,,ii #aac? ,,congress #b;d ,session ,s4 #cjje ,,9 ,,! ,,s5ate ,,( ,,! ,,unit$ ,,/ates ,decemb] #aa1 #bjad ,mr4 ,c>d9 introduc$ ! foll[+ bill2 :i* 0 read twice & ref]r$ to ! ,committee on ,f9ance ,a ,,bill ,to am5d ! ,int]nal ,rev5ue ,code ( #aihf to provide = a progressive consumption tax & to re=m ! income tax1 & = o!r purposes4 #a4 ,%ort title1 etc 7a7 ,9 g5]al ,?is ,act may be cit$ z ! ,progressive ,consumption ,tax ,act ( #bjad4 7b7 ,ref]5ce ,except z o!rwise expressly provid$1 :5ev] 9 ?is ,act an am5dm5t or repeal is express$ 9 t]ms ( an am5dm5t to1 or repeal (1 a section or o!r provision1 ! ref]5ce %all be consid]$ to be made to a section or o!r provision ( ! ,int]nal ,rev5ue ,code ( #aihf4 7c7 ,table ( cont5ts ,! table ( cont5ts ( ?is ,act is z foll[s3 ,sec4 #a4 ,%ort title1 etc4 ,,title ,i--,progressive consumption tax ,sec4 #aja4 ,imposition ( progressive consumption tax4 ,,title ,,ii--,individual & corporate tax re=m ,subtitle ,a--,individual income tax re=ms ,sec4 #bja4 ,individual income tax rate r$uctions4 ,sec4 #bjb4 ,family all[ance am\nts4 ,sec4 #bjc4 ,repeal ( limitations relat+ to itemiz$ d$uctions4 ,sec4 #bjd4 ,t]m9ation ( sep>ate treatm5t ( capital ga9s4 ,sec4 #bje4 ,repeals4 ,sec4 #bjf4 ,e/abli%m5t ( progressive tax rebate4 ,sec4 #bjg4 ,te*nical & con=m+ am5dm5ts4 ,subtitle ,b--,corporate tax re=ms ,sec4 #baa4 ,corporate income tax rate r$uction4 ,,title ,,iii--,refund ( excess consumption tax rev5ue ,sec4 #cja4 ,refunds ( excess consumption tax rev5ue4 ,i ,progressive consumption tax #aja4 ,imposition ( progressive consumption tax 7a7 ,9 ,g5]al ,subtitle ,d is am5d$ by ins]t+ be=e *apt] #ca ! foll[+ new *apt]3 #cj ,progressive consumption tax ,sub*apt] ,a4 ,imposition ( tax ,sub*apt] ,b4 ,taxable supply ,sub*apt] ,c4 ,cr$it aga9/ tax ,sub*apt] ,d4 ,adm9i/ration ,sub*apt] ,e4 ,def9itions & special rules ,a ,imposition ( ,tax ,sec4 #cija4 ,imposition ( tax4 ,sec4 #cijb4 ,taxable am\nt4 #cija4 ,imposition ( tax 7a7 ,g5]al ,rule ,a tax is h]eby impos$ on e taxable supply4 7b7 ,am\nt ( ,tax 7#a7 ,9 g5]al ,except z provid$ 9 p>agraph 7#b71 ! am\nt ( ! tax %all be #aj p]c5t ( ! taxable am\nt4 7#b7 ,special rate = exports ,! am\nt ( ! tax %all be z]o ) respect to ! provision ( any supply :i* is-- 7,a7 a supply ( tangible p]sonal prop]ty t is export$ f ! ,unit$ ,/ates )9 #ij days aft] ! provid] gives an invoice = ! supply1 or 7,b7 a supply1 o!r ?an a supply ( tangible p]sonal prop]ty-- 7i7 :i* is provid$ to a recipi5t t is n 9 ! ,unit$ ,/ates :5 ! supply is p]=m$ or o!rwise done1 & 7ii7 ! use ( :i* takes place outside ( ! ,unit$ ,/ates4 #cijb4 ,taxable am\nt 7a7 ,am\nt *>g$ cu/om] ,= purposes ( ?is *apt]1 ! taxable am\nt = any taxable supply = :i* money is ! only consid]ation %all be ! price *>g$ by ! provid]-- 7#a7 includ+ all invoic$ *>ges = transportation1 & o!r items payable to ! provid] ) respect to ! supply1 b 7#b7 exclud+ ! tax impos$ by section #cija ) respect to ! supply & exclud+ any ,/ate & local sales & use taxes ) respect to ! supply4 7b7 ,b>t] transactions ,= purposes ( ?is *apt]1 ! taxable am\nt = any taxable supply :i* includes consid]ation o!r ?an money %all be ! fair m>ket value ( ! consid]ation 7includ+ all invoic$ *>ges = transportation & o!r items payable to ! provid]7 plus ! am\nt ( any money paid 9 consid]ation4 7c7 ,imports ,= purposes ( ?is *apt]1 ! taxable am\nt 9 ! case ( any import %all be-- 7#a7 ! cu/oms value plus cu/oms duties & any o!r duties :i* may be impos$1 or 7#b7 if !re is no su* cu/oms value1 ! fair m>ket value 7det]m9$ z if ! import] _h sold ! supply74 ,= purposes ( ?is subsection1 ! cu/oms value ( any import %all include all invoic$ *>ges = transportation & o!r items payable to ! import] ) respect to ! supply4 7d7 ,special rule 9 ! case ( sales ( c]ta9 us$ consum] goods ,= purposes ( ?is *apt]1 if-- 7#a7 a p]son acquires any tangible p]sonal prop]ty 9 a transaction :i* 0 n taxable "u ?is *apt]1 & 7#b7 su* prop]ty _h be5 us$ by an ultimate consum] be=e su* acquisition1 ! taxable am\nt 9 ! case ( any sale ( su* prop]ty by su* p]son 7det]m9$ )\t reg>d to ?is subsection7 %all be r$uc$ by ! am\nt paid = su* prop]ty by su* p]son4 ,b ,taxable supply ,sec4 #ciaa4 ,taxable supply4 ,sec4 #ciab4 ,supplies made 9 connection ) ! ,unit$ ,/ates4 ,sec4 #ciac4 ,exempt supply4 #ciaa4 ,taxable supply 7a7 ,9 g5]al ,= purposes ( ?is *apt]1 ! t]m taxable supply means-- 7#a7 ! importation ( prop]ty into ! ,unit$ ,/ates1 & 7#b7 any supply 7o!r ?an an exempt supply7-- 7,a7 :i* is provid$-- 7i7 9 ! c\rse ( c>ry+ on a trade or bus9ess1 7ii7 9 ! case ( an organization exempt f tax "u section #eja7;a71 9 fur!rance ( ! activities relat$ to ! purpose or function con/itut+ ! basis ( its exemption "u section #eja1 or 7iii7 9 ! case ( a ,/ate1 an ,indian tribal gov]nm5t1 a possession ( ! ,unit$ ,/ates1 or any political subdivision ( any ( ! =ego+1 or ! ,unit$ ,/ates or ! ,di/rict ( ,columbia1 9 c>ry+ out any activity t is n an ess5tial gov]nm5tal function1 7,b7 = :i* consid]ation is provid$ 9 return1 & 7,c7 :i* is made 9 connection ) ! ,unit$ ,/ates4 7b7 ,supply ,= purposes ( ?is *apt]-- 7#a7 ,9 g5]al ,! t]m supply means any supply :atsoev]1 includ+-- 7,a7 ! sale or provision 7includ+ ?r\gh r5t+1 leas+1 or lic5s+7 ( prop]ty1 7,b7 ! p]=mance ( s]vices1 7,c7 ! grant1 assignm5t1 or surr5d] ( real prop]ty1 7,d7 ! creation1 grant1 transf]1 assignm5t1 or surr5d] ( any "r1 7,e7 f9ancial supplies1 & 7,f7 an entry into1 or release f1 an obligation or agreem5t to p]=m or refra9 f p]=m+ an act4 7#b7 ,special rule = s]vices = employ] ,an employee's s]vices = ! employee's employ] %all n be treat$ z a supply4 #ciab4 ,supplies made 9 connection ) ! ,unit$ ,/ates 7a7 ,tangible prop]ty ,= purposes ( ?is *apt]-- 7#a7 ,9 g5]al ,! supply ( tangible prop]ty is made 9 connection ) ! ,unit$ ,/ates if-- 7,a7 ! prop]ty is deliv]$ or made available to ! recipi5t 9 ! ,unit$ ,/ates1 or 7,b7 ! prop]ty is assembl$ 9 or remov$ f any location 9 ! ,unit$ ,/ates4 7#b7 ,real prop]ty ,! supply ( real prop]ty is made 9 connection ) ! ,unit$ ,/ates if ! real prop]ty is locat$ 9 ! ,unit$ ,/ates4 7b7 ,s]vices1 intangible prop]ty1 & o!r supplies ,= purposes ( ?is *apt]1 ! supply ( any?+ o!r ?an tangible prop]ty or real prop]ty is made 9 connection ) ! ,unit$ ,/ates if-- 7#a7 ! supply is us$1 p]=m$1 or o!rwise done 9 ! ,unit$ ,/ates1 or 7#b7 ! supply is provid$ ?r\gh a trade or bus9ess 9 ! ,unit$ ,/ates4 #ciac4 ,exempt supply 7a7 ,9 g5]al ,an exempt supply %all n be subject to tax "u ?is *apt]4 7b7 ,exempt supply ,= purposes ( ?is *apt]-- 7#a7 ,9 g5]al ,! t]m exempt supply means-- 7,a7 ! r5tal or leas+ ( resid5tial real prop]ty1 7,b7 any sale ( qualifi$ resid5tial real prop]ty1 7,c7 any f9ancial supply1 & 7,d7 any taxable supply 7or category ( su* supplies7 treat$ z an exempt supply "u section #cicb7;b74 7#b7 ,qualifi$ resid5tial real prop]ty ,= purposes ( p>agraph 7#a71 ! t]m qualifi$ resid5tial real prop]ty means resid5tial real prop]ty-- 7,a7 :i*-- 7i7 has previ\sly be5 sold z resid5tial real prop]ty1 or 7ii7 has be5 cont9u\sly r5t$ = #e ye>s or m1 & 7,b7 to :i* sub/antial r5ovations h n be5 made aft] ! date ( ! enactm5t ( ?is *apt]4 ,c ,cr$it aga9/ tax ,sec4 #ciaf4 ,cr$it aga9/ tax4 #ciaf4 ,cr$it aga9/ tax 7a7 ,g5]al rule ,!re %all be all[$ z a cr$it aga9/ ! aggregate am\nt ( tax impos$ by section #cija ) respect to all taxable supplies made by ! taxpay] dur+ ! taxable p]iod an am\nt equal to ! aggregate am\nt ( tax impos$ by section #cija on cr$itable acquisitions ( ! taxpay] dur+ su* taxable p]iod4 7b7 ,cr$itable