— ‘‘(4) REGULATIONS.—The Secretary shall clude any corporation which is a passive for- ‘‘(i) IN GENERAL.—The term ‘qualified op- prescribe such regulations as may be nec- eign investment company (as defined in sec- portunity zone business property’ means tan- essary or appropriate to carry out the pur- tion 1297) with respect to the shareholder gible property used in a trade or business of poses of this section, including— and which is not a controlled foreign cor- the taxpayer if— ‘‘(A) rules for the certification of qualified poration. ‘‘(I) such property was acquired by the tax- opportunity funds for the purposes of this ‘‘(c) FOREIGN-SOURCE PORTION.—For pur- payer by purchase (as defined in section section, and poses of this section— 179(d)(2)) after December 31, 2017, ‘‘(B) rules to prevent abuse. ‘‘(1) IN GENERAL.—The foreign-source por- ‘‘(II) the original use of such property in ‘‘(f) FAILURE OF QUALIFIED OPPORTUNITY tion of any dividend from a specified 10-per- the qualified opportunity zone commences FUND TO MAINTAIN INVESTMENT STANDARD.— cent owned foreign corporation is an amount with the taxpayer or the taxpayer substan- ‘‘(1) IN GENERAL.—If a qualified oppor- which bears the same ratio to such dividend tially improves the property, and tunity fund fails to meet the 90-percent re- as— ‘‘(III) during substantially all of the tax- quirement of subsection (c)(1), the qualified ‘‘(A) the undistributed foreign earnings of payer’s holding period for such property, opportunity fund shall pay a penalty for the specified 10-percent owned foreign cor- substantially all of the use of such property each month it fails to meet the requirement poration, bears to was in a qualified opportunity zone. in an amount equal to the product of— ‘‘(B) the total undistributed earnings of ‘‘(ii) SUBSTANTIAL IMPROVEMENT.—For pur- ‘‘(A) the excess of— such foreign corporation. poses of subparagraph (A)(ii), property shall ‘‘(i) the amount equal to 90 percent of its ‘‘(2) UNDISTRIBUTED EARNINGS.—The term be treated as substantially improved by the aggregate assets, over ‘undistributed earnings’ means the amount taxpayer only if, during any 30-month period ‘‘(ii) the aggregate amount of qualified op- of the earnings and profits of the specified beginning after the date of acquisition of portunity zone property held by the fund, 10-percent owned foreign corporation (com- such property, additions to basis with re- multiplied by puted in accordance with sections 964(a) and spect to such property in the hands of the ‘‘(B) the underpayment rate established 986)— taxpayer exceed an amount equal to the ad- under section 6621(a)(2) for such month. ‘‘(A) as of the close of the taxable year of justed basis of such property at the begin- ‘‘(2) SPECIAL RULE FOR PARTNERSHIPS.—In the specified 10-percent owned foreign cor- ning of such 30-month period in the hands of the case that the qualified opportunity fund poration in which the dividend is distributed, the taxpayer. is a partnership, the penalty imposed by and ‘‘(iii) RELATED PARTY.—For purposes of paragraph (1) shall be taken into account ‘‘(B) without diminution by reason of divi- subparagraph (A)(i), the related person rule proportionately as part of the distributive dends distributed during such taxable year. of section 179(d)(2) shall be applied pursuant share of each partner of the partnership. ‘‘(3) UNDISTRIBUTED FOREIGN EARNINGS.— to paragraph (8) of this subsection in lieu of ‘‘(3) REASONABLE CAUSE EXCEPTION.—No The term ‘undistributed foreign earnings’ the application of such rule in section penalty shall be imposed under this sub- means the portion of the undistributed earn- 179(d)(2)(A). section with respect to any failure if it is ings which is attributable to neither— ‘‘(3) QUALIFIED OPPORTUNITY ZONE BUSI- shown that such failure is due to reasonable ‘‘(A) income described in subparagraph (A) NESS.— cause.’’. of section 245(a)(5), nor

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‘‘(B) dividends described in subparagraph ‘‘(i) paragraph (1)(A) shall be applied— ‘‘(j) COORDINATION WITH DIVIDENDS RE- (B) of such section (determined without re- ‘‘(I) by substituting ‘365 days’ for ‘45 days’ CEIVED DEDUCTION.—In the case of the sale or gard to section 245(a)(12)). each place it appears, and exchange by a domestic corporation of stock ‘‘(d) DISALLOWANCE OF FOREIGN TAX CRED- ‘‘(II) by substituting ‘731-day period’ for in a foreign corporation held for 1 year or IT, ETC.— ‘91-day period’, and more, any amount received by the domestic ‘‘(1) IN GENERAL.—No credit shall be al- ‘‘(ii) paragraph (2) shall not apply. corporation which is treated as a dividend by lowed under section 901 for any taxes paid or ‘‘(B) STATUS MUST BE MAINTAINED DURING reason of this section shall be treated as a accrued (or treated as paid or accrued) with HOLDING PERIOD.—For purposes of applying dividend for purposes of applying section respect to any distribution any portion of paragraph (1) with respect to section 245A, 245A.’’. which constitutes a dividend for which a de- the taxpayer shall be treated as holding the (b) BASIS IN SPECIFIED 10-PERCENT OWNED duction is allowed under this section. stock referred to in paragraph (1) for any pe- FOREIGN CORPORATION REDUCED BY NONTAXED ‘‘(2) DENIAL OF DEDUCTION.—No deduction riod only if— PORTION OF DIVIDEND FOR PURPOSES OF DE- shall be allowed under this chapter for any ‘‘(i) the specified 10-percent owned foreign TERMINING LOSS.— tax for which credit is not allowable under corporation referred to in section 245A(a) is a (1) IN GENERAL.—Section 961 is amended by section 901 by reason of paragraph (1) (deter- specified 10-percent owned foreign corpora- adding at the end the following new sub- mined by treating the taxpayer as having tion at all times during such period, and section: elected the benefits of subpart A of part III ‘‘(ii) the taxpayer is a United States share- ‘‘(d) BASIS IN SPECIFIED 10-PERCENT OWNED of subchapter N). holder with respect to such specified 10-per- FOREIGN CORPORATION REDUCED BY NONTAXED ‘‘(e) SPECIAL RULES FOR HYBRID DIVI- cent owned foreign corporation at all times PORTION OF DIVIDEND FOR PURPOSES OF DE- DENDS.— during such period.’’. TERMINING LOSS.—If a domestic corporation ‘‘(1) IN GENERAL.—Subsection (a) shall not (c) APPLICATION OF RULES GENERALLY AP- receives a dividend from a specified 10-per- apply to any dividend received by a United PLICABLE TO DEDUCTIONS FOR DIVIDENDS RE- cent owned foreign corporation (as defined in States shareholder from a controlled foreign CEIVED.— section 245A) in any taxable year, solely for corporation if the dividend is a hybrid divi- (1) TREATMENT OF DIVIDENDS FROM CERTAIN purposes of determining loss on any disposi- dend. CORPORATIONS.—Paragraph (1) of section tion of stock of such foreign corporation in ‘‘(2) HYBRID DIVIDENDS OF TIERED CORPORA- 246(a) is amended by striking ‘‘and 245’’ and such taxable year or any subsequent taxable TIONS.—If a controlled foreign corporation inserting ‘‘245, and 245A’’. year, the basis of such domestic corporation with respect to which a domestic corporation (2) ASSETS GENERATING TAX-EXEMPT POR- in such stock shall be reduced (but not below is a United States shareholder receives a hy- TION OF DIVIDEND NOT TAKEN INTO ACCOUNT IN zero) by the amount of any deduction allow- brid dividend from any other controlled for- ALLOCATING AND APPORTIONING DEDUCTIBLE able to such domestic corporation under sec- eign corporation with respect to which such EXPENSES.—Paragraph (3) of section 864(e) is tion 245A with respect to such stock.’’. domestic corporation is also a United States amended by striking ‘‘or 245(a)’’ and insert- (2) EFFECTIVE DATE.—The amendments shareholder, then, notwithstanding any ing ‘‘, 245(a), or 245A’’. made by this subsection shall apply to divi- other provision of this title— (3) COORDINATION WITH SECTION 1059.—Sub- dends received in taxable years beginning ‘‘(A) the hybrid dividend shall be treated paragraph (B) of section 1059(b)(2) is amended after December 31, 2017. for purposes of section 951(a)(1)(A) as subpart by striking ‘‘or 245’’ and inserting ‘‘245, or (c) SALE BY A CFC OF A LOWER TIER CFC.— F income of the receiving controlled foreign 245A’’. Section 964(e) is amended by adding at the corporation for the taxable year of the con- (d) COORDINATION WITH FOREIGN TAX CRED- end the following new paragraph: trolled foreign corporation in which the divi- IT LIMITATION.—Subsection (b) of section 904 ‘‘(4) COORDINATION WITH DIVIDENDS RE- dend was received, and is amended by adding at the end the fol- CEIVED DEDUCTION.— ‘‘(B) the United States shareholder shall lowing new paragraph: ‘‘(A) IN GENERAL.—If, for any taxable year include in gross income an amount equal to ‘‘(5) TREATMENT OF DIVIDENDS FOR WHICH of a controlled foreign corporation beginning the shareholder’s pro rata share (determined DEDUCTION IS ALLOWED UNDER SECTION 245A.— after December 31, 2017, any amount is treat- in the same manner as under section For purposes of subsection (a), in the case of ed as a dividend under paragraph (1) by rea- 951(a)(2)) of the subpart F income described a domestic corporation which is a United son of a sale or exchange by the controlled in subparagraph (A). States shareholder with respect to a speci- foreign corporation of stock in another for- ‘‘(3) DENIAL OF FOREIGN TAX CREDIT, ETC.— fied 10-percent owned foreign corporation, eign corporation held for 1 year or more, The rules of subsection (d) shall apply to any such domestic corporation’s taxable income then, notwithstanding any other provision of hybrid dividend received by, or any amount from sources without the United States shall this title— included under paragraph (2) in the gross in- be determined without regard to— ‘‘(i) the foreign-source portion of such divi- come of, a United States shareholder. ‘‘(A) the foreign-source portion of any divi- dend shall be treated for purposes of section ‘‘(4) HYBRID DIVIDEND.—The term ‘hybrid dend received from such foreign corporation, 951(a)(1)(A) as subpart F income of the sell- dividend’ means an amount received from a and ing controlled foreign corporation for such controlled foreign corporation— ‘‘(B) any deductions properly allocable to taxable year, ‘‘(A) for which a deduction would be al- such portion. ‘‘(ii) a United States shareholder with re- lowed under subsection (a) but for this sub- Any term which is used in section 245A and spect to the selling controlled foreign cor- section, and in this paragraph shall have the same mean- poration shall include in gross income for ‘‘(B) for which the controlled foreign cor- ing for purposes of this paragraph as when the taxable year of the shareholder with or poration received a deduction (or other tax used in such section.’’. within which such taxable year of the con- benefit) from taxes imposed by any foreign (e) CONFORMING AMENDMENTS.— trolled foreign corporation ends an amount country. (1) Subsection (b) of section 951 is amended equal to the shareholder’s pro rata share (de- ‘‘(f) SPECIAL RULE FOR PURGING DISTRIBU- by striking ‘‘subpart’’ and inserting ‘‘title’’. termined in the same manner as under sec- TIONS OF PASSIVE FOREIGN INVESTMENT COM- (2) Subsection (a) of section 957 is amended PANIES.—Any amount which is treated as a by striking ‘‘subpart’’ in the matter pre- tion 951(a)(2)) of the amount treated as sub- dividend under section 1291(d)(2)(B) shall not ceding paragraph (1) and inserting ‘‘title’’. part F income under clause (i), and be treated as a dividend for purposes of this (3) The table of sections for part VIII of ‘‘(iii) the deduction under section 245A(a) section. subchapter B of chapter 1 is amended by in- shall be allowable to the United States ‘‘(g) REGULATIONS.—The Secretary shall serting after the item relating to section 245 shareholder with respect to the subpart F in- prescribe such regulations or other guidance the following new item: come included in gross income under clause (ii) in the same manner as if such subpart F as may be necessary or appropriate to carry ‘‘Sec. 245A. Dividends received by domestic income were a dividend received by the out the provisions of this section, including corporations from certain for- shareholder from the selling controlled for- regulations for the treatment of United eign corporations.’’. eign corporation. States shareholders owning stock of a speci- (f) EFFECTIVE DATE.—The amendments fied 10 percent owned foreign corporation made by this section shall apply to taxable ‘‘(B) EFFECT OF LOSS ON EARNINGS AND through a partnership.’’. years of foreign corporations beginning after PROFITS.—For purposes of this title, in the (b) APPLICATION OF HOLDING PERIOD RE- December 31, 2017, and to taxable years of case of a sale or exchange by a controlled QUIREMENT.—Subsection (c) of section 246 is United States shareholders in which or with foreign corporation of stock in another for- amended— which such taxable years of foreign corpora- eign corporation in a taxable year of the sell- (1) by striking ‘‘or 245’’ in paragraph (1) tions end. ing controlled foreign corporation beginning and inserting ‘‘245, or 245A’’, and after December 31, 2017, to which this para- SEC. 14102. SPECIAL RULES RELATING TO SALES (2) by adding at the end the following new OR TRANSFERS INVOLVING SPECI- graph would apply if gain were recognized, paragraph: FIED 10-PERCENT OWNED FOREIGN the earnings and profits of the selling con- ‘‘(5) SPECIAL RULES FOR FOREIGN SOURCE CORPORATIONS. trolled foreign corporation shall not be re- PORTION OF DIVIDENDS RECEIVED FROM SPECI- (a) SALES BY UNITED STATES PERSONS OF duced by reason of any loss from such sale or FIED 10-PERCENT OWNED FOREIGN CORPORA- STOCK.—Section 1248 is amended by redesig- exchange. TIONS.— nating subsection (j) as subsection (k) and by ‘‘(C) FOREIGN-SOURCE PORTION.—For pur- ‘‘(A) 1-YEAR HOLDING PERIOD REQUIRE- inserting after subsection (i) the following poses of this paragraph, the foreign-source MENT.—For purposes of section 245A— new subsection: portion of any amount treated as a dividend

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under paragraph (1) shall be determined in (3) EFFECTIVE DATE.—The amendments ‘‘(II) the amount determined under para- the same manner as under section 245A(c).’’. made by this subsection shall apply to trans- graph (2)(B). (d) TREATMENT OF FOREIGN BRANCH LOSSES fers after December 31, 2017. ‘‘(ii) ALLOCATION OF DEFICIT.—If the TRANSFERRED TO SPECIFIED 10-PERCENT (e) REPEAL OF ACTIVE TRADE OR BUSINESS amount described in clause (i)(II) is less than OWNED FOREIGN CORPORATIONS.— EXCEPTION UNDER SECTION 367.— the amount described in clause (i)(I), then (1) IN GENERAL.—Part II of subchapter B of (1) IN GENERAL.—Section 367(a) is amended the shareholder shall designate, in such form chapter 1 is amended by adding at the end by striking paragraph (3) and redesignating and manner as the Secretary determines— the following new section: paragraphs (4), (5), and (6) as paragraphs (3), ‘‘(I) the amount of the specified E&P def- ‘‘SEC. 91. CERTAIN FOREIGN BRANCH LOSSES (4), and (5), respectively icit which is to be taken into account for TRANSFERRED TO SPECIFIED 10- (2) CONFORMING AMENDMENTS.—Section each E&P deficit corporation with respect to PERCENT OWNED FOREIGN COR- 367(a)(4), as redesignated by paragraph (1), is the taxpayer, and PORATIONS. amended— ‘‘(II) in the case of an E&P deficit corpora- ‘‘(a) IN GENERAL.—If a domestic corpora- (A) by striking ‘‘Paragraphs (2) and (3)’’ tion transfers substantially all of the assets tion which has a qualified deficit (as defined and inserting ‘‘Paragraph (2)’’, and in section 952), the portion (if any) of the def- of a foreign branch (within the meaning of (B) by striking ‘‘PARAGRAPHS (2) AND (3)’’ in section 367(a)(3)(C), as in effect before the icit taken into account under subclause (I) the heading and inserting ‘‘PARAGRAPH (2)’’. which is attributable to a qualified deficit, date of the enactment of the Tax Cuts and (3) EFFECTIVE DATE.—The amendments Jobs Act) to a specified 10-percent owned for- including the qualified activities to which made by this subsection shall apply to trans- such portion is attributable. eign corporation (as defined in section 245A) fers after December 31, 2017. with respect to which it is a United States ‘‘(B) E&P DEFICIT FOREIGN CORPORATION.— SEC. 14103. TREATMENT OF DEFERRED FOREIGN shareholder after such transfer, such domes- The term ‘E&P deficit foreign corporation’ INCOME UPON TRANSITION TO PAR- means, with respect to any taxpayer, any tic corporation shall include in gross income TICIPATION EXEMPTION SYSTEM OF for the taxable year which includes such TAXATION. specified foreign corporation with respect to transfer an amount equal to the transferred (a) IN GENERAL.—Section 965 is amended to which such taxpayer is a United States loss amount with respect to such transfer. read as follows: shareholder, if— ‘‘(b) LIMITATION AND CARRYFORWARD BASED ‘‘SEC. 965. TREATMENT OF DEFERRED FOREIGN ‘‘(i) such specified foreign corporation has ON FOREIGN-SOURCE DIVIDENDS RECEIVED.— INCOME UPON TRANSITION TO PAR- a deficit in post-1986 earnings and profits, ‘‘(1) IN GENERAL.—The amount included in TICIPATION EXEMPTION SYSTEM OF and the gross income of the taxpayer under sub- TAXATION. ‘‘(ii) as of November 9, 2017— section (a) for any taxable year shall not ex- ‘‘(a) TREATMENT OF DEFERRED FOREIGN IN- ‘‘(I) such corporation was a specified for- ceed the amount allowed as a deduction COME AS SUBPART F INCOME.—In the case of eign corporation, and under section 245A for such taxable year the last taxable year of a deferred income ‘‘(II) such taxpayer was a United States (taking into account dividends received from corporation which begins before January 1, shareholder of such corporation. all specified 10-percent owned foreign cor- 2018, the subpart F income of such foreign ‘‘(C) SPECIFIED E&P DEFICIT.—The term porations with respect to which the taxpayer corporation (as otherwise determined for ‘specified E&P deficit’ means, with respect is a United States shareholder). such taxable year under section 952) shall be to any E&P deficit foreign corporation, the ‘‘(2) AMOUNTS NOT INCLUDED CARRIED FOR- increased by the greater of— amount of the deficit referred to in subpara- WARD.—Any amount not included in gross in- ‘‘(1) the accumulated post-1986 deferred for- graph (B). come for any taxable year by reason of para- eign income of such corporation determined ‘‘(4) TREATMENT OF EARNINGS AND PROFITS graph (1) shall, subject to the application of as of November 9, 2017, or IN FUTURE YEARS.— paragraph (1) to the succeeding taxable year, ‘‘(2) the accumulated post-1986 deferred for- ‘‘(A) REDUCED EARNINGS AND PROFITS be included in gross income for the suc- eign income of such corporation determined TREATED AS PREVIOUSLY TAXED INCOME WHEN ceeding taxable year. as of December 31, 2017. DISTRIBUTED.—For purposes of applying sec- ‘‘(b) REDUCTION IN AMOUNTS INCLUDED IN ‘‘(c) TRANSFERRED LOSS AMOUNT.—For pur- tion 959 in any taxable year beginning after GROSS INCOME OF UNITED STATES SHARE- poses of this section, the term ‘transferred December 31, 2017, with respect to any HOLDERS OF SPECIFIED FOREIGN CORPORA- loss amount’ means, with respect to any United States shareholder of a deferred for- TIONS WITH DEFICITS IN EARNINGS AND PROF- transfer of substantially all of the assets of eign income corporation, an amount equal to ITS.— a foreign branch, the excess (if any) of— such shareholder’s reduction under para- ‘‘(1) IN GENERAL.—In the case of a taxpayer ‘‘(1) the sum of losses— graph (1) which is allocated to such deferred ‘‘(A) which were incurred by the foreign which is a United States shareholder with re- spect to at least one deferred foreign income foreign income corporation under this sub- branch after December 31, 2017, and before section shall be treated as an amount which the transfer, and corporation and at least one E&P deficit for- eign corporation, the amount which would was included in the gross income of such ‘‘(B) with respect to which a deduction was United States shareholder under section allowed to the taxpayer, over (but for this subsection) be taken into ac- count under section 951(a)(1) by reason of 951(a). ‘‘(2) the sum of— subsection (a) as such United States share- ‘‘(B) E&P DEFICITS.—For purposes of this ‘‘(A) any taxable income of such branch for holder’s pro rata share of the subpart F in- title, a United States shareholder’s pro rata a taxable year after the taxable year in come of each deferred foreign income cor- share of the earnings and profits of any spec- which the loss was incurred and through the poration shall be reduced by the amount of ified E&P deficit foreign corporation under close of the taxable year of the transfer, and such United States shareholder’s aggregate this subsection shall be increased by the ‘‘(B) any amount which is recognized under foreign E&P deficit which is allocated under amount of the specified E&P deficit of such section 904(f)(3) on account of the transfer. paragraph (2) to such deferred foreign in- corporation taken into account by such ‘‘(d) REDUCTION FOR RECOGNIZED GAINS.— shareholder under paragraph (1), and, for The transferred loss amount shall be reduced come corporation. ‘‘(2) ALLOCATION OF AGGREGATE FOREIGN purposes of section 952, such increase shall (but not below zero) by the amount of gain be attributable to the same activity to which recognized by the taxpayer on account of the E&P DEFICIT.—The aggregate foreign E&P deficit of any United States shareholder the deficit so taken into account was attrib- transfer (other than amounts taken into ac- utable. count under subsection (c)(2)(B)). shall be allocated among the deferred foreign ‘‘(e) SOURCE OF INCOME.—Amounts included income corporations of such United States ‘‘(c) APPLICATION OF PARTICIPATION EXEMP- in gross income under this section shall be shareholder in an amount which bears the TION TO INCLUDED INCOME.— treated as derived from sources within the same proportion to such aggregate as— ‘‘(1) IN GENERAL.—In the case of a United United States. ‘‘(A) such United States shareholder’s pro States shareholder of a deferred foreign in- ‘‘(f) BASIS ADJUSTMENTS.—Consistent with rata share of the accumulated post-1986 de- come corporation, there shall be allowed as a such regulations or other guidance as the ferred foreign income of each such deferred deduction for the taxable year in which an Secretary shall prescribe, proper adjust- foreign income corporation, bears to amount is included in the gross income of ments shall be made in the adjusted basis of ‘‘(B) the aggregate of such United States such United States shareholder under sec- the taxpayer’s stock in the specified 10-per- shareholder’s pro rata share of the accumu- tion 951(a)(1) by reason of this section an cent owned foreign corporation to which the lated post-1986 deferred foreign income of all amount equal to the sum of— transfer is made, and in the transferee’s ad- deferred foreign income corporations of such ‘‘(A) 78.6 percent of the excess (if any) of— justed basis in the property transferred, to United States shareholder. ‘‘(i) the amount so included as gross in- reflect amounts included in gross income ‘‘(3) DEFINITIONS RELATED TO E&P DEFI- come, over under this section.’’. CITS.—For purposes of this subsection— ‘‘(ii) the amount of such United States (2) CLERICAL AMENDMENT.—The table of ‘‘(A) AGGREGATE FOREIGN E&P DEFICIT.— shareholder’s aggregate foreign cash posi- sections for part II of subchapter B of chap- ‘‘(i) IN GENERAL.—The term ‘aggregate for- tion, plus ter 1 is amended by adding at the end the fol- eign E&P deficit’ means, with respect to any ‘‘(B) 58.6 percent of so much of the amount lowing new item: United States shareholder, the lesser of— described in subparagraph (A)(ii) as does not ‘‘Sec. 91. Certain foreign branch losses ‘‘(I) the aggregate of such shareholder’s pro exceed the amount described in subpara- transferred to specified 10-per- rata shares of the specified E&P deficits of graph (A)(i). cent owned foreign corpora- the E&P deficit foreign corporations of such ‘‘(2) AGGREGATE FOREIGN CASH POSITION.— tions.’’. shareholder, or For purposes of this subsection—

