S 2079 — A bill to amend the Internal Revenue Code of 1986 to treat certain tribal benefits as earned income for purposes of the kiddie tax.

Summary

This bill treats certain disability payments and other payments made by Indian tribes or Native Corporations to children as the earned income of such children. This exempts such income from the "kiddie tax" which taxes the unearned income of children at the parent's marginal tax rate.

Bill Text

• Introduced Introduced in Senate Current html July 10, 2019

AI-generated reading aid from the bill's amendatory text — verify against the official bill.

The bill amends the Internal Revenue Code to classify certain tribal benefits as earned income for kiddie tax purposes.

• Section 1(g)(4)(C)

  The existing text of Section 1(g)(4)(C) is not provided. → Treatment of certain amounts as earned income.--For purposes of this subsection, each of the following amounts shall be treated as earned income of the child referred to in paragraph (1) to the extent included in the gross income of such child: (i) Distributions from qualified disability trusts.--Any amount included in the gross income of such child under section 652 or 662 by reason of being a beneficiary of a qualified disability trust (as defined in section 642(b)(2)(C)(ii)). (ii) Certain indian tribal payments.--Any payment which is included in the gross income of such child and made by an Indian tribal government (as defined in section 139E(c)(1)), or from a trust of which the Indian tribal government is treated as the owner under subpart E of part I of subchapter J, to or for the benefit of such child if-- (I) such child or a family member (within the meaning of section 267(c)(4)) is an enrolled member of the tribe with respect to such Indian tribal government, and (II) such payment is made by reason of such enrollment. (iii) Certain payments from native corporations or settlement trusts.--Any payment which is included in the gross income of such child and-- (I) made by a Native corporation (as defined in section 646(h)(2)) to or for the benefit of such child if such child or a family member (within the meaning of section 267(c)(4)) has an equity interest in the Native corporation, or (II) made by a Settlement Trust (as defined in section 646(h)(4)) to or for the benefit of such child if such child or a family member (within the meaning of section 267(c)(4)) has a beneficial interest in such Settlement Trust.

  This change expands the definition of earned income under the kiddie tax to include certain payments made by Indian tribal governments and native corporations.

• The amendment made by this section shall apply to taxable years beginning after December 31, 2017.

  Establishes the effective date for the new provisions regarding the treatment of certain tribal benefits.

Action History

1. July 10, 2019

   Introduced in Senate

2. July 10, 2019

   Read twice and referred to the Committee on Finance.

Sponsors

• Lisa Murkowski · Primary

Subjects