Emergency Direct Payments Act

II 116TH CONGRESS 2D SESSION S. 5063 To amend the Internal Revenue Code of 1986 to provide additional recovery rebates to individuals. IN THE SENATE OF THE UNITED STATES DECEMBER 18, 2020 Mr. SANDERS introduced the following bill; which was read twice and referred to the Committee on Finance A BILL To amend the Internal Revenue Code of 1986 to provide additional recovery rebates to individuals. 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 ‘‘Emergency Direct Pay- 4 ments Act’’. 5 SEC. 2. ADDITIONAL RECOVERY REBATES FOR INDIVID- 6 UALS. 7 (a) IN GENERAL.—Subchapter B of chapter 65 of 8 subtitle F of the Internal Revenue Code of 1986 is amend- 9 VerDate Sep 11 2014 02:19 Jan 11, 2021 Jkt 019200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S5063.IS S5063 pbinns on DSKJLVW7X2PROD with BILLS 2 •S 5063 IS ed by inserting after section 6428 the following new sec- 1 tion: 2 ‘‘SEC. 6428A. ADDITIONAL RECOVERY REBATES FOR INDI- 3 VIDUALS. 4 ‘‘(a) IN GENERAL.—In the case of an eligible indi- 5 vidual, there shall be allowed as a credit against the tax 6 imposed by subtitle A for the first taxable year beginning 7 in 2020 an amount equal to the sum of— 8 ‘‘(1) $1,200 ($2,400 in the case of eligible indi- 9 viduals filing a joint return), plus 10 ‘‘(2) an amount equal to the product of $500 11 multiplied by the number of dependents (as defined 12 in section 152) of the taxpayer. 13 ‘‘(b) TREATMENT OF CREDIT.—The credit allowed by 14 subsection (a) shall be treated as allowed by subpart C 15 of part IV of subchapter A of chapter 1. 16 ‘‘(c) LIMITATION BASED ON ADJUSTED GROSS IN- 17 COME.—The amount of the credit allowed by subsection 18 (a) (determined without regard to this subsection and sub- 19 section (e)) shall be reduced (but not below zero) by 5 20 percent of so much of the taxpayer’s adjusted gross in- 21 come as exceeds— 22 ‘‘(1) $150,000 in the case of a joint return, 23 ‘‘(2) $112,500 in the case of a head of house- 24 hold, and 25 VerDate Sep 11 2014 02:19 Jan 11, 2021 Jkt 019200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S5063.IS S5063 pbinns on DSKJLVW7X2PROD with BILLS 3 •S 5063 IS ‘‘(3) $75,000 in the case of a taxpayer not de- 1 scribed in paragraph (1) or (2). 2 ‘‘(d) ELIGIBLE INDIVIDUAL.—For purposes of this 3 section, the term ‘eligible individual’ means any individual 4 other than— 5 ‘‘(1) any nonresident alien individual, 6 ‘‘(2) any individual with respect to whom a de- 7 duction under section 151 is allowable to another 8 taxpayer for a taxable year beginning in the cal- 9 endar year in which the individual’s taxable year be- 10 gins, and 11 ‘‘(3) an estate or trust. 12 ‘‘(e) COORDINATION WITH ADVANCE REFUNDS OF 13 CREDIT.— 14 ‘‘(1) IN GENERAL.—The amount of credit 15 which would (but for this paragraph) be allowable 16 under this section shall be reduced (but not below 17 zero) by the aggregate refunds and credits made or 18 allowed to the taxpayer under subsection (f). Any 19 failure to so reduce the credit shall be treated as 20 arising out of a mathematical or clerical error and 21 assessed according to section 6213(b)(1). 22 ‘‘(2) JOINT RETURNS.—In the case of a refund 23 or credit made or allowed under subsection (f) with 24 respect to a joint return, half of such refund or cred- 25 VerDate Sep 11 2014 02:19 Jan 11, 2021 Jkt 019200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S5063.IS S5063 pbinns on DSKJLVW7X2PROD with BILLS 4 •S 5063 IS it shall be treated as having been made or allowed 1 to each individual filing such return. 2 ‘‘(f) ADVANCE REFUNDS AND CREDITS.— 3 ‘‘(1) IN GENERAL.