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‘‘(A) IN GENERAL.—The term ‘aggregate for- ‘‘(d) DEFERRED FOREIGN INCOME CORPORA- corporation as a controlled foreign corpora- eign cash position’ means, with respect to TION; ACCUMULATED POST-1986 DEFERRED tion). any United States shareholder, the greater FOREIGN INCOME.—For purposes of this sec- ‘‘(g) DISALLOWANCE OF FOREIGN TAX CRED- of— tion— IT, ETC.— ‘‘(i) the aggregate of such United States ‘‘(1) DEFERRED FOREIGN INCOME CORPORA- ‘‘(1) IN GENERAL.—No credit shall be al- shareholder’s pro rata share of the cash posi- TION.—The term ‘deferred foreign income lowed under section 901 for the applicable tion of each specified foreign corporation of corporation’ means, with respect to any percentage of any taxes paid or accrued (or such United States shareholder determined United States shareholder, any specified for- treated as paid or accrued) with respect to as of the close of the last taxable year of eign corporation of such United States any amount for which a deduction is allowed such specified foreign corporation which be- shareholder which has accumulated post-1986 under this section. gins before January 1, 2018, or deferred foreign income (as of the close of ‘‘(2) APPLICABLE PERCENTAGE.—For pur- ‘‘(ii) one half of the sum of— the taxable year referred to in subsection poses of this subsection, the term ‘applicable ‘‘(I) the aggregate described in clause (i) (a)) greater than zero. percentage’ means the amount (expressed as determined as of the close of the last taxable ‘‘(2) ACCUMULATED POST-1986 DEFERRED FOR- a percentage) equal to the sum of— year of each such specified foreign corpora- EIGN INCOME.—The term ‘accumulated post- ‘‘(A) 0.786 multiplied by the ratio of— tion which ends before November 9, 2017, plus 1986 deferred foreign income’ means the post- ‘‘(i) the excess to which subsection (c)(1)(A) ‘‘(II) the aggregate described in clause (i) 1986 earnings and profits except to the extent applies, divided by determined as of the close of the taxable such earnings— ‘‘(ii) the sum of such excess plus the year of each such specified foreign corpora- ‘‘(A) are attributable to income of the amount to which subsection (c)(1)(B) applies, tion which precedes the taxable year referred specified foreign corporation which is effec- plus to in subclause (I). tively connected with the conduct of a trade ‘‘(B) 0.586 multiplied by the ratio of— ‘‘(B) CASH POSITION.—For purposes of this or business within the United States and ‘‘(i) the amount to which subsection paragraph, the cash position of any specified subject to tax under this chapter, or (c)(1)(B) applies, divided by foreign corporation is the sum of— ‘‘(B) in the case of a controlled foreign cor- ‘‘(ii) the sum described in subparagraph ‘‘(i) cash and foreign currency held by such poration, if distributed, would be excluded (A)(ii). foreign corporation, from the gross income of a United States ‘‘(3) DENIAL OF DEDUCTION.—No deduction ‘‘(ii) the net accounts receivable of such shareholder under section 959. shall be allowed under this chapter for any tax for which credit is not allowable under foreign corporation, plus To the extent provided in regulations or section 901 by reason of paragraph (1) (deter- ‘‘(iii) the fair market value of the fol- other guidance prescribed by the Secretary, mined by treating the taxpayer as having lowing assets held by such corporation: in the case of any controlled foreign corpora- elected the benefits of subpart A of part III ‘‘(I) Personal property which is of a type tion which has shareholders which are not of subchapter N). that is actively traded and for which there is United States shareholders, accumulated ‘‘(4) COORDINATION WITH SECTION 78.—Sec- an established financial market (other than post-1986 deferred foreign income shall be ap- tion 78 shall not apply to any tax for which stock in the specified foreign corporation). propriately reduced by amounts which would credit is not allowable under section 901 by ‘‘(II) Commercial paper, certificates of de- be described in subparagraph (B) if such reason of paragraph (1). posit, the securities of the Federal govern- shareholders were United States share- ment and of any State or foreign govern- ‘‘(h) ELECTION TO PAY LIABILITY IN IN- holders. ment. STALLMENTS.— ‘‘(3) POST-1986 EARNINGS AND PROFITS.—The ‘‘(III) Any obligation with a term of less ‘‘(1) IN GENERAL.—In the case of a United term ‘post-1986 earnings and profits’ means than one year. States shareholder of a deferred foreign in- the earnings and profits of the foreign cor- ‘‘(IV) Any asset which the Secretary iden- come corporation, such United States share- poration (computed in accordance with sec- tifies as being economically equivalent to holder may elect to pay the net tax liability tions 964(a) and 986, and by only taking into any asset described in this subparagraph. under this section in 8 installments of the account periods when the foreign corpora- ‘‘(C) NET ACCOUNTS RECEIVABLE.—For pur- following amounts: tion was a specified foreign corporation) ac- poses of this paragraph, the term ‘net ac- ‘‘(A) 8 percent of the net tax liability in counts receivable’ means, with respect to cumulated in taxable years beginning after the case of each of the first 5 of such install- any specified foreign corporation, the excess December 31, 1986, and determined— ments, (if any) of— ‘‘(A) as of the date of the taxable year re- ‘‘(B) 15 percent of the net tax liability in ‘‘(i) such corporation’s accounts receivable, ferred to in paragraph (1) or (2) of subsection the case of the 6th such installment, over (a), whichever is applicable with respect to ‘‘(C) 20 percent of the net tax liability in ‘‘(ii) such corporation’s accounts payable such foreign corporation, and the case of the 7th such installment, and (determined consistent with the rules of sec- ‘‘(B) without diminution by reason of divi- ‘‘(D) 25 percent of the net tax liability in tion 461). dends distributed during the taxable year the case of the 8th such installment. ‘‘(D) PREVENTION OF DOUBLE COUNTING.— ending with or including such date. ‘‘(2) DATE FOR PAYMENT OF INSTALLMENTS.— Cash positions of a specified foreign corpora- ‘‘(e) SPECIFIED FOREIGN CORPORATION.— If an election is made under paragraph (1), tion described in clause (ii) or (iii)(III) of ‘‘(1) IN GENERAL.—For purposes of this sec- the first installment shall be paid on the due subparagraph (B) shall not be taken into ac- tion, the term ‘specified foreign corporation’ date (determined without regard to any ex- count by a United States shareholder under means— tension of time for filing the return) for the subparagraph (A) to the extent that such ‘‘(A) any controlled foreign corporation, return of tax for the taxable year described United States shareholder demonstrates to and in subsection (a) and each succeeding install- the satisfaction of the Secretary that such ‘‘(B) any section 902 corporation (as defined ment shall be paid on the due date (as so de- amount is so taken into account by such in section 909(d)(5) as in effect before the termined) for the return of tax for the tax- United States shareholder with respect to date of the enactment of the Tax Cuts and able year following the taxable year with re- another specified foreign corporation. Jobs Act). spect to which the preceding installment was ‘‘(E) CASH POSITIONS OF CERTAIN NON-COR- ‘‘(2) APPLICATION TO SECTION 902 CORPORA- made. PORATE ENTITIES TAKEN INTO ACCOUNT.—An TIONS.—For purposes of sections 951 and 961, ‘‘(3) ACCELERATION OF PAYMENT.—If there is entity shall be treated as a specified foreign a section 902 corporation (as so defined) shall an addition to tax for failure to timely pay corporation of a United States shareholder be treated as a controlled foreign corpora- any installment required under this sub- for purposes of determining such United tion solely for purposes of taking into ac- section, a liquidation or sale of substantially States shareholder’s aggregate foreign cash count the subpart F income of such corpora- all the assets of the taxpayer (including in a position if— tion under subsection (a) (and for purposes of title 11 or similar case), a cessation of busi- ‘‘(i) such entity is a foreign entity which applying subsection (e)). ness by the taxpayer, or any similar cir- would be a specified foreign corporation of ‘‘(3) EXCLUSION OF PASSIVE FOREIGN INVEST- cumstance, then the unpaid portion of all re- such United States shareholder if such enti- MENT COMPANIES.—Such term shall not in- maining installments shall be due on the ty were a corporation, or clude any corporation which is a passive for- date of such event (or in the case of a title ‘‘(ii) any interest in such entity is held by eign investment company (as defined in sec- 11 or similar case, the day before the petition a specified foreign corporation of such tion 1297) with respect to the shareholder is filed). The preceding sentence shall not United States shareholder (determined after and which is not a controlled foreign cor- apply to the sale of substantially all the as- application of clause (i)) and such entity poration. sets of a taxpayer to a buyer if such buyer would be a specified foreign corporation of ‘‘(f) DETERMINATIONS OF PRO RATA enters into an agreement with the Secretary such United States shareholder if such enti- SHARE.—For purposes of this section, the de- under which such buyer is liable for the re- ty were a foreign corporation. termination of any United States share- maining installments due under this sub- ‘‘(F) ANTI-ABUSE.—If the Secretary deter- holder’s pro rata share of any amount with section in the same manner as if such buyer mines that a principal purpose of any trans- respect to any specified foreign corporation were the taxpayer. action was to reduce the aggregate foreign shall be determined under rules similar to ‘‘(4) PRORATION OF DEFICIENCY TO INSTALL- cash position taken into account under this the rules of section 951(a)(2) by treating such MENTS.—If an election is made under para- subsection, such transaction shall be dis- amount in the same manner as subpart F in- graph (1) to pay the net tax liability under regarded for purposes of this subsection. come (and by treating such specified foreign this section in installments and a deficiency

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has been assessed with respect to such net ‘‘(C) TRANSFER OF LIABILITY.—A transfer ‘‘(B) shall be made in such manner as the tax liability, the deficiency shall be prorated described in clause (iii) of subparagraph (A) Secretary shall provide. to the installments payable under paragraph shall not be treated as a triggering event if ‘‘(j) REPORTING BY S CORPORATION.—Each S (1). The part of the deficiency so prorated to the transferee enters into an agreement with corporation which is a United States share- any installment the date for payment of the Secretary under which such transferee is holder of a specified foreign corporation which has not arrived shall be collected at liable for net tax liability with respect to shall report in its return of tax under section the same time as, and as a part of, such in- such stock in the same manner as if such 6037(a) the amount includible in its gross in- stallment. The part of the deficiency so pro- transferee were the taxpayer. come for such taxable year by reason of this rated to any installment the date for pay- ‘‘(3) NET TAX LIABILITY.—A shareholder’s section and the amount of the deduction al- ment of which has arrived shall be paid upon net tax liability under this section with re- lowable by subsection (b). Any copy provided notice and demand from the Secretary. This spect to any S corporation is the net tax li- to a shareholder under section 6037(b) shall subsection shall not apply if the deficiency is ability under this section which would be de- include a statement of such shareholder’s due to negligence, to intentional disregard of termined under subsection (h)(6) if the only pro rata share of such amounts. rules and regulations, or to fraud with intent subpart F income taken into account by ‘‘(k) EXTENSION OF LIMITATION ON ASSESS- to evade tax. such shareholder by reason of this section MENT.—Notwithstanding section 6501, the ‘‘(5) ELECTION.—Any election under para- were allocations from such S corporation. limitation on the time period for the assess- graph (1) shall be made not later than the ‘‘(4) ELECTION TO PAY DEFERRED LIABILITY ment of the net tax liability under this sec- due date for the return of tax for the taxable IN INSTALLMENTS.—In the case of a taxpayer tion (as defined in subsection (h)(6)) shall not year described in subsection (a) and shall be which elects to defer payment under para- expire before the date that is 6 years after made in such manner as the Secretary shall graph (1)— the return for the taxable year described in provide. ‘‘(A) subsection (h) shall be applied sepa- such subsection was filed. ‘‘(6) NET TAX LIABILITY UNDER THIS SEC- rately with respect to the liability to which ‘‘(l) RECAPTURE FOR EXPATRIATED ENTI- TION.—For purposes of this subsection— such election applies, TIES.— ‘‘(A) IN GENERAL.—The net tax liability ‘‘(B) an election under subsection (h) with ‘‘(1) IN GENERAL.—If a deduction is allowed under this section with respect to any respect to such liability shall be treated as under subsection (c) to a United States United States shareholder is the excess (if shareholder and such shareholder first be- any) of— timely made if made not later than the due comes an expatriated entity at any time dur- ‘‘(i) such taxpayer’s net income tax for the date for the return of tax for the taxable ing the 10-year period beginning on the date taxable year in which an amount is included year in which the triggering event with re- of the enactment of the Tax Cuts and Jobs in the gross income of such United States spect to such liability occurs, shareholder under section 951(a)(1) by reason ‘‘(C) the first installment under subsection Act, then— of this section, over (h) with respect to such liability shall be ‘‘(A) the tax imposed by this chapter shall ‘‘(ii) such taxpayer’s net income tax for paid not later than such due date (but deter- be increased for the first taxable year in such taxable year determined— mined without regard to any extension of which such taxpayer becomes an expatriated ‘‘(I) without regard to this section, and time for filing the return), and entity by an amount equal to 35 percent of ‘‘(II) without regard to any income or de- ‘‘(D) if the triggering event with respect to the amount of the deduction allowed to the duction properly attributable to a dividend any net tax liability is described in para- specified foreign corporation under sub- received by such United States shareholder graph (2)(A)(ii), an election under subsection section (c), and from any deferred foreign income corpora- (h) with respect to such liability may be ‘‘(B) no credits shall be allowed against the tion. made only with the consent of the Secretary. increase in tax under subparagraph (A). ‘‘(B) NET INCOME TAX.—The term ‘net in- ‘‘(5) JOINT AND SEVERAL LIABILITY OF S COR- ‘‘(2) EXPATRIATED ENTITY.—For purposes of come tax’ means the regular tax liability re- PORATION.—If any shareholder of an S cor- this subsection, the term ‘expatriated entity’ duced by the credits allowed under subparts poration elects to defer payment under para- has the same meaning given such term under A, B, and D of part IV of subchapter A. graph (1), such S corporation shall be jointly section 7874(a)(2), except that such term ‘‘(i) SPECIAL RULES FOR S CORPORATION and severally liable for such payment and shall not include an entity if the surrogate SHAREHOLDERS.— any penalty, addition to tax, or additional foreign corporation with respect to the enti- ‘‘(1) IN GENERAL.—In the case of any S cor- amount attributable thereto. ty is treated as a domestic corporation under poration which is a United States share- ‘‘(6) EXTENSION OF LIMITATION ON COLLEC- section 7874(b). holder of a deferred foreign income corpora- TION.—Any limitation on the time period for ‘‘(m) SPECIAL RULES FOR UNITED STATES tion, each shareholder of such S corporation the collection of a liability deferred under SHAREHOLDERS WHICH ARE REAL ESTATE IN- may elect to defer payment of such share- this subsection shall not be treated as begin- VESTMENT TRUSTS.— holder’s net tax liability under this section ning before the date of the triggering event ‘‘(1) IN GENERAL.—If a real estate invest- with respect to such S corporation until the with respect to such liability. ment trust is a United States shareholder in shareholder’s taxable year which includes ‘‘(7) ANNUAL REPORTING OF NET TAX LIABIL- 1 or more deferred foreign income corpora- the triggering event with respect to such li- ITY.— tions— ability. Any net tax liability payment of ‘‘(A) IN GENERAL.—Any shareholder of an S ‘‘(A) any amount required to be taken into which is deferred under the preceding sen- corporation which makes an election under account under section 951(a)(1) by reason of tence shall be assessed on the return of tax paragraph (1) shall report the amount of this section shall not be taken into account as an addition to tax in the shareholder’s such shareholder’s deferred net tax liability as gross income of the real estate investment taxable year which includes such triggering on such shareholder’s return of tax for the trust for purposes of applying paragraphs (2) event. taxable year for which such election is made and (3) of section 856(c) to any taxable year ‘‘(2) TRIGGERING EVENT.— and on the return of tax for each taxable for which such amount is taken into account ‘‘(A) IN GENERAL.—In the case of any share- year thereafter until such amount has been under section 951(a)(1), and holder’s net tax liability under this section fully assessed on such returns. ‘‘(B) if the real estate investment trust with respect to any S corporation, the trig- ‘‘(B) DEFERRED NET TAX LIABILITY.—For elects the application of this subparagraph, gering event with respect to such liability is purposes of this paragraph, the term ‘de- notwithstanding subsection (a), any amount whichever of the following occurs first: ferred net tax liability’ means, with respect required to be taken into account under sec- ‘‘(i) Such corporation ceases to be an S cor- to any taxable year, the amount of net tax tion 951(a)(1) by reason of this section shall, poration (determined as of the first day of liability payment of which has been deferred in lieu of the taxable year in which it would the first taxable year that such corporation under paragraph (1) and which has not been otherwise be included in gross income ((for is not an S corporation). assessed on a return of tax for any prior tax- purposes of the computation of real estate ‘‘(ii) A liquidation or sale of substantially able year. investment trust taxable income under sec- all the assets of such S corporation (includ- ‘‘(C) FAILURE TO REPORT.—In the case of tion 857(b)), be included in gross income as ing in a title 11 or similar case), a cessation any failure to report any amount required to follows: of business by such S corporation, such S be reported under subparagraph (A) with re- ‘‘(i) 8 percent of such amount in the case of corporation ceases to exist, or any similar spect to any taxable year before the due date each of the taxable years in the 5-taxable circumstance. for the return of tax for such taxable year, year period beginning with the taxable year ‘‘(iii) A transfer of any share of stock in there shall be assessed on such return as an in which such amount would otherwise be in- such S corporation by the taxpayer (includ- addition to tax 5 percent of such amount. cluded. ing by reason of death, or otherwise). ‘‘(8) ELECTION.—Any election under para- ‘‘(ii) 15 percent of such amount in the case ‘‘(B) PARTIAL TRANSFERS OF STOCK.—In the graph (1)— of the 1st taxable year following such period. case of a transfer of less than all of the tax- ‘‘(A) shall be made by the shareholder of ‘‘(iii) 20 percent of such amount in the case payer’s shares of stock in the S corporation, the S corporation not later than the due date of the 2nd taxable year following such pe- such transfer shall only be a triggering event for such shareholder’s return of tax for the riod. with respect to so much of the taxpayer’s net taxable year which includes the close of the ‘‘(iv) 25 percent of such amount in the case tax liability under this section with respect taxable year of such S corporation in which of the 3rd taxable year following such period. to such S corporation as is properly allocable the amount described in subsection (a) is ‘‘(2) RULES FOR TRUSTS ELECTING DEFERRED to such stock. taken into account, and INCLUSION.—

