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Fact Sheet on Congressional Tax Proposals , Record No.: RS20264, Date: July 18, 2002 1 (July 18, 2002)

handle is hein.tera/crstax0457 and id is 1 raw text is: Order Code RS20264 Updated July 18, 2002 CRS Report for Congress Received through the CRS Web Fact Sheet on Congressional Tax Proposals Jane G. Gravelle Senior Specialist in Economic Policy Government and Finance Division Summary After passing a major multi-year tax cut in Mid-2001 (which was sunsetted after ten years) and a stimulus bill in 2002, Congress is considering energy tax subsidies, tax incentives for charitable giving deductions, pension diversification in the wake of the ENRON problems, and tax shelters. The House has passed several bills that would make the multiyear tax cut permanent as well as a bill to speed up certain provisions. This report will be updated to reflect legislative developments. In the first half of 2001, a major multi-year tax cut was enacted and signed into law. The bill was passed with a sunset provision because there were not enough votes to set aside a budget rule. Several bills have passed the House in 2002 to make the tax cut or parts of it permanent (H.R. 586 to make all provisions permanent on April 18, H.R. 2143 to make the estate tax repeal permanent on June 6, H.R. 4019 to make marriage tax relief provisions permanent on June 13). H.R. 4931 to make the retirement and pension provisions permanent was passed on June 21. The House also passed H.R. 4626, which would speed up marriage relief provisions on May22. The terrorist attacks of September 11 led to consideration of a stimulus package which was enacted and signed into law in March of 2002. More detail on both of these bills is provided below. While revenue concerns limited the consideration of some tax changes, the House, on July 19, approved H.R. 7, a bill to expand tax benefits for charitable giving and charities. H.R. 7 is estimated to cost $13.3 billion over 10-years, with about half the cost associated with a capped above-the-line deduction for charitable contributions for non- itemizers. This bill is a considerably scaled back version of the President's faith-based initiative that would have cost $80 billion. About half of the cost of H.R. 7 is due to allowing an above-the-line deduction for charitable giving by those who do not itemize deductions. The revenue cost was limited, however, because there was a cap on the deductions gradually rising to $200.. Singles would have limits half as big. The bill also includes provisions for tax free distributions from individual retirement accounts to Congressional Research Service ** The Library of Congress

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