January 06, 1995
Archer Announces Details on Savings and Investment Hearings
January 24, 25, 26, and 31
Congressman Bill Archer (R-TX), Chairman of the Committee on
Ways and Means, today announced that the Committee will conduct hearings on January 24, 25, 26, and 31, 1995, on the tax provisions in the Contract with America designed to encourage greater savings and investment. The Committee will receive testimony on the proposed American Dream Savings Account provision in the American Dream Restoration Act
and tax cuts in the Job Creation and Wage Act, which includes the proposed capital gains
tax cut, neutral cost recovery, increased expensing for small businesses, increased estate
tax unified credit, and improved home office deduction. The hearings will feature invited
witnesses, Members of Congress, and public witnesses. All hearings will begin at 10:00
a.m., in the main Committee hearing room, 1100 Longworth House Office Building.
BACKGROUND
The American Dream Restoration Act would create a new
personal savings vehicle, the American Dream Savings Account (the "ADS
Account"), effective for tax years beginning in 1996. Individuals could make
non-deductible contributions up to $2,000 (married couples could contribute up to $4,000)
annually to an ADS Account and could rollover amounts from a regular deductible IRA into
an ADS Account. Distributions from an ADS Account used for retirement, first-time home
purchases, educational expenses, and medical expenses would receive favorable tax
treatment. Current-law, deductible IRAs would be retained. The Job Creation and Wage
Enhancement Act contains several proposals to encourage savings, investment, and
entrepreneurship. First, the Act includes three capital gains incentives: (1) a 50 percent
capital gains deduction, (2) index Indexation of capital gains basis to eliminate
inflationary gains, and (3) a capital loss deduction for homeowners who sell their homes
at a loss. The 50 percent capital gains deduction and the home sale capital loss provision
would apply to sales on or after January 1, 1995, and the capital gains indexation ion
would apply to inflation (and sales of assets) occurring after December 31, 1994. Second,
the Act contains a "neutral cost recovery" proposal. Effective for eligible
property placed in service on or after January 1, 1995, the proposal would increase
depreciation deductions to approach the economic equivalent of expensing. Third, the Act
would allow small businesses to "expense" (i.e. deduct in the year of purchase)
up to $25,000 of property annually (current law limits expensing to $17,500). Fourth, the
Act would phase in an increase in the estate and gift tax exemption to S70,000 and index
the exemption. The current $600,000 exemption has not been increased in several years and
has been eroded by inflation. Fifth, the Act would clarify the tax laws to allow greater
deduction of expenses arising from a taxpayer's use of an office in his or ha home. Sixth,
the Act would let taxpayers allocate up to 10 percent of their tax liability to a public
debt reduction fund. The designated funds would be strictly earmarked for national debt
reduction and would be enforced through automatic spending cuts.
Archer stated, "There is no question that we should provide greater incentives for
people to save and invest. These provisions contained in the Contract with America will go
far in helping people to achieve these goals."
WAYS AND MEANS COMMITTEE
DETAILS FOR SUBMISSIONS OF REQUESTS TO BE HEARD:
Requests to be heard at the hearings must be made by telephone to Diane Kirkland, Traci
Altman, or Richard Scott, (202) 225-1721 no later than the close of business, Thursday,
January 12, 1995. The telephone request should be followed by a formal written request to
Phillip D. Moseley, Chief of Staff, Committee on Ways and Means, U.S. House of
Representatives, 1102 Longworth House Office Building, Washington, D.C. 20515. The staff
of the Committee will notify by telephone those scheduled to appear as soon as possible
after the filing deadline. Any questions concerning a scheduled appearance should be
directed to the staff at (202) 225-1721.
ID view of the limited time available to hear witnesses, the Committee may not be able
to accommodate all requests to be heard. Those persons and organizations not scheduled for
an oral appearance are encouraged to submit written statements for the record of the
hearing. All persons requesting to be heard, whether they are scheduled for oral testimony
or not, will be notified as soon as possible after the filing deadline.
Witnesses scheduled to present oral testimony are are required to summarize briefly
their written statements in no more than five minutes. THE FIVE MINUTE RULE WILL BE
STRICTLY ENFORCED. The full written statement of each witness will be included in the
printed record.
In order to assure the most productive use of the limited amount of time available to
question witnesses, all witnesses scheduled to appear before the Committee are required to
submit 300 copies of their prepared statements for review by Members prior to the hearing.
Testimony should drove at the Committee office, room 1102 Longworth House Office Building,
no later 48 hours before he rings.
WRITTEN STATEMENTS IN LIEU OF PERSONAL APPEARANCE
Any person or organization wishing to submit a written
statement for the printed record of the hearing should submit at least six (6) copies of
their statement by the close of business, Friday, February 3, 1995, to Phillip D. Moseley,
Chief of Staff, Committee on Ways and Means, U.S. House of Representatives, 1102 Longworth
House Office Building, Washington, D.C. 20515. If those filing written statements wish to
have their statements distributed to the press and interested public at the hearing, they
may deliver 200 additional copies for this purpose to the Committee office, room 1102
Longworth House Office Building, before the hearing begins.
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