Foster Opportunity EITC Act of 2019

II 116TH CONGRESS 1ST SESSION S. 2790 To amend the Internal Revenue Act of 1986 to strengthen the earned income tax credit and expand eligibility for childless individuals, homeless youth, and youth formerly in foster care. IN THE SENATE OF THE UNITED STATES NOVEMBER 6, 2019 Mr. CASEY (for himself and Mrs. MURRAY) introduced the following bill; which was read twice and referred to the Committee on Finance A BILL To amend the Internal Revenue Act of 1986 to strengthen the earned income tax credit and expand eligibility for childless individuals, homeless youth, and youth formerly in foster care. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Foster Opportunity 4 EITC Act of 2019’’. 5 VerDate Sep 11 2014 00:03 Nov 13, 2019 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S2790.IS S2790 kjohnson on DSK79L0C42 with BILLS 2 •S 2790 IS SEC. 2. STRENGTHENING THE EARNED INCOME TAX CRED- 1 IT. 2 (a) INCREASED CREDIT FOR INDIVIDUALS WITH NO 3 QUALIFYING CHILDREN.— 4 (1) IN GENERAL.—The table in subparagraph 5 (A) of section 32(b)(2) of the Internal Revenue Code 6 of 1986 is amended— 7 (A) by striking ‘‘$4,220’’ in the second col- 8 umn of the third row and inserting ‘‘$10,180’’, 9 and 10 (B) by striking ‘‘$5,280’’ in the third col- 11 umn of the third row and inserting ‘‘$11,380’’. 12 (2) INFLATION ADJUSTMENTS.—Subparagraph 13 (B) of section 32(j)(1) of such Code is amended— 14 (A) in clause (i)— 15 (i) by inserting ‘‘(except as provided 16 in clause (iii))’’ after ‘‘(b)(2)(A)’’, and 17 (ii) by striking ‘‘and’’ at the end, 18 (B) by redesignating clause (ii) as clause 19 (iii), and 20 (C) by inserting after clause (i) the fol- 21 lowing new clause: 22 ‘‘(ii) in the case of the $10,180 and 23 $11,380 amounts in the table in subsection 24 (b)(2)(A), ‘calendar year 2017’ for ‘cal- 25 endar year 1992’, and’’. 26 VerDate Sep 11 2014 00:03 Nov 13, 2019 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S2790.IS S2790 kjohnson on DSK79L0C42 with BILLS 3 •S 2790 IS (b) CREDIT INCREASE AND REDUCTION IN PHASE- 1 OUT FOR INDIVIDUALS WITH NO CHILDREN.—The table 2 contained in section 32(b)(1)(A) of the Internal Revenue 3 Code of 1986 is amended— 4 (1) by striking ‘‘7.65’’ in the second column of 5 the fourth row and inserting ‘‘20’’, and 6 (2) by striking ‘‘7.65’’ in the third column of 7 the fourth row and inserting ‘‘15.98’’. 8 (c) ELIGIBILITY AGE LIMITS.— 9 (1) UPPER AGE LIMIT.—Subclause (II) of sec- 10 tion 32(c)(1)(A)(ii) of the Internal Revenue Code of 11 1986 is amended by striking ‘‘age 65’’ and inserting 12 ‘‘age 68’’. 13 (2) LOWERING ELIGIBILITY AGE FOR CERTAIN 14 CHILDLESS INDIVIDUALS, HOMELESS YOUTH, AND 15 QUALIFIED FOSTER YOUTH.— 16 (A) IN GENERAL.—Subclause (II) of sec- 17 tion 32(c)(1)(A)(ii) of such Code, as amended 18 by paragraph (1), is further amended by strik- 19 ing ‘‘age 25’’ and inserting ‘‘age 19 (or, in the 20 case of homeless youth and qualified foster 21 youth, age 18)’’. 22 (B) HOMELESS YOUTH AND QUALIFIED 23 FOSTER YOUTH.—Paragraph (1) of section 24 VerDate Sep 11 2014 00:03 Nov 13, 2019 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S2790.IS S2790 kjohnson on DSK79L0C42 with BILLS 4 •S 2790 IS 32(c) of such Code is amended by adding at the 1 end the following new subparagraphs: 2 ‘‘(G) HOMELESS YOUTH.— 3 ‘‘(i) IN GENERAL.—For purposes of 4 subparagraph (A)(ii)(II), the term ‘home- 5 less youth’ means— 6 ‘‘(I) an unaccompanied youth 7 who has not attained age 24 and who 8 is a homeless child or youth (as de- 9 fined in section 725 of the McKinney- 10 Vento Homeless Assistance Act), or 11 ‘‘(II) an individual who is deter- 12 mined by a specified official to be un- 13 accompanied, at risk of homelessness, 14 and self-supporting. 