Page:United States Statutes at Large Volume 89.djvu/92

 PUBLIC LAW 94-12—MAR. 29, 1975

89 STAT. 32

(c) CLERICAL AMENDMENT. — The table of sections for such subpart is amended by striking out the last item and inserting in lieu thereof the following: "Sec. 43. Credit for certain earned income. "Sec. 44. Overpayments of tax." SEC. 205. WITHHOLDING TAX. (a)

26 USC 3402.

of

section

REQUIREMENT OF W I T H H O L D I N G. — E x c e p t as otherwise p r o -

vided in this section, every employer making payment of wages shall deduct and withhold upon such wages a tax determined i n accordance with tables prescribed by the Secretary or his delegate. The tables so prescribed shall be the same as the tables contained in this subsection as in effect on January 1, 1975, except that the amounts set forth as amounts of income tax to be withheld with respect to wages paid after April 30, 1975, and before January 1, 1976, shall reflect the full calendar year effect for 1975 of the amendments made by sections 201, 202, 203, and 204 of the T a x Reduction Act of 1975. For purposes of applying such tables, the term 'the amount of wages' means the amount by which the wages exceed the number of withholding exemptions claimed, multiplied by the amount of one such exemption as shown in the table in subsection (b)(1). " (b)

26 USC 214.

(a)

3402 (relating to income tax collected at source) is amended to read as follows: "(a)

"The amount of wages."

REQUIREMENT OF WITHHOLDING.—Subsection

CONFORMING AMENDMENT. — S e c t i o n 3402(c)(6)

(relating to

wage bracket withholding) is amended by striking out "table 7 contained in subsection (a) " and inserting i n lieu thereof "the table for an annual payroll period prescribed pursuant to subsection (a) ". SEC. 206. INCREASE IN INCOME LIMITATION APPLICABLE TO CHILD AND DEPENDENT CARE DEDUCTION. Section 214 (relating to expenses for household and dependent care services necessary for gainful employment) is amended by striking out "$18,000" each place it appears in subsection (d) and inserting in lieu thereof "$35,000". SEC. 207. EXTENSION OF PERIOD FOR REPLACING OLD RESIDENCE FOR PURPOSES OF NONRECOGNITION OF GAIN UNDER SECTION 1034. (a) O N E - Y E A R PERIOD INCREASED TO 18 M O N T H S. —

26 USC 1034.

(1) Subsections (a), (c)(4), (c)(5), (d), and (h) of section 1034 (relating to nonrecognition of gain on sale or exchange of residence) are each amended by striking out "1 year" each place it appears and inserting in lieu thereof "18 months". (2) Subsection (c)(5) of section 1034 is amended by striking out "one year " and inserting in lieu thereof "18 months". (b) 18-MoNTii PERIOD FOR CONSTRUCTING N E W RESIDENCE INCREASED

TO 2 YEARS.—Subsection (c)(5) of section 1034 is amended by striking out "18 months " and inserting in lieu thereof "2 years". SEC. 208. CREDIT FOR PURCHASE OF NEW PRINCIPAL RESIDENCE. (a) ALLOWANCE OF C R E D I T. — Subpart A of part IV of subchapter A

26 USC 44.

of chapter 1 (relating to credits allowed) is amended by redesignating section 44 as section 45 and by inserting after section 43 the following new section: "SEC. 44. PURCHASE OF NEW PRINCIPAL RESIDENCE. " (a) GENERAL RULE. — I n the case of an individual there is allowed, as a credit against the tax imposed by this chapter for the taxable year, an amount equal to 5 percent of the purchase price of a new principal residence purchased or constructed by the taxpayer.

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