Tax Consistency Act of 1979

Summary

Tax Consistency Act of 1979 - Amends the Internal Revenue Code to lower the corporate income tax rates. Replaces the present rate structure with a graduated, five-tier schedule, imposing the uppermost (38 percent) marginal rate upon income in excess of $100,000. Repeals the investment tax credit. Repeals the provisions excluding from gross income interest on the obligations of a State, a territory, or a possession of the United States. Eliminates the declining balance and sum-of-the-years digit methods of computing allowable depreciation expense. Limits deductions for such depreciation to amounts determined by a replacement cost straight line method, as formulated by this Act, or by any other consistent method which does not yield an amount which exceeds the total amount allowed under the replacement cost straight line method during the first two-thirds of the property's useful life. Repeals the allowance for deductions with respect to the amortization of any certified pollution control facility based on a period of 60 months. Repeals the allowance for deductions of intangible drilling and development costs for oil and gas wells. States that the last taxable year in which financial institutions may use the percentage method of computing additions to bad debt reserves shall be the taxable year beginning before 1980 instead of 1988, as is currently provided. Repeals the existing percentages allowed for depletion of mines, wells, and specified natural deposits, and the percentages allowed for oil and gas wells. Specifies those treatment processes for mineral deposits which are considered mining, and those which are not so considered, for the purposes of the percentage depletion allowance. Repeals special capital gains treatment of income from certain timber, coal, or iron ore operations. Repeals the allowance for special deductions for domestic corporations which do business in North, Central, or South America, or in the West Indies, and derive a certain percentage of their gross income from outside the United States. Repeals provisions allowing special tax treatment for Domestic International Sales Corporations (DISC). Repeals provisions of the Merchant Marine Act of 1936 which permit domestic shipping companies to exclude from gross income amounts deposited in the capital construction fund for the purpose of building new vessels. Establishes an income tax credit for contributions to an employee stock ownership plan. Limits such credit to one-half of one percent of the taxpayer's tax liability for the taxable year. Sets forth requirements for the establishment of such plans.

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1 official file

• Introduced in House

  summary · EN · 15 January 1979

  Open at official source

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