[Congressional Bills 112th Congress]
[From the U.S. Government Publishing Office]
[S. 2343 Placed on Calendar Senate (PCS)]
Calendar No. 365
112th CONGRESS
2d Session
S. 2343
To amend the Higher Education Act of 1965 to extend the reduced
interest rate for Federal Direct Stafford Loans, and for other
purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
April 24 (legislative day, April 23), 2012
Mr. Reid introduced the following bill; which was read twice and
ordered placed on the calendar
_______________________________________________________________________
A BILL
To amend the Higher Education Act of 1965 to extend the reduced
interest rate for Federal Direct Stafford Loans, and for other
purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Stop the Student Loan Interest Rate
Hike Act of 2012''.
SEC. 2. INTEREST RATE EXTENSION.
Section 455(b)(7)(D) of the Higher Education Act of 1965 (20 U.S.C.
1087e(b)(7)(D)) is amended--
(1) in the matter preceding clause (i), by striking ``and
before July 1, 2012,'' and inserting ``and before July 1,
2013,''; and
(2) in clause (v), by striking ``and before July 1, 2012,''
and inserting ``and before July 1, 2013,''.
SEC. 3. EMPLOYMENT TAX TREATMENT OF PROFESSIONAL SERVICE BUSINESSES.
(a) In General.--Section 1402 of the Internal Revenue Code of 1986
is amended by adding at the end the following new subsection:
``(m) Special Rules for Professional Service Businesses.--
``(1) Shareholders providing services to specified s
corporations.--
``(A) In general.--In the case of an applicable
shareholder who provides substantial services with
respect to a professional service business referred to
in subparagraph (C) of a specified S corporation--
``(i) such shareholder shall be treated as
engaged in the trade or business of such
professional service business with respect to
items of income or loss described in section
1366 which are attributable to such business,
and
``(ii) such shareholder's net earnings from
self-employment shall include such
shareholder's pro rata share of such items of
income or loss, except that in computing such
pro rata share of such items the exceptions
provided in subsection (a) shall apply.
``(B) Treatment of family members.--Except as
otherwise provided by the Secretary, the applicable
shareholder's pro rata share of items referred to in
subparagraph (A) shall be increased by the pro rata
share of such items of each member of such applicable
shareholder's family (within the meaning of section
318(a)(1)) who does not provide substantial services
with respect to such professional service business.
``(C) Specified s corporation.--For purposes of
this subsection, the term `specified S corporation'
means--
``(i) any S corporation which is a partner
in a partnership which is engaged in a
professional service business if substantially
all of the activities of such S corporation are
performed in connection with such partnership,
and
``(ii) any other S corporation which is
engaged in a professional service business if
75 percent or more of the gross income of such
business is attributable to service of 3 or
fewer shareholders of such corporation.
``(D) Applicable shareholder.--For purposes of this
paragraph, the term `applicable shareholder' means any
shareholder whose modified adjusted gross income for
the taxable year exceeds--
``(i) in the case of a shareholder making a
joint return under section 6013 or a surviving
spouse (as defined in section 2(a)), $250,000,
``(ii) in the case of a married shareholder
(as defined in section 7703) filing a separate
return, half of the dollar amount determined
under clause (i), and
``(iii) in any other case, $200,000.
``(2) Partners.--
``(A) In general.--In the case of any partnership
which is engaged in a professional service business,
subsection (a)(13) shall not apply to any applicable
partner who provides substantial services with respect
to such professional service business.
``(B) Applicable partner.--For purposes of this
paragraph, the term `applicable partner' means any
partner whose modified adjusted gross income for the
taxable year exceeds--
``(i) in the case of a partner making a
joint return under section 6013 or a surviving
spouse (as defined in section 2(a)), $250,000,
``(ii) in the case of a married partner (as
defined in section 7703) filing a separate
return, half of the dollar amount determined
under clause (i), and
``(iii) in any other case, $200,000.
``(3) Professional service business.--For purposes of this
subsection, the term `professional service business' means any
trade or business (or portion thereof) providing services in
the fields of health, law, lobbying, engineering, architecture,
accounting, actuarial science, performing arts, consulting,
athletics, investment advice or management, or brokerage
services.
``(4) Modified adjusted gross income.--For purposes of this
subsection, the term `modified adjusted gross income' means
adjusted gross income--
``(A) determined without regard to any deduction
allowed under section 164(f), and
``(B) increased by the amount excluded from gross
income under section 911(a)(1).
``(5) Regulations.--The Secretary shall prescribe such
regulations as may be necessary or appropriate to carry out the
purposes of this subsection, including regulations which
prevent the avoidance of the purposes of this subsection
through tiered entities or otherwise.
