SA 578. Mr. COBURN submitted an amendment intended to be proposed by him to the bill S. 160, to provide the District of Columbia a voting seat and the State of Utah an additional seat in the House of Representatives; which was ordered to lie on the table; as follows:


Strike all after the enacting clause and insert the following:
SECTION 1. ELIMINATION OF FEDERAL INCOME TAX FOR RESIDENTS OF THE DISTRICT OF COLUMBIA.
(a) In General.--Subpart D of part III of subchapter N of chapter 1 of the Internal Revenue Code of 1986 is amended by adding at the end the following new section:
``SEC. 938. INCOME FROM SOURCES WITHIN THE DISTRICT OF COLUMBIA.
``(a) General Rule.--In the case of an individual who is a bona fide resident of the District of Columbia during the entire taxable year, gross income shall not include--
``(1) income derived from sources within the District of Columbia; and
``(2) income effectively connected with the conduct of a trade or business by such individual within the District of Columbia.
``(b) Deductions, etc. Allocable to Excluded Amounts Not Allowable.--An individual shall not be allowed--
``(1) as a deduction from gross income any deductions (other than the deduction under section 151, relating to personal exemptions); or
``(2) any credit, properly allocable or chargeable against amounts excluded from gross income under this section.
``(c) Bona Fide Resident and Other Applicable Rules.--For purposes of this section, rules similar to the rules of section 876, 937, 957(c), 3401(a)(8)(D), and 7654 shall apply.''.
(b) Clerical Amendment.--The table of sections for subpart D of part III of subchapter N of chapter 1 of such Code is amended by adding at the end the following new item:


``Sec..938..Income from sources within the District of Columbia.''.


(c) Effective Date.--The amendments made by this section shall apply to taxable years ending after the date of the enactment of this Act.


(As printed in the Congressional Record for the Senate on Feb 25, 2009.)