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‘‘(A) ELECTION.—Any election under para- (b) CLERICAL AMENDMENT.—The table of such controlled foreign corporation, the ex- graph (1)(B) shall be made not later than the sections for subpart F of part III of sub- cess (if any) of— due date for the first taxable year in the 5- chapter N of chapter 1 is amended by strik- ‘‘(i) the gross income of such corporation taxable year period described in clause (i) of ing the item relating to section 965 and in- determined without regard to— paragraph (1)(B) and shall be made in such serting the following: ‘‘(I) any item of income described in sec- manner as the Secretary shall provide. ‘‘Sec. 965. Treatment of deferred foreign in- tion 952(b), ‘‘(B) SPECIAL RULES.—If an election under come upon transition to par- ‘‘(II) any gross income taken into account paragraph (1)(B) is in effect with respect to ticipation exemption system of in determining the subpart F income of such any real estate investment trust, the fol- taxation.’’. corporation, lowing rules shall apply: Subpart B—Rules Related to Passive and ‘‘(III) any gross income excluded from the ‘‘(i) APPLICATION OF PARTICIPATION EXEMP- Mobile Income foreign base company income (as defined in TION.—For purposes of subsection (c)(1)— section 954) and the insurance income (as de- ‘‘(I) the aggregate amount to which sub- CHAPTER 1—TAXATION OF FOREIGN-DE- fined in section 953) of such corporation by paragraph (A) or (B) of subsection (c)(1) ap- RIVED INTANGIBLE INCOME AND GLOB- reason of section 954(b)(4), plies shall be determined without regard to AL INTANGIBLE LOW-TAXED INCOME ‘‘(IV) any dividend received from a related the election, SEC. 14201. CURRENT YEAR INCLUSION OF GLOB- person (as defined in section 954(d)(3)), and ‘‘(II) each such aggregate amount shall be AL INTANGIBLE LOW-TAXED INCOME ‘‘(V) any foreign oil and gas extraction in- BY UNITED STATES SHAREHOLDERS. allocated to each taxable year described in come (as defined in section 907(c)(1)) of such (a) IN GENERAL.—Subpart F of part III of paragraph (1)(B) in the same proportion as corporation, over subchapter N of chapter 1 is amended by in- the amount included in the gross income of ‘‘(ii) the deductions (including taxes) prop- serting after section 951 the following new such United States shareholder under sec- erly allocable to such gross income under section: tion 951(a)(1) by reason of this section is allo- rules similar to the rules of section 954(b)(5). ‘‘SEC. 951A. GLOBAL INTANGIBLE LOW-TAXED IN- cated to each such taxable year. ‘‘(B) TESTED LOSS.— COME INCLUDED IN GROSS INCOME ‘‘(III) NO INSTALLMENT PAYMENTS.—The OF UNITED STATES SHAREHOLDERS. ‘‘(i) IN GENERAL.—The term ‘tested loss’ real estate investment trust may not make means, with respect to any controlled for- ‘‘(a) IN GENERAL.—Each person who is a an election under subsection (g) for any tax- United States shareholder of any controlled eign corporation for any taxable year of such able year described in paragraph (1)(B). foreign corporation for any taxable year of controlled foreign corporation, the excess (if ‘‘(ii) ACCELERATION OF INCLUSION.—If there such United States shareholder shall include any) of the amount described in subpara- is a liquidation or sale of substantially all in gross income such shareholder’s global in- graph (A)(ii) over the amount described in the assets of the real estate investment trust tangible low-taxed income for such taxable subparagraph (A)(i). (including in a title 11 or similar case), a ces- year. ‘‘(ii) COORDINATION WITH SUBPART F TO DENY sation of business by such trust, or any simi- ‘‘(b) GLOBAL INTANGIBLE LOW-TAXED IN- DOUBLE BENEFIT OF LOSSES.—Section lar circumstance, then any amount not yet COME.—For purposes of this section— 952(c)(1)(A) shall be applied by increasing the included in gross income under paragraph ‘‘(1) IN GENERAL.—The term ‘global intan- earnings and profits of the controlled foreign (1)(B) shall be included in gross income as of gible low-taxed income’ means, with respect corporation by the tested loss of such cor- the day before the date of the event and the to any United States shareholder for any poration. unpaid portion of any tax liability with re- taxable year of such United States share- ‘‘(d) QUALIFIED BUSINESS ASSET INVEST- spect to such inclusion shall be due on the holder, the excess (if any) of— MENT.—For purposes of this section— date of such event (or in the case of a title ‘‘(A) such shareholder’s net CFC tested in- ‘‘(1) IN GENERAL.—The term ‘qualified busi- 11 or similar case, the day before the petition come for such taxable year, over ness asset investment’ means, with respect is filed). ‘‘(B) such shareholder’s net deemed tan- to any corporation for any taxable year of ‘‘(n) ELECTION NOT TO APPLY NET OPER- gible income return for such taxable year. such controlled foreign corporation, the av- ATING LOSS DEDUCTION.— ‘‘(2) NET DEEMED TANGIBLE INCOME RE- erage of the aggregate of the corporation’s ‘‘(1) IN GENERAL.—If a United States share- TURN.—The term ‘net deemed tangible in- adjusted bases as of the close of each quarter holder of a deferred foreign income corpora- come return’ means, with respect to any of such taxable year in specified tangible tion elects the application of this subsection United States shareholder for any taxable property — for the taxable year described in subsection year, an amount equal to 10 percent of the ‘‘(A) used in a trade or business of the cor- (a), then the amount described in paragraph aggregate of such shareholder’s pro rata poration, and (2) shall not be taken into account— share of the qualified business asset invest- ‘‘(B) of a type with respect to which a de- ‘‘(A) in determining the amount of the net ment of each controlled foreign corporation duction is allowable under section 167. operating loss deduction under section 172 of with respect to which such shareholder is a ‘‘(2) SPECIFIED TANGIBLE PROPERTY.— such shareholder for such taxable year, or United States shareholder for such taxable ‘‘(A) IN GENERAL.—The term ‘specified tan- ‘‘(B) in determining the amount of taxable year (determined for each taxable year of gible property’ means, except as provided in income for such taxable year which may be each such controlled foreign corporation subparagraph (B), any tangible property used reduced by net operating loss carryovers or which ends in or with such taxable year of in the production of tested income. carrybacks to such taxable year under sec- such United States shareholder). ‘‘(B) DUAL USE PROPERTY.—In the case of tion 172. ‘‘(c) NET CFC TESTED INCOME.—For pur- property used both in the production of test- ‘‘(2) AMOUNT DESCRIBED.—The amount de- poses of this section— ed income and income which is not tested in- scribed in this paragraph is the sum of— ‘‘(1) IN GENERAL.—The term ‘net CFC test- come, such property shall be treated as spec- ‘‘(A) the amount required to be taken into ed income’ means, with respect to any ified tangible property in the same propor- account under section 951(a)(1) by reason of United States shareholder for any taxable tion that the gross income described in sub- this section (determined after the applica- year of such United States shareholder, the section (c)(1)(A) produced with respect to tion of subsection (c)), plus excess (if any) of— such property bears to the total gross in- ‘‘(B) in the case of a domestic corporation ‘‘(A) the aggregate of such shareholder’s come produced with respect to such prop- which chooses to have the benefits of subpart pro rata share of the tested income of each erty. A of part III of subchapter N for the taxable controlled foreign corporation with respect ‘‘(3) DETERMINATION OF ADJUSTED BASIS.— year, the taxes deemed to be paid by such to which such shareholder is a United States For purposes of this subsection, notwith- corporation under subsections (a) and (b) of shareholder for such taxable year of such standing any provision of this title (or any section 960 for such taxable year with respect United States shareholder (determined for other provision of law) which is enacted after to the amount described in subparagraph (A) each taxable year of such controlled foreign the date of the enactment of this section, the which are treated as a dividends under sec- corporation which ends in or with such tax- adjusted basis in any property shall be deter- tion 78. able year of such United States shareholder), mined using the alternative depreciation ‘‘(3) ELECTION.—Any election under this over system under section 168(g). subsection shall be made not later than the ‘‘(B) the aggregate of such shareholder’s ‘‘(4) REGULATIONS.—The Secretary shall due date (including extensions) for filing the pro rata share of the tested loss of each con- issue such regulations or other guidance as return of tax for the taxable year and shall trolled foreign corporation with respect to the Secretary determines appropriate to pre- be made in such manner as the Secretary which such shareholder is a United States vent the avoidance of the purposes of this shall prescribe. shareholder for such taxable year of such subsection, including regulations or other ‘‘(o) REGULATIONS.—The Secretary shall United States shareholder (determined for guidance which provide for the treatment of prescribe such regulations or other guidance each taxable year of such controlled foreign property if— as may be necessary or appropriate to carry corporation which ends in or with such tax- ‘‘(A) such property is transferred, or held, out the provisions of this section or to pre- able year of such United States shareholder). temporarily, or vent the avoidance of the purposes of this ‘‘(2) TESTED INCOME; TESTED LOSS.—For ‘‘(B) the avoidance of the purposes of this section, including through a reduction in purposes of this section— paragraph is a factor in the transfer or hold- earnings and profits through changes in enti- ‘‘(A) TESTED INCOME.—The term ‘tested in- ing of such property. ty classification, changes in accounting come’ means, with respect to any controlled ‘‘(e) DETERMINATION OF PRO RATA SHARE, methods, or otherwise.’’. foreign corporation for any taxable year of ETC.—For purposes of this section—

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‘‘(1) IN GENERAL.—The pro rata shares re- ‘‘(2) INCLUSION PERCENTAGE.—For purposes ‘‘(i) the sum of the foreign-derived intan- ferred to in subsections (b), (c)(1)(A), and of paragraph (1), the term ‘inclusion percent- gible income and the global intangible low- (c)(1)(B), respectively, shall be determined age’ means, with respect to any domestic taxed income amount otherwise taken into under the rules of section 951(a)(2) in the corporation, the ratio (expressed as a per- account by the domestic corporation under same manner as such section applies to sub- centage) of— paragraph (1), exceeds part F income and shall be taken into ac- ‘‘(A) such corporation’s global intangible ‘‘(ii) the taxable income of the domestic count in the taxable year of the United low-taxed income (as defined in section corporation (determined without regard to States shareholder in which or with which 951A(b)), divided by this section), the taxable year of the controlled foreign ‘‘(B) the aggregate amount described in then the amount of the foreign-derived in- corporation ends. section 951A(c)(1)(A) with respect to such tangible income and the global intangible ‘‘(2) TREATMENT AS UNITED STATES SHARE- corporation. low-taxed income amount so taken into ac- HOLDER.—For purposes of paragraph (1), a ‘‘(3) TESTED FOREIGN INCOME TAXES.—For count shall be reduced as provided in sub- person shall be treated as a United States purposes of paragraph (1), the term ‘tested paragraph (B). shareholder of a controlled foreign corpora- foreign income taxes’ means, with respect to ‘‘(B) REDUCTION.—For purposes of subpara- tion for any taxable year only if such person any domestic corporation which is a United graph (A)— owns (within the meaning of section 958(a)) States shareholder of a controlled foreign ‘‘(i) foreign-derived intangible income shall stock in such foreign corporation on the last corporation, the foreign income taxes paid or be reduced by an amount which bears the day, in such year, on which such foreign cor- accrued by such foreign corporation which same ratio to the excess described in sub- poration is a controlled foreign corporation. are properly attributable to the tested in- paragraph (A) as such foreign-derived intan- ‘‘(3) TREATMENT AS CONTROLLED FOREIGN come of such foreign corporation taken into gible income bears to the sum described in CORPORATION.—A foreign corporation shall be account by such domestic corporation under subparagraph (A)(i), and treated as a controlled foreign corporation section 951A.’’. ‘‘(ii) the global intangible low-taxed in- for any taxable year if such foreign corpora- (2) APPLICATION OF FOREIGN TAX CREDIT LIM- come amount shall be reduced by the re- tion is a controlled foreign corporation at ITATION.— mainder of such excess. any time during such taxable year. (A) SEPARATE BASKET FOR GLOBAL INTAN- ‘‘(3) REDUCTION IN DEDUCTION FOR TAXABLE ‘‘(f) TREATMENT AS SUBPART F INCOME FOR GIBLE LOW-TAXED INCOME.—Section 904(d)(1) YEARS AFTER 2025.—In the case of any taxable CERTAIN PURPOSES.— is amended by redesignating subparagraphs year beginning after December 31, 2025, para- ‘‘(1) IN GENERAL.— (A) and (B) as subparagraphs (B) and (C), re- graph (1) shall be applied by substituting— ‘‘(A) APPLICATION.—Except as provided in spectively, and by inserting before subpara- ‘‘(A) ‘21.875 percent’ for ‘37.5 percent’ in subparagraph (B), any global intangible low- graph (B) (as so redesignated) the following subparagraph (A), and taxed income included in gross income under new subparagraph: ‘‘(B) ‘37.5 percent’ for ‘50 percent’ in sub- subsection (a) shall be treated in the same ‘‘(A) any amount includible in gross in- paragraph (B). manner as an amount included under section come under section 951A (other than passive ‘‘(b) FOREIGN-DERIVED INTANGIBLE IN- 951(a)(1)(A) for purposes of applying sections category income),’’. COME.—For purposes of this section— 168(h)(2)(B), 535(b)(10), 851(b), 904(h)(1), 959, (B) EXCLUSION FROM GENERAL CATEGORY IN- ‘‘(1) IN GENERAL.—The foreign-derived in- 961, 962(c), 962(d), 993(a)(1)(E), 996(f)(1), COME.—Section 904(d)(2)(A)(ii) is amended by tangible income of any domestic corporation 1248(b)(1), 1248(d)(1), 6501(e)(1)(C), inserting ‘‘income described in paragraph is the amount which bears the same ratio to 6654(d)(2)(D), and 6655(e)(4). (1)(A) and’’ before ‘‘passive category in- the deemed intangible income of such cor- ‘‘(B) EXCEPTION.—The Secretary shall pro- come’’. poration as— vide rules for the application of subpara- (C) NO CARRYOVER OR CARRYBACK OF EXCESS ‘‘(A) the foreign-derived deduction eligible graph (A) to other provisions of this title in TAXES.—Section 904(c) is amended by adding income of such corporation, bears to any case in which the determination of sub- at the end the following: ‘‘This subsection ‘‘(B) the deduction eligible income of such part F income is required to be made at the shall not apply to taxes paid or accrued with corporation. level of the controlled foreign corporation. respect to amounts described in subsection ‘‘(2) DEEMED INTANGIBLE INCOME.—For pur- ‘‘(2) ALLOCATION OF GLOBAL INTANGIBLE (d)(1)(A).’’. poses of this subsection— LOW-TAXED INCOME TO CONTROLLED FOREIGN (c) CLERICAL AMENDMENT .—The table of ‘‘(A) IN GENERAL.—The term ‘deemed intan- CORPORATIONS.—For purposes of the sections sections for subpart F of part III of sub- gible income’ means the excess (if any) of— referred to in paragraph (1), with respect to chapter N of chapter 1 is amended by insert- ‘‘(i) the deduction eligible income of the any controlled foreign corporation any pro ing after the item relating to section 951 the domestic corporation, over rata amount from which is taken into ac- following new item: ‘‘(ii) the deemed tangible income return of count in determining the global intangible ‘‘Sec. 951A. Global intangible low-taxed in- the corporation. low-taxed income included in gross income come included in gross income ‘‘(B) DEEMED TANGIBLE INCOME RETURN.— of a United States shareholder under sub- of United States share- The term ‘deemed tangible income return’ section (a), the portion of such global intan- holders.’’. means, with respect to any corporation, an gible low-taxed income which is treated as (d) EFFECTIVE DATE.—The amendments amount equal to 10 percent of the corpora- being with respect to such controlled foreign made by this section shall apply to taxable tion’s qualified business asset investment (as corporation is— years of foreign corporations beginning after defined in section 951A(d), determined by ‘‘(A) in the case of a controlled foreign cor- December 31, 2017, and to taxable years of substituting ‘deduction eligible income’ for poration with no tested income, zero, and United States shareholders in which or with ‘tested income’ in paragraph (2) thereof). ‘‘(B) in the case of a controlled foreign cor- which such taxable years of foreign corpora- ‘‘(3) DEDUCTION ELIGIBLE INCOME.— poration with tested income, the portion of tions end. ‘‘(A) IN GENERAL.—The term ‘deduction eli- such global intangible low-taxed income SEC. 14202. DEDUCTION FOR FOREIGN-DERIVED gible income’ means, with respect to any do- which bears the same ratio to such global in- INTANGIBLE INCOME AND GLOBAL mestic corporation, the excess (if any) of— tangible low-taxed income as— INTANGIBLE LOW-TAXED INCOME. ‘‘(i) gross income of such corporation de- ‘‘(i) such United States shareholder’s pro (a) IN GENERAL.—Part VIII of subchapter B termined without regard to— rata amount of the tested income of such of chapter 1 is amended by adding at the end ‘‘(I) the subpart F income of such corpora- controlled foreign corporation, bears to the following new section: tion determined under section 951, ‘‘(ii) the aggregate amount described in ‘‘SEC. 250. FOREIGN-DERIVED INTANGIBLE IN- ‘‘(II) the global intangible low-taxed in- subsection (c)(1)(A) with respect to such COME AND GLOBAL INTANGIBLE come determined under section 951A, United States shareholder.’’. LOW-TAXED INCOME. ‘‘(III) any financial services income (as de- (b) FOREIGN TAX CREDIT.— ‘‘(a) ALLOWANCE OF DEDUCTION.— fined in section 904(d)(2)(D)) of such corpora- (1) APPLICATION OF DEEMED PAID FOREIGN ‘‘(1) IN GENERAL.—In the case of a domestic tion which is not described in clause (ii), TAX CREDIT.—Section 960 is amended adding corporation for any taxable year, there shall ‘‘(IV) any dividend received from a cor- at the end the following new subsection: be allowed as a deduction an amount equal poration which is a controlled foreign cor- ‘‘(d) DEEMED PAID CREDIT FOR TAXES PROP- to the sum of— poration of such domestic corporation, ERLY ATTRIBUTABLE TO TESTED INCOME.— ‘‘(A) 37.5 percent of the foreign-derived in- ‘‘(V) any domestic oil and gas extraction ‘‘(1) IN GENERAL.—For purposes of this sub- tangible income of such domestic corpora- income of such corporation, and part, if any amount is includible in the gross tion for such taxable year, plus ‘‘(VI) any foreign branch income (as de- income of a domestic corporation under sec- ‘‘(B) 50 percent of the global intangible fined in section 904(d)(2)(J)), over tion 951A, such domestic corporation shall be low-taxed income amount (if any) which is ‘‘(ii) the deductions (including taxes) prop- deemed to have paid foreign income taxes included in the gross income of such domes- erly allocable to such gross income under equal to 80 percent of the product of— tic corporation under section 951A for such rules similar to the rules of section 954(b)(5). ‘‘(A) such domestic corporation’s inclusion taxable year. ‘‘(B) DOMESTIC OIL AND GAS EXTRACTION IN- percentage, multiplied by ‘‘(2) LIMITATION BASED ON TAXABLE IN- COME.—For purposes of subparagraph (A), the ‘‘(B) the aggregate tested foreign income COME.— term ‘domestic oil and gas extraction in- taxes paid or accrued by controlled foreign ‘‘(A) IN GENERAL.—If, for any taxable come’ means income described in section corporations. year— 907(c)(1), determined by substituting ‘within