acquisitions ,= purposes ( ?is *apt]1 ! t]m cr$itable acquisition means ! acquisition or receipt ( any supply-- 7#a7 :i* 0 subject to tax "u section #cija at ! "t x 0 provid$ to ! taxpay]1 7#b7 :i* 0 us$ by ! taxpay]-- 7,a7 9 ! c\rse ( c>ry+ on a trade or bus9ess1 7,b7 9 ! case ( a taxpay] exempt f tax "u section #eja7;a71 9 fur!rance ( ! activities relat$ to ! purpose or function con/itut+ ! basis ( ! exemption "u section #eja1 or 7,c7 9 ! case ( a ,/ate1 an ,indian tribal gov]nm5t1 a possession ( ! ,unit$ ,/ates1 or any political subdivision ( any ( ! =ego+1 or ! ,unit$ ,/ates or ! ,di/rict ( ,columbia1 9 c>ry+ out any activity t is n an ess5tial gov]nm5tal function1 & 7#c7 :i* 0 n us$ by ! taxpay] to make an exempt supply4 7c7 ,exempt supplies1 etc ,if supplies are us$ p>tly = a use describ$ 9 subsection 7b77#b7 & p>tly = ano!r use1 ! cr$it %all be all[able only ) respect to ! supplies us$ z describ$ 9 subsection 7b77#b74 7d7 ,excess cr$it treat$ z ov]paym5t 7#a7 ,9 g5]al ,if = any taxable p]iod ! am\nt ( ! cr$it all[able by subsection 7a7 exce$s ! aggregate am\nt ( ! tax impos$ by section #cija = su* p]iod1 su* excess %all be treat$ z an ov]paym5t ( ! tax impos$ by section #cija4 7#b7 ,"t :5 ov]paym5t arises ,any ov]paym5t "u p>agraph 7#a7 = any taxable p]iod %all be treat$ z aris+ on ! lat] (-- 7,a7 ! due date = ! return = su* p]iod1 or 7,b7 ! date on :i* ! return is fil$4 ,d ,adm9i/ration ,sec4 #ciba4 ,provid] liable = tax4 ,sec4 #cibb4 ,tax invoices4 ,sec4 #cibc4 ,"t = fil+ return & claim+ cr$it2 deposits ( tax4 ,sec4 #cibd4 ,treatm5t ( relat$ bus9esses1 etc4 ,sec4 #cibe4 ,reports4 ,sec4 #cibf4 ,regulations4 #ciba4 ,provid] liable = tax 7a7 ,9 g5]al ,except z provid$ 9 subsection 7b71 ! p]son provid+ ! supply %all be liable = ! tax impos$ by section #cija4 7b7 ,special rule = imports ,! p]son receiv+ ! supply %all be liable = ! tax impos$ "u section #cija-- 7#a7 9 ! case ( any taxable supply describ$ 9 section #ciaa7;a77#a71 & 7#b7 9 ! case ( any taxable supply :i* is n a supply ( tangible prop]ty & :i* is-- 7,a7 p]=m$ or o!rwise done outside ! ,unit$ ,/ates1 7,b7 us$ 9 ! ,unit$ ,/ates1 & 7,c7 acquir$ = use-- 7i7 9 c>ry+ on a trade or bus9ess 9 ! ,unit$ ,/ates1 7ii7 by an organization exempt f tax "u section #eja7;a71 9 fur!rance ( activities relat$ to ! purpose or function con/itut+ ! basis ( its exemption "u section #eja1 or 7iii7 by a ,/ate1 an ,indian tribal gov]nm5t1 a possession ( ! ,unit$ ,/ates1 or any political subdivision ( any ( ! =ego+1 or ! ,unit$ ,/ates or ! ,di/rict ( ,columbia1 9 c>ry+ out any activity t is n an ess5tial gov]nm5tal function4 #cibb4 ,tax invoices 7a7 ,9 g5]al 7#a7 ,supplies made 9 connection ) ! ,unit$ ,/ates ,except z o!rwise provid$ 9 ?is subsection1 any p]son provid+ a taxable supply %all give ! recipi5t a tax invoice ) respect to su* supply4 7#b7 ,c]ta9 s]vices p]=m$ outside ! ,unit$ ,/ates ,9 ! case ( any taxable supply describ$ 9 section #ciba7;b77#b71 p>agraph 7#a7 %all n apply & ! p]son receiv+ ! taxable supply %all g5]ate a tax invoice ) respect to su* supply4 7#c7 ,imports ,9 ! case ( any taxable supply describ$ 9 section #ciaa7;a71 ! ,secret>y1 9 consultation ) ! ,commission] ( ,cu/oms & ,bord] ,protection1 %all promulgate regulations gov]n+ ! provision ( tax invoices4 7b7 ,cont5t ( invoice ,! tax invoice requir$ by subsection 7a7 ) respect to any supply %all set =?-- 7#a7 ! "n &1 9 ! case ( an invoice "u subsection 7a77#a71 id5tification numb] ( ! provid]1 7#b7 ! "n ( ! recipi5t1 7#c7 ! date ( ! taxable supply1 7#d7 ! taxable am\nt ) respect to ! taxable supply1 7#e7 ! am\nt ( ! tax impos$ by section #cija1 & 7#f7 su* o!r in=mation z may be prescrib$ by regulations4 7c7 ,no cr$it )\t invoice 7#a7 ,9 g5]al ,except z provid$ 9 p>agraph 7#b7 or 7#c71 a taxpay] may claim a cr$it ) respect to a cr$itable acquisition only if ! taxpay]-- 7,a7 has 9 ! taxpay]'s possession a tax invoice :i* meets ! requirem5ts ( ?is section1 & 7,b7 is nam$ z ! recipi5t ( ! supply 9 su* invoice4 7#b7 ,employees or o!r ag5ts nam$ 9 invoices ,to ! ext5t provid$ 9 regulations1 ! nam+ ( an employee or o!r ag5t ( ! recipi5t ( ! supply %all be treat$ z ! nam+ ( ! recipi5t4 7#c7 ,waiv] ( invoice requirem5t 9 c]ta9 cases ,to ! ext5t provid$ 9 regulations1 p>agraph 7#a7 %all n apply-- 7,a7 :]e ! taxpay] c demon/rate t ! failure to receive or to h 9 ! taxpay]'s possession a tax invoice 0 )\t fault on ! taxpay]'s "p1 or 7,b7 to a taxable supply 7or category ( supplies7 :]e-- 7i7 ! am\nt involv$ is de m9imis1 or 7ii7 ! in=mation requir$ by subsection 7b7 c be reliably e/abli%$ by sampl+ or by ano!r me?od & c be adequately docum5t$4 7d7 ,"t = furni%+ invoice ,any invoice requir$ to be furni%$ by subsection 7a7 ) respect to any supply %all be furni%$ n lat] ?an #ae bus9ess days aft] ! tax po9t = su* supply4 #cibc4 ,"t = fil+ return & claim+ cr$it2 deposits ( tax 7a7 ,fil+ return ,be=e ! la/ day ( ! f\r? week 7?ird week1 9 ! case ( any taxpay] to :i* subsection 7c77#b7 applies7 aft] ! close ( ea* taxable p]iod1 ea* p]son liable = tax "u ?is *apt] %all file a return ( ! tax impos$ by section #cija on taxable supplies hav+ a tax po9t )9 su* taxable p]iod4 7b7 ,cr$it all[$ = taxable p]iod 9 :i* recipi5t receives invoice 7#a7 ,9 g5]al ,except z provid$ 9 p>agraph 7#b71 a cr$it all[able by section #ciaf ) respect to a supply may be all[$ only = ! fir/ taxable p]iod by ! close ( :i* ! taxpay]-- 7,a7 has paid or accru$ am\nts prop]ly allocable to ! tax impos$ by section #cija ) respect to su* supply1 & 7,b7 has a tax invoice 7or equival5t7 ) respect to su* supply4 7#b7 ,use = lat] p]iod ,"u regulations1 a cr$it all[able by section #ciaf may be all[$ = a p]iod aft] ! p]iod set =? 9 p>agraph 7#a74 7c7 ,taxable p]iod ,= purposes ( ?is *apt]-- 7#a7 ,9 g5]al ,except z provid$ 9 p>agraph 7#b71 ! t]m taxable p]iod means a cal5d> qu>t]4 7#b7 ,mon?ly p]iod = c]ta9 taxpay]s 7,a7 ,9 g5]al ,9 ! case ( a taxpay] :o makes taxable supplies = any mon? 9 excess ( #bj1jjj1jjj1 ! t]m taxable p]iod means a cal5d> mon?4 7,b7 ,election ( #a-mon? p]iod ,if ! taxpay] s elects1 ! t]m taxable p]iod means a cal5d> mon?4 7d7 ,tax po9t ,= purposes ( ?is *apt]-- 7#a7 ,*apt] #a rules ) respect to provid] gov]n ,except z provid$ 9 p>agraph 7#b71 ! tax po9t = any supply is ! e>li] (-- 7,a7 ! "t 7or times7 :5 any income f ! provision ( ! supply %\ld be treat$ by ! provid] z receiv$ or accru$ 7or any loss %\ld be tak5 into acc\nt by ! sell]7 = purposes ( *apt] #a1 or 7,b7 ! "t 7or times7 :5 ! provid] receives paym5t = ! sale4 7#b7 ,imports ,9 ! case ( ! import+ ( prop]ty1 ! tax po9t is :5 ! prop]ty is ent]$1 or )drawn f w>eh\se1 = consumption 9 ! ,unit$ ,/ates4 7e7 ,mon?ly deposits requir$ ,to ! ext5t provid$ 9 regulations1 mon?ly deposits may be requir$ ( ! e/imat$ liability = any taxable p]iod = ! tax impos$ by section #cija4 #cibd4 ,treatm5t ( relat$ bus9esses1 etc ,= purposes ( ?is *apt]1 to ! ext5t provid$ 9 regulations1 ! taxpay] may elect-- 7#a7 to treat z #a p]son #b or m bus9esses :i* may be treat$ "u section #eb7;b7 z #a employ]1 & 7#b7 to treat z sep>ate p]sons sep>ate divisions ( ! same bus9ess4 #cibe4 ,reports ,! ,secret>y %all submit to ,congress semi-annual reports on ! implem5tation & adm9i/ration ( ?is *apt]1 includ+ ! am\nt ( rev5ue collect$ f ! tax impos$ "u ?is *apt] & e/imates ( ! rev5ue to be collect$ f su* tax = future p]iod4 #cibf4 ,regulations ,! ,secret>y %all prescribe su* regulations z may be necess>y to c>ry out ! purposes ( ?is *apt]4 ,e ,def9itions & ,special ,rules ,sec4 #cica4 ,def9itions4 ,sec4 #cicb4 ,special rules4 #cica4 ,def9itions ,= purposes ( ?is *apt]-- 7#a7 ,bus9ess ,! t]m bus9ess includes-- 7,a7 a trade1 & 7,b7 an activity regul>ly c>ri$ on = pr(it4 7#b7 ,bus9ess ,day ,! t]m bus9ess day means any day o!r ?an ,saturday & ,sunday & o!r ?an a legal holiday 7)9 ! mean+ ( section #gejc74 7#c7 ,employee ,! t]m employee has ! mean+ su* t]m has = purposes ( *apt] #bd4 7#d7 ,f9ancial supplies ,! t]m f9ancial supplies means ! provision1 acquisition1 or disposal ( any ( ! foll[+3 a bank acc\nt1 a debit or cr$it arrangem5t1 a mortgage1 a sup]annuation fund1 an annuity1 insurance1 a f9ancial gu>antee1 an indemnity1 curr5cy1 securities1 or d]ivatives4 7#e7 ,p]son ,! t]m p]son includes any gov]nm5tal entity4 7#f7 ,provide2 provid] ,! t]m provide1 :5 us$ 9 ref]5ce to taxable supplies 7o!r ?an 9 section #ciaa7;a77#b771 includes ! importation ( prop]ty & ! t]m provid] includes ! import] ( prop]ty4 7#g7 ,unit$ ,/ates ,! t]m ,unit$ ,/ates1 :5 us$ 9 a geographical s5se1 includes a ,commonweal? & any possession ( ! ,unit$ ,/ates4 #cicb4 ,special rules 7a7 ,coord9ation ) subtitle ,a ,= purposes ( subtitle ,a-- 7#a7 ,treatm5t ( cr$it ,any cr$it all[able to a taxpay] "u section #ciaf :i* is attributable to any supply %all be treat$ z a r$uction 9 ! am\nt paid or incurr$ by ! taxpay] = su* supply4 7#b7 ,am\nt ( d$uction = tax ,! am\nt all[able z a d$uction = ! tax impos$ by section #cija %all be det]m9$ )\t reg>d to any cr$it all[able "u section #ciaf4 7#c7 ,computation ( p]c5tage depletion ,= purposes ( sections #fac & #fac;,a-- 7,a7 gross income %all be r$uc$ by ! am\nt ( ! tax impos$ by section #cija1 & 7,b7 taxable income %all be det]m9$ )\t reg>d to any d$uction all[$ = su* tax4 7b7 ,au?ority to z]o rate de m9imis supplies1 etc ,! ,secret>y may prescribe regulations treat+ z an exempt supply any taxable supply 7or category ( su* supplies7 :]e-- 7#a7 ! am\nt involv$ is de m9imis1 or 7#b7 ! rev5ue rais$ by tax+ ! supply is n suffici5t to ju/ify ! adm9i/rative & o!r co/s involv$ 9 ! paym5t & collection ( ! tax4 4 7b7 ,cl]ical ,am5dm5t ,! table ( *apt]s = subtitle ,d is am5d$ by ins]t+ be=e ! item relat+ to *apt] #ca ! foll[+3 ,*apt] #cj4 ,progressive consumption tax 4 7c7 ,effective ,date ,! am5dm5ts made by ?is section %all apply to supplies provid$ aft] ,decemb] #ca1 #bjae4 ,,ii ,individual & corporate tax re=m ,a ,individual income tax re=ms #bja4 ,individual income tax rate r$uctions 7a7 ,9 g5]al 7#a7 ,m>ri$ individuals fil+ jo9t returns & surviv+ sp\ses ,subsection 7a7 ( section #a is am5d$ by /rik+ ! table & ins]t+ ! foll[+3 ,if taxable income is3,! tax is3,n ov] #ajj1jjjae p]c5t ( taxable income4,ov] #ajj1jjj b n ov] #ejj1jjjae1jjj1 plus #be p]c5t ( ! excess ov] #ajj1jjj4,ov] #ejj1jjjaae1jjj1 plus #bh p]c5t ( ! excess ov] #ejj1jjj4 4 7#b7 ,heads ( h\seholds ,subsection 7b7 ( section #a is am5d$ by /rik+ ! table & ins]t+ ! foll[+3 ,if taxable income is3,! tax is3,n ov] #ej1jjjae p]c5t ( taxable income4,ov] #ej1jjj b n ov] #bej1jjjg1ejj1 plus #be p]c5t ( ! excess ov] #ej1jjj4,ov] #bej1jjjeg1ejj1 plus #bh p]c5t ( ! excess ov] #bej1jjj4 4 7#c7 ,unm>ri$ individuals 7o!r ?an surviv+ sp\ses & heads ( h\seholds7 ,subsection 7c7 ( section #a is am5d$ by /rik+ ! table & ins]t+ ! foll[+3 ,if taxable income is3,! tax is3,n ov] #ej1jjjae p]c5t ( taxable income4,ov] #ej1jjj b n ov] #bej1jjjg1ejj1 plus #be p]c5t ( ! excess ov] #bej1jjj4,ov] #bej1jjjeg1ejj1 plus #bh p]c5t ( ! excess ov] #bej1jjj4 4 7#d7 ,m>ri$ individuals fil+ sep>ate returns ,subsection 7d7 ( section #a is am5d$ by /rik+ ! table & ins]t+ ! foll[+3 ,if taxable income is3,! tax is3,n ov] #ej1jjjae p]c5t ( taxable income4,ov] #ej1jjj b n ov] #bej1jjjg1ejj1 plus #be p]c5t ( ! excess ov] #bej1jjj4,ov] #bej1jjjeg1ejj1 plus #bh p]c5t ( ! excess ov] #bej1jjj4 4 7b7 ,con=m+ am5dm5ts relat+ to co/-(-,liv+ adju/m5t 7#a7 ,9 g5]al ,p>agraph 7#c7 ( section #a7;f7 is am5d$ by ins]t+ 1 except z provid$ 9 p>agraph 7#g71 aft] = any cal5d> ye>4 7#b7 ,updat$ co/-(-liv+ adju/m5t = new rates ,section #a7;f7 is am5d$ by /rik+ p>agraphs 7#g7 & 7#h7 & ins]t+ ! foll[+3 7#g7 ,co/-(-liv+ adju/m5t = ye>s aft] #bjae 7,a7 ,cal5d> ye> #bjaf ,9 prescrib+ ! tables "u p>agraph 7#a7 :i* apply 9 lieu ( ! tables conta9$ 9 subsections 7a71 7b71 7c71 & 7d7 ) respect to taxable ye>s beg9n+ 9 cal5d> ye> #bjaf1 ! ,secret>y %all make no adju/m5t to ! doll> am\nts 9 any su* table4 7,b7 ,lat] cal5d> ye>s ,9 prescrib+ tables "u p>agraph 7#a7 :i* apply 9 lieu ( ! tables conta9$ 9 subsections 7a71 7b71 7c71 & 7d7 ) respect to taxable ye>s beg9n+ aft] ,decemb] #ca1 #bjaf1 ! co/-(-liv+ adju/m5t us$ 9 mak+ adju/m5ts to ! doll> am\nts 9 su* tables %all be det]m9$ "u p>agraph 7#c7 by sub/itut+ #bjae = #aiib4 4 7#c7 ,con=m+ am5dm5ts 7,a7 ,p>agraph 7#b7 ( section #a7;f7 is am5d$-- 7i7 by /rik+ p>agraph 7#h7 9 subp>agraph 7,a7 & ins]t+ p>agraph 7#g77;,a71 & 7ii7 by /rik+ by adju/+ 9 subp>agraph 7,c7 & ins]t+ except z provid$ 9 p>agraph 7#g77;,a71 by adju/+4 7,b7 ,! head+ ( subsection 7f7 ( section #a is am5d$ by /rik+ ,phase\t ( m>riage p5alty 9 #ae-p]c5t bracket2 adju/m5ts & ins]t+ ,adju/m5ts4 7c7 ,con=m+ am5dm5t relat+ to rates ,section #a is am5d$ by /rik+ subsection 7i74 7d7 ,effective date ,! am5dm5ts made by ?is section %all apply to taxable ye>s beg9n+ aft] ,decemb] #ca1 #bjae4 #bjb4 ,family all[ance am\nts 7a7 ,9 g5]al ,section #fc is am5d$ to read z foll[s3 #fc4 ,taxable income def9$ 7a7 ,9 g5]al ,= purposes ( ?is subtitle1 ! t]m taxable income means adju/$ gross income m9us-- 7#a7 ! d$uctions all[$ by ?is *apt] 7o!r ?an ^? tak5 into acc\nt 9 det]m9+ adju/$ gross income71 & 7#b7 ! family all[ance am\nt4 7b7 ,family all[ance ,= purposes ( ?is subtitle-- 7#a7 ,9 g5]al ,! family all[ance am\nt ) respect to a taxpay] %all be det]m9$ 9 accordance ) ! foll[+ table3 ,if ! taxpay] is3,! family all[ance am\nt is3 ,s+le or m>ri$ fil+ sep>ately#ej1jjj ,m>ri$ fil+ jo9tly or a surviv+ sp\se#ajj1jjj ,a head ( a h\sehold#ge1jjj4 7#b7 ,def9itions ,= purposes ( ?is subsection-- 7,a7 ! t]m s+le or m>ri$ fil+ sep>ately means a taxpay] to :om subsection 7c7 or 7d7 ( section #a applies1 7,b7 ! t]m m>ri$ fil+ jo9tly or a surviv+ sp\se means a taxpay] to :om subsection 7a7 ( section #a applies1 & 7,c7 ! t]m head ( a h\sehold means a taxpay] to :om subsection 7b7 ( section #a applies4 7#c7 ,adju/m5t = inflation ,9 ! case ( any taxable ye> beg9n+ aft] #bjaf1 ea* ( ! doll> am\nts 9 ! table "u p>agraph 7#a7 %all be increas$ by an am\nt equal to-- 7,a7 su* doll> am\nt1 multipli$ by 7,b7 ! co/-(-liv+ adju/m5t det]m9$ "u section #a7;f77#c7 = ! cal5d> ye> 9 :i* ! taxable ye> beg9s1 by sub/itut+ cal5d> ye> #bjae = cal5d> ye> #aiib 9 subp>agraph 7,b7 !re(4 7c7 ,cross ref]5ces 7#a7 ,= d$uctions ( e/ates & tru/s 9 lieu ( ! family all[ance am\nt1 see section #fdb7;b74 7#b7 ,= calculation ( family all[ance relat+ to nonresid5t ali5s1 see section #hgc7;b77#c74 7#c7 ,= det]m9ation ( m>ital /atus1 see section #ggjc4 4 7b7 ,t]m9ation ( p]sonal exemptions 7#a7 ,9 g5]al ,subsection 7a7 ( section #aea is am5d$ by ins]t+ 1 = a taxable ye> beg9n+ be=e ,janu>y #a1 #bjaf aft] ,9 ! case ( an individual4 7#b7 ,id5tify+ in=mation requir$ to treat individual z dep5d5t ,section #aeb is am5d$ by add+ at ! end ! foll[+ new subsection3 7g7 ,id5tify+ in=mation requir$ ,no individual %all be treat$ z a dep5d5t ( ! taxpay] "u ?is section = a taxable ye> unless ! taxpay] includes ! ,,t9 ( su* individual on ! return ( tax = ! taxable ye>4 4 7#c7 ,con=m+ am5dm5ts 7,a7 ,section #b7;a77#a77;,b77ii7 is am5d$ by /rik+ ( a dep5d5t & all t foll[s & ins]t+ ( a dep5d5t 7z def9$ 9 section #aeb7 :o 7)9 ! mean+ ( section #aeb1 det]m9$ )\t reg>d to subsections 7b77#a71 7b77#b71 & 7d77#a77;,b7 !re(7 is a son1 /epson1 daught]1 or /epdaught] ( ! taxpay]44 7,b7 ,section #b7;b77#a77;,a77ii7 is am5d$ by /rik+ if ! taxpay] is entitl$ to a d$uction = ! taxable ye> = su* p]son "u section #aea & ins]t+ )9 ! mean+ ( section #aeb4 7,c7 ,section #b7;b77#a77;,b7 is am5d$ by /rik+ if ! taxpay] is entitl$ to a d$uction = ! taxable ye> = su* fa!r or "m "u section #aea & ins]t+ if su* fa!r or "m is a dep5d5t ( ! taxpay] = ! taxable ye>1 )9 ! mean+ ( section #aeb4 7,d7 ,section #cf;,b7b77#c77;,b7 is am5d$-- 7i7 by /rik+ :o is n all[$ a d$uction "u section #aea = ! taxable ye> ) respect to a dep5d5t 9 clause 7ii77,i77aa7 & ins]t+ ) respect to :om no dep5d5ts are tak5 into acc\nt "u section #aeb = purposes ( any provision ( ?is title = ! taxable ye>1 & 7ii7 by /rik+ unless a d$uction is all[$ "u section #aea = ! taxable ye> ) respect to a dep5d5t o!r ?an ei!r sp\se & ins]t+ unless a dep5d5t o!r ?an ei!r sp\se is tak5 into acc\nt "u section #aeb = purposes ( any provision ( ?is title = ! taxable ye>4 7,e7 ,section #cf;,b7c77#a77;,d7 is am5d$ by /rik+ ) respect to :om a d$uction "u section #aea is all[able to ano!r taxpay] & ins]t+ :o is tak5 into acc\nt z a dep5d5t by ano!r taxpay] "u section #aeb = purposes ( any provision ( ?is title4 7,f7 ,section #cf;,b7d77#a7 is am5d$ by /rik+ = :om ! taxpay] is all[$ a d$uction "u section #aea 7relat+ to all[ance ( d$uction = p]sonal exemptions7 & ins]t+ :o is a dep5d5t ( ! taxpay] "u section #aeb4 7,g7 ,section #cf;,b7e77#a7 is am5d$ by /rik+ = :om a taxpay] is all[$ a d$uction "u section #aea 7relat+ to all[ance ( d$uction = p]sonal exemptions7 & ins]t+ :o is a dep5d5t ( ! taxpay] "u section #aeb4 7,h7 ,section #aeb7;d77#a77;,b7 is am5d$ by /rik+ ! exemption am\nt 7z def9$ 9 section #aea7;d77 & ins]t+ ! family all[ance am\nt applicable to taxpay]s :o are s+le or m>ri$ fil+ sep>ately "u section #fc7;b74 7,i7 ,section #aeb7;f77#f77;,b77i7 is am5d$ by /rik+ ! d$uction "u section #aea7;c7 & ins]t+ ! family all[ance am\nt "u section #fc7;b74 7,j7 ,"p ,v ( sub*apt] ,b ( *apt] #a is am5d$ by /rik+ section #aec4 7,k7 ,! table ( sections = "p ,v ( sub*apt] ,b ( *apt] #a is am5d$ by /rik+ ! item relat+ to section #aec4 7,l7 ,section #agb7;d77#c7 is am5d$ to read z foll[s3 7#c7 ,family all[ance am\nt ,taxable income "u section #fc %all be det]m9$ )\t reg>d to p>agraph 7#b7 ( section #fc7;a71 relat+ to ! family all[ance am\nt4 ,no d$uction 9 lieu ( ! exclusion ( su* family all[ance am\nt %all be all[$4 4 7,m7 ,section #bbj7;b77#f7 is am5d$ by /rik+ ) respect to :om a d$uction "u section #aea is all[able to ano!r taxpay] & ins]t+ :o is tak5 into acc\nt z a dep5d5t by ano!r taxpay] "u section #aeb = purposes ( any provision ( ?is title4 7,n7 ,section #bbc7;b77#f7 is am5d$ by /rik+ ) respect to :om a d$uction "u section #aea is all[able to ano!r taxpay] & ins]t+ :o is tak5 into acc\nt z a dep5d5t by ano!r taxpay] "u section #aeb = purposes ( any provision ( ?is title4 7,o7 ,section #ddc7;c7 is am5d$ by /rik+ ! exemptions all[$ z a d$uction "u section #aea 7& any d$uction 9 lieu !re(7 %all be r$uc$ to am\nts :i* be> ! same ratio to ! full exemptions & ins]t+ ! family all[ance am\nt "u section #fc 7& any d$uction 9 lieu !re(7 %all be r$uc$ to an am\nt :i* be>s ! same ratio to ! full family all[ance am\nt4 7,p7 ,section #fdb7;b77#b77;,c77i7 is am5d$-- 7i7 by /rik+ #aea7;d7 & ins]t+ #aea7;d7 7z 9 effect = taxable ye>s beg9n+ be=e ,janu>y #a1 #bjaf71 & 7ii7 by /rik+ #aea7;d77#c77;,c77iii7 9 subclause 7,i7 & ins]t+ #aea7;d77#c77;,c77iii7 7z s 9 effect74 7,q7 ,section #fdb7;b77#c7 is am5d$ by /rik+ ! d$uctions all[$ "u section #aea 7relat+ to d$uction = p]sonal exemption7 & ins]t+ ! family all[ance am\nt "u section #fc4 7,r7 ,section #gjc7;a7 is am5d$-- 7i7 by /rik+ & at ! end ( p>agraph 7#a71 7ii7 by /rik+ subp>agraph 7,a7 ( p>agraph 7#b7 & by r$esignat+ subp>agraphs 7,b71 7,c71 7,d71 7,e71 & 7,f7 ( su* p>agraph z subp>agraphs 7,a71 7,b71 7,c71 7,d71 & 7,e71 7iii7 by /rik+ ! p]iod at ! end ( p>agraph 7#b77;,f7 & ins]t+ 1 &1 & 7iv7 by add+ at ! end ! foll[+ new p>agraph3 7#c7 taxable income "u section #fc %all be det]m9$ )\t reg>d to p>agraph 7#b7 ( section #fc7;a71 relat+ to ! family all[ance am\nt4 4 7,s7 ,section #ggc7;b7 is am5d$-- 7i7 by /rik+ subp>agraph 7,a7 ( p>agraph 7#a7 & by r$esignat+ subp>agraphs 7,b7 & 7,c7 ( su* p>agraph z subp>agraphs 7,a7 & 7,b71 & 7ii7 by add+ at ! end ! foll[+ new p>agraph3 7#d7 ,family all[ance am\nt ,taxable income "u section #fc %all be det]m9$ )\t reg>d to p>agraph 7#b7 ( section #fc7;a71 relat+ to ! family all[ance am\nt4 4 7,t7 ,section #hgc7;b7 is am5d$-- 7i7 by /rik+ d$uctions 9 ! matt] prec$+ p>agraph 7#a71 & 7ii7 by /rik+ p>agraph 7#c7 & ins]t+ ! foll[+3 7#c7 ,family all[ance am\nt ,! exclusion ( ! family all[ance am\nt "u section #fc7;a77#b71 except t ! taxpay] %all be treat$ = purposes ( section #fc7;b7 z s+le or m>ri$ fil+ sep>ately unless ! taxpay] is a resid5t ( a contigu\s c\ntry or is a national ( ! ,unit$ ,/ates4 4 7,u7 ,! head+ ( section #hgc is am5d$ by /rik+ ,d$uctions & ins]t+ ,d$uctions & all[ances4 7,v7 ,! item relat+ to section #hgc 9 ! table ( sections = subp>t ,a ( "p ,,ii ( sub*apt] ,n ( *apt] #a is am5d$ to read z foll[s3 ,sec4 #hgc4 ,d$uctions & all[ances4 4 7,w7 ,section #hgd7;b7 is am5d$ by /rik+ d$uction = exemptions "u section #aea & ins]t+ exclusion ( ! family all[ance am\nt "u section #fc7;a77#b74 7,x7 ,section #hia is am5d$ by /rik+ d$uctions all[able "u section #aea & "u & ins]t+ exclusion ( ! family all[ance am\nt "u section #fc7;a77#b7 & ! d$uctions all[able "u4 7,y7 ,section #ijd7;b77#a7 is am5d$ to read z foll[s3 7#a7 ,family all[ance & d$uctions ,= purposes ( subsection 7a71 ! taxable income 9 ! case ( an individual1 e/ate1 or tru/ %all be comput$ )\t reg>d to ! exclusion ( ! family all[ance am\nt "u section #fc7;a77#b7 or any d$uction 9 lieu ( su* exclusion4 4 7,z7 ,section #ica7;b77#a7 is am5d$ by /rik+ d$uctions 7o!r ?an ! d$uction "u section #aea1 relat+ to p]sonal exemptions7 & ins]t+ d$uctions4 7,,aa7 ,section #icc is am5d$-- 7i7 by /rik+ d$uctions 7o!r ?an ! d$uction "u section #aea1 relat+ to p]sonal exemptions7 9 p>agraph 7#a7 & ins]t+ d$uctions1 & 7ii7 by /rik+ d$uctions 7o!r ?an ! d$uction = p]sonal exemptions "u section #aea7 9 p>agraph 7#b7 & ins]t+ d$uctions4 7,,bb7 ,section #abab7;b77#b77;,b77ii7 is am5d$ to read z foll[s3 7ii7 ! family all[ance am\nt = ! taxable ye> "u section #fc7;b7 or any d$uction all[$ 9 lieu !re(4 4 7,,cc7 ,section #adjb7;a77#g7 is am5d$ to read z foll[s3 7#g7 taxable income "u section #fc %all be det]m9$ )\t reg>d to p>agraph 7#b7 ( section #fc7;a71 relat+ to ! family all[ance am\nt2 4 7,,dd7 ,section #ejjj;,a7c77#d77;,a7 is am5d$ by /rik+ = :om ! taxpay] is all[$ a d$uction "u section #aea 7relat+ to all[ance ( d$uction = p]sonal exemptions7 & ins]t+ :o are tak5 into acc\nt z a dep5d5t by ! taxpay] "u section #aeb = purposes ( any provision ( ?is title4 7,,ee7 ,section #fjab7;a77#a7 is am5d$ to read z foll[s3 7#a7 7,a7 ,e individual-- 7i7 hav+ = ! taxable ye> gross income :i* equals or exce$s ! family all[ance am\nt applicable to ! individual "u section #fc1 or 7ii7 9 ! case ( individuals entitl$ to make a jo9t return 7b only if ! individual & ! individual's sp\se _h ! same h\sehold z _! home at ! close ( ! taxable ye>71 e individual ^: gross income1 :5 comb9$ ) ! gross income ( ! individual's sp\se1 equals or exce$s ! family all[ance