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I
116TH CONGRESS
2D SESSION
H. R. 8394
To amend the Internal Revenue Code of 1986 to treat diapers as qualified
medical expenses; and to prohibit States and local governments to impose
a tax on the retail sale of diapers.
IN THE HOUSE OF REPRESENTATIVES
SEPTEMBER 24, 2020
Mrs. WATSON COLEMAN (for herself, Ms. DELAURO, and Ms. LEE of Cali-
fornia) introduced the following bill; which was referred to the Committee
on Ways and Means, and in addition to the Committee on the Judiciary,
for a period to be subsequently determined by the Speaker, in each case
for consideration of such provisions as fall within the jurisdiction of the
committee concerned
A BILL
To amend the Internal Revenue Code of 1986 to treat dia-
pers as qualified medical expenses; and to prohibit States
and local governments to impose a tax on the retail
sale of diapers.
Be it enacted by the Senate and House of Representa-
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tives of the United States of America in Congress assembled,
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SECTION 1. SHORT TITLE.
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This Act may be cited as the ‘‘Improving Diaper Af-
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fordability Act of 2020’’.
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•HR 8394 IH
SEC. 2. FINDINGS.
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Congress finds the following:
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(1) One in 3 families with infants and toddlers
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struggles to provide the diapers their children need.
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(2) Low-income families with infants spend 14
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percent of their income on diapers alone, which is
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roughly $936 per child, per year.
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(3) Low-income families spend twice as much
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on diapers for their children, compared to families
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who have the means to buy diapers in bulk at a
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lower price.
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(4) More than 5 million children under the typ-
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ical potty training age of 3-years-old live in low-in-
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come families.
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(5) Diaper need affects not only the health and
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well-being of the child but it can affect the economic
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security of the entire family.
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(6) Over half of families in diaper need who
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rely on child care in order to go to work or school,
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missed work or school in the preceding month be-
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cause they did not have the diapers they needed to
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put their child in child care.
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(7) No State or Federal child safety-net pro-
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gram allocates dollars specifically for the purchase of
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diapers.
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•HR 8394 IH
(8) Since the start of the COVID-19 pandemic,
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diaper banks around the country have experienced
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double, triple, or greater increase in demand for dia-
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pers due to the pandemic and economic shutdown.
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SEC. 3. INCLUSION OF DIAPERS AS QUALIFIED MEDICAL
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EXPENSES.
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(a)
HEALTH
SAVINGS
ACCOUNTS.—Section
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223(d)(2) of the Internal Revenue Code of 1986 is amend-
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ed by adding at the end of subparagraph (A) the following:
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‘‘Notwithstanding the preceding sentence, amounts paid
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for diapers shall be treated as paid for medical care.’’.
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(b) ARCHER MSAS.—Section 220(d)(2)(A) of such
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Code is amended by adding at the end the following: ‘‘Not-
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withstanding the preceding sentence, amounts paid for
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diapers shall be treated as paid for medical care.’’.
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(c) HEALTH FLEXIBLE SPENDING ARRANGEMENTS
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AND HEALTH REIMBURSEMENT ARRANGEMENTS.—Sec-
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tion 106 of such Code is amended by adding at the end
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the following new subsection:
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‘‘(f) REIMBURSEMENTS
FOR DIAPERS.—For pur-
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poses of this section and section 105, expenses incurred
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for diapers shall be treated as incurred for medical care.’’.
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(d) DEPENDENT CARE ASSISTANCE AND DEPEND-
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ENT CARE FLEXIBLE SPENDING ARRANGEMENTS.—Sec-
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tion 129(e)(1) of such Code is amended by adding at the
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•HR 8394 IH
end the following: ‘‘Such term shall include expenses in-
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curred for diapers.’’.
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(e) LIMITED PURPOSE FLEXIBLE SPENDING AR-
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RANGEMENTS AND REIMBURSEMENT ARRANGEMENTS.—
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Section 223(c)(1)(B) of such Code is amended by striking
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‘‘and’’ at the end of clause (ii), by striking the period at
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the end of clause (iii) and inserting ‘‘, and’’, and by adding
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at the end the following new clause:
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‘‘(iv) coverage under a flexible spend-
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ing arrangement, or health reimbursement
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arrangement, that pays or reimburses for
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coverage described in clause (ii) (other
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than long-term care services and, in the
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case of a flexible spending arrangement,
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other than through insurance). Coverage
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shall not fail to be treated as coverage de-
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scribed in the preceding sentence solely by
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reason of paying or reimbursing expenses
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incurred for diapers.’’.
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(f) EFFECTIVE DATES.—
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(1) DISTRIBUTIONS FROM HEALTH SAVINGS AC-
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COUNTS.—The amendments made by subsections (a)
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and (b) shall apply to amounts paid after December
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31, 2019.
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•HR 8394 IH
(2) REIMBURSEMENTS.—The amendment made
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by subsection (c) and (d) shall apply to expenses in-
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curred after December 31, 2019.
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(3) LIMITED
PURPOSE
HSA
AND
HRA.—The
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amendments made by subsection (e) shall apply to
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months beginning after December 31, 2019.
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SEC. 4. PROHIBITION OF RETAIL SALES TAXES.
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A State, or unit of local government of a State, may
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not impose a sales tax on the retail purchase of diapers.
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Æ
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