Taxpayer Relief Act of 1997
The Taxpayer Relief Act of 1997 (Pub.L. 105-34, H.R. 2014, 111 Stat. 787, enacted August 5, 1997) reduced several federal taxes in the United States.
Subject to certain phase-in rules, the top capital gains rate fell from 28% to 20%. The 15% bracket was lowered to 10%.
Starting in 1998, a $400 tax credit for each child under age 17 was introduced, which was increased to $500 in 1999. This credit was phased out for high income families.
The act exempted from taxation the profits on the sale of a personal residence of up to $500,000 for married couples filing jointly and $250,000 for singles. This is for residences that were lived in for at least 2 years over the last 5 (ref).
The $600,000 estate tax exemption was to increase gradually to $1 million by the year 2006.
Family farms and small businesses could qualify for an exemption of $1.3 million, effective 1998. Starting in 1999, the $10,000 annual gift tax exclusion was to be corrected for inflation.
The act also provided tax relief for retirement accounts as well as education savings in the Hope Scholarship Credit and Lifetime Learning Credits. Some expiring business tax provisions were extended.
[edit] Legislative history
This was the first law devoted solely to tax cuts that Congress enacted using the fast-track budget reconciliation process.
Final House vote, July 30, 1997:
| Vote by Party | Yea | Nay | ||
|---|---|---|---|---|
| Republicans | 225 | 99.6% | 1 | 0.4% |
| Democrats | 164 | 80.0% | 41 | 20.0% |
| Independents | 0 | 0.0% | 1 | 100% |
| Total | 389 | 90.0% | 43 | 10.0% |
| Not voting | 2 | 1 | ||
Final Senate vote, July 30, 1997:
| Vote by Party | Yea | Nay | ||
|---|---|---|---|---|
| Republicans | 55 | 100% | 0 | 0.0% |
| Democrats | 37 | 82.2% | 8 | 17.8% |
| Total | 92 | 92.0% | 8 | 8.0% |
It was signed into law by President Bill Clinton on August 5, 1997.
[edit] External links
- Pub.L. 105-34, Taxpayer Relief Act of 1997
- Pub.L. 105-34, Taxpayer Relief Act of 1997 (readable online)
- H.R. 2014, Taxpayer Relief Act of 1997
- 105th Congress / House / 1st session / Vote 350 final vote results on H R 2014: Revenue Reconciliation Act of 1997, by various groups and by individuals, from the Washington Post
- Mark Bautz, How a Capital-Gains Cut Will Change the Way You Invest CNN Money, August 1, 1997