am\nt applicable to taxpay]s :o are m>ri$ fil+ jo9tly "u section #fc4 7,b7 ,e individual n describ$ 9 subp>agraph 7,a7 :o is tak5 into acc\nt z a dep5d5t by ano!r taxpay] "u section #aeb = purposes ( any provision ( ?is title1 b only if su* individual's gross income1 :5 comb9$ ) ! gross income ( all individuals tak5 into acc\nt 9 det]m9+ ! family all[ance am\nt "u section #fc7;b7 ( ! taxpay]1 equals or exce$s ! family all[ance am\nt applicable to ! taxpay] "u su* section4 4 7,,ff7 ,section #fjab7;a77#h7 is am5d$ by /rik+ is n less ?an ! sum ( ! exemption am\nt plus ! basic /&>d d$uction "u section #fc7;c77#b77;,d7 & ins]t+ equals or exce$s ! family all[ance am\nt applicable to ! e/ate "u section #acih7;c77#c74 7,,gg7 ,section #fjac7;b77#c77;,a7 is am5d$ by /rik+ has ! mean+ giv5 to su* t]m & all t foll[s & ins]t+ means ! family all[ance am\nt applicable to a taxpay] :o is s+le or m>ri$ fil+ sep>ately "u section #fc7;b744 7,,hh7 ,section #fjad7;a7 is am5d$ by /rik+ :o does n itemize 8 d$uctions & :o is n describ$ 9 section #fjab7;a77#a77;,c77i7 & ins]t+ :o is n describ$ 9 section #fjab7;a77#a77;,b74 7,,ii7 ,section #fajc7l77#ba77;,a77iii7 is am5d$ by /rik+ = :om a d$uction is all[$ "u section #aea & ins]t+ :o is tak5 into acc\nt z a dep5d5t "u section #aeb = purposes ( any provision ( ?is title4 7,,jj7 ,section #fccd7;d77#b77;,a7 is am5d$ to read z foll[s3 7,a7 ! family all[ance am\nt det]m9$ "u section #fc7;b7 ) respect to ! taxpay] = ! taxable ye> 9 :i* su* levy occurs1 divid$ by 4 7,,kk7 ,section #ggjc7;b77#a7 is am5d$ by /rik+ ) respect to :om su* individual is entitl$ to a d$uction = ! taxable ye> "u section #aea 7or w\ld be s entitl$ b = section #aeb7;e77 & ins]t+ :o is a dep5d5t 7)9 ! mean+ ( section #aeb7 ( ! individual = ! taxable ye>4 7#d7 ,am5dm5ts relat+ to payroll )hold+ 7,a7 ,9 g5]al ,p>agraph 7#a7 ( section #cdjb7;f7 is am5d$ by /rik+ subp>agraph 7,a7 & all t foll[s & ins]t+ ! foll[+3 7,a7 an exemption equal to ! family all[ance exemption am\nt2 & 7,b7 any all[ance to :i* ! employee is entitl$ "u subsection 7m71 b only if ! employee's sp\se does n h 9 effect a )hold+ exemption c]tificate claim+ su* all[ance4 4 7,b7 ,family all[ance exemption am\nt ,subsection 7f7 ( section #cdjb is am5d$-- 7i7 by r$esignat+ p>agraphs 7#b71 7#c71 7#d71 7#e71 7#f71 & 7#g7 z p>agraphs 7#c71 7#d71 7#e71 7#f71 7#g71 & 7#h71 respectively1 7ii7 by /rik+ p>agraph 7#b77;,c7 9 p>agraph 7#c77;,b77iii7 & ins]t+ p>agraph 7#c77;,c71 & 7iii7 by ins]t+ aft] p>agraph 7#a7 ! foll[+ new p>agraph3 7#b7 ,family all[ance exemption am\nt ,= purposes ( ?is section-- 7,a7 ,9 g5]al ,except z provid$ 9 subp>agraphs 7,b7 & 7,c71 ! t]m family all[ance exemption am\nt means ! family all[ance am\nt ) respect to ! taxpay] "u section #fc7;b7 = ! taxable ye> 9 :i* ! payroll p]iod beg9s1 prorat$ to ! payroll p]iod4 7,b7 ,m>ri$ employees ,if ! employee is m>ri$ fil+ jo9tly & ! employee's sp\se is an employee receiv+ wages1 ! employee & ! employee's sp\se may divide ! family all[ance am\nt det]m9$ "u section #fc7;b7 9 ! proportion ( _! *oice = purposes ( ?is p>agraph1 b ! sum ( ! family all[ance exemption am\nts claim$ by ! employee & ! employee's sp\se %all n exce$ su* family all[ance am\nt4 7,c7 ,employees ) m ?an #a employ] ,9 ! case ( an employee t has )hold+ exemption c]tificates 9 effect ) respect to m ?an #a employ]1 ! employee may divide ! family all[ance am\nt 7or ! employee's %>e ( su* am\nt aft] ! application ( subp>agraph 7,b71 if applicable7 det]m9$ "u section #fc7;b7 among employ]s 9 ! proportion ( ! employee's *oice = purposes ( ?is p>agraph1 b ! sum ( ! family all[ance exemption am\nts claim$ by ! employee ) respect to all employ]s %all n exce$ su* family all[ance am\nt 7or ! employee's %>e ( su* am\nt aft] ! application ( subp>agraph 7,b71 if applicable74 4 7,c7 ,con=m+ am5dm5ts 7i7 ,p>agraph 7#b7 ( section #cdjb7;a7 is am5d$ by /rik+ ! numb] ( )hold+ exemptions claim$ & all t foll[s & ins]t+ ! total am\nt ( ! )hold+ exemptions claim$44 7ii7 ,p>agraph 7#c7 ( section #cdjb7;f71 z r$esignat$ by subp>agraph 7,b77i7 ( ?is p>agraph1 is am5d$-- 7,i7 by /rik+ ! numb] ( )hold+ exemptions & all t foll[s 9 subp>agraph 7,a7 & ins]t+ ! total am\nt ( ! )hold+ exemptions :i* ! employee claims1 :i* %all 9 no ev5t exce$ ! am\nt to :i* ! employee is entitl$41 7,,ii7 by /rik+ ! numb] ( )hold+ exemptions ea* place x appe>s 9 subp>agraphs 7,b7 & 7,c7 & ins]t+ ! total am\nt ( ! )hold+ exemptions1 7,,iii7 by /rik+ ! numb] to :i* he is entitl$ ea* place x appe>s 9 subp>agraph 7,b7 & ins]t+ ! am\nt to :i* ! employee is entitl$1 7,,iv7 by /rik+ ! numb] to :i* ! employee is entitl$ 9 subp>agraph 7,c7 & ins]t+ ! am\nt to :i* ! employee is entitl$1 & 7,v7 by /rik+ ! numb] to :i* he w be1 or reasonably may be expect$ to be1 s entitl$ 9 subp>agraph 7,c7 & ins]t+ ! am\nt to :i* ! employee w be1 or reasonably may be expect$ to be1 s entitl$4 7iii7 ,p>agraph 7#g7 ( section #cdjb7;f71 z r$esignat$ by subp>agraph 7,b77i7 ( ?is p>agraph1 is am5d$ by /rik+ %all be entitl$ to only "o )hold+ exemption & ins]t+ %all be treat$ z s+le or m>ri$ fil+ sep>ately = purposes ( det]m9+ ! family all[ance exemption am\nt4 7iv7 ,p>agraph 7#h7 ( section #cdjb7;f71 z r$esignat$ by subp>agraph 7,b77i7 ( ?is p>agraph1 is am5d$ by ins]t+ 1 except z provid$ 9 p>agraph 7#b77;,c7 aft] ) respect to "o employ]4 7v7 ,p>agraph 7#c7 ( section #cdjb7m7 is am5d$ by /rik+ d$uctions 7includ+ ! additional /&>d d$uction "u section #fc7;c77#c7 = ! ag$ & bl9d7 & ins]t+ d$uctions4 7vi7 ,p>agraph 7#b7 ( section #cdjb7r7 is am5d$ /rik+ ! sum ( & all t foll[s & ins]t+ ! family all[ance am\nt det]m9$ "u section #fc7;b7 = a taxpay] :o is s+le or m>ri$ fil+ sep>ately44 7vii7 ,section #fjdj7d7 is am5d$ by /rik+ section #cdjb7;f77#b71 7#c71 7#d71 & 7#e7 & ins]t+ p>agraphs 7#c71 7#d71 7#e71 & 7#f7 ( section #cdjb7;f74 7c7 ,con=m+ am5dm5ts 7#a7 ,section #a7;f77#f7 is am5d$-- 7,a7 by /rik+ #fc7;c77#d7 ea* place x appe>s & ins]t+ #fc7;b77#c71 & 7,b7 by ins]t+ 1 subsection 7g77#d77;,b7 aft] p>agraph 7#b77;,a7 9 subp>agraph 7,a74 7#b7 ,section #a7;g77#d7 is am5d$-- 7,a7 by /rik+ clause 7ii7 ( subp>agraph 7,a7 & ins]t+ ! foll[+3 7ii7 ! sum (-- 7,i7 #ejj1 plus 7,,ii7 ! great] ( ! am\nt describ$ 9 subclause 7,i7 or ! am\nt ( ! itemiz$ d$uctions all[$ by ?is *apt] :i* are directly connect$ ) ! production ( ! portion ( adju/$ gross income ref]r$ to 9 clause 7i74 1 & 7,b7 by r$esignat+ subp>agraphs 7,b7 & 7,c7 z subp>agraphs 7,c7 & 7,d71 respectively1 & ins]t+ aft] subp>agraph 7,a7 ! foll[+ new subp>agraph3 7,b7 ,adju/m5t = inflation ,9 ! case ( any taxable ye> beg9n+ 9 a cal5d> ye> aft] #aihh1 ! #ejj am\nt 9 subp>agraph 7,a77ii77,i7 %all be increas$ by an am\nt equal to-- 7i7 su* doll> am\nt1 multipli$ by 7ii7 ! co/-(-liv+ adju/m5t det]m9$ "u subsection 7f77#c7 = ! cal5d> ye> 9 :i* ! taxable ye> beg9s1 by sub/itut+ cal5d> ye> #aihg = cal5d> ye> #aiib 9 subp>agraph 7,b7 !re(4 4 7#c7 ,section #c7;a7 is am5d$ to read z foll[s3 7a7 7#a7 ,9 g5]al ,9 lieu ( ! tax impos$ by section #a1 !re is h]eby impos$ = ea* taxable ye> on ! taxable income ( e individual ^: taxable income does n exce$ ! ceil+ am\nt a tax det]m9$ "u tables1 applicable to su* taxable ye>1 :i* %all be prescrib$ by ! ,secret>y & :i* %all be 9 su* =m z ! ,secret>y det]m9es appropriate4 ,9 ! table s prescrib$1 ! am\nts ( ! tax %all be comput$ on ! basis ( ! rates prescrib$ by section #a4 7#b7 ,ceil+ am\nt def9$ ,= purposes ( p>agraph 7#a71 ! t]m ceil+ am\nt means1 ) respect to any taxpay]1 ! am\nt 7n less ?an #bj1jjj7 det]m9$ by ! ,secret>y = ! tax