110 HR 2983 IH: Middle Class Tax Relief Act of 2007
U.S. House of Representatives
2007-07-10
text/xml
EN
Pursuant to Title 17 Section 105 of the United States Code, this file is not subject to copyright protection and is in the public domain.
1.Short title; table of contents
(a)This Act may be cited as the Middle Class Tax Relief Act of 2007
.
(b)The table of contents of this Act is as follows:
Sec. 1. Short title; table of contents.
Title I—Tax relief for middle class families
Sec. 101. Middle class families tax relief credits.
Sec. 102. Double the child tax credit for middle class families.
Sec. 103. Eliminate the middle class surcharge.
Title II—Surtax for families with incomes over $1 million
Sec. 201. Surtax for families with incomes over $1 million.
<enum>I</enum><header>Tax relief for middle class families</header>
<section id="H13A11D236DA14E3B8000BBFDB3E1290"><enum>101.</enum><header>Middle class families tax relief credits</header>
<subsection id="H28D36AC3430F4CEDAD9C254DF9398389"><enum>(a)</enum><header>In general</header><text>Subpart A of part IV of subchapter A of <external-xref legal-doc="usc-chapter" parsable-cite="usc-chapter/26/1">chapter 1</external-xref> of the Internal Revenue Code of 1986 (relating to nonrefundable personal credits) is amended by inserting before section 26 the following new section:</text>
<quoted-block display-inline="no-display-inline" id="H6A95B79F4B764117BE107D99C3E91488" style="OLC">
<section id="H6CB06FD45216453CB43832F846434B13"><enum>25E.</enum><header>Middle class families tax relief credit</header>
<subsection id="H3109FE04C1DF48F6A43B2EE19C2C1D84"><enum>(a)</enum><header> 10 percent tax reduction for the middle class</header>
<paragraph id="HC054A00D7C134E789064FCBF3347C7F8"><enum>(1)</enum><header>In general</header><text>In the case of any natural person, there shall be allowed as a credit against the tax imposed by this chapter for the taxable year an amount equal to 10 percent of the amount of such tax.</text></paragraph>
<paragraph id="H5EBADE9DFC204F9787573D4C88C2DAF7"><enum>(2)</enum><header>Income limitation</header><text display-inline="yes-display-inline">The amount allowable as a credit under paragraph (1) for any taxable year shall be reduced (but not below zero) by an amount which bears the same ratio to the amount so allowable (determined without regard to this paragraph) as—</text>
<subparagraph id="HBB60298C87494D5087CFFA1691C2354B"><enum>(A)</enum><text>the amount (if any) by which the taxpayer’s adjusted gross income exceeds $75,000 ($150,000 in the case of a joint return), bears to</text></subparagraph>
<subparagraph id="H4F76967ADD2B499485A412C768748F89"><enum>(B)</enum><text display-inline="yes-display-inline">$5,000 ($10,000 in the case of a joint return).</text></subparagraph></paragraph></subsection>
<subsection id="HBA10513A0EDD48558C3719CEF6023D00"><enum>(b)</enum><header>Zero tax bracket for the poor</header>
<paragraph id="H62F534214969407798837C759F12DFCC"><enum>(1)</enum><header>In general</header><text>In the case of any natural person, there shall be allowed as a credit against the tax imposed by this chapter for the taxable year an amount equal to the excess, if any, of—</text>
<subparagraph display-inline="no-display-inline" id="H857E54D566ED4BDBB6BD15FFC16C5080"><enum>(A)</enum><text display-inline="yes-display-inline">the sum of the taxpayer’s regular tax liability for the taxable year and the tax imposed by section 55(a) for the taxable year, over</text></subparagraph>
<subparagraph id="H2FFF9AB1EDE04782A2EB6202F026FD13"><enum>(B)</enum><text>the sum of the credits allowed under this part (other than this subsection) for the taxable year.</text></subparagraph></paragraph>