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the United States’ for ‘without the United ‘‘(E) SOLD.—For purposes of this sub- (b) CONFORMING AMENDMENTS.— States’. section, the terms ‘sold’, ‘sells’, and ‘sale’ (1) Section 197(f)(2)(B)(i) is amended by in- ‘‘(4) FOREIGN-DERIVED DEDUCTION ELIGIBLE shall include any lease, license, exchange, or serting ‘‘966(a),’’ after ‘‘731,’’. INCOME.—The term ‘foreign-derived deduc- other disposition. (2) The table of sections for subpart F of tion eligible income’ means, with respect to ‘‘(c) REGULATIONS.—The Secretary shall part III of subchapter N of chapter 1 is any taxpayer for any taxable year, any de- prescribe such regulations or other guidance amended by adding at the end the following duction eligible income of such taxpayer as may be necessary or appropriate to carry new item: which is derived in connection with— out the provisions of this section.’’. ‘‘Sec. 966. Transfers of intangible property ‘‘(A) property— (b) CONFORMING AMENDMENTS.— to United States share- ‘‘(i) which is sold by the taxpayer to any (1) Section 172(d), as amended by section holders.’’. person who is not a United States person, 13011, is amended by adding at the end the (c) EFFECTIVE DATE.—The amendments and following new paragraph: made by this section shall apply to distribu- ‘‘(ii) which the taxpayer establishes to the ‘‘(10) DEDUCTION FOR FOREIGN-DERIVED IN- tions made in taxable years of foreign cor- satisfaction of the Secretary is for a foreign TANGIBLE INCOME.—The deduction under sec- porations beginning after December 31, 2017, use, or tion 250 shall not be allowed.’’. and to taxable years of United States share- ‘‘(B) services provided by the taxpayer (2) Section 246(b)(1) is amended— holders in which or with which such taxable which the taxpayer establishes to the satis- (A) by striking ‘‘and subsection (a) and (b) years of foreign corporations end. faction of the Secretary are provided to any of section 245’’ the first place it appears and CHAPTER 2—OTHER MODIFICATIONS OF person, or with respect to property, not lo- inserting ‘‘, subsection (a) and (b) of section SUBPART F PROVISIONS cated within the United States. 245, and section 250’’, SEC. 14211. ELIMINATION OF INCLUSION OF FOR- ‘‘(5) RULES RELATING TO FOREIGN USE PROP- (B) by striking ‘‘and subsection (a) and (b) EIGN BASE COMPANY OIL RELATED ERTY OR SERVICES.—For purposes of this sub- of section 245’’ the second place it appears INCOME. section— and inserting ‘‘subsection (a) and (b) of sec- (a) REPEAL.—Subsection (a) of section 954 ‘‘(A) FOREIGN USE.—The term ‘foreign use’ tion 245, and 250’’. is amended— means any use, consumption, or disposition (3) Section 469(i)(3)(F)(iii) is amended by (1) by inserting ‘‘and’’ at the end of para- which is not within the United States. striking ‘‘and 222’’ and inserting ‘‘222, and graph (2), ‘‘(B) PROPERTY OR SERVICES PROVIDED TO 250’’. (2) by striking the comma at the end of DOMESTIC INTERMEDIARIES.— (4) The table of sections for part VIII of paragraph (3) and inserting a period, and ‘‘(i) PROPERTY.—If a taxpayer sells prop- subchapter B of chapter 1 is amended by add- (3) by striking paragraph (5). erty to another person (other than a related ing at the end the following new item: (b) CONFORMING AMENDMENTS.— party) for further manufacture or other ‘‘Sec. 250. Foreign-derived intangible income (1) Section 952(c)(1)(B)(iii) is amended by modification within the United States, such and global intangible low-taxed striking subclause (I) and redesignating sub- property shall not be treated as sold for a income.’’. clauses (II) through (V) as subclauses (I) foreign use even if such other person subse- (c) EFFECTIVE DATE.—The amendments through (IV), respectively. quently uses such property for a foreign use. made by this section shall apply to taxable (2) Section 954(b) is amended— ‘‘(ii) SERVICES.—If a taxpayer provides years beginning after December 31, 2017. (A) by striking the second sentence of services to another person (other than a re- SEC. 14203. SPECIAL RULES FOR TRANSFERS OF paragraph (4), lated party) located within the United INTANGIBLE PROPERTY FROM CON- (B) by striking ‘‘the foreign base company States, such services shall not be treated as TROLLED FOREIGN CORPORATIONS services income, and the foreign base com- described in paragraph (4)(B) even if such TO UNITED STATES SHAREHOLDERS. pany oil related income’’ in paragraph (5) other person uses such services in providing (a) IN GENERAL.—Subpart F of part III of and inserting ‘‘and the foreign base company services which are so described. subchapter N of chapter 1 is amended by add- services income’’, and ‘‘(C) SPECIAL RULES WITH RESPECT TO RE- ing at the end the following new section: (C) by striking paragraph (6). LATED PARTY TRANSACTIONS.— ‘‘SEC. 966. TRANSFERS OF INTANGIBLE PROP- (3) Section 954 is amended by striking sub- ‘‘(i) SALES TO RELATED PARTIES.—If prop- ERTY TO UNITED STATES SHARE- section (g). erty is sold to a related party who is not a HOLDERS. (c) EFFECTIVE DATE.—The amendments United States person, such sale shall not be ‘‘(a) IN GENERAL.—In the case of any dis- made by this section shall apply to taxable treated as for a foreign use unless— tribution of intangible property which is years of foreign corporations beginning after ‘‘(I) such property is ultimately sold by a held by a controlled foreign corporation on December 31, 2017, and to taxable years of related party, or used by a related party in the date of enactment of this section and United States shareholders with or within connection with property which is sold or which is described in subsection (b)— which such taxable years of foreign corpora- the provision of services, to another person ‘‘(1) for purposes of part I of subchapter C tions end. who is an unrelated party who is not a and any other provision of this title specified SEC. 14212. INFLATION ADJUSTMENT OF DE MINI- United States person, and by the Secretary, the fair market value of MIS EXCEPTION FOR FOREIGN BASE ‘‘(II) the taxpayer establishes to the satis- such property on the date of such distribu- COMPANY INCOME. faction of the Secretary that such property tion shall be treated as not exceeding the ad- (a) IN GENERAL.—Section 954(b)(3) is is for a foreign use. justed basis of such property immediately amended by adding at the end the following new subparagraph: For purposes of this clause, a sale of prop- before such distribution, and ‘‘(D) INFLATION ADJUSTMENT.—In the case erty shall be treated as a sale of each of the ‘‘(2) if the distribution is to a United of any taxable year beginning after 2017, the components thereof. States shareholder and is not a dividend— dollar amount in subparagraph (A)(ii) shall ‘‘(ii) SERVICE PROVIDED TO RELATED PAR- ‘‘(A) the United States shareholder’s ad- be increased by an amount equal to— TIES.—If a service is provided to a related justed basis in the stock of the controlled ‘‘(i) such dollar amount, multiplied by party who is not located in the United foreign corporation with respect to which ‘‘(ii) the cost-of-living adjustment deter- States, such service shall not be treated de- such distribution is made shall be increased mined under section 1(f)(3) for the calendar scribed in subparagraph (A)(ii) unless the by the amount (if any) of such distribution year in which the taxable year begins. taxpayer established to the satisfaction of which would (but for this subsection) be in- Any increase determined under the preceding the Secretary that such service is not sub- cludible in gross income, and sentence shall be rounded to the nearest stantially similar to services provided by ‘‘(B) the adjusted basis of such property in multiple of $50,000.’’. such related party to persons located within the hands of such United States shareholder the United States. (b) EFFECTIVE DATE.—The amendments immediately after such distribution shall be made by this section shall apply to taxable ‘‘(D) RELATED PARTY.—For purposes of this such adjusted basis immediately before such paragraph, the term ‘related party’ means years of foreign corporations beginning after distribution reduced by the amount of the December 31, 2017, and to taxable years of any member of an affiliated group as defined increase described in subparagraph (A). United States shareholders in which or with in section 1504(a), determined— ‘‘(b) DISTRIBUTION.—A distribution is de- which such taxable years of foreign corpora- ‘‘(i) by substituting ‘more than 50 percent’ scribed in this section if the distribution is— tions end. for ‘at least 80 percent’ each place it appears, ‘‘(1) received by a domestic corporation and SEC. 14213. REPEAL OF INCLUSION BASED ON from a controlled foreign corporation with WITHDRAWAL OF PREVIOUSLY EX- ‘‘(ii) without regard to paragraphs (2) and respect to which such corporation is a CLUDED SUBPART F INCOME FROM (3) of section 1504(b). United States shareholder, and QUALIFIED INVESTMENT. Any person (other than a corporation) shall ‘‘(2) made by the controlled foreign cor- (a) IN GENERAL.—Subpart F of part III of be treated as a member of such group if such poration before the last day of the third tax- subchapter N of chapter 1 is amended by person is controlled by members of such able year of the controlled foreign corpora- striking section 955. group (including any entity treated as a tion beginning after December 31, 2017. (b) CONFORMING AMENDMENTS.— member of such group by reason of this sen- ‘‘(c) INTANGIBLE PROPERTY.—For purposes (1)(A) Section 951(a)(1)(A) is amended to tence) or controls any such member. For of this subsection, the term ‘intangible prop- read as follows: purposes of the preceding sentence, control erty’ has the meaning given such term by ‘‘(A) his pro rata share (determined under shall be determined under the rules of sec- section 936(h)(3)(B) or which is computer paragraph (2)) of the corporation’s subpart F tion 954(d)(3). software described in section 197(e)(3)(B).’’. income for such year, and’’.

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(B) Section 851(b) is amended by striking United States shareholders in which or with ‘‘(i) IN GENERAL.—For purposes of this ‘‘section 951(a)(1)(A)(i)’’ in the flush language which such taxable years of foreign corpora- paragraph— at the end and inserting ‘‘section tions end. ‘‘(I) the amount taken into account with 951(a)(1)(A)’’. SEC. 14218. CORPORATIONS ELIGIBLE FOR DE- respect to any asset shall be the adjusted (C) Section 952(c)(1)(B)(i) is amended by DUCTION FOR DIVIDENDS FROM basis thereof for purposes of determining striking ‘‘section 951(a)(1)(A)(i)’’ and insert- CONTROLLED FOREIGN CORPORA- gain, ing ‘‘section 951(a)(1)(A)’’. TIONS EXEMPT FROM SUBPART F IN- ‘‘(II) the amount taken into account with CLUSION FOR INVESTMENT IN (D) Section 953(c)(1)(C) is amended by UNITED STATES PROPERTY. respect to any indebtedness with original striking ‘‘section 951(a)(1)(A)(i)’’ and insert- (a) IN GENERAL.—Section 956(a) is amended issue discount shall be its issue price plus ing ‘‘section 951(a)(1)(A)’’. by inserting ‘‘(other than a corporation)’’ the portion of the original issue discount (2) Section 951(a) is amended by striking after ‘‘United States shareholder’’ in the previously accrued as determined under the paragraph (3). matter preceding paragraph (1). rules of section 1272 (determined without re- (3) Section 953(d)(4)(B)(iv)(II) is amended (b) EFFECTIVE DATE.—The amendment gard to subsection (a)(7) or (b)(4) thereof), by striking ‘‘or amounts referred to in clause made by this section shall apply to taxable and (ii) or (iii) of section 951(a)(1)(A)’’. years of controlled foreign corporations end- ‘‘(III) there shall be such other adjust- (4) Section 964(b) is amended by striking ‘‘, ing after December 31, 2017, and to taxable ments as the Secretary shall by regulations 955,’’. years of United States shareholders with or prescribe. (5) Section 970 is amended by striking sub- within which such taxable years of con- ‘‘(ii) INTRAGROUP DEBT AND EQUITY INTER- section (b). trolled foreign corporations end. ESTS DISREGARDED.—For purposes of this (6) The table of sections for subpart F of CHAPTER 3—PREVENTION OF BASE paragraph, the total indebtedness, and the part III of subchapter N of chapter 1 is EROSION assets, of any group of corporations shall be amended by striking the item relating to SEC. 14221. DENIAL OF DEDUCTION FOR INTER- determined by treating all members of such section 955. EST EXPENSE OF UNITED STATES group as one corporation. (c) EFFECTIVE DATE.—The amendments SHAREHOLDERS WHICH ARE MEM- ‘‘(iii) DETERMINATION OF ASSETS OF DOMES- made by this section shall apply to taxable BERS OF WORLDWIDE AFFILIATED TIC GROUP.—For purposes of this paragraph, years of foreign corporations beginning after GROUPS WITH EXCESS DOMESTIC the assets of the domestic corporations December 31, 2017, and to taxable years of INDEBTEDNESS. which are members of any worldwide affili- United States shareholders in which or with (a) IN GENERAL.—Section 163 is amended by ated group shall be determined by dis- redesignating subsection (n) as subsection which such taxable years of foreign corpora- regarding any interest held by any such do- (o) and by inserting after subsection (m) the tions end. mestic corporation in any foreign corpora- following new subsection: SEC. 14214. MODIFICATION OF STOCK ATTRIBU- tion which is a member of such group. ‘‘(n) DISALLOWANCE OF DEDUCTION FOR IN- TION RULES FOR DETERMINING ‘‘(E) PHASE IN OF PERCENTAGE USED IN DE- TEREST EXPENSE OF UNITED STATES SHARE- STATUS AS A CONTROLLED FOREIGN TERMINING EXCESS INDEBTEDNESS.—In the CORPORATION. HOLDERS WHICH ARE MEMBERS OF WORLDWIDE AFFILIATED GROUPS WITH EXCESS DOMESTIC case of any taxable year beginning in a cal- (a) IN GENERAL.—Section 958(b) is amend- endar year before 2022, the following percent- ed— INDEBTEDNESS.— ‘‘(1) IN GENERAL.—In the case of any domes- ages shall be substituted for ‘110 percent’ in (1) by striking paragraph (4), and applying subparagraph (B)(ii): (2) by striking ‘‘Paragraphs (1) and (4)’’ in tic corporation which is a member of a the last sentence and inserting ‘‘Paragraph worldwide affiliated group, the deduction al- lowed under this chapter for interest paid or ‘‘In the case of a taxable year beginning The percentage is: (1)’’. in: accrued by such domestic corporation during (b) EFFECTIVE DATE.—The amendments the taxable year shall be reduced by the 2018 ...... 130 made by this section shall apply to— 2019 ...... 125 (1) the last taxable year of foreign corpora- product of— ‘‘(A) the net interest expense of such do- 2020 ...... 120 tions beginning before January 1, 2018, and 2021 ...... 115 each subsequent taxable year of such foreign mestic corporation, multiplied by corporations, and ‘‘(B) the debt-to-equity differential per- ‘‘(4) OTHER DEFINITIONS.—For purposes of (2) taxable years of United States share- centage of such worldwide affiliated group. this subsection— holders in which or with which such taxable ‘‘(2) CARRYFORWARD.—Any amount dis- ‘‘(A) WORLDWIDE AFFILIATED GROUP.—The years of foreign corporations end. allowed under paragraph (1) for any taxable term ‘worldwide affiliated group’ means a year shall be treated as interest paid or ac- group consisting of the includible members SEC. 14215. MODIFICATION OF DEFINITION OF crued in the succeeding taxable year. of an affiliated group, as defined in section UNITED STATES SHAREHOLDER. ‘‘(3) DEBT-TO-EQUITY DIFFERENTIAL PER- 1504(a), determined— (a) IN GENERAL.—Section 951(b) is amended CENTAGE.— ‘‘(i) by substituting ‘more than 50 percent’ by inserting ‘‘, or 10 percent or more of the ‘‘(A) IN GENERAL.—For purposes of this sub- for ‘at least 80 percent’ each place it appears total value of shares of all classes of stock of section, the term ‘debt-to-equity differential in such section, and such foreign corporation’’ after ‘‘such for- percentage’ means, with respect to any ‘‘(ii) without regard to paragraphs (2), (3), eign corporation’’. worldwide affiliated group, the percentage and (4) of section 1504(b). (b) EFFECTIVE DATE.—The amendment made by this section shall apply to taxable which the excess domestic indebtedness of ‘‘(B) NET INTEREST EXPENSE.—The term years of foreign corporations beginning after such group bears to the total indebtedness of ‘net interest expense’ means the excess (if December 31, 2017, and to taxable years of the domestic corporations which are mem- any) of United States shareholders with or within bers of such group. ‘‘(i) the interest paid or accrued by the tax- which such taxable years of foreign corpora- ‘‘(B) EXCESS DOMESTIC INDEBTEDNESS.—For payer during the taxable year, over tions end. purposes of subparagraph (A), the term ‘ex- ‘‘(ii) the amount of interest includible in cess domestic indebtedness’ means, with re- the gross income of such taxpayer for such SEC. 14216. ELIMINATION OF REQUIREMENT THAT CORPORATION MUST BE CON- spect to any worldwide affiliated group, the taxable year. TROLLED FOR 30 DAYS BEFORE SUB- excess (if any) of— The Secretary shall by regulations provide PART F INCLUSIONS APPLY. ‘‘(i) the total indebtedness of the domestic for adjustments in determining the amount (a) IN GENERAL.—Section 951(a)(1) is corporations which are members of such of net interest expense if necessary. amended by striking ‘‘for an uninterrupted group, over ‘‘(5) TREATMENT OF AFFILIATED GROUP.—For period of 30 days or more’’ and inserting ‘‘at ‘‘(ii) 110 percent of the amount which the purposes of this subsection, all members of any time’’. total indebtedness of such domestic corpora- the same affiliated group (within the mean- (b) EFFECTIVE DATE.—The amendment tions would be if the ratio of such indebted- ing of section 1504(a) applied by substituting made by this section shall apply to taxable ness to the total equity of such domestic cor- ‘more than 50 percent’ for ‘at least 80 per- years of foreign corporations beginning after porations equaled the ratio which— cent’ each place it appears) shall be treated December 31, 2017, and to taxable years of ‘‘(I) the total indebtedness of such group, as one taxpayer. United States shareholders with or within bears to ‘‘(6) REGULATIONS.—The Secretary shall which such taxable years of foreign corpora- ‘‘(II) the total equity of such group. prescribe such regulations or other guidance tions end. ‘‘(C) TOTAL EQUITY.—For purposes of sub- as may be appropriate to carry out the pur- SEC. 14217. LOOK-THRU RULE FOR RELATED paragraph (B), the term ‘total equity’ means, poses of this subsection, including regula- CONTROLLED FOREIGN CORPORA- with respect to one or more corporations, an tions or other guidance— TIONS MADE PERMANENT. amount equal to— ‘‘(A) to prevent the avoidance of the pur- (a) IN GENERAL.—Paragraph (6) of section ‘‘(i) the sum of the money and all other as- poses of this subsection, 954(c) is amended by striking subparagraph sets of such corporations, reduced (but not ‘‘(B) providing such adjustments in the (C). below one) by case of corporations which are members of (b) EFFECTIVE DATE.—The amendments ‘‘(ii) the total indebtedness of such cor- an affiliated group as may be appropriate to made by this section shall apply to taxable porations. carry out the purposes of this subsection, years of foreign corporations beginning after ‘‘(D) SPECIAL RULES FOR DETERMINING DEBT ‘‘(C) providing for the coordination of this December 31, 2017, and to taxable years of AND EQUITY.— subsection with section 884,