—Subject to paragraph (5), 4 each individual who was an eligible individual for 5 such individual’s first taxable year beginning in 6 2019 shall be treated as having made a payment 7 against the tax imposed by chapter 1 for such tax- 8 able year in an amount equal to the advance refund 9 amount for such taxable year. 10 ‘‘(2) ADVANCE REFUND AMOUNT.—For pur- 11 poses of paragraph (1), the advance refund amount 12 is the amount that would have been allowed as a 13 credit under this section for such taxable year if this 14 section (other than subsection (e) and this sub- 15 section) had applied to such taxable year. 16 ‘‘(3) TIMING AND MANNER OF PAYMENTS.— 17 ‘‘(A) TIMING.—The Secretary shall, sub- 18 ject to the provisions of this title, refund or 19 credit any overpayment attributable to this sec- 20 tion as rapidly as possible. No refund or credit 21 shall be made or allowed under this subsection 22 after December 31, 2021. 23 ‘‘(B) DELIVERY OF PAYMENTS.—Notwith- 24 standing any other provision of law, the Sec- 25 VerDate Sep 11 2014 02:19 Jan 11, 2021 Jkt 019200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S5063.IS S5063 pbinns on DSKJLVW7X2PROD with BILLS 5 •S 5063 IS retary may certify and disburse refunds payable 1 under this subsection electronically to any ac- 2 count to which the payee authorized, on or after 3 January 1, 2018, the delivery of a refund of 4 taxes under this title or of a Federal payment 5 (as defined in section 3332 of title 31, United 6 States Code). 7 ‘‘(C) WAIVER OF CERTAIN RULES.—Not- 8 withstanding section 3325 of title 31, United 9 States Code, or any other provision of law, with 10 respect to any payment of a refund under this 11 subsection, a disbursing official in the executive 12 branch of the United States Government may 13 modify payment information received from an 14 officer or employee described in section 15 3325(a)(1)(B) of such title for the purpose of 16 facilitating the accurate and efficient delivery of 17 such payment. Except in cases of fraud or reck- 18 less neglect, no liability under section 3325, 19 3527, 3528, or 3529 of title 31, United States 20 Code, shall be imposed with respect to pay- 21 ments made under this subparagraph. 22 ‘‘(4) NO INTEREST.—No interest shall be al- 23 lowed on any overpayment attributable to this sec- 24 tion. 25 VerDate Sep 11 2014 02:19 Jan 11, 2021 Jkt 019200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S5063.IS S5063 pbinns on DSKJLVW7X2PROD with BILLS 6 •S 5063 IS ‘‘(5) ALTERNATE TAXABLE YEAR.—In the case 1 of an individual who, at the time of any determina- 2 tion made pursuant to paragraph (3), has not filed 3 a tax return for the year described in paragraph (1), 4 the Secretary may— 5 ‘‘(A) apply such paragraph by substituting 6 ‘2018’ for ‘2019’, and 7 ‘‘(B) if the individual has not filed a tax 8 return for such individual’s first taxable year 9 beginning in 2018, use information with respect 10 to such individual for calendar year 2019 pro- 11 vided in— 12 ‘‘(i) Form SSA–1099, Social Security 13 Benefit Statement, or 14 ‘‘(ii) Form RRB–1099, Social Secu- 15 rity Equivalent Benefit Statement. 16 ‘‘(6) PAYMENT TO REPRESENTATIVE PAYEES 17 AND FIDUCIARIES.— 18 ‘‘(A) IN GENERAL.—In the case of any in- 19 dividual for which payment information is pro- 20 vided to the Secretary by the Commissioner of 21 Social Security, the Railroad Retirement Board, 22 or the Secretary of Veterans Affairs, the pay- 23 ment by the Secretary under paragraph (3) 24 with respect to such individual may be made to 25 VerDate Sep 11 2014 02:19 Jan 11, 2021 Jkt 019200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S5063.IS S5063 pbinns on DSKJLVW7X2PROD with BILLS 7 •S 5063 IS such individual’s representative payee or fidu- 1 ciary and the entire payment shall be— 2 ‘‘(i) provided to the individual who is 3 entitled to the payment, or 4 ‘‘(ii) used only for the benefit of the 5 individual who is entitled to the payment. 