To amend the Internal Revenue Code of 1986 to allow an income disparity tax credit.
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 ``Adjusting for Income Disparity Act of 2012''.
SEC. 2. INCOME DISPARITY TAX CREDIT.
(a) In General.--Part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by inserting after section 32 the following new section:
``SEC. 32A. INCOME DISPARITY CREDIT.
``(a) Allowance of Credit.--In the case of an individual, there shall be allowed as a credit against the tax imposed by this subtitle for the taxable year an amount equal to income disparity credit amount with respect to the taxpayer for the taxable year. ``(b) Income Disparity Credit Amount.--For purposes of this section-- ``(1) In general.--The income disparity credit amount shall be an amount equal to the applicable credit amount reduced (but not below zero) by the applicable percentage of so much of the taxpayer's modified adjusted gross income as exceeds the phaseout threshold. ``(2) Applicable amount; percentage.--The applicable credit amount, the applicable percentage, and the phaseout threshold shall be determined as follows:
The The The ``In the case of a taxpayer applicable applicable phaseout with: credit percentage threshold amount is: is: is: No dependents................. $2,500 3\1/3\ $15,000 1 dependent................... $4,000 5\1/3\ $20,000 2 dependents.................. $4,500 6 $25,000 3 or more dependents.......... $5,000 6\2/3\ $30,000.
``(c) Definitions and...