<paragraph display-inline="no-display-inline" id="HC386D04E02014C328C4876D0FE1C7239"><enum>(2)</enum><header>Income limitation</header><text display-inline="yes-display-inline">The amount allowable as a credit under paragraph (1) for any taxable year shall be reduced (but not below zero) by an amount which bears the same ratio to the amount so allowable (determined without regard to this paragraph) as—</text>
<subparagraph id="HE84069B13B5344F8B0647C316CC5CAA"><enum>(A)</enum><text>the amount (if any) by which the taxpayer’s adjusted gross income exceeds $12,500 ($25,000 in the case of a joint return), bears to</text></subparagraph>
<subparagraph id="H62AD2751EC1046A1B91F1646D467AD00"><enum>(B)</enum><text display-inline="yes-display-inline">$2,500 ($5,000 in the case of a joint return).</text></subparagraph></paragraph></subsection></section><after-quoted-block>.</after-quoted-block></quoted-block></subsection>
<subsection display-inline="no-display-inline" id="HED033B853FD149F7B9231700F11EF739"><enum>(b)</enum><header>Clerical amendment</header><text display-inline="yes-display-inline">The table of sections of subpart A of part IV of subchapter A of chapter 1 of such Code is amended by inserting before the item relating to section 26 the following new item:</text>
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<toc container-level="quoted-block-container" idref="H6A95B79F4B764117BE107D99C3E91488" lowest-bolded-level="division-lowest-bolded" lowest-level="section" quoted-block="no-quoted-block" regeneration="yes-regeneration">
<toc-entry idref="H6CB06FD45216453CB43832F846434B13" level="section">Sec. 25E. Middle class families tax relief credits.</toc-entry></toc><after-quoted-block>.</after-quoted-block></quoted-block></subsection>
<subsection commented="no" id="H755160265FC64BAF9CA1F9451ECE332"><enum>(c)</enum><header>Effective date</header><text>The amendments made by this section shall apply to taxable years beginning after the date of the enactment of this Act.</text></subsection></section>
<section id="H3F94CBFD520F464792F6047520CA116E"><enum>102.</enum><header>Double the child tax credit for middle class families</header>
<subsection id="H2124A2194BEF4F4B917BC8C1315925F2"><enum>(a)</enum><header>In general</header><text display-inline="yes-display-inline">Subsection (a) of <external-xref legal-doc="usc" parsable-cite="usc/26/24">section 24</external-xref> of the Internal Revenue Code of 1986 (relating to child tax credit) is amended to read as follows:</text>
<quoted-block display-inline="no-display-inline" id="H2D2347490D33476F8C3C06B49204FF3C" style="OLC">
<subsection id="HF6953C0850C342998228D715D64F1B8C"><enum>(a)</enum><header>Allowance of credit</header>
<paragraph id="H7A3A4122CA494910BFE56498A5FFC9C4"><enum>(1)</enum><header>In general</header><text>There shall be allowed as a credit against the tax imposed by this chapter for the taxable year with respect to each qualifying child of the taxpayer an amount equal to the sum of—</text>
<subparagraph id="H3F67CFED1744406093F288CF197CAD01"><enum>(A)</enum><text>the basic credit for the taxable year, plus</text></subparagraph>
<subparagraph id="H9EE7F1D3162D4E1D85343BC4B82BA45"><enum>(B)</enum><text>the additional credit for the taxable year.</text></subparagraph></paragraph>
<paragraph id="HFA10E8B2335749B3BC00AFBA8F91E05"><enum>(2)</enum><header>Basic credit</header><text>For purposes of this section, the term <quote>basic credit</quote> means—</text>
<subparagraph id="H5A119192D91942D7A2C518A77EAED9D"><enum>(A)</enum><text>$1,000 in the case of any taxable year beginning before January 1, 2011, and</text></subparagraph>
<subparagraph id="HD11431C4450247AA9D2C6E55E9CA72EB"><enum>(B)</enum><text>$500 in the case of any other taxable year.</text></subparagraph></paragraph>