6 ‘‘(B) APPLICATION OF ENFORCEMENT 7 PROVISIONS.— 8 ‘‘(i) In the case of a payment de- 9 scribed in subparagraph (A) which is made 10 with respect to a social security beneficiary 11 or a supplemental security income recipi- 12 ent, section 1129(a)(3) of the Social Secu- 13 rity Act (42 U.S.C. 1320a–8(a)(3)) shall 14 apply to such payment in the same manner 15 as such section applies to a payment under 16 title II or XVI of such Act. 17 ‘‘(ii) In the case of a payment de- 18 scribed in subparagraph (A) which is made 19 with respect to a railroad retirement bene- 20 ficiary, section 13 of the Railroad Retire- 21 ment Act (45 U.S.C. 231l) shall apply to 22 such payment in the same manner as such 23 section applies to a payment under such 24 Act. 25 VerDate Sep 11 2014 02:19 Jan 11, 2021 Jkt 019200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S5063.IS S5063 pbinns on DSKJLVW7X2PROD with BILLS 8 •S 5063 IS ‘‘(iii) In the case of a payment de- 1 scribed in subparagraph (A) which is made 2 with respect to a veterans beneficiary, sec- 3 tions 5502, 6106, and 6108 of title 38, 4 United States Code, shall apply to such 5 payment in the same manner as such sec- 6 tions apply to a payment under such title. 7 ‘‘(7) NOTICE TO TAXPAYER.—Not later than 15 8 days after the date on which the Secretary distrib- 9 uted any payment to an eligible taxpayer pursuant 10 to this subsection, notice shall be sent by mail to 11 such taxpayer’s last known address. Such notice 12 shall indicate the method by which such payment 13 was made, the amount of such payment, and a 14 phone number for the appropriate point of contact 15 at the Internal Revenue Service to report any failure 16 to receive such payment. 17 ‘‘(g) IDENTIFICATION NUMBER REQUIREMENT.— 18 ‘‘(1) IN GENERAL.—In the case of any taxpayer 19 who does not include the valid identification number 20 of such taxpayer on the return of tax for the taxable 21 year, subsection (a)(1) shall be applied by sub- 22 stituting ‘$0’ for ‘$1,200’. 23 ‘‘(2) JOINT RETURNS.—In the case of a joint 24 return— 25 VerDate Sep 11 2014 02:19 Jan 11, 2021 Jkt 019200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S5063.IS S5063 pbinns on DSKJLVW7X2PROD with BILLS 9 •S 5063 IS ‘‘(A) if the valid identification number of 1 only 1 spouse is included on the return of tax 2 for the taxable year— 3 ‘‘(i) subsection (a)(1) shall be applied 4 by substituting ‘$1,200’ for ‘$2,400’, and 5 ‘‘(ii) subsection (c)(1) shall be applied 6 by substituting ‘$75,000’ for ‘$150,000’, 7 or 8 ‘‘(B) if the valid identification number of 9 neither spouse is included on the return of tax 10 for the taxable year, subsection (a)(1) shall be 11 applied by substituting ‘$0’ for ‘$2,400’. 12 ‘‘(3) DEPENDENT.—A dependent of a taxpayer 13 shall not be taken into account under subsection 14 (a)(2) unless— 15 ‘‘(A) the taxpayer includes the valid identi- 16 fication number of such taxpayer (or, in the 17 case of a joint return, the valid identification 18 number of at least 1 spouse) on the return of 19 tax for the taxable year, and 20 ‘‘(B) the valid identification number of 21 such dependent is included on the return of tax 22 for the taxable year. 23 ‘‘(4) VALID IDENTIFICATION NUMBER.— 24 VerDate Sep 11 2014 02:19 Jan 11, 2021 Jkt 019200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\S5063.IS S5063 pbinns on DSKJLVW7X2PROD with BILLS 10 •S 5063 IS ‘‘(A) IN GENERAL.