Economic Growth and Tax Relief Reconciliation Act of 2001

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    Note: This is the original legislation as it was initially enacted. Any subsequent amendments hosted on WS may be listed using  What Links Here.
    107TH UNITED STATES CONGRESS
    1ST SESSION


    An Act
    To provide for reconciliation pursuant to section 104 of the concurrent resolution on the budget for fiscal year 2002.


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

    SECTION 1. SHORT TITLE; REFERENCES; TABLE OF CONTENTS.[edit]

    (a) Short Title.—
    This Act may be cited as the ``Economic Growth and Tax Relief Reconciliation Act of 2001''.
    (b) Amendment of 1986 Code.—
    Except as otherwise expressly provided, whenever in this Act an amendment or repeal is expressed in terms of an amendment to, or repeal of, a section or other provision, the reference shall be considered to be made to a section or other provision of the Internal Revenue Code of 1986.
    (c) Table of Contents.—
    The table of contents of this Act is as follows:
    Sec. 1. Short title; references; table of contents.
    TITLE I—INDIVIDUAL INCOME TAX RATE REDUCTIONS
    Sec. 101. Reduction in income tax rates for individuals.
    Sec. 102. Repeal of phaseout of personal exemptions.
    Sec. 103. Phaseout of overall limitation on itemized deductions.
    TITLE II—TAX BENEFITS RELATING TO CHILDREN
    Sec. 201. Modifications to child tax credit.
    Sec. 202. Expansion of adoption credit and adoption assistance programs.
    Sec. 203. Refunds disregarded in the administration of Federal programs and federally assisted programs.
    Sec. 204. Dependent care credit.
    Sec. 205. Allowance of credit for employer expenses for child care assistance.
    TITLE III—MARRIAGE PENALTY RELIEF
    Sec. 301. Elimination of marriage penalty in standard deduction.
    Sec. 302. Phaseout of marriage penalty in 15-percent bracket.
    Sec. 303. Marriage penalty relief for earned income credit; earned income to include only amounts includible in gross income; simplification of earned income credit.
    TITLE IV—AFFORDABLE EDUCATION PROVISIONS
    Subtitle A—Education Savings Incentives
    Sec. 401. Modifications to education individual retirement accounts.
    Sec. 402. Modifications to qualified tuition programs.
    Subtitle B—Educational Assistance
    Sec. 411. Extension of exclusion for employer-provided educational assistance.
    Sec. 412. Elimination of 60-month limit and increase in income limitation on student loan interest deduction.
    Sec. 413. Exclusion of certain amounts received under the National Health Service Corps Scholarship Program and the F. Edward Hebert Armed Forces Health Professions Scholarship and Financial Assistance Program.
    Subtitle C—Liberalization of Tax-Exempt Financing Rules for Public School Construction
    Sec. 421. Additional increase in arbitrage rebate exception for governmental bonds used to finance educational facilities.
    Sec. 422. Treatment of qualified public educational facility bonds as exempt facility bonds.
    Subtitle D—Other Provisions
    Sec. 431. Deduction for higher education expenses.
    TITLE V—ESTATE, GIFT, AND GENERATION-SKIPPING TRANSFER TAX PROVISIONS
    Subtitle A—Repeal of Estate and Generation-Skipping Transfer Taxes
    Sec. 501. Repeal of estate and generation-skipping transfer taxes.
    Subtitle B—Reductions of Estate and Gift Tax Rates
    Sec. 511. Additional reductions of estate and gift tax rates.
    Subtitle C—Increase in Exemption Amounts
    Sec. 521. Increase in exemption equivalent of unified credit, lifetime gifts exemption, and GST exemption amounts.
    Subtitle D—Credit for State Death Taxes
    Sec. 531. Reduction of credit for State death taxes.
    Sec. 532. Credit for State death taxes replaced with deduction for such taxes.
    Subtitle E—Carryover Basis at Death; Other Changes Taking Effect With Repeal
    Sec. 541. Termination of step-up in basis at death.
    Sec. 542. Treatment of property acquired from a decedent dying after December 31, 2009.
    Subtitle F—Conservation Easements
    Sec. 551. Expansion of estate tax rule for conservation easements.
    Subtitle G—Modifications of Generation-Skipping Transfer Tax
    Sec. 561. Deemed allocation of GST exemption to lifetime transfers to trusts; retroactive allocations.
    Sec. 562. Severing of trusts.
    Sec. 563. Modification of certain valuation rules.
    Sec. 564. Relief provisions.
    Subtitle H—Extension of Time for Payment of Estate Tax
    Sec. 571. Increase in number of allowable partners and shareholders in closely held businesses.
    Sec. 572. Expansion of availability of installment payment for estates with interests qualifying lending and finance businesses.
    Sec. 573. Clarification of availability of installment payment.
    Subtitle I—Other Provisions