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‘‘(D) providing for the reallocation of ‘‘(1) DISQUALIFIED RELATED PARTY (b) CONFORMING AMENDMENT.—The table of shares of partnership indebtedness, or dis- AMOUNT.—The term ‘disqualified related sections for part IX of subchapter B of chap- tributive shares of the partnership’s interest party amount’ means any interest or royalty ter 1 is amended by inserting after the item income or interest expense, and paid or accrued to a related party to the ex- relating to section 267 the following new ‘‘(E) providing for the coordination with tent that— item: the limitation under subsection (j).’’. ‘‘(A) such amount is not included in the in- ‘‘Sec. 267A. Certain related party amounts (b) EFFECTIVE DATE.—The amendments come of such related party under the tax law paid or accrued in hybrid trans- made by this section shall apply to taxable of the country of which such related party is actions or with hybrid enti- years beginning after December 31, 2017. a resident for tax purposes or is subject to ties.’’. SEC. 14222. LIMITATIONS ON INCOME SHIFTING tax, or (c) EFFECTIVE DATE.—The amendments THROUGH INTANGIBLE PROPERTY ‘‘(B) such related party is allowed a deduc- made by this section shall apply to taxable TRANSFERS. tion with respect to such amount under the years beginning after December 31, 2017. (a) DEFINITION OF INTANGIBLE ASSET.—Sec- tax law of such country. tion 936(h)(3)(B) is amended— SEC. 14224. SHAREHOLDERS OF SURROGATE FOR- Such term shall not include any payment to EIGN CORPORATIONS NOT ELIGIBLE (1) by striking ‘‘or’’ at the end of clause the extent such payment is included in the (v), FOR REDUCED RATE ON DIVIDENDS. gross income of a United States shareholder (a) IN GENERAL.—Section 1(h)(11)(C)(iii) is (2) by striking clause (vi) and inserting the under section 951(a). following: amended— ‘‘(2) RELATED PARTY.—The term ‘related ‘‘(vi) any goodwill, going concern value, or (1) by striking ‘‘shall not include any for- party’ means a related person as defined in workforce in place (including its composi- eign corporation’’ and inserting ‘‘shall not section 954(d)(3), except that such section tion and terms and conditions (contractual include— shall be applied with respect to the person or otherwise) of its employment); or ‘‘(I) any foreign corporation’’, making the payment described in paragraph ‘‘(vii) any other item the value or potential (2) by striking the period at the end and in- (1) in lieu of the controlled foreign corpora- value of which is not attributable to tangible serting ‘‘, and’’, and tion otherwise referred to in such section. property or the services of any individual.’’, (3) by adding at the end the following new ‘‘(c) HYBRID TRANSACTION.—For purposes of and subclause: this section, the term ‘hybrid transaction’ ‘‘(II) any corporation which is a surrogate (3) by striking the flush language after means any transaction, series of trans- clause (vii), as added by paragraph (2). foreign corporation (as defined in section actions, agreement, or instrument one or 7874(a)(2)(B)) other than a foreign corpora- (b) CLARIFICATION OF ALLOWABLE VALU- more payments with respect to which are ATION METHODS.— tion which is treated as a domestic corpora- treated as interest or royalties for purposes tion under section 7874(b).’’. (1) FOREIGN CORPORATIONS.—Section of this chapter and which are not so treated (b) EFFECTIVE DATE.—The amendments 367(d)(2) is amended by adding at the end the for purposes the tax law of the foreign coun- following new subparagraph: made by this section shall apply to dividends try of which the recipient of such payment is paid in taxable years beginning after Decem- ‘‘(D) REGULATORY AUTHORITY.—For pur- resident for tax purposes or is subject to tax. ber 31, 2017. poses of the last sentence of subparagraph ‘‘(d) HYBRID ENTITY.—For purposes of this (A), the Secretary shall require— section, the term ‘hybrid entity’ means any Subpart C—Modifications Related to Foreign ‘‘(i) the valuation of transfers of intangible entity which is either— Tax Credit System property, including intangible property ‘‘(1) treated as fiscally transparent for pur- SEC. 14301. REPEAL OF SECTION 902 INDIRECT transferred with other property or services, poses of this chapter but not so treated for FOREIGN TAX CREDITS; DETERMINA- on an aggregate basis, or purposes of the tax law of the foreign coun- TION OF SECTION 960 CREDIT ON ‘‘(ii) the valuation of such a transfer on the try of which the entity is resident for tax CURRENT YEAR BASIS. basis of the realistic alternatives to such a purposes or is subject to tax, or (a) REPEAL OF SECTION 902 INDIRECT FOR- transfer, ‘‘(2) treated as fiscally transparent for pur- EIGN TAX CREDITS.—Subpart A of part III of if the Secretary determines that such basis poses of such tax law but not so treated for subchapter N of chapter 1 is amended by is the most reliable means of valuation of purposes of this chapter. striking section 902. such transfers.’’. ‘‘(e) REGULATIONS.—The Secretary shall (b) DETERMINATION OF SECTION 960 CREDIT (2) ALLOCATION AMONG TAXPAYERS.—Sec- issue such regulations or other guidance as ON CURRENT YEAR BASIS.—Section 960, as tion 482 is amended by adding at the end the may be necessary or appropriate to carry out amended by section 14201, is amended— following: ‘‘For purposes of this section, the the purposes of this section, including regu- (1) by striking subsection (c), by redesig- Secretary shall require the valuation of lations or other guidance providing for— nating subsection (b) as subsection (c), by transfers of intangible property (including ‘‘(1) rules for treating certain conduit ar- striking all that precedes subsection (c) (as intangible property transferred with other rangements which involve a hybrid trans- so redesignated) and inserting the following: property or services) on an aggregate basis action or a hybrid entity as subject to sub- ‘‘SEC. 960. DEEMED PAID CREDIT FOR SUBPART F or the valuation of such a transfer on the section (a), INCLUSIONS. basis of the realistic alternatives to such a ‘‘(2) rules for the application of this section ‘‘(a) IN GENERAL.—For purposes of this sub- transfer, if the Secretary determines that to foreign branches, part, if there is included in the gross income such basis is the most reliable means of valu- ‘‘(3) rules for treating certain structured of a domestic corporation any item of in- ation of such transfers.’’. transactions as subject to subsection (a), come under section 951(a)(1) with respect to (c) EFFECTIVE DATE.— ‘‘(4) rules for treating a tax preference as any controlled foreign corporation with re- (1) IN GENERAL.—The amendments made by an exclusion from income for purposes of ap- spect to which such domestic corporation is this section shall apply to transfers in tax- plying subsection (b)(1) if such tax pref- a United States shareholder, such domestic able years beginning after December 31, 2017. erence has the effect of reducing the gen- corporation shall be deemed to have paid so (2) NO INFERENCE.—Nothing in the amend- erally applicable statutory rate by 25 percent much of such foreign corporation’s foreign ment made by subsection (a) shall be con- or more, income taxes as are properly attributable to strued to create any inference with respect ‘‘(5) rules for treating the entire amount of such item of income. to the application of section 936(h)(3) of the interest or royalty paid or accrued to a re- ‘‘(b) SPECIAL RULES FOR DISTRIBUTIONS Internal Revenue Code of 1986, or the author- lated party as a disqualified related party FROM PREVIOUSLY TAXED EARNINGS AND ity of the Secretary of the Treasury to pro- amount if such amount is subject to a par- PROFITS.—For purposes of this subpart— vide regulations for such application, with ticipation exemption system or other system ‘‘(1) IN GENERAL.—If any portion of a dis- respect to taxable years beginning before which provides for the exclusion or deduc- tribution from a controlled foreign corpora- January 1, 2018. tion of a substantial portion of such amount, tion to a domestic corporation which is a SEC. 14223. CERTAIN RELATED PARTY AMOUNTS ‘‘(6) rules for determining the tax residence United States shareholder with respect to PAID OR ACCRUED IN HYBRID of a foreign entity if the entity is otherwise such controlled foreign corporation is ex- TRANSACTIONS OR WITH HYBRID considered a resident of more than one coun- cluded from gross income under section ENTITIES. try or of no country, 959(a), such domestic corporation shall be (a) IN GENERAL.—Part IX of subchapter B ‘‘(7) exceptions from subsection (a) with re- deemed to have paid so much of such foreign of chapter 1 is amended by inserting after spect to— corporation’s foreign income taxes as— section 267 the following: ‘‘(A) cases in which the disqualified related ‘‘(A) are properly attributable to such por- ‘‘SEC. 267A. CERTAIN RELATED PARTY AMOUNTS party amount is taxed under the laws of a tion, and PAID OR ACCRUED IN HYBRID TRANSACTIONS OR WITH HYBRID foreign country other than the country of ‘‘(B) have not been deemed to have to been ENTITIES. which the related party is a resident for tax paid by such domestic corporation under this ‘‘(a) IN GENERAL.—No deduction shall be al- purposes, and section for the taxable year or any prior tax- lowed under this chapter for any disqualified ‘‘(B) other cases which the Secretary deter- able year. related party amount paid or accrued pursu- mines do not present a risk of eroding the ‘‘(2) TIERED CONTROLLED FOREIGN CORPORA- ant to a hybrid transaction or by, or to, a Federal tax base, TIONS.—If section 959(b) applies to any por- hybrid entity. ‘‘(8) requirements for record keeping and tion of a distribution from a controlled for- ‘‘(b) DISQUALIFIED RELATED PARTY information reporting in addition to any re- eign corporation to another controlled for- AMOUNT.—For purposes of this section— quirements imposed by section 6038A.’’. eign corporation, such controlled foreign

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(33) Section 6038(c)(1)(B) is amended by ‘‘(A) are properly attributable to such por- (12) Section 901(k)(2) is amended by strik- striking ‘‘sections 902 (relating to foreign tax tion, and ing ‘‘, 902,’’. credit for corporate stockholder in foreign ‘‘(B) have not been deemed to have been (13) Section 901(k)(6) is amended by strik- corporation) and 960 (relating to special rules paid by a domestic corporation under this ing ‘‘902 or’’. for foreign tax credit)’’ and inserting ‘‘sec- section for any prior taxable year.’’, (14) Section 901(m)(1) is amended by strik- tion 960’’. (2) and by adding after subsection (d) (as ing ‘‘relevant foreign assets—’’ and all that (34) Section 6038(c)(4) is amended by strik- added by section 14201) the following new follows and inserting ‘‘relevant foreign as- ing subparagraph (C). subsections: sets shall not be taken into account in deter- (35) The table of sections for subpart A of ‘‘(e) FOREIGN INCOME TAXES.—The term mining the credit allowed under subsection part III of subchapter N of chapter 1 is ‘foreign income taxes’ means any income, (a).’’. amended by striking the item relating to war profits, or excess profits taxes paid or (15) Section 904(d)(6)(A) is amended by section 902. accrued to any foreign country or possession striking ‘‘902, 907,’’ and inserting ‘‘907’’. (36) The table of sections for subpart F of of the United States. (16) Section 904(h)(10)(A) is amended by part III of subchapter N of chapter 1 is striking ‘‘sections 902, 907, and 960’’ and in- amended by striking the item relating to ‘‘(f) REGULATIONS.—The Secretary shall serting ‘‘sections 907 and 960’’. section 960 and inserting the following: prescribe such regulations or other guidance (17) Section 904(k) is amended to read as as may be necessary or appropriate to carry ‘‘Sec. 960. Deemed paid credit for subpart F follows: out the provisions of this section.’’. inclusions.’’. ‘‘(k) CROSS REFERENCES.—For increase of (d) EFFECTIVE DATE.—The amendments (c) CONFORMING AMENDMENTS.— limitation under subsection (a) for taxes made by this section shall apply to taxable (1) Section 78 is amended to read as fol- years of foreign corporations beginning after lows: paid with respect to amounts received which were included in the gross income of the tax- December 31, 2017, and to taxable years of ‘‘SEC. 78. GROSS UP FOR DEEMED PAID FOREIGN payer for a prior taxable year as a United United States shareholders in which or with TAX CREDIT. States shareholder with respect to a con- which such taxable years of foreign corpora- ‘‘If a domestic corporation chooses to have trolled foreign corporation, see section tions end. the benefits of subpart A of part III of sub- 960(c).’’. SEC. 14302. SEPARATE FOREIGN TAX CREDIT LIM- chapter N (relating to foreign tax credit) for (18) Section 905(c)(1) is amended by strik- ITATION BASKET FOR FOREIGN BRANCH INCOME. any taxable year— ing the last sentence. (a) IN GENERAL.—Section 904(d)(1), as ‘‘(1) an amount equal to the taxes deemed (19) Section 905(c)(2)(B)(i) is amended to amended by section 14201, is amended by re- to be paid by such corporation under sub- read as follows: designating subparagraphs (B) and (C) as sections (a) and (b) of section 960 for such ‘‘(i) shall be taken into account for the subparagraphs (C) and (D), respectively, and taxable year shall be treated for purposes of taxable year to which such taxes relate, by inserting after subparagraph (A) the fol- this title (other than section 960) as an item and’’. lowing new subparagraph: of income required to be included in the (20) Section 906(a) is amended by striking ‘‘(B) foreign branch income,’’. gross income of such domestic corporation ‘‘(or deemed, under section 902, paid or ac- (b) FOREIGN BRANCH INCOME.— under section 951(a), and crued during the taxable year)’’. (1) IN GENERAL.—Section 904(d)(2) is amend- ‘‘(2) an amount equal to the aggregate test- (21) Section 906(b) is amended by striking ed by inserting after subparagraph (I) the ed foreign income taxes deemed paid by such paragraphs (4) and (5). following new subparagraph: corporation under section 960(d) (determined (22) Section 907(b)(2)(B) is amended by ‘‘(J) FOREIGN BRANCH INCOME.— without regard to the phrase ‘80 percent of’ striking ‘‘902 or’’. ‘‘(i) IN GENERAL.—The term ‘foreign branch in paragraph (1) thereof) shall be treated for (23) Section 907(c)(3) is amended— income’ means the business profits of such purposes of this title (other than section 960) (A) by striking subparagraph (A) and redes- United States person which are attributable as an addition to the global intangible low- ignating subparagraphs (B) and (C) as sub- to 1 or more qualified business units (as de- taxed income of such domestic corporation paragraphs (A) and (B), respectively, and fined in section 989(a)) in 1 or more foreign under section 951A(a) for such taxable (B) by striking ‘‘section 960(a)’’ in subpara- countries. For purposes of the preceding sen- year.’’. graph (A) (as so redesignated) and inserting tence, the amount of business profits attrib- (2) Paragraph (4) of section 245(a) is amend- ‘‘section 960’’. utable to a qualified business unit shall be ed to read as follows: (24) Section 907(c)(5) is amended by strik- determined under rules established by the ‘‘(4) POST-1986 UNDISTRIBUTED EARNINGS.— ing ‘‘902 or’’. Secretary. The term ‘post-1986 undistributed earnings’ (25) Section 907(f)(2)(B)(i) is amended by ‘‘(ii) EXCEPTION.—Such term shall not in- means the amount of the earnings and prof- striking ‘‘902 or’’. clude any income which is passive category its of the foreign corporation (computed in (26) Section 908(a) is amended by striking income.’’. accordance with sections 964(a) and 986) ac- ‘‘902 or’’. (2) CONFORMING AMENDMENT.—Section cumulated in taxable years beginning after (27) Section 909(b) is amended— 904(d)(2)(A)(ii), as amended by section 14201, December 31, 1986— (A) by striking ‘‘section 902 corporation’’ is amended by striking ‘‘income described in ‘‘(A) as of the close of the taxable year of in the matter preceding paragraph (1) and in- paragraph (1)(A) and’’ and inserting ‘‘income the foreign corporation in which the divi- serting ‘‘specified 10-percent owned foreign described in paragraph (1)(A), foreign branch dend is distributed, and corporation (as defined in section 245A(b))’’, income, and’’. ‘‘(B) without diminution by reason of divi- (B) by striking ‘‘902 or’’ in paragraph (1), (c) EFFECTIVE DATE.—The amendments dends distributed during such taxable year.’’. (C) by striking ‘‘by such section 902 cor- made by this section shall apply to taxable (3) Section 245(a)(10)(C) is amended by poration’’ and all that follows in the matter years beginning after December 31, 2017. striking ‘‘902, 907, and 960’’ and inserting ‘‘907 following paragraph (2) and inserting ‘‘by SEC. 14303. ACCELERATION OF ELECTION TO AL- and 960’’. such specified 10-percent owned foreign cor- LOCATE INTEREST, ETC., ON A (4) Sections 535(b)(1) and 545(b)(1) are each poration or a domestic corporation which is WORLDWIDE BASIS. amended by striking ‘‘section 902(a) or a United States shareholder with respect to (a) IN GENERAL.—Section 864(f)(6) is amend- 960(a)(1)’’ and inserting ‘‘section 960’’. such specified 10-percent owned foreign cor- ed by striking ‘‘December 31, 2020’’ and in- (5) Section 814(f)(1) is amended— poration.’’, and serting ‘‘December 31, 2017’’. (A) by striking subparagraph (B), and (D) by striking ‘‘SECTION 902 CORPORA- (b) EFFECTIVE DATE.—The amendments (B) by striking all that precedes ‘‘No in- TIONS’’ in the heading thereof and inserting made by this section shall apply to taxable come’’ and inserting the following: ‘‘SPECIFIED 10-PERCENT OWNED FOREIGN COR- years beginning after December 31, 2017. ‘‘(1) TREATMENT OF FOREIGN TAXES.—’’. PORATIONS’’. SEC. 14304. SOURCE OF INCOME FROM SALES OF (6) Section 865(h)(1)(B) is amended by strik- (28) Section 909(d) is amended by striking INVENTORY DETERMINED SOLELY ON BASIS OF PRODUCTION ACTIVI- ing ‘‘902, 907,’’ and inserting ‘‘907’’. paragraph (5). TIES. (7) Section 901(a) is amended by striking (29) Section 958(a)(1) is amended by strik- (a) IN GENERAL.—Section 863(b) is amended ‘‘sections 902 and 960’’ and inserting ‘‘section ing ‘‘960(a)(1)’’ and inserting ‘‘960’’. by adding at the end the following: ‘‘Gains, 960’’. (30) Section 959(d) is amended by striking profits, and income from the sale or ex- (8) Section 901(e)(2) is amended by striking ‘‘Except as provided in section 960(a)(3), any’’ change of inventory property described in ‘‘but is not limited to—’’ and all that follows and inserting ‘‘Any’’. paragraph (2) shall be allocated and appor- through ‘‘that portion’’ and inserting ‘‘but is (31) Section 959(e) is amended by striking tioned between sources within and without not limited to that portion’’. ‘‘section 960(b)’’ and inserting ‘‘section the United States solely on the basis of the (9) Section 901(f) is amended by striking 960(c)’’. production activities with respect to the ‘‘sections 902 and 960’’ and inserting ‘‘section (32) Section 1291(g)(2)(A) is amended by property.’’. 960’’. striking ‘‘any distribution—’’ and all that (b) EFFECTIVE DATE.—The amendment (10) Section 901(j)(1)(A) is amended by follows through ‘‘but only if’’ and inserting made by this section shall apply to taxable striking ‘‘902 or’’. ‘‘any distribution, any withholding tax im- years beginning after December 31, 2017.