15 ‘‘(ii) VERIFICATION.—No credit shall 16 be allowed under this section by reason of 17 clause (i) to any individual unless such in- 18 dividual attests on the return of tax for the 19 taxable year that the individual is a home- 20 less youth and that no other taxpayer is 21 entitled to claim such individual as a quali- 22 fying child for purposes of this section or 23 section 24 for the taxable year. The Sec- 24 retary, in consultation with the National 25 VerDate Sep 11 2014 00:03 Nov 13, 2019 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S2790.IS S2790 kjohnson on DSK79L0C42 with BILLS 5 •S 2790 IS Taxpayer Advocate and national homeless 1 youth advocates, shall issue regulations— 2 ‘‘(I) determining the information 3 on relevant tax forms or documenta- 4 tion necessary to demonstrate home- 5 less youth status in the case of an 6 audit of the return, and 7 ‘‘(II) providing that a docu- 8 mented telephone call with or a writ- 9 ten statement from a specified official 10 shall be treated as sufficient to verify 11 the status of an individual as a home- 12 less youth. 13 ‘‘(iii) SPECIFIED OFFICIAL.—For pur- 14 poses of this subparagraph, the term ‘spec- 15 ified official’ means— 16 ‘‘(I) a local educational agency 17 homeless liaison designated pursuant 18 to section 722(g)(1)(J)(ii) of the 19 McKinney-Vento Homeless Assistance 20 Act (or a designee of such liaison), 21 ‘‘(II) the director of an emer- 22 gency or transitional shelter street 23 outreach program, homeless youth 24 drop-in center, or other program serv- 25 VerDate Sep 11 2014 00:03 Nov 13, 2019 Jkt 099200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S2790.IS S2790 kjohnson on DSK79L0C42 with BILLS 6 •S 2790 IS icing homeless youth (or a designee of 1 such director), 2 ‘‘(III) the director of a Federal 3 TRIO program under chapter 1 of 4 subpart 2 of part A of title IV of the 5 Higher Education Act of 1965 (20 6 U.S.C. 1070a–11 et seq.) or a Gain- 7 ing Early Awareness and Readiness 8 for Undergraduate Program under 9 chapter 2 of subpart 2 of part A of 10 title IV of such Act (20 U.S.C. 11 1070a–21 et seq.) (or a designee of 12 such director), or 13 ‘‘(IV) a financial aid adminis- 14 trator (within the meaning of the 15 Higher Education Act of 1965) (or a 16 designee of such administrator). 17 ‘‘(H) QUALIFIED FOSTER YOUTH.— 18 ‘‘(i) IN GENERAL.—For purposes of 19 subparagraph (A)(ii)(II), the term ‘quali- 20 fied foster youth’ means an individual who 21 was in foster care on or after the date that 22 such individual attained age 14, if such 23 care was under the supervision or adminis- 24 tration of a State or tribal agency admin- 25 VerDate Sep 11 2014 00:03 Nov 13, 2019 Jkt 099200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S2790.IS S2790 kjohnson on DSK79L0C42 with BILLS 7 •S 2790 IS istering (or eligible to administer) a plan 1 under part B or part E of the Social Secu- 2 rity Act (without regard to whether Fed- 3 eral assistance was provided with respect 4 to such child under such part E). 5 ‘‘(ii) VERIFICATION.