<paragraph id="HD5A5DE3A9E3D40B2BF6406AF7F23D0C8"><enum>(3)</enum><header>Additional credit</header><text>For purposes of this section, the term <quote>additional credit</quote> means—</text>
<subparagraph id="H036BAE12C5064DF38560B45E82C6F4BB"><enum>(A)</enum><text>$1,000 in the case of any taxable year beginning before January 1, 2011, and</text></subparagraph>
<subparagraph id="H14D7E6D7ACD44BEF98604D54A59818D2"><enum>(B)</enum><text>$500 in the case of any other taxable year.</text></subparagraph></paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block></subsection>
<subsection id="H67B655288B7F474D8D5CC3FC60F1B432"><enum>(b)</enum><header>Limitation on additional credit based on adjusted gross income</header><text>Subsection (b) of section 24 of such Code is amended by adding at the end the following new paragraphs:</text>
<quoted-block display-inline="no-display-inline" id="H66D3E6B703B6445AB4D5EF1FDA403BDB" style="OLC">
<paragraph id="HF15B4D7B6457461E8CD6454B9153D585"><enum>(4)</enum><header>Limitation on additional credit based on adjusted gross income</header><text display-inline="yes-display-inline">The amount of the additional credit determined under subsection (a)(3) shall be reduced (but not below zero) by an amount which bears the same ratio to such amount (determined without regard to this paragraph) as—</text>
<subparagraph id="H472C8FDA867449C2A5D948E1968D715B"><enum>(A)</enum><text>the amount (if any) by which the taxpayer’s adjusted gross income exceeds $75,000 ($150,000 in the case of a joint return), bears to</text></subparagraph>
<subparagraph id="H8AC0FBD4AEA643EE8151890027B2D51"><enum>(B)</enum><text display-inline="yes-display-inline">$5,000 ($10,000 in the case of a joint return).</text></subparagraph></paragraph><after-quoted-block>.</after-quoted-block></quoted-block></subsection>
<subsection id="HE9E831A960FB4147A607A73E261BF5A1"><enum>(c)</enum><header>Conforming amendments</header><text>Paragraph (1) of section 24(b) of such Code is amended—</text>
<paragraph id="HFAEDCF7116154CFEAD7BFFFFD6BD6176"><enum>(1)</enum><text>by striking <quote>the credit allowable under subsection (a)</quote> and inserting <quote>the basic credit determined under subsection (a)(2)</quote>, and</text></paragraph>
<paragraph id="H95BDC3D70BFA4CCABE12FCFC9FB081D"><enum>(2)</enum><text>by inserting <quote><header-in-text level="paragraph" style="OLC">on basic credit</header-in-text></quote> after <quote><header-in-text level="paragraph" style="OLC">Limitation</header-in-text></quote> in the heading thereof.</text></paragraph></subsection>
<subsection id="HDC0D51162C404EAABC6F745F1F008506"><enum>(d)</enum><header>Coordination with EGTRRA sunset</header><text>Section 901 of the Economic Growth and Tax Relief Reconciliation Act of 2001 shall not apply to the amendment made by section 201(a) of such Act.</text></subsection>
<subsection id="H19BBA2639222419BB54955211468EB25"><enum>(e)</enum><header>Effective date</header><text>The amendments made by this section shall apply to taxable years beginning after the date of the enactment of this Act.</text></subsection></section>
<section display-inline="no-display-inline" id="HAE11B39EE9B243BCB0643EFE99A30044" section-type="subsequent-section"><enum>103.</enum><header>Eliminate the middle class surcharge</header>
<subsection id="H41260077D1E640C7A089CD19D68EB116"><enum>(a)</enum><header>In general</header><text display-inline="yes-display-inline"><external-xref legal-doc="usc" parsable-cite="usc/26/55">Section 55</external-xref> of the Internal Revenue Code of 1986 (relating to alternative minimum tax imposed) is amended by adding at the end the following new subsection:</text>