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SEC. 14305. ELECTION TO INCREASE PERCENT- ‘‘(3) INCREASED RATE FOR CERTAIN BANKS ‘‘(i) the aggregate amount of base erosion AGE OF DOMESTIC TAXABLE IN- AND SECURITIES DEALERS.— tax benefits of the taxpayer for the taxable COME OFFSET BY OVERALL DOMES- ‘‘(A) IN GENERAL.—In the case of an appli- year, by TIC LOSS TREATED AS FOREIGN cable taxpayer described in subparagraph (B) ‘‘(ii) the aggregate amount of the deduc- SOURCE. for any taxable year— tions allowable to the taxpayer under this (a) IN GENERAL.—Section 904(g) is amended by adding at the end the following new para- ‘‘(i) paragraphs (1)(A) and (2)(A) shall each chapter for the taxable year. graph: be applied by substituting ‘11 percent’ for ‘10 ‘‘(B) SPECIAL RULES.—The amount under percent’, and subparagraph (A)(ii) shall be determined— ‘‘(5) ELECTION TO INCREASE PERCENTAGE OF ‘‘(ii) paragraph (2)(A) shall be applied by ‘‘(i) by taking into account base erosion TAXABLE INCOME TREATED AS FOREIGN substituting ‘13.5 percent’ for ‘12.5 percent’. tax benefits described in clauses (i) and (ii) SOURCE.— ‘‘(B) TAXPAYER DESCRIBED.—An applicable of paragraph (2)(A), and ‘‘(A) IN GENERAL.—If any pre-2018 unused overall domestic loss is taken into account taxpayer is described in this subparagraph if ‘‘(ii) by not taking into account any deduc- under paragraph (1) for any applicable tax- such taxpayer is a member of an affiliated tion allowed under section 172, 245A, or 250 group (as defined in section 1504(a)(1)) which able year, the taxpayer may elect to have for the taxable year. includes— ‘‘(d) BASE EROSION PAYMENT.—For purposes such paragraph applied to such loss by sub- ‘‘(i) a bank (as defined in section 581), or of this section— stituting a percentage greater than 50 per- ‘‘(ii) a registered securities dealer under ‘‘(1) IN GENERAL.—The term ‘base erosion cent (but not greater than 100 percent) for 50 section 15(a) of the Securities Exchange Act payment’ means any amount paid or accrued percent in subparagraph (B) thereof. of 1934. by the taxpayer to a foreign person which is ‘‘(B) PRE-2018 UNUSED OVERALL DOMESTIC ‘‘(c) MODIFIED TAXABLE INCOME.—For pur- a related party of the taxpayer and with re- LOSS.—For purposes of this paragraph, the poses of this section— spect to which a deduction is allowable term ‘pre-2018 unused overall domestic loss’ ‘‘(1) IN GENERAL.—The term ‘modified tax- under this chapter. means any overall domestic loss which— able income’ means the taxable income of ‘‘(2) PURCHASE OF DEPRECIABLE PROPERTY.— ‘‘(i) arises in a qualified taxable year be- the taxpayer computed under this chapter Such term shall also include any amount ginning before January 1, 2018, and for the taxable year, determined without re- paid or accrued by the taxpayer to a foreign ‘‘(ii) has not been used under paragraph (1) gard to— person which is a related party of the tax- for any taxable year beginning before such ‘‘(A) any base erosion tax benefit with re- payer in connection with the acquisition by date. spect to any base erosion payment, or the taxpayer from such person of property of ‘‘(C) APPLICABLE TAXABLE YEAR.—For pur- ‘‘(B) the base erosion percentage of any net a character subject to the allowance of de- poses of this paragraph, the term ‘applicable operating loss deduction allowed under sec- preciation (or amortization in lieu of depre- taxable year’ means any taxable year of the tion 172 for the taxable year. ciation). taxpayer beginning after December 31, 2017, ‘‘(2) BASE EROSION TAX BENEFIT.— ‘‘(3) CERTAIN PAYMENTS TO EXPATRIATED EN- and before January 1, 2028.’’. ‘‘(A) IN GENERAL.—The term ‘base erosion TITIES.— (b) EFFECTIVE DATE.—The amendment tax benefit’ means— ‘‘(A) IN GENERAL.—Such term shall also in- made by this section shall apply to taxable ‘‘(i) any deduction described in subsection clude any amount paid or accrued by the years beginning after December 31, 2017. (d)(1) which is allowed under this chapter for taxpayer with respect to a person described PART II—INBOUND TRANSACTIONS the taxable year with respect to any base in subparagraph (B) which results in a reduc- SEC. 14401. BASE EROSION AND ANTI-ABUSE TAX. erosion payment, tion of the gross receipts of the taxpayer. (a) IMPOSITION OF TAX.—Subchapter A of ‘‘(ii) in the case of a base erosion payment ‘‘(B) PERSON DESCRIBED.—A person is de- chapter 1 is amended by adding at the end described in subsection (d)(2), any deduction scribed in this subparagraph if such person is the following new part: allowed under this chapter for the taxable a— ‘‘PART VII—BASE EROSION AND ANTI- year for depreciation (or amortization in lieu ‘‘(i) surrogate foreign corporation which is ABUSE TAX of depreciation) with respect to the property a related party of the taxpayer, but only if ‘‘Sec. 59A. Tax on base erosion payments of acquired with such payment, and such person first became a surrogate foreign taxpayers with substantial ‘‘(iii) in the case of a base erosion payment corporation after November 9, 2017, or gross receipts. described in subsection (d)(3), any reduction ‘‘(ii) foreign person which is a member of in gross receipts with respect to such pay- ‘‘SEC. 59A. TAX ON BASE EROSION PAYMENTS OF the same expanded affiliated group as the TAXPAYERS WITH SUBSTANTIAL ment in computing gross income of the tax- surrogate foreign corporation. GROSS RECEIPTS. payer for the taxable year for purposes of ‘‘(C) DEFINITIONS.—For purposes of this ‘‘(a) IMPOSITION OF TAX.—There is hereby this chapter. paragraph— imposed on each applicable taxpayer for any ‘‘(B) TAX BENEFITS DISREGARDED IF TAX ‘‘(i) SURROGATE FOREIGN CORPORATION.— taxable year a tax equal to the base erosion WITHHELD ON BASE EROSION PAYMENT.— The term ‘surrogate foreign corporation’ has minimum tax amount for the taxable year. ‘‘(i) IN GENERAL.—Except as provided in the meaning given such term by section Such tax shall be in addition to any other clause (ii), any base erosion tax benefit at- 7874(a)(2) but does not include a foreign cor- tax imposed by this subtitle. tributable to any base erosion payment— poration treated as a domestic corporation ‘‘(b) BASE EROSION MINIMUM TAX ‘‘(I) on which tax is imposed by section 871 under section 7874(b). AMOUNT.—For purposes of this section— or 881, and ‘‘(ii) EXPANDED AFFILIATED GROUP.—The ‘‘(1) IN GENERAL.—Except as provided in ‘‘(II) with respect to which tax has been de- term ‘expanded affiliated group’ has the paragraphs (2) and (3), the term ‘base erosion ducted and withheld under section 1441 or meaning given such term by section minimum tax amount’ means, with respect 1442, 7874(c)(1). to any applicable taxpayer for any taxable shall not be taken into account in computing ‘‘(4) EXCEPTION FOR CERTAIN AMOUNTS WITH year, the excess (if any) of— modified taxable income under paragraph RESPECT TO SERVICES.—Paragraph (1) shall ‘‘(A) an amount equal to 10 percent of the (1)(A) or the base erosion percentage under not apply to any amount paid or accrued by modified taxable income of such taxpayer for paragraph (4). a taxpayer for services if— the taxable year, over ‘‘(ii) EXCEPTION.—The amount not taken ‘‘(A) such services are services which meet ‘‘(B) an amount equal to the regular tax li- into account in computing modified taxable the requirements for eligibility for use of the ability (as defined in section 26(b)) of the income by reason of clause (i) shall be re- services cost method under section 482 (de- taxpayer for the taxable year, reduced (but duced under rules similar to the rules under termined without regard to the requirement not below zero) by the excess (if any) of— section 163(j)(5)(B) (as in effect before the that the services not contribute significantly ‘‘(i) the credits allowed under this chapter date of the enactment of the Tax Cuts and to fundamental risks of business success or against such regular tax liability, over Jobs Act). failure), and ‘‘(ii) the credit allowed under section 38 for ‘‘(3) SPECIAL RULES FOR DETERMINING INTER- ‘‘(B) such amount constitutes the total the taxable year which is properly allocable EST FOR WHICH DEDUCTION ALLOWED.—For pur- services cost with no markup. to the research credit determined under sec- poses of applying paragraph (1), in the case ‘‘(e) APPLICABLE TAXPAYER.—For purposes tion 41(a). of a taxpayer to which subsection (j) or (n) of of this section— ‘‘(2) MODIFICATIONS FOR TAXABLE YEARS BE- section 163 applies for the taxable year, the ‘‘(1) IN GENERAL.—The term ‘applicable GINNING AFTER 2025.—In the case of any tax- reduction in the amount of interest for taxpayer’ means, with respect to any taxable able year beginning after December 31, 2025, which a deduction is allowed by reason of year, a taxpayer— paragraph (1) shall be applied— such subsection shall be treated as allocable ‘‘(A) which is a corporation other than a ‘‘(A) by substituting ‘12.5 percent’ for ‘10 first to interest paid or accrued to persons regulated investment company, a real estate percent’ in subparagraph (A) thereof, and who are not related parties with respect to investment trust, or an S corporation, ‘‘(B) by reducing (but not below zero) the the taxpayer and then to such related par- ‘‘(B) the average annual gross receipts of regular tax liability (as defined in section ties. which for the 3-taxable-year period ending 26(b)) for purposes of subparagraph (B) there- ‘‘(4) BASE EROSION PERCENTAGE.—For pur- with the preceding taxable year are at least of by the aggregate amount of the credits al- poses of paragraph (1)(B)— $500,000,000, and lowed under this chapter against such reg- ‘‘(A) IN GENERAL.—The term ‘base erosion ‘‘(C) the base erosion percentage (as deter- ular tax liability rather than the excess de- percentage’ means, for any taxable year, the mined under subsection (c)(4)) of which for scribed in such subparagraph. percentage determined by dividing— the taxable year is 4 percent or higher.

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‘‘(2) GROSS RECEIPTS.— ‘‘(B) REPORTING REQUIREMENT.—No pay- ‘‘(B) the manner in which the reporting ‘‘(A) SPECIAL RULE FOR FOREIGN PERSONS.— ments shall be treated as qualified derivative corporation is related to each person referred In the case of a foreign person the gross re- payments under subparagraph (A) for any to in subparagraph (A), and ceipts of which are taken into account for taxable year unless the taxpayer includes in ‘‘(C) transactions between the reporting purposes of paragraph (1)(B), only gross re- the information required to be reported corporation and each foreign person which is ceipts which are taken into account in deter- under section 6038B(b)(2) with respect to such a related party to the reporting corporation. mining income which is effectively con- taxable year such information as is nec- ‘‘(2) ADDITIONAL INFORMATION REGARDING nected with the conduct of a trade or busi- essary to identify the payments to be so BASE EROSION PAYMENTS.—For purposes of ness within the United States shall be taken treated and such other information as the subsection (a) and section 6038C, if the re- into account. In the case of a taxpayer which Secretary determines necessary to carry out porting corporation or the foreign corpora- is a foreign person, the preceding sentence the provisions of this subsection. tion to whom section 6038C applies is an ap- shall not apply to the gross receipts of any ‘‘(3) EXCEPTIONS FOR PAYMENTS OTHERWISE plicable taxpayer, the information described United States person which are aggregated TREATED AS BASE EROSION PAYMENTS.—This in this subsection shall include— with the taxpayer’s gross receipts by reason subsection shall not apply to any qualified ‘‘(A) such information as the Secretary de- of paragraph (3). derivative payment if— termines necessary to determine the base ‘‘(B) OTHER RULES MADE APPLICABLE.— ‘‘(A) the payment would be treated as a erosion minimum tax amount, base erosion Rules similar to the rules of subparagraphs base erosion payment if it were not made payments, and base erosion tax benefits of (B), (C), and (D) of section 448(c)(3) shall pursuant to a derivative, including any in- the taxpayer for purposes of section 59A for apply in determining gross receipts for pur- terest, royalty, or service payment, or the taxable year, and poses of this section. ‘‘(B) in the case of a contract which has de- ‘‘(B) such other information as the Sec- ‘‘(3) AGGREGATION RULES.—All persons rivative and nonderivative components, the retary determines necessary to carry out treated as a single employer under sub- payment is properly allocable to the non- such section. section (a) of section 52 shall be treated as 1 derivative component. For purposes of this paragraph, any term person for purposes of this subsection and ‘‘(4) DERIVATIVE DEFINED.—For purposes of used in this paragraph which is also used in subsection (c)(4), except that in applying sec- this subsection— section 59A shall have the same meaning as tion 1563 for purposes of section 52, the ex- ‘‘(A) IN GENERAL.—The term ‘derivative’ when used in such section.’’. ception for foreign corporations under sec- means any contract (including any option, (2) INCREASE IN PENALTY.—Paragraphs (1) tion 1563(b)(2)(C) shall be disregarded. forward contract, futures contract, short po- and (2) of section 6038A(d) are each amended ‘‘(f) FOREIGN PERSON.—For purposes of this sition, swap, or similar contract) the value by striking ‘‘$10,000’’ and inserting ‘‘$25,000’’. section, the term ‘foreign person’ has the of which, or any payment or other transfer (c) DISALLOWANCE OF CREDITS AGAINST meaning given such term by section with respect to which, is (directly or indi- BASE EROSION TAX.—Paragraph (2) of section 6038A(c)(3). rectly) determined by reference to one or 26(b) is amended by inserting after subpara- graph (A) the following new subparagraph: ‘‘(g) RELATED PARTY.—For purposes of this more of the following: ‘‘(B) section 59A (relating to base erosion section— ‘‘(i) Any share of stock in a corporation. and anti-abuse tax),’’. ‘‘(1) IN GENERAL.—The term ‘related party’ ‘‘(ii) Any evidence of indebtedness. (d) CONFORMING AMENDMENTS.— ‘‘(iii) Any commodity which is actively means, with respect to any applicable tax- (1) The table of parts for subchapter A of traded. payer— chapter 1 is amended by adding after the ‘‘(iv) Any currency. ‘‘(A) any 25-percent owner of the taxpayer, item relating to part VI the following new ‘‘(v) Any rate, price, amount, index, for- ‘‘(B) any person who is related (within the item: meaning of section 267(b) or 707(b)(1)) to the mula, or algorithm. ‘‘Part VII. Base erosion and anti-abuse tax’’. taxpayer or any 25-percent owner of the tax- ‘‘(B) TREATMENT OF AMERICAN DEPOSITORY (2) Paragraph (1) of section 882(a), as payer, and RECEIPTS AND SIMILAR INSTRUMENTS.—Except amended by this Act, is amended by insert- ‘‘(C) any other person who is related (with- as otherwise provided by the Secretary, for ing ‘‘ or 59A,’’ after ‘‘section 11,’’. in the meaning of section 482) to the tax- purposes of this part, American depository (3) Subparagraph (A) of section 6425(c)(1), payer. receipts (and similar instruments) with re- as amended by section 13001, is amended to ‘‘(2) 25-PERCENT OWNER.—The term ‘25-per- spect to shares of stock in foreign corpora- read as follows: cent owner’ means, with respect to any cor- tions shall be treated as shares of stock in ‘‘(A) the sum of— poration, any person who owns at least 25 such foreign corporations. ‘‘(i) the tax imposed by section 11, or sub- percent of— ‘‘(i) REGULATIONS.—The Secretary shall chapter L of chapter 1, whichever is applica- ‘‘(A) the total voting power of all classes of prescribe such regulations or other guidance ble, plus stock of a corporation entitled to vote, or as may be necessary or appropriate to carry ‘‘(ii) the tax imposed by section 59A, over’’. ‘‘(B) the total value of all classes of stock out the provisions of this section, including (4)(A) Subparagraph (A) of section of such corporation. regulations— 6655(g)(1), as amended by section 13001, is ‘‘(3) SECTION 318 TO APPLY.—Section 318 ‘‘(1) providing for such adjustments to the amended by striking ‘‘plus’’ at the end of shall apply for purposes of paragraphs (1) and application of this section as are necessary clause (i), by redesignating clause (ii) as (2), except that— to prevent the avoidance of the purposes of clause (iii), and by inserting after clause (i) ‘‘(A) ‘10 percent’ shall be substituted for ‘50 this section, including through— the following new clause: percent’ in section 318(a)(2)(C), and ‘‘(A) the use of unrelated persons, conduit ‘‘(ii) the tax imposed by section 59A, plus’’. ‘‘(B) subparagraphs (A), (B), and (C) of sec- transactions, or other intermediaries, or (B) Subparagraphs (A)(i) and (B)(i) of sec- tion 318(a)(3) shall not be applied so as to ‘‘(B) transactions or arrangements de- tion 6655(e)(2), as amended by section 13001, consider a United States person as owning signed, in whole or in part— are each amended by inserting ‘‘and modified stock which is owned by a person who is not ‘‘(i) to characterize payments otherwise taxable income’’ after ‘‘taxable income’’. a United States person. subject to this section as payments not sub- (C) Subparagraph (B) of section 6655(e)(2) is ‘‘(h) EXCEPTION FOR CERTAIN PAYMENTS ject to this section, or amended by adding at the end the following MADE IN THE ORDINARY COURSE OF TRADE OR ‘‘(ii) to substitute payments not subject to new clause: BUSINESS.—For purposes of this section— this section for payments otherwise subject ‘‘(iii) MODIFIED TAXABLE INCOME.—The term ‘‘(1) IN GENERAL.—Except as provided in to this section and ‘modified taxable income’ has the meaning paragraph (3), any qualified derivative pay- ‘‘(2) for the application of subsection (g), including rules to prevent the avoidance of given such term by section 59A(c)(1).’’. ment shall not be treated as a base erosion (e) EFFECTIVE DATE.—The amendments the exceptions under subsection (g)(3).’’. payment. made by this section shall apply to base ero- ‘‘(2) QUALIFIED DERIVATIVE PAYMENT.— (b) REPORTING REQUIREMENTS AND PEN- sion payments (as defined in section 59A(d) ‘‘(A) IN GENERAL.—The term ‘qualified de- ALTIES.— of the Internal Revenue Code of 1986, as rivative payment’ means any payment made (1) IN GENERAL.—Subsection (b) of section added by this section) paid or accrued in tax- by a taxpayer pursuant to a derivative with 6038A is amended to read as follows: able years beginning after December 31, 2017. respect to which the taxpayer— ‘‘(b) REQUIRED INFORMATION.— PART III—OTHER PROVISIONS ‘‘(i) recognizes gain or loss as if such deriv- ‘‘(1) IN GENERAL.—For purposes of sub- ative were sold for its fair market value on section (a), the information described in this SEC. 14501. RESTRICTION ON INSURANCE BUSI- NESS EXCEPTION TO PASSIVE FOR- the last business day of the taxable year (and subsection is such information as the Sec- EIGN INVESTMENT COMPANY such additional times as required by this retary prescribes by regulations relating to— RULES. title or the taxpayer’s method of account- ‘‘(A) the name, principal place of business, (a) IN GENERAL.—Section 1297(b)(2)(B) is ing), nature of business, and country or countries amended to read as follows: ‘‘(ii) treats any gain or loss so recognized in which organized or resident, of each per- ‘‘(B) derived in the active conduct of an in- as ordinary, and son which— surance business by a qualifying insurance ‘‘(iii) treats the character of all items of ‘‘(i) is a related party to the reporting cor- corporation (as defined in subsection (f)),’’. income, deduction, gain, or loss with respect poration, and (b) QUALIFYING INSURANCE CORPORATION to a payment pursuant to the derivative as ‘‘(ii) had any transaction with the report- DEFINED.—Section 1297 is amended by adding ordinary. ing corporation during its taxable year, at the end the following new subsection:

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‘‘(f) QUALIFYING INSURANCE CORPORATION.— SEC. 14502. REPEAL OF FAIR MARKET VALUE (A) 50 percent shall be paid to the State of For purposes of subsection (b)(2)(B)— METHOD OF INTEREST EXPENSE AP- Alaska; and ‘‘(1) IN GENERAL.—The term ‘qualifying in- PORTIONMENT. (B) the balance shall be deposited into the surance corporation’ means, with respect to (a) IN GENERAL.—Paragraph (2) of section Treasury as miscellaneous receipts. any taxable year, a foreign corporation— 864(e) is amended to read as follows: (c) 2 LEASE SALES WITHIN 10 YEARS.— ‘‘(A) which would be subject to tax under ‘‘(2) GROSS INCOME AND FAIR MARKET VALUE (1) REQUIREMENT.— subchapter L if such corporation were a do- METHODS MAY NOT BE USED FOR INTEREST.— (A) IN GENERAL.—Subject to subparagraph mestic corporation, and All allocations and apportionments of inter- (B), the Secretary shall conduct not fewer ‘‘(B) the applicable insurance liabilities of est expense shall be determined using the ad- than 2 lease sales area-wide under the oil and which constitute more than 25 percent of its justed bases of assets rather than on the gas program under this section by not later total assets, determined on the basis of such basis of the fair market value of the assets than 10 years after the date of enactment of liabilities and assets as reported on the cor- or gross income.’’. this Act. poration’s applicable financial statement for (b) EFFECTIVE DATE.—The amendment (B) SALE ACREAGES; SCHEDULE.— the last year ending with or within the tax- made by this section shall apply to taxable (i) ACREAGES.—The Secretary shall offer able year. years beginning after December 31, 2017. for lease under the oil and gas program ‘‘(2) ALTERNATIVE FACTS AND CIR- SEC. 14503. MODIFICATION TO SOURCE RULES IN- under this section— CUMSTANCES TEST FOR CERTAIN CORPORA- VOLVING POSSESSIONS. (I) not fewer than 400,000 acres area-wide in TIONS.—If a corporation fails to qualify as a (a) IN GENERAL.—Subsection (b)(2) of Sec- each lease sale; and qualified insurance corporation under para- tion 937 of the Internal Revenue Code of 1986 (II) those areas that have the highest po- graph (1) solely because the percentage de- is amended by inserting ‘‘, but only to the tential for the discovery of hydrocarbons. termined under paragraph (1)(B) is 25 percent extent such income is attributable to an of- (ii) SCHEDULE.—The Secretary shall offer— or less, a United States person that owns fice or fixed place of business within the (I) the initial lease sale under the oil and stock in such corporation may elect to treat United States (determined under the rules of gas program under this section not later such stock as stock of a qualifying insurance Section 864(c)(5))’’ before the period at the than 4 years after the date of enactment of corporation if— end. this Act; and ‘‘(A) the percentage so determined for the (b) SOURCE RULES FOR PERSONAL PROPERTY (II) a second lease sale under the oil and corporation is at least 10 percent, and SALES.—Subsection (j)(3) of section 865 of the gas program under this section not later ‘‘(B) under regulations provided by the Internal Revenue Code of 1986 is amended by than 7 years after the date of enactment of Secretary, based on the applicable facts and inserting ‘‘932,’’ after ‘‘931,’’. this Act. circumstances— (c) EFFECTIVE DATE.—The amendments (2) RIGHTS-OF-WAY.—The Secretary shall ‘‘(i) the corporation is predominantly en- made by this section shall apply to taxable issue any rights-of-way or easements across gaged in an insurance business, and years beginning after December 31, 2018. the Coastal Plain for the exploration, devel- ‘‘(ii) such failure is due solely to runoff-re- TITLE II opment, production, or transportation nec- lated or rating-related circumstances involv- SEC. 20001. OIL AND GAS PROGRAM. essary to carry out this section. (3) SURFACE DEVELOPMENT.—In admin- ing such insurance business. (a) DEFINITIONS.—In this section: istering this section, the Secretary shall au- ‘‘(3) APPLICABLE INSURANCE LIABILITIES.— (1) COASTAL PLAIN.—The term ‘‘Coastal For purposes of this subsection— Plain’’ means the area identified as the 1002 thorize up to 2,000 surface acres of Federal ‘‘(A) IN GENERAL.—The term ‘applicable in- Area on the plates prepared by the United land on the Coastal Plain to be covered by surance liabilities’ means, with respect to States Geological Survey entitled ‘‘ANWR production and support facilities (including any life or property and casualty insurance Map – Plate 1’’ and ‘‘ANWR Map – Plate 2’’, airstrips and any area covered by gravel business— dated October 24, 2017, and on file with the berms or piers for support of pipelines) dur- ‘‘(i) loss and loss adjustment expenses, and United States Geological Survey and the Of- ing the term of the leases under the oil and ‘‘(ii) reserves (other than deficiency, con- fice of the Solicitor of the Department of the gas program under this section. tingency, or unearned premium reserves) for Interior. SEC. 20002. LIMITATIONS ON AMOUNT OF DIS- TRIBUTED QUALIFIED OUTER CON- life and health insurance risks and life and (2) SECRETARY.—The term ‘‘Secretary’’ TINENTAL SHELF REVENUES. health insurance claims with respect to con- means the Secretary of the Interior, acting tracts providing coverage for mortality or Section 105(f)(1) of the Gulf of Mexico En- through the Bureau of Land Management. ergy Security Act of 2006 (43 U.S.C. 1331 note; morbidity risks. (b) OIL AND GAS PROGRAM.— ‘‘(B) LIMITATIONS ON AMOUNT OF LIABIL- Public Law 109–432) is amended by striking (1) IN GENERAL.—Section 1003 of the Alaska ‘‘exceed $500,000,000 for each of fiscal years ITIES.—Any amount determined under clause National Interest Lands Conservation Act (16 (i) or (ii) of subparagraph (A) shall not ex- 2016 through 2055.’’ and inserting the fol- U.S.C. 3143) shall not apply to the Coastal lowing: ‘‘exceed— ceed the lesser of such amount— Plain. ‘‘(i) as reported to the applicable insurance ‘‘(A) $500,000,000 for each of fiscal years 2016 (2) ESTABLISHMENT.— through 2019; regulatory body in the applicable financial (A) IN GENERAL.—The Secretary shall es- statement described in paragraph (4)(A) (or, ‘‘(B) $650,000,000 for each of fiscal years 2020 tablish and administer a competitive oil and and 2021; and if less, the amount required by applicable gas program for the leasing, development, law or regulation), or ‘‘(C) $500,000,000 for each of fiscal years 2022 production, and transportation of oil and gas through 2055.’’. ‘‘(ii) as determined under regulations pre- in and from the Coastal Plain. scribed by the Secretary. SEC. 20003. STRATEGIC PETROLEUM RESERVE (B) PURPOSES.—Section 303(2)(B) of the DRAWDOWN AND SALE. ‘‘(4) OTHER DEFINITIONS AND RULES.—For Alaska National Interest Lands Conserva- (a) DRAWDOWN AND SALE.— purposes of this subsection— tion Act (Public Law 96–487; 94 Stat. 2390) is (1) IN GENERAL.—Notwithstanding section ‘‘(A) APPLICABLE FINANCIAL STATEMENT.— amended— The term ‘applicable financial statement’ 161 of the Energy Policy and Conservation (i) in clause (iii), by striking ‘‘and’’ at the Act (42 U.S.C. 6241), except as provided in means a statement for financial reporting end; purposes which— subsections (b) and (c), the Secretary of En- (ii) in clause (iv), by striking the period at ergy shall draw down and sell from the Stra- ‘‘(i) is made on the basis of generally ac- the end and inserting ‘‘; and’’; and cepted accounting principles, tegic Petroleum Reserve 7,000,000 barrels of (iii) by adding at the end the following: crude oil during the period of fiscal years ‘‘(ii) is made on the basis of international ‘‘(v) to provide for an oil and gas program financial reporting standards, but only if 2026 through 2027. on the Coastal Plain.’’. EPOSIT OF AMOUNTS RECEIVED FROM there is no statement that meets the re- (2) D (3) MANAGEMENT.—Except as otherwise pro- SALE.—Amounts received from a sale under quirement of clause (i), or vided in this section, the Secretary shall paragraph (1) shall be deposited in the gen- ‘‘(iii) except as otherwise provided by the manage the oil and gas program on the eral fund of the Treasury during the fiscal Secretary in regulations, is the annual state- Coastal Plain in a manner similar to the ad- year in which the sale occurs. ment which is required to be filed with the ministration of lease sales under the Naval (b) EMERGENCY PROTECTION.—The Sec- applicable insurance regulatory body, but Petroleum Reserves Production Act of 1976 retary of Energy shall not draw down and only if there is no statement which meets (42 U.S.C. 6501 et seq.) (including regula- sell crude oil under subsection (a) in a quan- the requirements of clause (i) or (ii). tions). tity that would limit the authority to sell ‘‘(B) APPLICABLE INSURANCE REGULATORY (4) ROYALTIES.—Notwithstanding the Min- petroleum products under subsection (h) of BODY.—The term ‘applicable insurance regu- eral Leasing Act (30 U.S.C. 181 et seq.), the section 161 of the Energy Policy and Con- latory body’ means, with respect to any in- royalty rate for leases issued pursuant to servation Act (42 U.S.C. 6241) in the full surance business, the entity established by this section shall be 16.67 percent. quantity authorized by that subsection. law to license, authorize, or regulate such (5) RECEIPTS.—Notwithstanding the Min- (c) LIMITATION.—The Secretary of Energy business and to which the statement de- eral Leasing Act (30 U.S.C. 181 et seq.), of the shall not drawdown or conduct sales of crude scribed in subparagraph (A) is provided.’’. amount of adjusted bonus, rental, and roy- oil under subsection (a) after the date on (c) EFFECTIVE DATE.—The amendments alty receipts derived from the oil and gas which a total of $600,000,000 has been depos- made by this section shall apply to taxable program and operations on Federal land au- ited in the general fund of the Treasury from years beginning after December 31, 2017. thorized under this section— sales authorized under that subsection.

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00152 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.053 S01DEPT1 December 1, 2017 CONGRESSIONAL RECORD — SENATE S7805 SA 1856. Mr. MERKLEY proposed an rity number issued to an individual by the 725(2) of the McKinney-Vento Homeless As- amendment to amendment SA 1618 pro- Social Security Administration, but only if sistance Act (42 U.S.C. 11434a(2)), posed by Mr. MCCONNELL (for Mr. the social security number is issued to a cit- ‘‘(III) a full-time student who, during any izen of the United States or is issued pursu- portion of the 5-year period ending with the HATCH (for himself and Ms. MUR- ant to subclause (I) (or that portion of sub- commencement of such individual’s contin- KOWSKI)) to the bill H.R. 1, to provide clause (III) that relates to subclause (I)) of uous occupation of any low-income unit or for reconciliation pursuant to titles II section 205(c)(2)(B)(i) of the Social Security units, was an individual described in section and V of the concurrent resolution on Act. 2002(1) of title 38, United States Code,’’. the budget for fiscal year 2018; which ‘‘(8) CREDIT ALLOWED WITH RESPECT TO CER- (b) EFFECTIVE DATE.—The amendments was ordered to lie on the table; as fol- TAIN CHILDREN.— made by subsection (a) shall apply to deter- lows: ‘‘(A) IN GENERAL.—The term ‘qualifying minations made before, on, or after the date child’ for any such taxable year includes any of the enactment of this Act. On page 289, strike lines 17 through 19 child who is born and issued a social security SA 1861.. Mr. FRANKEN submitted SA 1857. Mr. DAINES (for himself, number (as defined in paragraph (7)) before the due date for the return of tax (without an amendment intended to be proposed Mrs. ERNST, Mr. LANKFORD, Mr. MORAN, regard to extensions) for the taxable year. by him to the bill H.R. 1, to provide for Mrs. FISCHER, Mr. INHOFE, Mr. BLUNT, ‘‘(B) DOUBLE CREDIT IN CASE OF CHILDREN reconciliation pursuant to titles II and Mr. LEE, Mr. RISCH, and Mr. SASSE) UNABLE TO CLAIM CREDIT.—In the case of any V of the concurrent resolution on the submitted an amendment intended to child born during a taxable year described in budget for fiscal year 2018; which was be proposed to amendment SA 1618 pro- paragraph (1) who is not taken into account ordered to lie on the table, as follows: posed by Mr. MCCONNELL (for Mr. under subparagraph (A) for the taxable year At the end of part IV of subtitle A of title HATCH (for himself and Ms. MUR- immediately preceding the taxable year in which the child is born, the amount of the I, add the following: KOWSKI)) to the bill H.R. 1, to provide SEC. 11033. SENSE OF THE SENATE ON PRE- for reconciliation pursuant to titles II credit determined under this section with re- spect to such child for the taxable year of SERVING THE TAX-FREE STATUS OF and V of the concurrent resolution on the child’s birth shall be increased by the EMPLOYER-PROVIDED TUITION AS- SISTANCE. the budget for fiscal year 2018; which lesser of— It is the sense of the Senate that— was ordered to lie on the table; as fol- ‘‘(i) the amount of the credit determined (1) employer-provided tuition assistance is under this section with respect to such child lows: a critical resource for workers seeking to for the taxable year without regard to this Beginning on page 46, strike line 7 and all improve job skills and strengthen the econ- subparagraph and subsection (d), or that follows through page 48, line 20 and in- omy, and ‘‘(ii) the amount of the credit determined sert the following: (2) employer-provided tuition assistance under subsection (d) with respect to such ‘‘(1) IN GENERAL.—In the case of a taxable should not be treated as taxable income. year beginning after December 31, 2017, and child for the taxable year.’’. before January 1, 2026, this section shall be SA 1862. Mr. FRANKEN submitted an SA 1858. Ms. BALDWIN submitted an applied as provided in paragraphs (2) through amendment intended to be proposed by amendment intended to be proposed by (8). him to the bill H.R. 1, to provide for her to the bill H.R. 1, to provide for ‘‘(2) CREDIT AMOUNT.—Subsection (a) shall reconciliation pursuant to titles II and be applied by substituting ‘$2,000’ for ‘$1,000’. reconciliation pursuant to titles II and V of the concurrent resolution on the ‘‘(3) LIMITATION.—In lieu of the amount de- V of the concurrent resolution on the budget for fiscal year 2018; which was termined under subsection (b)(2), the thresh- budget for fiscal year 2018; which was ordered to lie on the table, as follows: old amount shall be $500,000. ordered to lie on the table, as follows: ‘‘(4) PARTIAL CREDIT ALLOWED FOR CERTAIN At the end of part IV of subtitle A of title Strike subsection (b) of section 11011. OTHER DEPENDENTS.— I, add the following: ‘‘(A) IN GENERAL.—The credit determined SA 1859. Mr. FRANKEN submitted an SEC. 11033. SENSE OF THE SENATE ON PRE- under subsection (a) (after the application of VENTING TAX INCREASES ON GRAD- paragraph (2)) shall be increased by $500 for amendment intended to be proposed by UATE STUDENTS. each dependent of the taxpayer (as defined in him to the bill H.R. 1, to provide for It is the sense of the Senate that— section 152) other than a qualifying child de- reconciliation pursuant to titles II and (1) tuition waivers for graduate students scribed in subsection (c). V of the concurrent resolution on the support critical research, education, and in- ‘‘(B) EXCEPTION FOR CERTAIN NONCITIZENS.— budget for fiscal year 2018; which was novation in the United States, and Subparagraph (A) shall not apply with re- ordered to lie on the table, as follows: (2) tuition waivers for graduate students spect to any individual who would not be a should not be treated as taxable income. At the end of part IV of subtitle A of title dependent if subparagraph (A) of section I, add the following: f 152(b)(3) were applied without regard to all that follows ‘resident of the United States’. SEC. 11033. REPEAL OF DENIAL OF CREDIT FOR PRIVILEGES OF THE FLOOR FELONY DRUG OFFENSES. ‘‘(5) MAXIMUM AMOUNT OF REFUNDABLE (a) IN GENERAL.—Section 25A(b)(2) is Mr. CASEY. Mr. President, I ask CREDIT.— amended by striking subparagraph (D). unanimous consent that Rachel ‘‘(A) IN GENERAL.—Subsection (d)(1)(A) (b) EFFECTIVE DATE.—The amendment McKinnon of my staff be granted floor shall be applied without regard to para- made by this section shall apply to taxable graphs (2) and (4) of this subsection. privileges for the duration of the 115th years beginning after the date of the enact- Congress. ‘‘(B) ADJUSTMENT FOR INFLATION.—In the ment of this Act. case of a taxable year beginning after 2017, The PRESIDING OFFICER. Without objection, it is so ordered. subsection (d)(1)(A) shall be applied as if the SA 1860. Mr. FRANKEN submitted an $1,000 amount in subsection (a) were in- amendment intended to be proposed by f creased (but not to exceed the amount under paragraph (2) of this subsection) by an him to the bill H.R. 1, to provide for COMMEMORATING THE 62ND ANNI- amount equal to— reconciliation pursuant to titles II and VERSARY OF THE DEDICATION ‘‘(i) such dollar amount, multiplied by V of the concurrent resolution on the OF WHITEMAN AIR FORCE BASE ‘‘(ii) the cost-of-living adjustment deter- budget for fiscal year 2018; which was Mr. ENZI. Mr. President, I ask unani- mined under section 1(f)(3) for the calendar ordered to lie on the table, as follows: mous consent that the Senate proceed year in which the taxable year begins. At the end of subpart B of part V of sub- to the immediate consideration of S. Any increase determined under the preceding title A of title I, add the following: sentence shall be rounded to the next highest Res. 347, submitted earlier today. SEC. 13417. HOMELESS YOUTH AND VETERANS The PRESIDING OFFICER. The multiple of $100. WHO ARE FULL-TIME STUDENTS ‘‘(6) EARNED INCOME THRESHOLD FOR RE- QUALIFIED FOR PURPOSES OF THE clerk will report the resolution by FUNDABLE CREDIT.—Subsection (d)(1)(B)(i) LOW INCOME HOUSING TAX CREDIT. title. shall be applied by substituting ‘$2,500’ for (a) IN GENERAL.—Clause (i) of section The senior assistant legislative clerk ‘$3,000’. 42(i)(3)(D) is amended by redesignating sub- read as follows: ‘‘(7) SOCIAL SECURITY NUMBER REQUIRED.— clauses (II) and (III) as subclauses (IV) and A resolution (S. Res. 347) commemorating No credit shall be allowed under subsection (V), respectively, and by inserting after sub- the 62nd anniversary of the dedication of (d) to a taxpayer with respect to any quali- clause (I) the following new subclauses: Whiteman Air Force Base. fying child unless the taxpayer includes the ‘‘(II) a full-time student who, during any social security number of such child on the portion of the 7-year period ending with the There being no objection, the Senate return of tax for the taxable year. For pur- commencement of such individual’s contin- proceeded to consider the resolution. poses of the preceding sentence, the term ‘so- uous occupation of any low-income unit or Mr. ENZI. Mr. President, I ask unani- cial security number’ means a social secu- units, was an individual described in section mous consent that the resolution be