rate category 9 :i* su* taxpay] falls4 4 7#d7 ,section #hfa7;b7 is am5d$ by /rik+ ! la/ s5t5ce4 7#e7 ,section #hfb7;b7 is am5d$ by /rik+ ! la/ s5t5ce4 7#f7 ,section #acih7;c7 is am5d$-- 7,a7 by /rik+ p>agraph 7#c7 & ins]t+ ! foll[+3 7#c7 ,family all[ance am\nt ,! family all[ance am\nt "u section #fc7;b7 tak5 into acc\nt = ! e/ate = ! taxable ye> %all be ! same z = a taxpay] :o is s+le or m>ri$ fil+ sep>ately4 1 & 7,b7 by /rik+ basic /&>d d$uction 9 ! head+ & ins]t+ family all[ance am\nt4 7#g7 ,section #fbab7;c77#b7 is am5d$ by /rik+ subp>agraph 7,a7 & by r$esignat+ subp>agraphs 7,b7 & 7,c7 z subp>agraphs 7,a7 & 7,b71 respectively4 7#h7 ,section #fjad7;b77#d7 is am5d$ by /rik+ d$uctions & all t foll[s & ins]t+ d$uctions44 7#i7 ,section #fejd is am5d$ by /rik+ p>agraph 7#b7 & by r$esignat+ p>agraphs 7#c71 7#d71 7#e71 7#f71 7#g71 7#h71 7#i71 7#aj71 & 7#aa7 z p>agraphs 7#b71 7#c71 7#d71 7#e71 7#f71 7#g71 7#h71 7#i71 & 7#aj71 respectively4 7d7 ,effective date ,! am5dm5ts made by ?is section %all apply to taxable ye>s beg9n+ aft] ,decemb] #ca1 #bjae4 #bjc4 ,repeal ( limitations relat+ to itemiz$ d$uctions 7a7 ,9 g5]al ,sections #fg & #fh are repeal$4 7b7 ,con=m+ am5dm5ts 7#a7 ,section #afb7o7 is am5d$ by /rik+ p>agraph 7#b7 & r$esignat+ p>agraph 7#c7 z p>agraph 7#b74 7#b7 ,section #afd7;b77#e77;,h77ii7 is am5d$-- 7,a7 by /rik+ ! comma at ! end ( subclause 7,i7 & ins]t+ 1 &1 7,b7 by /rik+ 1 & at ! end ( subclause 7,,ii7 & ins]t+ a p]iod1 & 7,c7 by /rik+ subclause 7,,iii74 7#c7 ,section #cjb7;b77#e7 is am5d$ by ins]t+ 1 z 9 effect on ,decemb] #ca1 #bjae aft] #fg7;c77#b77;,b74 7#d7 ,section #efb7;c7 is am5d$ by ins]t+ 1 z 9 effect on ,decemb] #ca1 #bjae aft] #fg7;c77#b77;,b74 7#e7 ,section #fdb7;b77#b77;,c77i77,,ii7 is am5d$ by ins]t+ 1 & z 9 effect on ,decemb] #ca1 #bjae aft] #fdb7;b74 7#f7 ,section #ggb7;c77#c7 is am5d$-- 7,a7 by /rik+ subp>agraph 7,b71 & 7,b7 by /rik+ ,income or loss f o!r activities4-- & all t foll[s ?r\gh ,= purposes ( ?is *apt] & ins]t+ ,income or loss f o!r activities4--,= purposes ( ?is *apt]4 7#g7 ,section #ggc7;a77#c77;,b7 is am5d$ by /rik+ clause 7i7 & by r$esignat+ clauses 7ii71 7iii71 & 7iv7 z clauses 7i71 7ii71 & 7iii71 respectively4 7#h7 ,section #ggc7;b7 is am5d$ by /rik+ p>agraph 7#c74 7#i7 ,section #adaa7;a77#b77;,b77i7 is am5d$ by ins]t+ 1 z 9 effect on ,decemb] #ca1 #bjae aft] #fg7;e74 7#aj7 ,subp>agraphs 7,c77iii7 & 7,d77v7 ( section #ffed7;d77#a7 are ea* am5d$ by ins]t+ 1 z 9 effect on ,decemb] #ca1 #bjae be=e ! p]iod4 7c7 ,effective date ,! repeal & ! am5dm5ts made by ?is section %all apply to taxable ye>s beg9n+ aft] ,decemb] #ca1 #bjae4 #bjd4 ,t]m9ation ( sep>ate treatm5t ( capital ga9s ,subsection 7h7 ( section #a is am5d$ by add+ at ! end ! foll[+ new p>agraph3 7#ab7 ,t]m9ation ,?is subsection %all n apply to any taxable ye> beg9n+ aft] ,decemb] #ca1 #bjae4 4 #bje4 ,repeals 7a7 ,9 g5]al ,! foll[+ provisions ( ! ,int]nal ,rev5ue ,code ( #aihf are repeal$3 7#a7 ,subp>t ,a ( "p ,,iv ( sub*apt] ,a ( *apt] #a 7relat+ to nonrefundable p]sonal cr$its74 7#b7 ,subp>t ,b ( "p ,,iv ( sub*apt] ,a ( *apt] #a 7relat+ to o!r cr$its71 o!r ?an section #bg 7relat+ to taxes ( =eign c\ntries & possessions ( ! ,unit$ ,/ates2 possession tax cr$it74 7#c7 ,subp>t ,c ( "p ,,iv ( sub*apt] ,a ( *apt] #a 7relat+ to refundable cr$its71 o!r ?an sections #cb 7relat+ to e>n$ income7 & #cf;,b 7relat+ to refundable cr$it = cov]age "u a qualifi$ heal? plan74 7#d7 ,"p ,,vi ( sub*apt] ,a ( *apt] #a 7relat+ to alt]native m9imum tax74 7#e7 ,section #bag 7relat+ to mov+ exp5ses74 7#f7 ,section #bba 7relat+ to int]e/ on education loans74 7#g7 ,section #bbb 7relat+ to qualifi$ tuition & relat$ exp5ses74 7#h7 ,*apt] #b;,a 7relat+ to une>n$ income m$ic>e contribution74 7b7 ,effective date ,! repeals made by subsection 7a7 %all take effect = taxable ye>s beg9n+ aft] ,decemb] #ca1 #bjae4 #bjf4 ,e/abli%m5t ( progressive tax rebate 7a7 ,9 g5]al ,section #cb is am5d$ to read z foll[s3 #cb4 ,progressive tax rebate 7a7 ,all[ance ( cr$it ,9 ! case ( an eligible taxpay]1 !re %all be all[$ z a cr$it aga9/ ! tax impos$ by ?is subtitle = ! taxable ye> an am\nt equal to ! sum (-- 7#a7 ! e>n$ income am\nt 7z det]m9$ "u subsection 7b771 7#b7 ! *ild b5efit am\nt 7z det]m9$ "u subsection 7c771 plus 7#c7 ! additional *ild b5efit am\nt 7z det]m9$ "u subsection 7d774 7b7 ,e>n$ income am\nt 7#a7 ,s+le work]s ,9 ! case ( an eligible taxpay] 7o!r ?an a head ( a h\sehold z def9$ 9 section #b7;b77 :o is n fil+ a jo9t return = ! taxable ye> "u section #fjac1 ! e>n$ income am\nt %all be equal to-- 7,a7 9 ! case ( a taxpay] ^: e>n$ income = ! taxable ye> does n exce$ #f1ajj1 #be4a p]c5t ( su* e>n$ income1 7,b7 9 ! case ( a taxpay] ^: e>n$ income = ! taxable ye> exce$s #f1ajj b does n exce$ #i1jjj1 #a1ecj plus #ag4a p]c5t ( su* e>n$ income 9 excess ( #f1ajj1 7,c7 9 ! case ( a taxpay] ^: e>n$ income 7or1 if great]1 adju/$ gross income7 = ! taxable ye> exce$s #i1jjj1 b does n exce$ #di1did1 #b1jbe m9us #e p]c5t ( su* e>n$ income or adju/$ gross income 9 excess ( #i1jjj1 or 7,d7 9 ! case ( a taxpay] ^: e>n$ income 7or1 if great]1 adju/$ gross income7 = ! taxable ye> exce$s #di1did1 #j4 7#b7 ,head ( h\sehold ,9 ! case ( an eligible taxpay] :o is a head ( a h\sehold 7z def9$ 9 section #b7;b771 ! e>n$ income am\nt %all be equal to-- 7,a7 9 ! case ( a taxpay] ^: e>n$ income = ! taxable ye> does n exce$ #i1aej1 #be4a p]c5t ( su* e>n$ income1 7,b7 9 ! case ( a taxpay] ^: e>n$ income = ! taxable ye> exce$s #i1aej b does n exce$ #ac1ejj1 #b1bid plus #ag4a p]c5t ( su* e>n$ income 9 excess ( #i1aej1 7,c7 9 ! case ( a taxpay] ^: e>n$ income 7or1 if great]1 adju/$ gross income7 = ! taxable ye> exce$s #ac1ejj1 b does n exce$ #gd1bda1 #c1jcg m9us #e p]c5t ( su* e>n$ income or adju/$ gross income 9 excess ( #ac1ejj1 or 7,d7 9 ! case ( a taxpay] ^: e>n$ income 7or1 if great]1 adju/$ gross income7 = ! taxable ye> exce$s #gd1bda1 #j4 7#c7 ,m>ri$ fil+ jo9tly ,9 ! case ( an eligible taxpay] fil+ a jo9t return "u section #fjac1 ! e>n$ income am\nt %all be det]m9$ pursuant to p>agraph 7#a71 except t ! doll> am\nts 9 effect "u su* p>agraph %all be multipli$ by #b4 7c7 ,*ild b5efit am\nt 7#a7 ,9 g5]al ,9 ! case ( an eligible taxpay] ) a qualify+ *ild1 ! *ild b5efit am\nt %all be equal to #ae p]c5t ( ! e>n$ income ( su* taxpay] = ! taxable ye>4 7#b7 ,limitations 7,a7 ,limitation bas$ on numb] ( *ildr5 ,! *ild b5efit am\nt det]m9$ "u p>agraph 7#a7 %all n exce$ an am\nt equal to ! product (-- 7i7 ! numb] ( qualify+ *ildr5 ( ! taxpay]1 multipli$ by 7ii7 #a1eij4 7,b7 ,r$uction bas$ on e>n+s or adju/$ gross income ,! *ild b5efit am\nt det]m9$ "u ?is subsection 7z det]m9$ aft] application ( subp>agraph 7,a77 %all be r$uc$ 7b n bel[ z]o7 by an am\nt equal to #e p]c5t ( ! e>n$ income 7or1 if great]1 ! adju/$ gross income7 ( ! taxpay] = ! taxable ye> 9 excess ( #ge1jjj 7#aaj1jjj 9 ! case ( a jo9t return74 7d7 ,additional *ild b5efit am\nt 7#a7 ,9 g5]al ,9 ! case ( an eligible taxpay] ) a qualify+ *ild1 ! additional *ild b5efit am\nt %all be equal to-- 7,a7 9 ! case ( a taxpay] ^: e>n$ income = ! taxable ye> does n exce$ #bj1jjj1 ! applicable p]c5tage ( su* e>n$ income1 7,b7 9 ! case ( a taxpay] ^: e>n$ income exce$s #bj1jjj b does n exce$ #be1jjj1 ! applicable p]c5tage ( #bj1jjj1 7,c7 9 ! case ( a taxpay] ^: e>n$ income 7or1 if great]1 adju/$ gross income7 exce$s #be1jjj b does n exce$ ! applicable am\nt1 an am\nt equal to-- 7i7 ! applicable p]c5tage ( #bj1jjj1 m9us 7ii7 #ae p]c5t ( su* e>n$ income or adju/$ gross income 9 excess ( #be1jjj1 or 7,d7 9 ! case ( a taxpay] ^: e>n$ income 7or1 if great]1 adju/$ gross income7 exce$s ! applicable am\nt1 #j4 7#b7 ,applicable p]c5tage ,= purposes ( p>agraph 7#a71 ! applicable p]c5tage is-- 7,a7 9 ! case ( a taxpay] ) #a qualify+ *ild1 #aa p]c5t1 7,b7 9 ! case ( a taxpay] ) #b qualify+ *ildr51 #ag p]c5t1 & 7,c7 9 ! case ( a taxpay] ) #c or m qualify+ *ildr51 #ai p]c5t4 7#c7 ,applicable am\nt ,= purposes ( p>agraph 7#a71 ! applicable am\nt is-- 7,a7 9 ! case ( a taxpay] ) #a qualify+ *ild1 #ci1ffg1 7,b7 9 ! case ( a taxpay] ) #b qualify+ *ildr51 #dg1ffg1 & 7,c7 9 ! case ( a taxpay] ) #c or m qualify+ *ildr51 #ej1ccc4 7e7 ,eligible taxpay] 7#a7 ,9 g5]al ,! t]m eligible taxpay] means an individual-- 7,a7 ^: pr9cipal place ( abode is 9 ! ,unit$ ,/ates = m ?an "o-half ( su* taxable ye>1 & 7,b7 is n a dep5d5t 7z def9$ "u section #aeb7 to ano!r taxpay] = any taxable ye> beg9n+ 9 ! same cal5d> ye> z su* taxable ye>4 7#b7 ,qualify+ *ild ineligible ,if an individual is ! qualify+ *ild ( a taxpay] = any taxable ye> ( su* taxpay] beg9n+ 9 a cal5d> ye>1 su* individual %all n be treat$ z an eligible taxpay] = any taxable ye> ( su* individual beg9n+ 9 su* cal5d> ye>4 7#c7 ,exception = taxpay] claim+ b5efits "u section #iaa ,! t]m eligible taxpay] does n include any taxpay] :o claims ! b5efits ( section #iaa = ! taxable ye>4 7#d7 ,limitation on eligibility ( nonresid5t ali5s ,! t]m eligible taxpay] %all n include any individual :o is a nonresid5t ali5 individual = any portion ( ! taxable ye> unless su* individual is treat$ = su* taxable ye> z a resid5t ( ! ,unit$ ,/ates = purposes ( ?is *apt] by reason ( an election "u subsection 7g7 or 7h7 ( section #fjac4 7#e7 ,id5tification numb] requirem5t ,no cr$it %all be all[$ "u ?is section to an eligible taxpay] :o does n include on ! return ( tax = ! taxable ye>-- 7,a7 su* individual's taxpay] id5tification numb]1 & 7,b7 if ! individual is m>ri$ 7)9 ! mean+ ( section #ggjc71 ! taxpay] id5tification numb] ( su* individual's sp\se4 7#f7 ,taxpay]s :o d n include ,,t91 etc41 ( any qualify+ *ild ,no cr$it %all be all[$ "u ?is section to any eligible taxpay] :o has "o or m qualify+ *ildr5 if no qualify+ *ild ( su* taxpay] is tak5 into acc\nt "u subsection 7c7 or 7d7 by reason ( subsection 7f77#d74 7#g7 ,treatm5t ( milit>y p]sonnel /ation$ outside ( ! ,unit$ ,/ates ,= purposes ( p>agraph 7#a77;,a7 & subsection 7f77#c71 ! pr9cipal place ( abode ( a memb] ( ! ,arm$ ,=ces ( ! ,unit$ ,/ates %all be treat$ z 9 ! ,unit$ ,/ates dur+ any p]iod dur+ :i* su* memb] is /ation$ outside ! ,unit$ ,/ates :ile s]v+ on ext5d$ active duty ) ! ,arm$ ,=ces ( ! ,unit$ ,/ates4 ,= purposes ( ! prec$+ s5t5ce1 ! t]m ext5d$ active duty means any p]iod ( active duty pursuant to a call or ord] to su* duty = a p]iod 9 excess ( #ij days or = an indef9ite p]iod4 7#h7 ,jo9t return 7,a7 ,m>ri$ individuals ,9 ! case ( an individual :o is m>ri$ 7)9 ! mean+ ( section #ggjc71 ?is section %all apply only if a jo9t return is fil$ = ! taxable ye> "u section #fjac4 7,b7 ,o!r ,9 ! case ( taxpay] fil+ a jo9t return "u section #fjac1 su* taxpay] %all n be treat$ z an eligible taxpay] = purposes ( ?is section unless ei!r ! taxpay] or ! taxpay]'s sp\se satisfies ea* ( ! requirem5ts "u ?is subsection4 7f7 ,qualify+ *ild 7#a7 ,9 g5]al ,! t]m qualify+ *ild means a qualify+ *ild ( ! taxpay] 7z def9$ 9 section #aeb7;c71 det]m9$ )\t reg>d to p>agraph 7#a77;,d7 !re( & section #aeb7;e774 7#b7 ,m>ri$ individual ,! t]m qualify+ *ild %all n include an individual :o is m>ri$ z ( ! close ( ! eligible taxpay]'s taxable ye> unless ! individual qualifies z a dep5d5t 7z def9$ "u section #aeb7 ( ! taxpay] = su* taxable ye>4 7#c7 ,place ( abode ,= purposes ( p>agraph 7#a71 ! requirem5ts ( section #aeb7;c77#a77;,b7 %all be met only if ! pr9cipal place ( abode is 9 ! ,unit$ ,/ates4 7#d7 ,id5tification requirem5ts 7,a7 ,9 g5]al ,a qualify+ *ild %all n be tak5 into acc\nt "u subsection 7c7 or 7d7 unless ! taxpay] includes ! "n1 age1 & ,,t9 ( ! qualify+ *ild on ! return ( tax = ! taxable ye>4 7,b7 ,o!r me?ods ,! ,secret>y may prescribe o!r me?ods = provid+ ! in=mation describ$ 9 subp>agraph 7,a74 7g7 ,e>n$ income 7#a7 ,9 g5]al ,! t]m e>n$ income means-- 7,a7 wages1 sal>ies1 tips1 & o!r employee comp5sation1 b only if su* am\nts are includible 9 gross income = ! taxable ye>1 plus 7,b7 ! am\nt ( ! taxpay]'s net e>n+s f self-employm5t = ! taxable ye> 7)9 ! mean+ ( section #adjb7;a771 b su* net e>n+s %all be det]m9$ ) reg>d to ! d$uction all[$ to ! taxpay] by section #afd7;f74 7#b7 ,special rules ,= purposes ( p>agraph 7#a7-- 7,a7 no am\nt receiv$ z a p5sion or annuity %all be tak5 into acc\nt1 7,b7 no am\nt to :i* section #hga7;a7 applies 7relat+ to income ( nonresid5t ali5 individuals n connect$ ) ,unit$ ,/ates bus9ess7 %all be tak5 into acc\nt1 7,c7 no am\nt receiv$ = s]vices provid$ by an individual :ile ! individual is an inmate at a p5al in/itution %all be tak5 into acc\nt1 7,d7 no am\nt describ$ 9 p>agraph 7#a7 receiv$ = s]vice p]=m$ 9 "w activities z def9$ 9 p>agraph 7#d7 or 7#g7 ( section #djg7;d7 ( ! ,social ,security ,act to :i* ! taxpay] is assign$ "u any ,/ate program "u "p ,a ( title ,,iv ( su* ,act %all be tak5 into acc\nt1 b only to ! ext5t su* am\nt is subsidiz$ "u su* ,/ate program1 & 7,e7 a taxpay] may elect to treat am\nts exclud$ f gross income by reason ( section #aab z e>n$ income4 7h7 ,taxable ye> mu/ be full taxable ye> ,except 9 ! case ( a taxable ye> clos$ by reason ( ! dea? ( ! eligible taxpay]1 no cr$it %all be all[able "u ?is section 9 ! case ( a taxable ye> cov]+ a p]iod ( less ?an #ab mon?s4 7i7 ,coord9ation ) c]ta9 means-,te/$ programs ,= purposes (-- 7#a7 ! ,unit$ ,/ates ,h\s+ ,act ( #aicg1 7#b7 title ,v ( ! ,h\s+ ,act ( #aidi1 7#c7 section #aja ( ! ,h\s+ & ,urban ,developm5t ,act ( #aife1 7#d7 sections #bba7;d77#c71 #bce1 & #bcf ( ! ,national ,h\s+ ,act1 & 7#e7 ! ,food & ,nutrition ,act ( #bjjh1 any refund made to a taxpay] by reason ( ?is section %all n be treat$ z income 7& %all n be tak5 into acc\nt 9 det]m9+ res\rces = ! mon? ( its receipt & ! foll[+ mon?74 7j7 ,am\nt ( cr$it ,to be det]m9$ "u tables ,! am\nt ( ! cr$it all[$ by ?is section %all be det]m9$ "u tables prescrib$ by ! ,secret>y4 7k7 ,d5ial ( cr$it = individuals hav+ excessive inve/m5t income 7#a7 ,9 g5]al ,no cr$it %all be all[$ "u subsection 7a7 = ! taxable ye> if ! aggregate am\nt ( disqualifi$ income ( ! taxpay] = ! taxable ye> exce$s #e1jjj4 7#b7 ,disqualifi$ income ,= purposes ( p>agraph 7#a71 ! t]m disqualifi$ income means-- 7,a7 int]e/ or divid5ds to ! ext5t includible 9 income = ! taxable ye>1 7,b7 int]e/ receiv$ or accru$ dur+ ! taxable ye> :i* is exempt f tax impos$ by ?is *apt]1 7,c7 ! excess 7if any7 (-- 7i7 gross income f r5ts or royalties n d]iv$ 9 ! ord9>y c\rse ( a trade or bus9ess1 ov] 7ii7 ! sum (-- 7,i7 ! d$uctions 7o!r ?an int]e/7 :i* are cle>ly & directly allocable to su* gross income1 plus 7,,ii7 int]e/ d$uctions prop]ly allocable to su* gross income1 7,d7 ! capital ga9 net income 7z def9$ 9 section #abbb7 ( ! taxpay] = su* taxable ye>1 & 7,e7 ! excess 7if any7 (-- 7i7 ! aggregate income f all passive activities = ! taxable ye> 7det]m9$ )\t reg>d to any am\nt includ$ 9 e>n$ income "u subsection 7f7 or describ$ 9 a prec$+ subp>agraph71 ov] 7ii7 ! aggregate losses f all passive activities = ! taxable ye> 7z s det]m9$74 7#c7 ,passive activity ,= purposes ( p>agraph 7#b77;,e71 ! t]m passive activity has ! mean+ giv5 su* t]m by section #dfi4 7l7 ,inflation adju/m5ts 7#a7 ,9 g5]al ,9 ! case ( any taxable ye> beg9n+ aft] #bjae1 ea* ( ! doll> am\nts 9 subsections 