text: SECTION 1. SHORT TITLE.
  
      This Act may be cited as the ``Telework Tax Incentive Act''.
  
  SEC. 2. FINDINGS.
  
      The Congress finds as follows:
              (1) Federal, State, and local governments spend billions of 
          dollars annually on the Nation's transportation needs.
              (2) Congestion on the Nation's roads costs over 
          $74,000,000,000 annually in lost work time, fuel consumption, 
          and costs of infrastructure and equipment repair.
              (3) On average on-road-vehicles contribute 30 percent of 
          nitrogen oxides emissions.
              (4) It is estimated that staying at home to work requires 3 
          times less energy consumption than commuting to work.
              (5) It was recently reported that if an identified 10 to 20 
          percent of commuters switched to teleworking, 1,800,000 tons of 
          regulated pollutants would be eliminated, 3,500,000,000 gallons 
          of gas would be saved, 3,100,000,000 hours of personal time 
          would be freed up, and maintenance and infrastructure costs 
          would decrease by $500,000,000 annually because of reduced 
          congestion and reduced vehicle miles traveled.
              (6) The average American daily commute is 62 minutes for a 
          44-mile round-trip (a total of 6 days per year and 5,808 miles 
          per year).
              (7) The increase in work from 1969 to 1996, the increase in 
          hours mothers spend in paid work, combined with a shift toward 
          single-parent families resulted in families on average 
          experiencing a decrease of 22 hours a week (14 percent) in 
          parental time available outside of paid work they could spend 
          with their children.
              (8) Companies with teleworking programs have found that 
          teleworking can boost employee productivity 5 percent to 20 
          percent.
              (9) Today 60 percent of the workforce is involved in 
          information work (an increase of 43 percent since 1990) 
          allowing and encouraging decentralization of paid work to 
          occur.
              (10) In recent years, studies performed in the United 
          States have shown a marked expansion of teleworking, with an 
          estimate of 19,000,000 Americans teleworking by the year 2002, 
          5 times the amount in 1990.
  
  SEC. 3. CREDIT FOR TELEWORKING.
  
      (a) In General.--Subpart B of part IV of subchapter A of chapter 1 
  of the Internal Revenue Code of 1986 (relating to foreign tax credit, 
  etc.) is amended by adding at the end the following new section:
  
  ``SEC. 30B. TELEWORKING CREDIT.
  
      ``(a) Allowance of Credit.--In the case of an eligible taxpayer, 
  there shall be allowed as a credit against the tax imposed by this 
  chapter for the taxable year an amount equal to the qualified 
  teleworking expenses paid or incurred by the taxpayer during such year.
      ``(b) Maximum Credit.--
              ``(1) Per teleworker limitation.--The credit allowed by 
          subsection (a) for a taxable year with respect to qualified 
          teleworking expenses paid or incurred by or on behalf of an 
          individual teleworker shall not exceed $500.
              ``(2) Reduction for teleworking less than full year.--In 
          the case of an individual who is in a teleworking arrangement 
          for less than a full taxable year, the amount referred to 
          paragraph (1) shall be reduced by an amount which bears the 
          same ratio to $500 as the number of months in which such 
          individual is not in a teleworking arrangement bears to 12. For 
          purposes of the preceding sentence, an individual shall be 
          treated as being in a teleworking arrangement for a month if 
          the individual is subject to such arrangement for any day of 
          such month.
      ``(c) Definitions.--For purposes of this section--
              ``(1) Eligible taxpayer.--The term `eligible taxpayer' 
          means--
                      ``(A) in the case of an individual, an individual 
                  who performs services for an employer under a 
                  teleworking arrangement, and
                      ``(B) in the case of an employer, an employer for 
                  whom employees perform services under a teleworking 
                  arrangement.
              ``(2) Teleworking arrangement.--The term `teleworking 
          arrangement' means an arrangement under which an employee 
          teleworks for an employer not less than 75 days per year.
              ``(3) Qualified teleworking expenses.--The term `qualified 
          teleworking expenses' means expenses paid or incurred under a 
          teleworking arrangement for furnishings and electronic 
          information equipment which are used to enable an individual to 
          telework.
              ``(4) Telework.--The term `telework' means to perform work 
          functions, using electronic information and communication 
          technologies, thereby reducing or eliminating the physical 
          commute to and from the traditional worksite.
      ``(d) Limitation Based on Amount of Tax.--
              ``(1) Liability for tax.--The credit allowable under 
          subsection (a) for any taxable year shall not exceed the excess 
          (if any) of--
                      ``(A) the regular tax for the taxable year, reduced 
                  by the sum of the credits allowable under subpart A and 
                  the preceding sections of this subpart, over
                      ``(B) the tentative minimum tax for the taxable 
                  year.
              ``(2) Carryforward of unused credit.--If the amount of the 
          credit allowable under subsection (a) for any taxable year 
          exceeds the limitation under paragraph (1) for the taxable 
          year, the excess shall be carried to the succeeding taxable 
          year and added to the amount allowable as a credit under 
          subsection (a) for such succeeding taxable year.
      ``(e) Special Rules.--
              ``(1) Basis reduction.--The basis of any property for which 
          a credit is allowable under subsection (a) shall be reduced by 
          the amount of such credit (determined without regard to 
          subsection (d)).
              ``(2) Recapture.--The Secretary shall, by regulations, 
          provide for recapturing the benefit of any credit allowable 
          under subsection (a) with respect to any property which ceases 
          to be property eligible for such credit.
              ``(3) Property used outside united states, etc., not 
          qualified.--No credit shall be allowed under subsection (a) 
          with respect to any property referred to in section 50(b) or 
          with respect to the portion of the cost of any property taken 
          into account under section 179.
              ``(4) Election to not take credit.--No credit shall be 
          allowed under subsection (a) for any expense if the taxpayer 
          elects to not have this section apply with respect to such 
          expense.
              ``(5) Denial of double benefit.--No deduction or credit 
          (other than under this section) shall be allowed under this 
          chapter with respect to any expense which is taken into account 
          in determining the credit under this section.''.
      (b) Technical Amendment.--Subsection (a) of section 1016 of the 
  Internal Revenue Code of 1986 is amended by striking ``and'' at the end 
  of paragraph (26), by striking the period at the end of paragraph (27) 
  and inserting ``; and'', and by adding at the end the following new 
  paragraph:
              ``(28) to the extent provided in section 30B(e), in the 
          case of amounts with respect to which a credit has been allowed 
          under section 30B.''.
      (c) Clerical Amendment.--The table of sections for subpart B of 
  part IV of subchapter A of chapter 1 of the Internal Revenue Code of 
  1986 is amended by adding at the end the following new item:
  
                                ``Sec. 30B. Teleworking credit.''.
      (d) Effective Date.--The amendments made by this section shall 
  apply to amounts paid or incurred after the date of the enactment of 
  this Act, in taxable years ending after such date.
target: Telework Tax Incentive Act - Amends the Internal Revenue Code to allow a tax credit of up to $500 annually for "qualified teleworking expenses." Defines such expenses.
feat_title: A bill to amend the Internal Revenue Code of 1986 to allow a credit against income tax for expenses incurred in teleworking.