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Permanently Extending Increased Standard Deduction, and 15% Individual Income Tax Rate Bracket Expansion, for Married Taxpayers Filing Joint Returns

By: Xavier Becerra

Date: April 28, 2004

Location: Washington, DC

Issues: National Security Defense Foreign Affairs Health and Health Care Government Budget and Spending Education

PERMANENTLY EXTENDING INCREASED STANDARD DEDUCTION, AND 15-PERCENT INDIVIDUAL INCOME TAX RATE BRACKET EXPANSION, FOR MARRIED TAXPAYERS FILING JOINT RETURNS -- (House of Representatives - April 28, 2004)

Mr. WELLER. Mr. Speaker, pursuant to House Resolution 607, I call up the bill (H.R. 4181) to amend the Internal Revenue Code of 1986 to permanently extend the increased standard deduction, and the 15-percent individual income tax rate bracket expansion, for married taxpayers filing joint returns, and ask for its immediate consideration in the House.

The Clerk read the title of the bill.

The SPEAKER pro tempore. Pursuant to House Resolution 607, the bill is considered read for amendment.

The text of H.R. 4181 is as follows:

H.R. 4181

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. EXTENSION OF INCREASED STANDARD DEDUCTION FOR MARRIED TAXPAYERS FILING JOINT RETURNS.

(a) IN GENERAL.-Paragraph (2) of section 63(c) of the Internal Revenue Code of 1986 (relating to basic standard deduction) is amended to read as follows:

"(2) BASIC STANDARD DEDUCTION.-For purposes of paragraph (1), the basic standard deduction is-

"(A) 200 percent of the dollar amount in effect under subparagraph (C) for the taxable year in the case of-

"(i) a joint return, or

"(ii) a surviving spouse (as defined in section 2(a)),

"(B) $4,400 in the case of a head of household (as defined in section 2(b)), or

"(c) $3,000 in any other case.".

(b) CONFORMING AMENDMENTS.-

(1) Section 63(c)(4) of such Code is amended by striking "(2)(D)" each place it occurs and inserting "(2)©".

(2) Section 63(c) of such Code is amended by striking paragraph (7).

SEC. 2. EXTENSION OF 15-PERCENT INDIVIDUAL INCOME TAX RATE BRACKET EXPANSION FOR MARRIED TAXPAYERS FILING JOINT RETURNS.

(a) IN GENERAL.-Paragraph (8) of section 1(f ) of the Internal Revenue Code of 1986 (relating to phaseout of marriage penalty in 15-percent bracket) is amended to read as follows:

"(8) ELIMINATION OF MARRIAGE PENALTY IN 15-PERCENT BRACKET.-With respect to taxable years beginning after December 31, 2004, in prescribing the tables under paragraph (1)--

"(A) the maximum taxable income in the 15 percent rate bracket in the table contained in subsection (a) (and the minimum taxable income in the next higher taxable income bracket in such table) shall be 200 percent of the maximum taxable income in the 15-percent rate bracket in the table contained in subsection (c) (after any other adjustment under this subsection), and

"(B) the comparable taxable income amounts in the table contained in subsection (d) shall be ½ of the amounts determined under subparagraph (A).".

(b) CONFORMING AMENDMENT.-The heading for subsection (f ) of section 1 of such Code is amended by striking "PHASEOUT" and inserting "ELIMINATION".

SEC. 3. REPEAL OF SUNSET.

Title IX of the Economic Growth and Tax Relief Reconciliation Act of 2001 shall not apply to the amendments made by sections 301 and 302 of such Act.

The SPEAKER pro tempore. The amendment printed in part A of House Report 108-470 is adopted.

The text of H.R. 4181, as amended, is as follows:

H.R. 4181

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,
SECTION 1. EXTENSION OF INCREASED STANDARD DEDUCTION FOR MARRIED TAXPAYERS FILING JOINT RETURNS.

(a) IN GENERAL.-Paragraph (2) of section 63(c) of the Internal Revenue Code of 1986 (relating to basic standard deduction) is amended to read as follows:

"(2) BASIC STANDARD DEDUCTION.-For purposes of paragraph (1), the basic standard deduction is-

"(A) 200 percent of the dollar amount in effect under subparagraph (C) for the taxable year in the case of-

"(i) a joint return, or

"(ii) a surviving spouse (as defined in section 2(a)),

"(B) $4,400 in the case of a head of household (as defined in section 2(b)), or

(C)$3,000 in any other case.".