<quoted-block display-inline="no-display-inline" id="H21E01D5A3203459CBE7582214BBBF43B" style="OLC">
<subsection id="H3EB783D0B3FB4A359D5E35E88BF1E815"><enum>(f)</enum><header>Exemption for Individuals for Taxable Years Beginning in 2008</header><text>For any taxable year beginning in 2008, in the case of an individual—</text>
<paragraph id="H9B3770E872AA41A08BF1DD65B22FAC3"><enum>(1)</enum><header>In general</header><text>The tentative minimum tax of the taxpayer shall be zero if the adjusted gross income of the taxpayer (as determined for purposes of the regular tax) is equal to or less than the threshold amount.</text></paragraph>
<paragraph id="HC7467EDD174A466F8167B4EE6CA911D1"><enum>(2)</enum><header>Phasein of liability above exemption level</header><text>In the case of a taxpayer whose adjusted gross income exceeds the threshold amount but does not exceed $112,500 ($225,000 in the case of a joint return), the tax imposed by subsection (a) shall be the amount which bears the same ratio to such tax (determined without regard to this subsection) as—</text>
<subparagraph id="H7167EF7CDF2842B790F342EF5BF6D1E6"><enum>(A)</enum><text>the excess of—</text>
<clause id="H1FC486876335423F99D071B26D00D3EF"><enum>(i)</enum><text>the adjusted gross income of the taxpayer (as determined for purposes of the regular tax), over</text></clause>
<clause id="H22B96F0A5F5C4D24ABF0D9DDEDB66E7"><enum>(ii)</enum><text>the threshold amount, bears to</text></clause></subparagraph>
<subparagraph id="H9ACA7C2976A74F9C8FFD5574A5954E2D"><enum>(B)</enum><text>$12,500 ($25,000 in the case of a joint return).</text></subparagraph></paragraph>
<paragraph id="H46977A9709D8430E9F9B9BF7F7BE2256"><enum>(3)</enum><header>Threshold amount</header><text>For purposes of this paragraph, the term <quote>threshold amount</quote> means $100,000 ($200,000 in the case of a joint return).</text></paragraph>
<paragraph id="H6761EE78ECD44BA700D2DCCDB76F29"><enum>(4)</enum><header>Estates and trusts</header><text>This subsection shall not apply to any estate or trust.</text></paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block></subsection>
<subsection id="H0AD45C451B93494CB296CF48E2F8BC73"><enum>(b)</enum><header>Effective Date</header><text>The amendment made by this section shall apply to taxable years beginning after December 31, 2007.</text></subsection></section>
<enum>II</enum><header>Surtax for families with incomes over $<enum-in-header>1</enum-in-header> million</header>
<section display-inline="no-display-inline" id="H18D9912306C0436FA88B51F4EDAFB0AC" section-type="subsequent-section"><enum>201.</enum><header>Surtax for families with incomes over $<enum-in-header>1</enum-in-header> million</header>
<subsection id="HFB757101CAE54759ABD273C692F7F629"><enum>(a)</enum><header>General rule</header><text><external-xref legal-doc="usc" parsable-cite="usc/26/1">Section 1</external-xref> of the Internal Revenue Code of 1986 (relating to imposition of tax on individuals) is amended by adding at the end the following new subsection:</text>
<quoted-block id="HB1936345DC0C40BEAA0116E00F5EE99" style="OLC">
<subsection id="HA2F92D63E78347E8AFBE92D1005962F0"><enum>(j)</enum><header>Surtax for families with incomes over $<enum-in-header>1,000,000</enum-in-header></header>
<paragraph id="HE8C0587F0245456800A860B1EBABFE84"><enum>(1)</enum><header>In general</header><text>If the adjusted gross income of a taxpayer exceeds $500,000 ($1,000,000, in the case of a joint return), the tax imposed by this section (determined without regard to this subsection) shall be increased by an amount determined in accordance with the following tables:</text>
<subparagraph id="HB73C6E2D8F9740B2ADC7B437643A3E5"><enum>(A)</enum><header>Joint returns</header><text display-inline="yes-display-inline">In the case of a joint return:</text>
