Domestic Investment Economic Growth Act

Summary

Domestic Investment Economic Growth Act - Amends the Internal Revenue Code to exclude from gross income gain on qualified investments in an enterprise zone business and a domestic business. Excludes 100 percent of such gain from investment in an enterprise zone business or an urban enterprise zone, and 50 percent of such gain from other qualified investments. Provides for the establishment of investment savings accounts. Allows an individual a reduction of 50 percent of the qualified contributions to an investment savings account. Sets forth the rules for computing such deduction if the individual is not less than 59 1/2 years of age. Limits the maximum annual deduction to $100,000. Defines qualified contributions as the lesser of the individual's qualified savings increase amount or the contributions made by the individual to the investment savings account. Provides a formula for determining the savings increase amount. Defines an investment savings account as a trust created for the exclusive benefit of an individual and the individual's beneficiaries if the account meets certain requirements including that the assets will be invested in: (1) eligible investments; (2) bonds issued by enterprise zone businesses and domestic businesses; and (3) loans to such businesses. Provides that any amount distributed out of such an account shall be included in the gross income of the distributee, except for amounts held in the account for at least ten years. Makes such accounts tax-exempt, except for the imposition of the tax on unrelated business income of charitable, etc., organizations. Disallows such exemption where the contributor engages in prohibited transactions. Imposes, in the case of a distribution from an investment savings account, an additional tax of ten percent of the amount of the distribution which is includible in the gross income of the distributee. Makes such tax inapplicable to distributions held in such accounts for at least five years if such distributions were made for: (1) home purchase expenses; (2) automobile purchase expenses; (3) education expenses; and (4) medical expenses. Makes such tax inapplicable if the distribution is made after the individual for whose benefit the account is established attains age 59 1/2 years or becomes disabled. Sets forth special rules and reporting requirements. Allows the deduction for contributions to investment savings accounts in computing adjusted gross income. Declares that such contributions are not subject to the gift tax. Subjects such accounts to the tax on excess contributions, the tax on prohibited transactions, and the penalty for failure to provide reports on individual retirement accounts or annuities. Imposes a penalty on any person who promotes a nonqualified investment as eligible under the provisions of this Act.

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2 official files

• Introduced in House (text)

  Introduced in House · EN

  ViewDownloadOpen at official source

• Introduced in House

  summary · EN · 28 May 1992

  Open at official source

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