(b) CONFORMING AMENDMENTS.-

(1) Section 63(c)(4) of such Code is amended by striking "(2)(D)" each place it occurs and inserting "(2)©".

(2) Section 63)(c) of such Code is amended by striking paragraph (7).

SEC. 2. EXTENSION OF 15-PERCENT INDIVIDUAL INCOME TAX RATE BRACKET EXPANSION FOR MARRIED TAXPAYERS FILING JOINT RETURNS.

(a) IN GENERAL.-Paragraph (8) of section 1(f ) of the Internal Revenue Code of 1986 (relating to phaseout of marriage penalty in 15-percent bracket) is amended to read as follows:

"(8) ELIMINATION OF MARRIAGE PENALTY IN 15-PERCENT BRACKET.-With respect to taxable years beginning after December 31, 2004, in prescribing the tables under paragraph (1)--

"(B) the comparable taxable income amounts in the table contained in subsection (d) shall be ½ of the amounts determined under subparagraph (A).".

(b) CONFORMING AMENDMENT.-The heading for subsection (f ) of section 1 of such Code is amended by striking "PHASEOUT" and inserting "ELIMINATION".

SEC. 3. REPEAL OF SUNSET.
Title IX of the Economic Growth and Tax Relief Reconciliation Act of 2001 shall not apply to the amendments made by title III of such Act.

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Mr. BECERRA. Mr. Speaker, I thank the gentleman for yielding me the time, and I yield myself such time as I may consume.

Mr. Speaker, the difficulty with this debate is that there is a big monster in the closet that people do not want to discuss, and that is the growing national deficit, which is going to make it impossible for us to ever do the type of investments in our education, in our housing, health care for seniors and others that we need to do. It certainly will stop us from doing things the right way in places like Afghanistan, Iraq, around the world where the United States must stand up to defend the rights of others and protect Americans, and certainly we are not doing the right thing for at least some 13 million Americans under this particular bill when it comes to the so-called marriage penalty relief because they will get a benefit, because what is not being said, because of that big monster in the closet is that a lot of these folks, 10 million directly, outright, will lose any type of relief from this legislation because they will fall into another tax category.

So my colleagues take care of what is called the marriage penalty, but they dump them into what is called the alternative minimum tax, such that if a family makes about 72,000 in a year and has two kids and, in filling out the tax form does the standard deductions, that family thinks all of the sudden it may get some relief out of the marriage penalty legislation, like what we have today, will finally get nothing, and that is the reality for 10 million families in America.

For another 3 million families, they will get less than what this bill promises, and the big monster in that closet is going to come out because if we have a $521 billion deficit for this current year and over a $7 trillion national debt collectively, which amounts to more than 24,000 for each man, woman and child in this country that each and every one of us owes and sooner or later will pay, either through higher taxes or reduced services in education, health care, housing, national defense, then we are going to see the real consequences come.

So this debate should be about doing marriage penalty relief responsibly at a time of deficits. This should be about doing marriage penalty relief responsibly at a time when we are asking men and women to sacrifice their lives every single day in places like Afghanistan and Iraq, and this should be a debate about doing this responsibly and in a bipartisan fashion so that we could craft legislation that would take care of the 13 million American families that are going to be deceived and believe that they are going to get something from this and get either nothing or very little whatsoever, at a cost of over $100 billion.

So, Mr. Speaker, there could be bipartisanship here. We should move forward in taking care of marriage penalty for any family under the Tax Code, and for that reason I would hope that Members would consider voting for this substitute because it goes in that direction.

Mr. Speaker, I reserve the balance of my time.

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Mr. BECERRA. Mr. Speaker, I yield 4 minutes to the gentleman from Maryland (Mr. Hoyer), the Democratic whip.

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Mr. BECERRA. Mr. Speaker, I yield myself such time as I may consume to mention that the last time I looked the majority party is in control of both the House and the Senate and controls any spending bills that come out of this Congress. Of course, they first are sent over to us by the White House, meaning the President as well. So in terms of who controls the spending and who is splurging, the minority party would love to have control of both the House and White House, but at this stage that is in the hands of the majority party, so the gentleman should take his concerns directly to his leadership of his party.

