Sec. 204. Limitation on itemized deductions to 28-percent rate bracket
330 words·~2 min read·
/bill/113/s/277/is/section-204A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
The Internal Revenue Code of 1986 is amended by inserting after section 68 the following new section: In the case of an individual whose adjusted gross income exceeds $200,000 ($250,000 in the case of a joint return), the amount of the itemized deductions otherwise allowable for the taxable year shall be reduced by an amount necessary to increase the amount of regular tax liability of the taxpayer to an amount that would be imposed if such deductions reduced the regular tax liability by not more than the amount such deductions would reduce the tax imposed by section 1 on taxable income within the 28-percent bracket amount.
For purposes of this section, the term regular tax liability has the meaning given such term by section 26(b). 68 This section shall apply after the application of section 68. . Subsection
(b)of section 55 is amended by adding at the end the following new paragraph: In the case of an individual, for purposes of paragraph (2), alternative minimum taxable income shall be determined by reducing the amount of any itemized deductions otherwise allowed in determining alternative minimum taxable income by an amount which bears the same ratio to the amount by which the itemized deductions of the taxpayer were reduced for the taxable year under section 68A as— the amount of itemized deductions otherwise allowed in determining the alternative minimum taxable income for the taxable year, bears to the aggregate amount of itemized deductions of the taxpayer for the taxable year (determined without regard to section 68A). . Paragraph
(1)of section 56(b) is amended by adding at the end the following new subparagraph: Section 68A shall not apply. . The table of sections for part I of subchapter B of chapter 1 is amended by adding at the end the following new item: Sec. 68A. Benefit of itemized deductions limited to 28-percent rate bracket. . The amendments made by this section shall apply to taxable years beginning after December 31, 2012.