—For purposes of this 1 subsection, the term ‘valid identification num- 2 ber’ means a social security number (as such 3 term is defined in section 24(h)(7)). 4 ‘‘(B) ADOPTION TAXPAYER IDENTIFICA- 5 TION NUMBER.—For purposes of paragraph 6 (3)(B), in the case of a dependent who is adopt- 7 ed or placed for adoption, the term ‘valid identi- 8 fication number’ shall include the adoption tax- 9 payer identification number of such dependent. 10 ‘‘(5) SPECIAL RULE FOR MEMBERS OF THE 11 ARMED FORCES.—Paragraph (2) shall not apply in 12 the case where at least 1 spouse was a member of 13 the Armed Forces of the United States at any time 14 during the taxable year and the valid identification 15 number of at least 1 spouse is included on the re- 16 turn of tax for the taxable year. 17 ‘‘(6) MATHEMATICAL OR CLERICAL ERROR AU- 18 THORITY.—Any omission of a correct valid identi- 19 fication number required under this subsection shall 20 be treated as a mathematical or clerical error for 21 purposes of applying section 6213(g)(2) to such 22 omission. 23 ‘‘(h) REGULATIONS.—The Secretary shall prescribe 24 such regulations or other guidance as may be necessary 25 VerDate Sep 11 2014 02:19 Jan 11, 2021 Jkt 019200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\S5063.IS S5063 pbinns on DSKJLVW7X2PROD with BILLS 11 •S 5063 IS to carry out the purposes of this section, including any 1 such measures as are deemed appropriate to avoid allow- 2 ing multiple credits or rebates to a taxpayer.’’. 3 (b) ADMINISTRATIVE AMENDMENTS.— 4 (1) DEFINITION OF DEFICIENCY.—Section 5 6211(b)(4)(A) of the Internal Revenue Code of 1986 6 is amended by striking ‘‘and 6428’’ and inserting 7 ‘‘6428, and 6428A’’. 8 (2) MATHEMATICAL OR CLERICAL ERROR AU- 9 THORITY.—Section 6213(g)(2)(L) of such Code is 10 amended by striking ‘‘or 6428’’ and inserting ‘‘6428, 11 or 6428A’’. 12 (c) TREATMENT OF POSSESSIONS.— 13 (1) PAYMENTS TO POSSESSIONS.— 14 (A) MIRROR CODE POSSESSION.—The Sec- 15 retary of the Treasury shall pay to each posses- 16 sion of the United States which has a mirror 17 code tax system amounts equal to the loss (if 18 any) to that possession by reason of the amend- 19 ments made by this section. Such amounts shall 20 be determined by the Secretary of the Treasury 21 based on information provided by the govern- 22 ment of the respective possession. 23 (B) OTHER POSSESSIONS.—The Secretary 24 of the Treasury shall pay to each possession of 25 VerDate Sep 11 2014 02:19 Jan 11, 2021 Jkt 019200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\S5063.IS S5063 pbinns on DSKJLVW7X2PROD with BILLS 12 •S 5063 IS the United States which does not have a mirror 1 code tax system amounts estimated by the Sec- 2 retary of the Treasury as being equal to the ag- 3 gregate benefits (if any) that would have been 4 provided to residents of such possession by rea- 5 son of the amendments made by this section if 6 a mirror code tax system had been in effect in 7 such possession. The preceding sentence shall 8 not apply unless the respective possession has a 9 plan, which has been approved by the Secretary 10 of the Treasury, under which such possession 11 will promptly distribute such payments to its 12 residents. 13 (2) COORDINATION WITH CREDIT ALLOWED 14 AGAINST UNITED STATES INCOME TAXES.—No cred- 15 it shall be allowed against United States income 16 taxes under section 6428A of the Internal Revenue 17 Code of 1986 (as added by this section) to any per- 18 son— 19 (A) to whom a credit is allowed against 20 taxes imposed by the possession by reason of 21 the amendments made by this section, or 22 (B) who is eligible for a payment under a 23 plan described in paragraph (1)(B). [Text truncated for display. Full text available on Congress.gov.]