Summary: H.R.3040 — 102nd Congress (1991-1992)All Information (Except Text)

Bill summaries are authored by CRS.

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Reported to Senate with amendment(s) (06/19/1992)

Tax Extension Act of 1992 - Title I: Extension of Certain Expiring Tax Provisions - Amends the Internal Revenue Code to extend the following provisions from June 30, 1992, until December 31, 1993: (1) the tax exclusion for employer-provided educational assistance; (2) the tax exclusion for employer-provided group legal services plans; (3) the deduction for health insurance costs of self-employed individuals; (4) the authority to issue qualified mortgage bonds and qualified mortgage credit certificates; (5) the authority to issue qualified small issue bonds to finance manufacturing facilities and farm property; (6) the tax credit for increasing research activities; (7) the targeted jobs credit; and (8) the credit for clinical testing expenses for certain drugs for rare diseases or conditions.

Increases the age requirement for economically disadvantaged youths for eligibility for the targeted jobs credit.

Allows the financing as a new mortgage under qualified mortgage bond provisions of certain contract deed agreements by families with income of less than $15,000 annually.

Extends the low-income housing credit until December 31, 1993, with modifications. Limits the eligible basis of units in a credit project. Provides that certain community service facilities in projects in qualified census tracts are included in eligible basis as functionally related and subordinate facilities. Expands the ten-year anti-churning rule waiver to certain projects substantially assisted, financed, or operated under the National Housing Act. Allows units occupied by certain full-time students to qualify for such credit. Authorizes the Treasury Department to waive penalties for certain de minimis errors and recertifications.

Repeals the tax preference for the appreciated property charitable deduction after December 31, 1991, and before January 1, 1994. Requires a report by the Secretary of the Treasury to certain congressional committees on an advance valuation procedure.

Postpones the termination date on the excise tax of certain vaccines and the authority to make expenditures from the Vaccine Injury Compensation Trust Fund. Requires the Secretary of Health and Human Services to study certain aspects of the Trust Fund and report to specified congressional committees.

Amends the Railroad Retirement Solvency Act of 1983 to make permanent the transfer of proceeds from the tax of certain railroad retirement benefits from the general fund of the Treasury to the Railroad Retirement Account.

Title II: Repeal of Certain Luxury Excise Taxes; Imposition of Tax on Diesel Fuel Used in Noncommercial Boats - Repeals the luxury excise tax on boats, aircraft, jewelry, and furs.

Modifies the luxury excise tax on automobiles to index the $30,000 threshold for inflation occurring after 1990 and make such tax applicable to the first retail sale. Terminates such tax after 1999.

Extends the current diesel fuel excise tax to diesel fuel used by motorboats. Exempts vessels used for commercial fishing, transportation for compensation or hire, or for business use other than predominantly for entertainment, amusement, or recreation.

Retains excise taxes for diesel fuels used in motor boats in the General Treasury. (Current law requires transfer of such amounts to the Highway Trust Fund and the Leaking Underground Storage Tank Trust Fund.)

Title III: Other Revenue-Raising Provisions - Increases, beginning in 1997, the percentage of current-year tax liability upon which a large corporation is required to base its estimated tax payments.

Allows an amortization deduction with respect to certain intangible property that is acquired and held by a taxpayer in connection with the conduct of a trade or business or an activity engaged in for the production of income. Provides for determining such deduction by amortizing the adjusted basis (for purposes of determining gain) of such intangible ratably over the 14-year period beginning with the month in which the intangible was acquired. Disallows any other depreciation or amortization deduction with respect to such intangible.

Describes an amortizable intangible as: (1) goodwill; (2) going concern value; (3) certain specified types of intangible property that generally relate to workforce, information base, know-how, customers, suppliers, or other similar items; (4) any license, permit, or other right granted by a governmental unit, agency, or instrumentality; (5) any covenant not to compete (or other arrangement to the extent that the arrangement has substantially the same effect as a covenant not to compete) entered into in connection with the direct or indirect acquisition of an interest in a trade or business or substantial portion thereof; and (6) any franchise, trademark, or trade name.

Excludes from treatment as an amortizable intangible: (1) any interest in a corporation, partnership, trust, or estate; (2) any interest under an existing futures contract, foreign currency contract, national principal contract, interest rate swap, or other similar financial contract; (3) any interest in land; (4) certain computer software; (5) certain interests in films, sound recordings, video tapes, books, or other similar property; (6) certain rights to receive tangible property or services; (7) certain interests in patents or copyrights; (8) any interest under an existing lease of tangible property; (9) any interest under an existing indebtedness (except for the deposit base and similar items of a financial institution); (10) a franchise to engage in any professional sport, and any item acquired in connection in such a franchise; (11) certain purchased mortgaging servicing rights; (12) certain property acquired from a qualified research entity (at the election of the taxpayer).

Sets forth special rules governing the application of the amortization deduction.

Provides for the treatment of certain computer software and leased property depreciation deductions excluded from the amortization rules.

Continues the present-law treatment of certain contingent amounts that are paid or incurred on account of the transfer of a franchise, trademark, or trade name.

Provides for the treatment of assumption reinsurance transactions of insurance companies.

Provides for the treatment of certain payments to retired or deceased partners.

Requires the reporting of identifying information to the IRS in the case of certain seller-provided financing.

Increases the base tax rate amount of both initially listed and newly listed ozone-depleting chemicals.