    Sec. 581. Waiver of statute of limitation for taxes on certain farm valuations.
    TITLE VI—PENSION AND INDIVIDUAL RETIREMENT ARRANGEMENT PROVISIONS
    Subtitle A—Individual Retirement Accounts
    Sec. 601. Modification of IRA contribution limits.
    Sec. 602. Deemed IRAs under employer plans.
    Subtitle B—Expanding Coverage
    Sec. 611. Increase in benefit and contribution limits.
    Sec. 612. Plan loans for subchapter S owners, partners, and sole proprietors.
    Sec. 613. Modification of top-heavy rules.
    Sec. 614. Elective deferrals not taken into account for purposes of deduction limits.
    Sec. 615. Repeal of coordination requirements for deferred compensation plans of State and local governments and tax-exempt organizations.
    Sec. 616. Deduction limits.
    Sec. 617. Option to treat elective deferrals as after-tax Roth contributions.
    Sec. 618. Nonrefundable credit to certain individuals for elective deferrals and IRA contributions.
    Sec. 619. Credit for pension plan startup costs of small employers.
    Sec. 620. Elimination of user fee for requests to IRS regarding pension plans.
    Sec. 621. Treatment of nonresident aliens engaged in international transportation services.
    Subtitle C—Enhancing Fairness for Women
    Sec. 631. Catch-up contributions for individuals age 50 or over.
    Sec. 632. Equitable treatment for contributions of employees to defined contribution plans.
    Sec. 633. Faster vesting of certain employer matching contributions.
    Sec. 634. Modification to minimum distribution rules.
    Sec. 635. Clarification of tax treatment of division of section 457 plan benefits upon divorce.
    Sec. 636. Provisions relating to hardship distributions.
    Sec. 637. Waiver of tax on nondeductible contributions for domestic or similar workers.
    Subtitle D—Increasing Portability for Participants
    Sec. 641. Rollovers allowed among various types of plans.
    Sec. 642. Rollovers of IRAs into workplace retirement plans.
    Sec. 643. Rollovers of after-tax contributions.
    Sec. 644. Hardship exception to 60-day rule.
    Sec. 645. Treatment of forms of distribution.
    Sec. 646. Rationalization of restrictions on distributions.
    Sec. 647. Purchase of service credit in governmental defined benefit plans.
    Sec. 648. Employers may disregard rollovers for purposes of cash-out amounts.
    Sec. 649. Minimum distribution and inclusion requirements for section 457 plans.
    Subtitle E—Strengthening Pension Security and Enforcement
    Part I—General Provisions
    Sec. 651. Repeal of 160 percent of current liability funding limit.
    Sec. 652. Maximum contribution deduction rules modified and applied to all defined benefit plans.
    Sec. 653. Excise tax relief for sound pension funding.
    Sec. 654. Treatment of multiemployer plans under section 415.
    Sec. 655. Protection of investment of employee contributions to 401(k) plans.
    Sec. 656. Prohibited allocations of stock in S corporation ESOP.
    Sec. 657. Automatic rollovers of certain mandatory distributions.
    Sec. 658. Clarification of treatment of contributions to multiemployer plan.
    Part II—Treatment of Plan Amendments Reducing Future Benefit Accruals
    Sec. 659. Excise tax on failure to provide notice by defined benefit plans significantly reducing future benefit accruals.
    Subtitle F—Reducing Regulatory Burdens
    Sec. 661. Modification of timing of plan valuations.
    Sec. 662. ESOP dividends may be reinvested without loss of dividend deduction.
    Sec. 663. Repeal of transition rule relating to certain highly compensated employees.
    Sec. 664. Employees of tax-exempt entities.
    Sec. 665. Clarification of treatment of employer-provided retirement advice.
    Sec. 666. Repeal of the multiple use test.
    Subtitle G—Miscellaneous Provisions
    Sec. 671. Tax treatment and information requirements of Alaska Native Settlement Trusts.
    TITLE VII—ALTERNATIVE MINIMUM TAX
    Sec. 701. Increase in alternative minimum tax exemption.
    TITLE VIII—OTHER PROVISIONS
    Sec. 801. Time for payment of corporate estimated taxes.
    Sec. 802. Expansion of authority to postpone certain tax-related deadlines by reason of Presidentially declared disaster.
    Sec. 803. No Federal income tax on restitution received by victims of the Nazi regime or their heirs or estates.
    TITLE IX—COMPLIANCE WITH CONGRESSIONAL BUDGET ACT
    Sec. 901. Sunset of provisions of Act.

    Approved June 7, 2001.

    Legislative History[edit]

    HOUSE REPORTS: No. 107-84 (Comm. of Conference).

    • CONGRESSIONAL RECORD, Vol. 147 (2001):
      • May 16, considered and passed House.
      • May 17, 21-23, considered and passed Senate, amended.
      • May 25, House agreed to conference report.
      • May 26, Senate agreed to conference report.
    • WEEKLY COMPILATION OF PRESIDENTIAL DOCUMENTS, Vol. 37 (2001):
      • June 7, Presidential remarks.