Mr. Speaker, I yield 3 minutes to the gentleman from New York (Mr. Israel).

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Mr. BECERRA. Mr. Speaker, I yield 3 minutes to the gentleman from Ohio (Mr. Ryan).

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Mr. BECERRA. Mr. Speaker, I yield 2 minutes to the gentleman from New York (Mr. Bishop).
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Mr. BECERRA. Mr. Speaker, I yield 2 minutes to the gentlewoman from Ohio (Mrs. Jones), a member of the Committee on Ways and Means.

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Mr. BECERRA. Mr. Speaker, I yield 1 ½ minutes to the gentleman from Illinois (Mr. Emanuel).

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Mr. BECERRA. Mr. Speaker, I yield 1 ½ minutes to the gentlewoman from Texas (Ms. Jackson-Lee).

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Mr. BECERRA. Mr. Speaker, I yield myself the balance of my time.

The SPEAKER pro tempore (Mr. LaHood). The gentleman has 3 ½ minutes remaining.

Mr. BECERRA. Mr. Speaker, everyone who has spoken today on both sides of the aisle supports tax relief for married couples. In fact, I know of no one who is going to come here and say to you they are prepared to vote against marriage penalty relief for married couples in this country.

But at a time when we are facing as a result of policies in this government the largest deficit in the Nation's history, some $521 billion, and at a time when there is a double whammy of having to fight a war in Iraq and Afghanistan with no sense of when we are going to have an opportunity to bring our troops home and at what cost, we have to move on legislation like this in a responsible fashion.

This legislation will cost over $100 billion. We do not have $100 billion to pull out of the Federal Treasury's pocket to pay for this bill. That means the deficit of the Nation will increase that much more.

As I mentioned at the inception of this debate, we have a $7 trillion-plus national debt. I guess you could continue spending, the credit card looks good, but at some point we have to pay. And if we are not going to pay, that means our children will pay.

At a time when we are this year, as a result of the administration's request, underfunding the President's own No Child Left Behind Act for education some $8 billion to $10 billion, at a time when we are underfunding the IDEA legislation, which is for special education needs of our kids throughout this country, by more than $2 billion this year, at a time when we are failing to help 44 million Americans have access to health insurance, at a time when we see men and women every day sacrificing their life in places like Afghanistan and Iraq for us, here we are talking about giving $100 billion in tax cuts, when we are not willing to pay for them.

The Democrat substitute simply says, let us give that tax relief, but let us pay for it. We do so by taking the top one-fifth of 1 percent of the richest Americans in this country, one-fifth of 1 percent, and saying to them, you are going to get about $136,000 in tax cuts from the 2001 and 2003 tax bills that were passed. Take $100,000 instead of $136,000. That will help us take care of the millions of families, tens of millions of families that will otherwise face this marriage tax penalty.

Sacrifice a little bit the way the young men or women in Afghanistan are doing today or Iraq are doing today, or the working family making $40,000 or $50,000 is doing today. You will still get $100,000. That is more in relative terms and in absolute terms in the tax cut than any other income group in America.

One-fifth of 1 percent of the richest families in America would help cover the cost. That way we do not add another $100 billion to the national debt. Cannot do that? I guess that is considered responsible.

Some of us believe we owe it to the people of this country to spend, but spend responsibly; to enact legislation, but do it responsibly. That is what I think the Democratic substitute does.

It simply says, let us not try to hoodwink you, let us not do tax policy in the back room with a big black monster back there you cannot see. Let us do it so people can understand transparently, clearly. Big print, not fine print, is what we are trying to say.

Let us give marriage tax relief to all families, but do it responsibly without adding to the debt that will have to be paid by the children of the people that will receive some of that relief. Do not take it from Peter to give it to Paul. Let us do it the right way.

I urge my colleagues to vote for the Democratic substitute.

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Mr. BECERRA. Mr. Speaker, I object to the vote on the ground that a quorum is not present and make the point of order that a quorum is not present.

The SPEAKER pro tempore. Evidently a quorum is not present.

The Sergeant at Arms will notify absent Members.

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Permanently Extending Increased Standard Deduction, and 15% Individual Income Tax Rate Bracket Expansion, for Married Taxpayers Filing Joint Returns

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