``(6) Cross reference.--For employment tax treatment of
wages paid to shareholders of S corporations, see subtitle
C.''.
(b) Conforming Amendment.--Section 211 of the Social Security Act
is amended by adding at the end the following new subsection:
``(l) Special Rules for Professional Service Businesses.--
``(1) Shareholders providing services to specified s
corporations.--
``(A) In general.--In the case of an applicable
shareholder who provides substantial services with
respect to a professional service business referred to
in subparagraph (C) of a specified S corporation--
``(i) such shareholder shall be treated as
engaged in the trade or business of such
professional service business with respect to
items of income or loss described in section
1366 of the Internal Revenue Code of 1986 which
are attributable to such business, and
``(ii) such shareholder's net earnings from
self-employment shall include such
shareholder's pro rata share of such items of
income or loss, except that in computing such
pro rata share of such items the exceptions
provided in subsection (a) shall apply.
``(B) Treatment of family members.--Except as
otherwise provided by the Secretary of the Treasury,
the applicable shareholder's pro rata share of items
referred to in subparagraph (A) shall be increased by
the pro rata share of such items of each member of such
applicable shareholder's family (within the meaning of
section 318(a)(1) of the Internal Revenue Code of 1986)
who does not provide substantial services with respect
to such professional service business.
``(C) Specified s corporation.--For purposes of
this subsection, the term `specified S corporation'
means--
``(i) any S corporation (as defined in
section 1361(a) of the Internal Revenue Code of
1986) which is a partner in a partnership which
is engaged in a professional service business
if substantially all of the activities of such
S corporation are performed in connection with
such partnership, and
``(ii) any other S corporation (as so
defined) which is engaged in a professional
service business if 75 percent or more of the
gross income of such business is attributable
to service of 3 or fewer shareholders of such
corporation.
``(D) Applicable shareholder.--For purposes of this
paragraph, the term `applicable shareholder' means any
shareholder whose modified adjusted gross income for
the taxable year exceeds--
``(i) in the case of a shareholder making a
joint return under section 6013 of the Internal
Revenue Code of 1986 or a surviving spouse (as
defined in section 2(a) of such Code),
$250,000,
``(ii) in the case of a married shareholder
(as defined in section 7703 of such Code)
filing a separate return, half of the dollar
amount determined under clause (i), and
``(iii) in any other case, $200,000.
``(2) Partners.--
``(A) In general.--In the case of any partnership
which is engaged in a professional service business,
subsection (a)(12) shall not apply to any applicable
partner who provides substantial services with respect
to such professional service business.
``(B) Applicable partner.--For purposes of this
paragraph, the term `applicable partner' means any
partner whose modified adjusted gross income for the
taxable year exceeds--
``(i) in the case of a partner making a
joint return under section 6013 of the Internal
Revenue Code of 1986 or a surviving spouse (as
defined in section 2(a) of such Code),
$250,000,
``(ii) in the case of a married partner (as
defined in section 7703 of such Code) filing a
separate return, half of the dollar amount
determined under clause (i), and
``(iii) in any other case, $200,000.
``(3) Professional service business.--For purposes of this
subsection, the term `professional service business' means any
trade or business (or portion thereof) providing services in
the fields of health, law, lobbying, engineering, architecture,
accounting, actuarial science, performing arts, consulting,
athletics, investment advice or management, or brokerage
services.
``(4) Modified adjusted gross income.--For purposes of this
subsection, the term `modified adjusted gross income' means
adjusted gross income as determined under section 62 of the
Internal Revenue Code of 1986--
``(A) determined without regard to any deduction
allowed under section 164(f) of such Code, and
``(B) increased by the amount excluded from gross
income under section 911(a)(1) of such Code.''.
(c) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2012.
SEC. 4. COMPLIANCE PROVISION.
The budgetary effects of this Act, for the purpose of complying
with the Statutory Pay-As-You-Go-Act of 2010, shall be determined by
reference to the latest statement titled ``Budgetary Effects of PAYGO
Legislation'' for this Act, submitted for printing in the Congressional
Record by the Chairman of the Senate Budget Committee, provided that
such statement has been submitted prior to the vote on passage.
Calendar No. 365
112th CONGRESS
2d Session
S. 2343
_______________________________________________________________________
A BILL
To amend the Higher Education Act of 1965 to extend the reduced
interest rate for Federal Direct Stafford Loans, and for other
purposes.
_______________________________________________________________________
April 24, 2012
Read twice and ordered placed on the calendar