—The Secretary, 6 in consultation with the National Taxpayer 7 Advocate and the Children’s Bureau, Ad- 8 ministration for Children and Families, 9 shall issue regulations determining the in- 10 formation on relevant tax forms providing 11 criteria for verifying an individual as a 12 qualified foster youth during any transition 13 period between the date of the enactment 14 of this subparagraph and the establish- 15 ment of an operational data reporting sys- 16 tem described in section 6050Z(a) if such 17 individual is not listed in the verification 18 database described in such section, or in 19 the case of an audit of the return. The 20 Secretary shall consider the use for such 21 purposes of court or official State docu- 22 mentation, verification from entities such 23 as a child welfare agency, case worker, 24 Court Appointed Special Advocate, attor- 25 VerDate Sep 11 2014 00:03 Nov 13, 2019 Jkt 099200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S2790.IS S2790 kjohnson on DSK79L0C42 with BILLS 8 •S 2790 IS ney, guardian ad litem, Federal TRIO pro- 1 gram under chapter 1 of subpart 2 of part 2 A of title IV of the Higher Education Act 3 of 1965 (20 U.S.C. 1070a–11 et seq.), 4 Gaining Early Awareness and Readiness 5 for Undergraduate Program under chapter 6 2 of subpart 2 of part A of title IV of such 7 Act (20 U.S.C. 1070a–21 et seq.), or other 8 recognized State, county, or tribal author- 9 ity, and verification through the John H. 10 Chafee Foster Care Program for Success- 11 ful Transition to Adulthood under section 12 477 of the Social Security Act (42 U.S.C. 13 677). During any transition period be- 14 tween the date of the enactment of this 15 subparagraph and the establishment of an 16 operational data reporting system de- 17 scribed in section 6050Z(a), no credit shall 18 be allowed under this section by reason of 19 clause (i) to any individual unless such in- 20 dividual attests on the return of tax for the 21 taxable year that the individual is a quali- 22 fied foster youth and that no other tax- 23 payer is entitled to claim such individual 24 as a qualified child for purposes of this 25 VerDate Sep 11 2014 00:03 Nov 13, 2019 Jkt 099200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S2790.IS S2790 kjohnson on DSK79L0C42 with BILLS 9 •S 2790 IS section or section 24 for the taxable year. 1 In the situation that an adult can claim a 2 qualified foster youth for purposes of this 3 section or section 24, the Secretary shall 4 develop a form to indicate that the adult 5 will not claim the qualified foster youth for 6 the taxable year.’’. 7 (C) RETURNS RELATING TO YOUTH IN 8 FOSTER CARE.— 9 (i) IN GENERAL.—Subpart B of part 10 III of subchapter A of chapter 61 of such 11 Code is amended by inserting after section 12 6050Y the following new section: 13 ‘‘SEC. 6050Z. RETURNS RELATING TO YOUTH IN FOSTER 14 CARE. 15 ‘‘(a) REQUIREMENT OF REPORTING.— 16 ‘‘(1) IN GENERAL.—Any State, local, or tribal 17 agency providing foster care under a plan approved 18 under part B or E of title IV of the Social Security 19 Act shall make a return, at such times as the Sec- 20 retary may prescribe, described in subsection (b) 21 with respect to any individual under the placement 22 and responsibility of such State, locality, or tribe on 23 or after the date that such individual attained age 24 14. 25 VerDate Sep 11 2014 00:03 Nov 13, 2019 Jkt 099200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\S2790.IS S2790 kjohnson on DSK79L0C42 with BILLS 10 •S 2790 IS ‘‘(2) DEVELOPMENT OF DATA REPORTING SYS- 1 TEM.—The Secretary, in coordination with the Chil- 2 dren’s Bureau, Administration for Children and 3 Families, shall develop a data reporting system 4 which satisfies the return requirements of paragraph 5 (1). 6 ‘‘(3) SINGLE RETURN.—Except as provided by 7 the Secretary, a State, local, or tribal agency de- 8 scribed in paragraph (1) which has made a return 9 for an individual described in such paragraph shall 10 not be required to make a return for such individual 11 for any subsequent calendar year. 12 ‘‘(b) FORM AND MANNER OF RETURNS.