SECTION 1. SHORT TITLE; AMENDMENT OF 1986 CODE.

    (a) Short Title.--This Act may be cited as the ``Alternative 
Minimum Tax Repeal Act of 1995''.
    (b) Amendment of 1986 Code.--Except as otherwise expressly 
provided, whenever in this Act an amendment or repeal is expressed in 
terms of an amendment to, or repeal of, a section or other provision, 
the reference shall be considered to be made to a section or other 
provision of the Internal Revenue Code of 1986.

SEC. 2. ALTERNATIVE MINIMUM TAX.

    (a) In General.--Part VI of subchapter A of chapter 1 of the 
Internal Revenue Code of 1986 (relating to alternative minimum tax) is 
hereby repealed.
    (b) Conforming Amendments.--
            (1) Subparagraph (B) of section 1(g)(7) (relating to 
        election to claim certain unearned income of child on parent's 
        return) is amended--
                    (A) by inserting ``and'' at the end of clause (i),
                    (B) by striking ``and'' and the end of clause (ii) 
                and inserting a period, and
                    (C) by striking clause (iii).
            (2) Subsection (d) of section 2 (relating to taxes imposed 
        on nonresident aliens) is amended by striking ``sections 1 and 
        55'' and inserting ``section 1''.
            (3) Subsection (a) of section 5 (relating to cross 
        references relating to tax on individuals) is amended by 
        striking paragraph (4).
            (4) Subsection (d) of section 11 (relating to taxes imposed 
        on foreign corporations) is amended by striking ``the taxes 
        imposed by subsection (a) and section 55'' and inserting ``the 
        tax imposed by subsection (a)''.
            (5) Section 12 (relating to cross references relating to 
        tax on corporations) is amended by striking paragraph (7).
            (6) Section 26 (relating to limitation based on tax 
        liability; definition of tax liability) is amended--
                    (A) by amending subsection (a) to read as follows:
    ``(a) Limitation Based on Amount of Tax.--The aggregate amount of 
credits allowed by this subpart for the taxable year shall not exceed 
the taxpayer's regular tax liability for the taxable year.'',
                    (B) in subsection (b)(2), by striking subparagraph 
                (A) and by redesignating subparagraphs (B) through (N) 
                as subparagraphs (A) through (M), respectively, and
                    (C) by striking subsection (c).
            (7) Paragraph (3) of section 30(b) (relating to credit for 
        qualified electric vehicles) is amended by striking ``the 
        excess'' and all that follows and inserting ``the regular tax 
        for the taxable year reduced by the sum of the credits 
        allowable under subpart A and sections 27, 28, and 29.''
            (8) Subsection (h) of section 32 (relating to reduction of 
        credit to taxpayers subject to alternative minimum tax) is 
        hereby repealed.
            (9) Subsection (c) of section 38 (relating to business 
        related credits) is amended--
                    (A) by striking paragraphs (1) and (2) and 
                inserting the following new paragraph:
            ``(1) In general.--The credit allowed under subsection (a) 
        for any taxable year shall not exceed 25 percent of so much of 
        the taxpayer's net regular tax liability as exceeds $25,000. 
        For purposes of the preceding sentence, the term `net regular 
        tax liability' means the regular tax liability reduced by the 
        sum of the credits allowable under subparts A and B of this 
        part.'', and
                    (B) by redesignating paragraph (3) as paragraph 
                (2).
            (10) Subsection (c) of section 53 is amended by striking 
        ``the excess'' and all that follows and inserting ``the regular 
        tax liability of the taxpayer for such taxable year reduced by 
        the sum of the credits allowable under subparts A, B, D, E, and 
        F of this part.''
            (11) Subsection (b) of section 59A (relating to 
        environmental tax) is amended by adding at the end the 
        following:
``For purposes of this subsection, references to sections 55 and 56 
shall be treated as references to such sections as in effect on the day 
before the date of the enactment of the Alternative Minimum Tax Repeal 
Act of 1995.''.
            (12)(A) Paragraph (2) of section 148(b) is amended by 
        adding at the end the following new flush sentence:
        ``Such term shall not include any tax-exempt bond.''
            (B) Paragraph (3) of section 148(b) (relating to higher 
        yield investments) is hereby repealed.
            (13) Subparagraph (B) of section 149(g)(3) (relating to 
        hedge bonds) is amended by striking all that follows ``invested 
        in bonds'' and inserting ``the interest on which is not 
        includible in gross income under section 103.''
            (14) Section 173 (relating to circulation expenditures) is 
        amended by striking ``(a) General Rule.--'' and by striking 
        subsection (b).
            (15) Subsection (f) of section 174 (relating to research 
        and experimental expenditures) is amended to read as follows:
    ``(f) Cross Reference.--