7b71 7c71 7d71 & 7j77#a7 %all ea* be increas$ by an am\nt equal to-- 7,a7 su* doll> am\nt1 multipli$ by 7,b7 ! co/-(-liv+ adju/m5t det]m9$ "u section #a7;f77#c7 = ! cal5d> ye> 9 :i* ! taxable ye> beg9s1 det]m9$ by sub/itut+ cal5d> ye> #bjad = cal5d> ye> #aiib 9 subp>agraph 7,b7 !re(4 7#b7 ,r\nd+ ,if any doll> am\nt 9 subsections 7b71 7c71 7d71 & 7j77#a71 aft] be+ increas$ "u p>agraph 7#a71 is n a multiple ( #ajj1 su* doll> am\nt %all be r\nd$ to ! ne>e/ multiple ( #ajj4 7m7 ,re/rictions on taxpay]s :o improp]ly claim$ cr$it 9 prior ye> 7#a7 ,taxpay]s mak+ prior fraudul5t or reckless claims 7,a7 ,9 g5]al ,no cr$it %all be all[$ "u ?is section = any taxable ye> 9 ! disall[ance p]iod4 7,b7 ,disall[ance p]iod ,= purposes ( subp>agraph 7,a71 ! disall[ance p]iod is-- 7i7 ! p]iod ( #aj taxable ye>s aft] ! mo/ rec5t taxable ye> = :i* !re 0 a f9al det]m9ation t ! taxpay]'s claim ( cr$it "u ?is section 0 due to fraud1 & 7ii7 ! p]iod ( #b taxable ye>s aft] ! mo/ rec5t taxable ye> = :i* !re 0 a f9al det]m9ation t ! taxpay]'s claim ( cr$it "u ?is section 0 due to reckless or int5tional disreg>d ( rules & regulations 7b n due to fraud74 7#b7 ,taxpay]s mak+ improp] prior claims ,9 ! case ( a taxpay] :o is d5i$ cr$it "u ?is section = any taxable ye> z a result ( ! defici5cy proc$ures "u sub*apt] ,b ( *apt] #fc1 no cr$it %all be all[$ "u ?is section = any subsequ5t taxable ye> unless ! taxpay] provides su* in=mation z ! ,secret>y may require to demon/rate eligibility = su* cr$it4 4 7b7 ,con=m+ am5dm5ts 7#a7 ,section #hf7;f77#b7 is am5d$ by /rik+ section #cb7;c77#b7 & ins]t+ section #cb7;g74 7#b7 ,section #abi7;e77#b7 is am5d$ by /rik+ section #cb7;c77#b7 & ins]t+ section #cb7;g74 7#c7 ,section #fbac7;g77#b7 is am5d$-- 7,a7 9 subp>agraph 7,g71 by /rik+ section #cb7;c77#b77;,a7 & ins]t+ section #cb7;g77#a71 & 7,b7 9 subp>agraph 7,k71 by /rik+ section #cb7k77#b7 & ins]t+ section #cb7m77#b74 7#d7 ,p>agraph 7#b7 ( section #acbd7;b7 ( title #ca1 ,unit$ ,/ates ,code1 is am5d$ by ins]t+ #cb1 aft] #be;,a14 7#e7 ,! table ( sections = subp>t ,c ( "p ,,iv ( sub*apt] ,a ( *apt] #a ( subtitle ,a is am5d$ by /rik+ ! item relat+ to section #cb & ins]t+ ! foll[+3 ,sec4 #cb4 ,progressive tax rebate44 7c7 ,effective date ,! am5dm5ts made by ?is section %all apply to taxable ye>s beg9n+ aft] ,decemb] #ca1 #bjae4 #bjg4 ,te*nical & con=m+ am5dm5ts ,! ,secret>y ( ! ,treasury or ! ,secret>y's delegate %all1 n lat] ?an #ij days aft] ! date ( ! enactm5t ( ?is ,act1 submit to ! ,committee on ,ways & ,means ( ! ,h\se ( ,repres5tatives & ! ,committee on ,f9ance ( ! ,s5ate a draft ( any te*nical & con=m+ *anges 9 ! ,int]nal ,rev5ue ,code ( #aihf :i* are necess>y to reflect ?r\gh\t su* ,code ! purposes ( ! provisions (1 & am5dm5ts made by1 ?is title4 ,b ,corporate tax re=ms #baa4 ,corporate income tax rate r$uction 7a7 ,9 g5]al ,subsection 7b7 ( section #aa is am5d$ to read z foll[s3 7b7 ,am\nt ( tax ,! am\nt ( ! tax impos$ by subsection 7a7 %all be an am\nt equal to #ag p]c5t ( ! taxable income4 4 7b7 ,con=m+ am5dm5t ,section #aeea is am5d$-- 7#a7 by /rik+ b5efits ( ! graduat$ corporate rates & 9 ! head+1 7#b7 by /rik+ ! b5efits ( ! rates conta9$ 9 section #aa7;b7 :i* are l[] ?an ! highe/ rate specifi$ 9 su* section1 or 9 subsection 7a71 & 7#c7 by /rik+ su* b5efits or cr$it 9 subsection 7a7 & ins]t+ su* cr$it4 7c7 ,effective date ,! am5dm5ts made by ?is section %all apply to taxable ye>s beg9n+ aft] ,decemb] #ca1 #bjae4 ,,iii ,refund ( excess consumption tax rev5ue #cja4 ,refunds ( excess consumption tax rev5ue 7a7 ,9 g5]al ,sub*apt] ,b ( *apt] #fe is am5d$ by add+ at ! end ! foll[+ new section3 #fdcc4 ,refunds ( excess consumption tax rev5ue 7a7 ,9 g5]al ,9 ! case ( any qualify+ excess consumption tax rev5ue ye>1 ! ,secret>y %all pay to ea* eligible fil] an am\nt equal to ! consumption tax refund am\nt4 7b7 ,qualify+ excess consumption tax rev5ue ye> ,= purposes ( ?is section-- 7#a7 ,9 g5]al ,! t]m qualify+ excess consumption tax rev5ue ye> means any cal5d> ye> = :i* ! net consumption tax rev5ues exce$ #aj p]c5t ( gross dome/ic product = su* ye>4 7#b7 ,net consumption tax rev5ues ,! net consumption tax rev5ues = any cal5d> ye> %all be ! excess (-- 7,a7 ! tax impos$ "u section #cija ) respect to taxable supplies ! tax po9t = :i* is dur+ su* cal5d> ye>1 ov] 7,b7 ! cr$its all[$ "u section #ciaf = su* cal5d> ye>4 7#c7 ,gross dome/ic product ,! gross dome/ic product = any cal5d> ye> %all be ! la/ e/imate ( ! gross dome/ic product = su* cal5d> ye> by ! ,dep>tm5t ( ,comm]ce :i* is publi%$ be=e ! date t is #c mon?s aft] ! close ( su* cal5d> ye>4 7c7 ,eligible fil] ,= purposes ( ?is section-- 7#a7 ,def9ition 7,a7 ,9 g5]al ,! t]m eligible fil] means1 ) respect to any qualify+ excess consumption tax rev5ue ye>1 any individual 7o!r ?an an individual describ$ 9 p>agraph 7#b77 :o fil$ a return ( income tax = ! individual's qualify+ rebate taxable ye>4 7,b7 ,exclusion ,! t]m eligible fil] %all n include-- 7i7 any nonresid5t ali5 individual1 7ii7 any individual :o is a dep5d5t 7z def9$ 9 section #aeb7 ( ano!r taxpay] = ! individual's qualify+ rebate taxable ye>1 or 7iii7 an e/ate or tru/4 7#b7 ,qualify+ rebate taxable ye> ,! t]m qualify+ rebate taxable ye> means1 ) respect to any individual 9 connection ) a qualify+ excess consumption tax rev5ue ye>1 ! taxable ye> ( su* individual :i* conta9s #f or m mon?s ( su* qualify+ excess consumption tax rev5ue ye>4 7#c7 ,id5tification requirem5t 7,a7 ,9 g5]al ,an individual %all n be treat$ z an eligible fil] = any ye> unless su* individual includes on ! return ( tax = su* ye>-- 7i7 su* individual's valid id5tification numb]1 7ii7 9 ! case ( a jo9t return1 ! valid id5tification numb] ( su* individual's sp\se1 & 7iii7 ! valid id5tification numb] ( any qualify+ *ild 7z def9$ 9 section #cb7;f77 claim$ on su* return4 7,b7 ,valid id5tification numb] ,= purposes ( subp>agraph 7,a71 ! t]m valid id5tification numb] means a social security numb] issu$ to an individual by ! ,social ,security ,adm9i/ration4 ,su* t]m %all n include a ,,t9 issu$ by ! ,int]nal ,rev5ue ,s]vice4 7,c7 ,special rule = memb]s ( ! ,arm$ ,=ces ,subp>agraph 7,a7 %all n apply to a jo9t return :]e at lea/ #a sp\se 0 a memb] ( ! ,arm$ ,=ces ( ! ,unit$ ,/ates at any "t dur+ ! taxable ye>4 7d7 ,consumption tax refund am\nt 7#a7 ,9 g5]al ,! consumption tax refund am\nt = any eligible fil] = any qualify+ excess consumption tax ye> %all be ! product (-- 7,a7 ! applicable am\nt1 times 7,b7 ! applicable %>es ( ! eligible fil]4 7#b7 ,applicable am\nt ,! applicable am\nt = any qualify+ excess rev5ue consumption tax ye> is an am\nt equal to-- 7,a7 ! excess describ$ 9 subsection 7b77#a71 divid$ by 7,b7 ! total numb] ( applicable %>es ( all eligible fil]s = su* ye>4 7#c7 ,applicable %>e ,! numb] ( applicable %>es = any eligible fil] %all be ! sum (-- 7,a7 #a 7#b 9 ! case ( a jo9t return71 plus 7,b7 ( ! numb] ( qualify+ *ildr5 7z def9$ 9 section #cb7;f77 claim$ on ! eligible fil]'s return = ! fil]'s qualify+ rebate taxable ye>4 7e7 ,"t = paym5t ,paym5ts "u subsection 7a7 %all be made z soon z practical aft] ! ,secret>y has det]m9$ ! consumption tax refund am\nt4 4 7b7 ,con=m+ am5dm5ts 7#a7 ,section #acbd7;b77#b7 ( title #ca1 ,unit$ ,/ates ,code1 is am5d$ by /rik+ or #fdca & ins]t+ #fdca1 or #fdcc4 7#b7 ,! table ( sections = sub*apt] ,b ( *apt] #fe is am5d$ by add+ at ! end ! foll[+ new item3 ,sec4 #fdcc4 ,refunds ( excess consumption tax rev5ue4 4 7c7 ,effective date ,! am5dm5ts made by ?is section %all apply to cal5d> ye>s beg9n+ aft] ! date ( ! enactm5t ( ?is ,act4