—A return 13 is described in this subsection if such return— 14 ‘‘(1) is in such form as the Secretary may pre- 15 scribe, and 16 ‘‘(2) contains, with respect to each individual 17 described in subsection (a)(1)— 18 ‘‘(A) the name, date of birth, and TIN of 19 such individual, and 20 ‘‘(B) such other information as the Sec- 21 retary may prescribe in consultation with the 22 Children’s Bureau, Administration for Children 23 and Families. 24 VerDate Sep 11 2014 00:03 Nov 13, 2019 Jkt 099200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\S2790.IS S2790 kjohnson on DSK79L0C42 with BILLS 11 •S 2790 IS ‘‘(c) STATEMENT TO BE FURNISHED TO INDIVID- 1 UALS WITH RESPECT TO WHOM INFORMATION IS RE- 2 QUIRED.— 3 ‘‘(1) IN GENERAL.—Every person required to 4 make a return under subsection (a) shall furnish to 5 each person whose name is required to be set forth 6 in such return a written statement showing— 7 ‘‘(A) the name and address of the person 8 required to make such return and the telephone 9 number of the information contact for such per- 10 son, and 11 ‘‘(B) the information required to be shown 12 on the return with respect to such individual. 13 ‘‘(2) DATE.—The written statement required 14 under paragraph (1) shall be furnished on or before 15 January 31 of the year following the calendar year 16 for which the return under subsection (a) is required 17 to be made.’’. 18 (ii) ASSESSABLE PENALTIES.—Sub- 19 paragraph (B) of section 6724(d)(1) of 20 such Code is amended— 21 (I) by striking ‘‘or’’ at the end of 22 clause (xxv), 23 VerDate Sep 11 2014 00:03 Nov 13, 2019 Jkt 099200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\S2790.IS S2790 kjohnson on DSK79L0C42 with BILLS 12 •S 2790 IS (II) by striking ‘‘and’’ at the end 1 of clause (xxvi) and inserting ‘‘or’’, 2 and 3 (III) by inserting after clause 4 (xxvi) the following new clause: 5 ‘‘(xxvii) section 6050Z (relating to re- 6 turns relating to youth in foster care),’’. 7 (iii) CONFORMING AMENDMENT.—The 8 table of sections for subpart B of part III 9 of subchapter A of chapter 61 of such 10 Code is amended by adding at the end the 11 following new item: 12 ‘‘Sec. 6050Z. Returns relating to youth in foster care.’’. (d) ELIGIBILITY FOR WORKING HOMELESS AND 13 QUALIFIED FOSTER YOUTH WHO ARE FULL-TIME STU- 14 DENTS.—Subparagraph (B) of section 32(c)(1) of the In- 15 ternal Revenue Code of 1986 is amended by adding at the 16 end the following: ‘‘The preceding sentence shall not apply 17 to— 18 ‘‘(1) a homeless youth (as defined in subpara- 19 graph (G)), or 20 ‘‘(2) a qualified foster youth (as defined in sub- 21 paragraph (H)), 22 who is a student (as defined in section 152(f)(2)) for the 23 taxable year.’’. 24 VerDate Sep 11 2014 00:03 Nov 13, 2019 Jkt 099200 PO 00000 Frm 00012 Fmt 6652 Sfmt 6201 E:\BILLS\S2790.IS S2790 kjohnson on DSK79L0C42 with BILLS 13 •S 2790 IS (e) INFORMATION RETURN MATCHING.—Not later 1 than 1 year after the date of the enactment of this Act, 2 the Secretary of the Treasury (or the Secretary’s delegate) 3 shall develop and implement procedures for checking an 4 individual’s claim for the credit under section 32 of the 5 Internal Revenue Code of 1986 against claims by other 6 taxpayers for tax credits relating to higher education with 7 respect to dependent college students. 8 (f) EFFECTIVE DATE.—The amendments made by 9 this section shall apply to taxable years beginning after 10 December 31, 2018. 11 Æ VerDate Sep 11 2014 00:03 Nov 13, 2019 Jkt 099200 PO 00000 Frm 00013 Fmt 6652 Sfmt 6301 E:\BILLS\S2790.IS S2790 kjohnson on DSK79L0C42 with BILLS