VerDate Sep 11 2014 09:24 Dec 02, 2017 Jkt 079060 PO 00000 Frm 00153 Fmt 0624 Sfmt 0634 E:\CR\FM\A01DE6.051 S01DEPT1 S7806 CONGRESSIONAL RECORD — SENATE December 1, 2017 agreed to, the preamble be agreed to, NATIONAL BANK FOR RECONSTRUCTION AND DEVELOP- INSURANCE CORPORATION FOR A TERM OF SIX YEARS, MENT FOR A TERM OF TWO YEARS, VICE SARA VICE JEREMIAH O’HEAR NORTON, RESIGNED. and the motions to reconsider be con- MARGALIT AVIEL, RESIGNED. JELENA MCWILLIAMS, OF OHIO, TO BE CHAIRPERSON sidered made and laid upon the table OF THE BOARD OF DIRECTORS OF THE FEDERAL DE- DEPARTMENT OF STATE POSIT INSURANCE CORPORATION FOR A TERM OF FIVE with no intervening action or debate. DAVID T. FISCHER, OF MICHIGAN, TO BE AMBASSADOR YEARS, VICE MARTIN J. GRUENBERG, TERM EXPIRED. The PRESIDING OFFICER. Without EXTRAORDINARY AND PLENIPOTENTIARY OF THE DEPARTMENT OF JUSTICE UNITED STATES OF AMERICA TO THE KINGDOM OF MO- objection, it is so ordered. ROCCO. MATTHEW D. HARRIS, OF UTAH, TO BE UNITED STATES MARSHAL FOR THE DISTRICT OF UTAH FOR THE TERM The resolution (S. Res. 347) was EUROPEAN BANK FOR RECONSTRUCTION AND OF FOUR YEARS, VICE JAMES ALFRED THOMPSON, TERM agreed to. DEVELOPMENT EXPIRED. TED G. KAMATCHUS, OF IOWA, TO BE UNITED STATES The preamble was agreed to. JUDY LYNN SHELTON, OF VIRGINIA, TO BE UNITED MARSHAL FOR THE SOUTHERN DISTRICT OF IOWA FOR STATES DIRECTOR OF THE EUROPEAN BANK FOR RECON- (The resolution, with its preamble, is THE TERM OF FOUR YEARS, VICE MICHAEL ROBERT STRUCTION AND DEVELOPMENT, VICE SCOTT ALLEN, RE- BLADEL, TERM EXPIRED. printed in today’s RECORD under ‘‘Sub- SIGNED. JOSEPH P. KELLY, OF NEBRASKA, TO BE UNITED mitted Resolutions.’’) DEPARTMENT OF LABOR STATES ATTORNEY FOR THE DISTRICT OF NEBRASKA FOR THE TERM OF FOUR YEARS, VICE DEBORAH K. R. f JAMES EDWIN WILLIAMS, OF UTAH, TO BE CHIEF FI- GILG, RETIRED. NANCIAL OFFICER, DEPARTMENT OF LABOR, VICE JOSEPH D. MCCLAIN, OF INDIANA, TO BE UNITED ORDERS FOR MONDAY, DECEMBER JAMES L. TAYLOR. STATES MARSHAL FOR THE SOUTHERN DISTRICT OF IN- 4, 2017 DEPARTMENT OF EDUCATION DIANA FOR THE TERM OF FOUR YEARS, VICE KERRY JO- SEPH FORESTAL, RESIGNED. Mr. ENZI. Mr. President, I ask unani- MARK SCHNEIDER, OF THE DISTRICT OF COLUMBIA, TO SCOTT W. MURRAY, OF NEW HAMPSHIRE, TO BE UNITED BE DIRECTOR OF THE INSTITUTE OF EDUCATION STATES ATTORNEY FOR THE DISTRICT OF NEW HAMP- mous consent that when the Senate SCIENCE, DEPARTMENT OF EDUCATION FOR A TERM OF SHIRE FOR THE TERM OF FOUR YEARS, VICE EMILY completes its business today, it ad- SIX YEARS, VICE JOHN Q. EASTON, TERM EXPIRED. GRAY RICE, RESIGNED. DAVID A. WEAVER, OF COLORADO, TO BE UNITED journ until 3 p.m., Monday, December CORPORATION FOR NATIONAL AND COMMUNITY STATES MARSHAL FOR THE DISTRICT OF COLORADO FOR 4; further, that following the prayer SERVICE THE TERM OF FOUR YEARS, VICE JOHN LEROY KAMMERZELL, TERM EXPIRED. and pledge, the morning hour be BARBARA STEWART, OF ILLINOIS, TO BE CHIEF EXECU- DAVID C. WEISS, OF DELAWARE, TO BE UNITED STATES deemed expired, the Journal of pro- TIVE OFFICER OF THE CORPORATION FOR NATIONAL ATTORNEY FOR THE DISTRICT OF DELAWARE FOR THE AND COMMUNITY SERVICE, VICE WENDY M. SPENCER, TERM OF FOUR YEARS, VICE CHARLES M. OBERLY III, RE- ceedings be approved to date, the time RESIGNED. SIGNED. for the two leaders be reserved for their IN THE AIR FORCE IN THE AIR FORCE use later in the day, and morning busi- THE FOLLOWING NAMED OFFICER FOR APPOINTMENT THE FOLLOWING NAMED OFFICER FOR APPOINTMENT ness be closed; finally, that following AS THE JUDGE ADVOCATE GENERAL, UNITED STATES IN THE RESERVE OF THE AIR FORCE TO THE GRADE INDI- AIR FORCE AND FOR APPOINTMENT IN THE UNITED CATED UNDER TITLE 10, U.S.C., SECTION 12203: leader remarks, the Senate proceed to STATES AIR FORCE TO THE GRADE INDICATED WHILE executive session and resume consider- SERVING AS THE JUDGE ADVOCATE GENERAL UNDER To be brigadier general TITLE 10, U.S.C., SECTIONS 601 AND 8037: ation of the Nielsen nomination as COL. MITCHEL NEUROCK To be lieutenant general under the previous order. THE FOLLOWING NAMED OFFICERS FOR APPOINTMENT MAJ. GEN. JEFFERY A. ROCKWELL IN THE RESERVE OF THE AIR FORCE TO THE GRADE INDI- The PRESIDING OFFICER. Without CATED UNDER TITLE 10, U.S.C., SECTION 12203: THE FOLLOWING NAMED OFFICER FOR APPOINTMENT objection, it is so ordered. TO THE GRADE INDICATED IN THE UNITED STATES AIR To be major general FORCE UNDER TITLE 10, U.S.C., SECTION 624: f BRIG. GEN. HUBERT C. HEGTVEDT To be major BRIG. GEN. TIMOTHY P. KELLY BRIG. GEN. ALBERT V. LUPENSKI ADJOURNMENT UNTIL MONDAY ARIANNE R. MORRISON BRIG. GEN. SAMUEL C. MAHANEY DECEMBER 4, 2017, AT 3 P.M. THE FOLLOWING NAMED OFFICER FOR APPOINTMENT BRIG. GEN. JOHN B. WILLIAMS TO THE GRADE INDICATED IN THE UNITED STATES AIR Mr. ENZI. Mr. President, if there is FORCE UNDER TITLE 10, U.S.C., SECTION 624: f no further business to come before the To be major CONFIRMATIONS Senate, I ask unanimous consent that RICHARD A. HANRAHAN it stand adjourned under the previous THE FOLLOWING NAMED OFFICERS FOR APPOINTMENT Executive nominations confirmed by order. TO THE GRADE INDICATED IN THE UNITED STATES AIR the Senate December 1, 2017: FORCE UNDER TITLE 10, U.S.C., SECTION 624: There being no objection, the Senate, IN THE ARMY To be major at 2:06 a.m., adjourned until Monday, THE FOLLOWING NAMED OFFICERS FOR APPOINTMENT December 4, 2017, at 3 p.m. ALECK A. BROWN TO THE GRADE INDICATED IN THE UNITED STATES ARMY JOHN D. RITTER UNDER TITLE 10, U.S.C., SECTION 624: f THE FOLLOWING NAMED OFFICER FOR APPOINTMENT TO THE GRADE INDICATED IN THE UNITED STATES AIR To be brigadier general NOMINATIONS FORCE UNDER TITLE 10, U.S.C., SECTION 624: COL. DOUGLAS F. STITT To be colonel Executive nominations received by IN THE NAVY the Senate: AMBER N. PECONGA THE FOLLOWING NAMED OFFICER FOR APPOINTMENT IN THE ARMY IN THE UNITED STATES NAVY TO THE GRADE INDICATED DEPARTMENT OF DEFENSE UNDER TITLE 10, U.S.C., SECTION 624: THE FOLLOWING NAMED OFFICER FOR APPOINTMENT PHYLLIS L. BAYER, OF MISSISSIPPI, TO BE AN ASSIST- TO THE GRADE INDICATED IN THE UNITED STATES ARMY To be rear admiral (lower half) ANT SECRETARY OF THE NAVY, VICE DENNIS V. MCGINN. UNDER TITLE 10, U.S.C., SECTION 624: CAPT. MICHAEL E. BOYLE FINANCIAL STABILITY OVERSIGHT COUNCIL To be major THE FOLLOWING NAMED OFFICER FOR APPOINTMENT IN THE UNITED STATES NAVY TO THE GRADE INDICATED THOMAS E. WORKMAN, OF NEW YORK, TO BE A MEMBER HEATHER M. LEE OF THE FINANCIAL STABILITY OVERSIGHT COUNCIL FOR WHILE ASSIGNED TO A POSITION OF IMPORTANCE AND A TERM OF SIX YEARS, VICE S. ROY WOODALL, JR., TERM IN THE NAVY RESPONSIBILITY UNDER TITLE 10, U.S.C., SECTION 601: EXPIRED. THE FOLLOWING NAMED OFFICER FOR APPOINTMENT To be vice admiral NATIONAL AERONAUTICS AND SPACE TO THE GRADE INDICATED IN THE UNITED STATES NAVY REAR ADM. LISA M. FRANCHETTI ADMINISTRATION UNDER TITLE 10, U.S.C., SECTION 624: IN THE AIR FORCE JEFFREY DEWIT, OF ARIZONA, TO BE CHIEF FINANCIAL To be captain THE FOLLOWING NAMED OFFICER FOR APPOINTMENT OFFICER, NATIONAL AERONAUTICS AND SPACE ADMINIS- SHARIF H. CALFEE TRATION, VICE DAVID RADZANOWSKI. IN THE RESERVE OF THE AIR FORCE TO THE GRADE INDI- THE FOLLOWING NAMED OFFICER FOR APPOINTMENT CATED UNDER TITLE 10, U.S.C., SECTION 12203: MORRIS K. UDALL AND STEWART L. UDALL TO THE GRADE INDICATED IN THE UNITED STATES NAVY To be major general FOUNDATION UNDER TITLE 10, U.S.C., SECTION 624: To be captain BRIG. GEN. ARTHUR E. JACKMAN, JR. TADD M. JOHNSON, OF MINNESOTA, TO BE A MEMBER THE FOLLOWING NAMED OFFICER FOR APPOINTMENT OF THE BOARD OF TRUSTEES OF THE MORRIS K. UDALL JOHN A. MILLS AND STEWART L. UDALL FOUNDATION FOR A TERM EX- IN THE RESERVE OF THE AIR FORCE TO THE GRADE INDI- THE FOLLOWING NAMED OFFICER FOR APPOINTMENT PIRING OCTOBER 6, 2022, VICE TERRENCE L. BRACY, TERM CATED UNDER TITLE 10, U.S.C., SECTION 12203: IN THE GRADE INDICATED IN THE UNITED STATES NAVY EXPIRED. UNDER TITLE 10, U.S.C., SECTION 531: To be major general LISA JOHNSON-BILLY, OF OKLAHOMA, TO BE A MEM- BER OF THE BOARD OF TRUSTEES OF THE MORRIS K. To be lieutenant commander BRIG. GEN. JOSEF F. SCHMID III UDALL AND STEWART L. UDALL FOUNDATION FOR A THE FOLLOWING NAMED OFFICERS FOR APPOINTMENT NICHOLAS H. STEGING, JR. TERM EXPIRING AUGUST 25, 2018, VICE DIANE IN THE RESERVE OF THE AIR FORCE TO THE GRADE INDI- HUMETEWA, RESIGNED. THE FOLLOWING NAMED OFFICER FOR APPOINTMENT CATED UNDER TITLE 10, U.S.C., SECTION 12203: LISA JOHNSON-BILLY, OF OKLAHOMA, TO BE A MEM- IN THE GRADE INDICATED IN THE REGULAR NAVY BER OF THE BOARD OF TRUSTEES OF THE MORRIS K. UNDER TITLE 10, U.S.C., SECTION 531: To be brigadier general UDALL AND STEWART L. UDALL FOUNDATION FOR A TERM EXPIRING AUGUST 25, 2024. (REAPPOINTMENT) To be lieutenant commander COL. JOHN M. BREAZEALE COL. DAMON S. FELTMAN INTERNATIONAL BANK FOR RECONSTRUCTION JONATHAN S. DURHAM COL. ANNE B. GUNTER AND DEVELOPMENT FEDERAL DEPOSIT INSURANCE CORPORATION COL. SCHEID P. HODGES COL. RICHARD L. KEMBLE ERIK BETHEL, OF FLORIDA, TO BE UNITED STATES AL- JELENA MCWILLIAMS, OF OHIO, TO BE A MEMBER OF COL. TANYA R. KUBINEC TERNATE EXECUTIVE DIRECTOR OF THE INTER- THE BOARD OF DIRECTORS OF THE FEDERAL DEPOSIT COL. ERICH C. NOVAK

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COL. JEFFREY T. PENNINGTON COL. MICHAEL D. SPROUL AIR FORCE NOMINATIONS BEGINNING WITH JOSEPH COL. JOHN N. TREE COL. CHRISTAN L. STEWART BENJAMIN AHLERS AND ENDING WITH TRENTON M. COL. AARON G. VANGELISTI COL. DAVID W. WALTER WHITE, WHICH NOMINATIONS WERE RECEIVED BY THE COL. WILLIAM W. WHITTENBERGER, JR. COL. TERRY L. WILLIAMS SENATE AND APPEARED IN THE CONGRESSIONAL COL. CHRISTOPHER F. YANCY COL. SHANNA M. WOYAK RECORD ON NOVEMBER 14, 2017. THE FOLLOWING NAMED AIR NATIONAL GUARD OF THE COL. FRANK Y. YANG AIR FORCE NOMINATION OF ERIKA R. WOODSON, TO BE UNITED STATES OFFICER FOR APPOINTMENT IN THE RE- COL. JEFFREY D. YOUNG MAJOR. SERVE OF THE AIR FORCE TO THE GRADE INDICATED THE FOLLOWING NAMED AIR NATIONAL GUARD OF THE AIR FORCE NOMINATION OF MICHAEL S. STROUD, TO BE UNDER TITLE 10, U.S.C., SECTIONS 12203 AND 12212: UNITED STATES OFFICERS FOR APPOINTMENT IN THE MAJOR. RESERVE OF THE AIR FORCE TO THE GRADE INDICATED AIR FORCE NOMINATIONS BEGINNING WITH LANCE A. To be brigadier general UNDER TITLE 10, U.S.C., SECTIONS 12203 AND 12212: AIUMOPAS AND ENDING WITH TARA L. VILLENA, WHICH COL. DARLOW G. BOTHA, JR. NOMINATIONS WERE RECEIVED BY THE SENATE AND AP- To be major general PEARED IN THE CONGRESSIONAL RECORD ON NOVEMBER THE FOLLOWING NAMED AIR NATIONAL GUARD OF THE 14, 2017. UNITED STATES OFFICERS FOR APPOINTMENT IN THE BRIG. GEN. ONDRA L. BERRY BRIG. GEN. SAMUEL W. BLACK AIR FORCE NOMINATION OF ROBERT SARLAY, JR., TO RESERVE OF THE AIR FORCE TO THE GRADE INDICATED BE COLONEL. UNDER TITLE 10, U.S.C., SECTIONS 12203 AND 12212: BRIG. GEN. WILLIAM D. BUNCH BRIG. GEN. JOSEPH S. CHISOLM AIR FORCE NOMINATIONS BEGINNING WITH RICHARD G. To be brigadier general BRIG. GEN. THOMAS B. CUCCHI ADAMS AND ENDING WITH JOSEPH F. ZINGARO, WHICH BRIG. GEN. GARY L. EBBEN NOMINATIONS WERE RECEIVED BY THE SENATE AND AP- COL. STEVEN J. DEMILLIANO BRIG. GEN. JERRY L. FENWICK PEARED IN THE CONGRESSIONAL RECORD ON NOVEMBER COL. CHRISTOPHER E. FINERTY BRIG. GEN. DAWN M. FERRELL 16, 2017. THE FOLLOWING NAMED AIR NATIONAL GUARD OF THE BRIG. GEN. THOMAS J. KENNETT UNITED STATES OFFICERS FOR APPOINTMENT IN THE BRIG. GEN. ERIC W. MANN IN THE ARMY RESERVE OF THE AIR FORCE TO THE GRADE INDICATED BRIG. GEN. EDWARD A. SAULEY III ARMY NOMINATION OF ASHLEY R. SELLERS, TO BE UNDER TITLE 10, U.S.C., SECTIONS 12203 AND 12212: BRIG. GEN. DEAN A. TREMPS MAJOR. To be brigadier general THE FOLLOWING NAMED AIR NATIONAL GUARD OF THE ARMY NOMINATION OF ELIAS M. CHELALA, TO BE UNITED STATES OFFICERS FOR APPOINTMENT IN THE MAJOR. COL. MICHELE K. LAMONTAGNE RESERVE OF THE AIR FORCE TO THE GRADE INDICATED ARMY NOMINATION OF CATHLEEN A. LABATE, TO BE COL. MICHAEL J. REGAN, JR. UNDER TITLE 10, U.S.C., SECTIONS 12203 AND 12212: COLONEL. THE FOLLOWING NAMED AIR NATIONAL GUARD OF THE To be major general ARMY NOMINATIONS BEGINNING WITH REBECCA J. UNITED STATES OFFICERS FOR APPOINTMENT IN THE COOPER AND ENDING WITH MATTHEW L. DANIELS, RESERVE OF THE AIR FORCE TO THE GRADE INDICATED BRIG. GEN. GEORGE M. DEGNON WHICH NOMINATIONS WERE RECEIVED BY THE SENATE UNDER TITLE 10, U.S.C., SECTIONS 12203 AND 12212: BRIG. GEN. TAMHRA L. HUTCHINS-FRYE AND APPEARED IN THE CONGRESSIONAL RECORD ON OC- To be brigadier general BRIG. GEN. SHERRIE L. MCCANDLESS TOBER 16, 2017. BRIG. GEN. STEVEN NORDHAUS ARMY NOMINATION OF BRANTLEY J. COMBS, TO BE COL. TRAVIS K. ACHESON BRIG. GEN. KIRK S. PIERCE LIEUTENANT COLONEL. COL. BARRY A. BLANCHARD BRIG. GEN. FRANK H. STOKES ARMY NOMINATIONS BEGINNING WITH MARK E. QUERY COL. MICHAEL A. BORKOWSKI BRIG. GEN. BRADLEY A. SWANSON AND ENDING WITH SAMUEL H. TAHK, WHICH NOMINA- COL. MICHAEL T. BUTLER BRIG. GEN. THOMAS K. WARK TIONS WERE RECEIVED BY THE SENATE AND APPEARED COL. MICHAEL A. COOPER THE FOLLOWING NAMED AIR NATIONAL GUARD OF THE IN THE CONGRESSIONAL RECORD ON NOVEMBER 14, 2017. COL. MONIQUE J. DESPAIN UNITED STATES OFFICERS FOR APPOINTMENT IN THE ARMY NOMINATION OF VICTOR A. PACHECOFOWLER, TO COL. MATTHEW D. DINMORE RESERVE OF THE AIR FORCE TO THE GRADE INDICATED BE LIEUTENANT COLONEL. COL. TERESA S. EDWARDS UNDER TITLE 10, U.S.C., SECTIONS 12203 AND 12212: ARMY NOMINATION OF JAMES M. BRUMIT, TO BE COLO- COL. EMMANUEL I. HALDOPOULOS NEL. COL. CHARLES G. JEFFRIES To be major general ARMY NOMINATION OF MELVIN J. NICKELL, TO BE COL. GREGORY W. LAIR COLONEL. COL. JEFFREY W. MAGRAM BRIG. GEN. DOUGLAS A. FARNHAM ARMY NOMINATION OF ERICA L. HERZOG, TO BE COLO- COL. JAMES C. MCEACHEN BRIG. GEN. CLAY L. GARRISON NEL. COL. MAURICE M. MCKINNEY AIR FORCE NOMINATIONS BEGINNING WITH DANE V. ARMY NOMINATION OF ADAM W. VANEK, TO BE COLO- COL. SUELLEN OVERTON CAMPBELL AND ENDING WITH RICHARD L. WOODRUFF, NEL. COL. GREGG A. PEREZ JR., WHICH NOMINATIONS WERE RECEIVED BY THE SEN- ARMY NOMINATION OF JASON PARK, TO BE MAJOR. COL. MARK D. PIPER ATE AND APPEARED IN THE CONGRESSIONAL RECORD ARMY NOMINATION OF JOHN T. HUCKABAY, TO BE COL. JAMES P. ROWLETT ON SEPTEMBER 5, 2017. MAJOR.

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