<table align-to-level="section" blank-lines-before="1" colsep="0" frame="none" line-rules="no-gen" rowsep="0" rule-weights="0.0.0.0.0.4" table-template-name="Tax Rate" table-type="Leaderwork, Tax">
<tgroup cols="2" rowsep="0"><colspec coldef="txt" colname="column1" colwidth="291.75pt" min-data-value="140"/><colspec coldef="txt" colname="column2" colsep="0" colwidth="333.00pt" min-data-value="140"/> <thead>
<row><entry align="left" colname="column1" morerows="0" namest="column1" rowsep="0"><bold>If taxable income is:</bold></entry><entry align="right" colname="column2" morerows="0" namest="column2" rowsep="0"><bold>The tax is:</bold></entry> </row> </thead>
<tbody>
<row><entry align="left" colname="column1" rowsep="0" stub-definition="txt-ldr">Over $1,000,000 but not over $1,000,000,000</entry><entry align="right" colname="column2" rowsep="0">7% of the excess over $1,000,000</entry> </row>
<row><entry align="left" colname="column1" rowsep="0" stub-definition="txt-ldr">Over $1,000,000,000</entry><entry align="right" colname="column2" rowsep="0">$69,930,000, plus 10% of the excess over $1,000,000,000</entry> </row> </tbody> </tgroup></table></subparagraph>
<subparagraph id="HCD85E69F4BA949DF94F710B2AD08CDCF"><enum>(B)</enum><header>Other returns</header><text>In the case of any other return:</text>
<table align-to-level="section" blank-lines-before="1" colsep="0" frame="none" line-rules="no-gen" rowsep="0" rule-weights="0.0.0.0.0.4" table-template-name="Tax Rate" table-type="Leaderwork, Tax">
<tgroup cols="2" rowsep="0"><colspec coldef="txt" colname="column1" colwidth="291.00pt" min-data-value="140"/><colspec coldef="txt" colname="column2" colsep="0" colwidth="335.25pt" min-data-value="140"/> <thead>
<row><entry align="left" colname="column1" morerows="0" namest="column1" rowsep="0"><bold>If taxable income is:</bold></entry><entry align="right" colname="column2" morerows="0" namest="column2" rowsep="0"><bold>The tax is:</bold></entry> </row> </thead>
<tbody>
<row><entry align="left" colname="column1" rowsep="0" stub-definition="txt-ldr">Over $500,000 but not over $500,000,000</entry><entry align="right" colname="column2" rowsep="0">7% of the excess over $500,000</entry> </row>
<row><entry align="left" colname="column1" rowsep="0" stub-definition="txt-ldr">Over $500,000,000</entry><entry align="right" colname="column2" rowsep="0">$34,965,000, plus 10% of the excess over $500,000,000</entry> </row> </tbody> </tgroup></table></subparagraph></paragraph>
<paragraph id="H6B5C6B3DC1654CFD877DF0C436523C94"><enum>(2)</enum><header>Tax not to apply to estates and trusts</header><text>This subsection shall not apply to an estate or trust.</text></paragraph>
<paragraph id="H8DB884F6099341B3837191DC57592319"><enum>(3)</enum><header>Special rule</header><text display-inline="yes-display-inline">For purposes of section 55, the amount of the regular tax shall be determined without regard to this subsection.</text></paragraph></subsection><after-quoted-block>.</after-quoted-block></quoted-block></subsection>
<subsection id="H48B74E45349840E0A29D39001B615018"><enum>(b)</enum><header>Effective date</header><text>The amendments made by this section shall apply to taxable years beginning after the date of the enactment of this Act.</text></subsection>
<subsection id="H4F4014CA151B48E3B2569FA1006E9293"><enum>(c)</enum><header>Section <enum-in-header>15</enum-in-header> not To apply</header><text>The amendment made by subsection (a) shall not be treated as a change in a rate of tax for purposes of <external-xref legal-doc="usc" parsable-cite="usc/26/15">section 15</external-xref> of the Internal Revenue Code of 1986.</text></subsection></section>