To amend the Internal Revenue Code of 1986 to authorize agricultural producers to establish and contribute to tax-exempt farm risk management accounts.
Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Farm Risk Abatement and Mitigation Election Act of 2012'' or the ``FRAME Act of 2012''.
SEC. 2. FARM RISK MANAGEMENT ACCOUNTS.
(a) In General.--Part VII of subchapter B of chapter 1 of the Internal Revenue Code of 1986 (relating to additional itemized deductions for individuals) is amended by redesignating section 224 as section 225 and by inserting after section 223 the following new section:
``SEC. 224. FRAME ACCOUNTS.
``(a) Deduction Allowed.--In the case of a qualified farmer, there shall be allowed as a deduction for the taxable year an amount equal to the aggregate amount paid in cash during such taxable year by or on behalf of such individual to a FRAME account of such individual. ``(b) Limitation.--The amount allowable as a deduction under subsection (a) shall not exceed the least of the following: ``(1) The taxable income of the taxpayer for the taxable year which is attributable to farming and ranching. ``(2) $50,000. ``(3) $500,000 reduced by the aggregate contributions of the taxpayer to all FRAME accounts of the taxpayer for all taxable years. ``(c) Qualified Farmer.--For purposes of this section, the term `qualified farmer' means, with respect to any taxable year, any individual who, during such...