                                ``For adjustments to basis of property 
for amounts allowed as deductions as deferred expenses under subsection 
(b), see section 1016(a)(14).''
            (16) Subsection (c) of section 263 (relating to capital 
        expenditures) is amended by striking ``59(e) or''.
            (17) Subsection (c) of section 263A (relating to 
        capitalization and inclusion in inventory costs of certain 
        expenses) is amended by striking paragraph (6).
            (18) Section 382(l) (relating to net operating loss 
        carryforwards and certain built-in losses following ownership 
        change) is amended by striking paragraph (7).
            (19) Section 443 (relating to adjustment in computing 
        minimum tax and tax preferences) is amended by striking 
        subsection (d) and by redesignating subsection (e) as 
        subsection (d).
            (20) Section 617 (relating to deduction and recapture of 
        certain mining exploration expenditures) is amended by striking 
        subsection (i).
            (21) Subsections (b) and (c) of section 666 (relating to 
        accumulation distribution of trust allocated to preceding 
        years) are each amended by striking ``(other than the tax 
        imposed by section 55)''.
            (22) Section 847 (relating to special estimated tax 
        payments) is amended--
                    (A) in paragraph (9), by striking the last 
                sentence;
                    (B) in paragraph (10), by inserting ``and'' at the 
                end of subparagraph (A) and by striking subparagraph 
                (B) and redesignating subparagraph (C) as subparagraph 
                (B).
            (23) Section 848 (relating to capitalization of certain 
        policy acquisition expenses) is amended by striking subsection 
        (i) and by redesignating subsection (j) as subsection (i).
            (24) Paragraph (1) of section 871(b) (relating to tax on 
        nonresident alien individuals) is amended by striking ``, 
        55,''.
            (25) Subsection (b) of section 877 (relating to 
        expatriation to avoid tax) is amended by striking ``, 55,''.
            (26) Paragraph (1) of section 882(a) is amended by striking 
        ``55,''.
            (27) Subsection (a) of section 897 (relating to disposition 
        of investment in United States real property) is amended to 
        read as follows:
    ``(a) Treatment as Effectively Connected With United States Trade 
or Business.--For purposes of this title, gain or loss of a nonresident 
alien individual or a foreign corporation from the disposition of a 
United States real property interest shall be taken into account--
            ``(1) in the case of a nonresident alien individual, under 
        section 871(b)(1), or
            ``(2) in the case of a foreign corporation, under section 
        8872(a)(1),
as if the taxpayer were engaged in a trade or business within the 
United States during the taxable year and as if such gain or loss were 
effectively connected with such trade or business.''
            (28) Subsection (j) of section 904 (relating to limitation 
        on credit) is amended to read as follows:
    ``(j) Cross Reference.--

                                ``For increase of limitation under 
subsection (a) for taxes paid with respect to amounts received which 
were included in the gross income of the taxpayer for a prior taxable 
year as a United States shareholder with respect to a controlled 
foreign corporation, see section 960(b).''
            (29) Paragraph (1) of section 962(a) (relating to election 
        by individuals to be subject to tax at corporate rates) is 
        amended--
                    (A) by striking ``sections 1 and 55'' and inserting 
                ``section 1'', and
                    (B) by striking ``sections 11 and 55'' and 
                inserting ``section 11''.
            (30) Paragraph (20) of section 1016(a) (relating to 
        adjustments to basis) is amended by inserting ``, as in effect 
        on the day before the date of the enactment of the Alternative 
        Minimum Tax Repeal Act of 1995'' after ``preferences)''.
            (31) Subsection (a) of section 1561 (relating to 
        limitations on certain multiple tax benefits in the case of 
        certain controlled corporations) is amended by striking the 
        last sentence.
            (32) Subparagraph (A) of section 6425(c)(1) (defining 
        income tax liability) is amended--
                    (A) by inserting ``plus'' at the end of clause (i), 
                and
                    (B) by striking clause (ii) and by redesignating 
                clause (iii) as clause (ii).
            (33) Section 6654(d)(2) (relating to failure by individual 
        to pay estimated income tax) is amended--
                    (A) in clause (i) of subparagraph (B), by striking 
                ``, alternative minimum taxable income,'', and
                    (B) in clause (i) of subparagraph (C), by striking 
                ``, alternative minimum taxable income,''.
            (34) Subparagraph (C) of section 6662(e)(3) (relating to 
        accuracy-related penalty) is amended by inserting ``, as in 
        effect on the day before the date of the enactment of the 
        Alternative Minimum Tax Repeal Act of 1995'' after ``55(c)''.
    (c) Clerical Amendments.--The table of parts for subchapter A of 
chapter 1 is amended by striking the item relating to part VI.
    (d) Effective Date.--The amendments made by this section shall take 
effect in taxable years beginning after December 31, 1994.
Alternative Minimum Tax Repeal Act of 1995 - Amends the Internal Revenue Code to repeal the alternative minimum tax.
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