H.R. 7303

[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 7303 Introduced in House (IH)]

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119th CONGRESS
2d Session
H. R. 7303

To amend the Internal Revenue Code of 1986 to reform the individual 
income tax rates.

_______________________________________________________________________

IN THE HOUSE OF REPRESENTATIVES

January 30, 2026

Mr. Thanedar introduced the following bill; which was referred to the 
Committee on Ways and Means

_______________________________________________________________________

A BILL

To amend the Internal Revenue Code of 1986 to reform the individual 
income tax rates.

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 ``Middle Class Tax Cut Act''.

SEC. 2. INCREASED STANDARD DEDUCTION.

(a) In General.--Section 63(c)(2) of the Internal Revenue Code of 
1986 is amended--
(1) in subparagraph (B), by striking ``$4,400'' and 
inserting ``$75,000'', and
(2) in subparagraph (C), by striking ``$3,000'' and 
inserting ``$50,000''.
(b) Conforming Amendments.--Section 63(c)(4) of such Code is 
amended--
(1) by inserting ``(2026 in the case of the dollar amounts 
contained in subparagraph (B) or (C) of paragraph (2))'' after 
``1988'', and
(2) in subparagraph (B)--
(A) in clause (i)--
(i) by striking ``paragraph (2)(B), (2)(C), 
or (5)(A)'' and inserting ``paragraph (5)(A)'', 
and
(ii) by striking ``and'' at the end,
(B) in clause (ii), by striking the period at the 
end and inserting ``, and'', and
(C) by adding at the end the following new clause:
``(i) `calendar year 2025' in the case of 
the dollar amounts contained in subparagraph 
(B) or (C) of paragraph (2).''.
(c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2025.

SEC. 3. INDIVIDUAL INCOME TAX RATE REFORM.

(a) Joint Returns and Surviving Spouses.--Section 1(a) of the 
Internal Revenue Code of 1986 is amended by striking the table 
contained therein and inserting the following:

``If taxable income is: The tax is:
Not over $200,000..............
25% of taxable income.
Over $200,000 but not over 
$400,000.
$50,000, plus 30% of the excess 
over $200,000.
Over $400,000 but not over 
$1,000,000.
$110,000, plus 40% of the 
excess over $400,000.
Over $1,000,000 but not over 
$2,000,000.
$350,000, plus 50% of the 
excess over $1,000,000.
Over $2,000,000................
$850,000, plus 70% of the 
excess over 
$2,000,000.''.
(b) Heads of Households.--Section 1(b) of such Code is amended by 
striking the table contained therein and inserting the following:

``If taxable income is: The tax is:
Not over $150,000..............
25% of taxable income.
Over $150,000 but not over 
$300,000.
$37,500, plus 30% of the excess 
over $150,000.
Over $300,000 but not over 
$750,000.
$82,500, plus 40% of the excess 
over $300,000.
Over $750,000 but not over 
$1,500,000.
$262,500, plus 50% of the 
excess over $750,000.
Over $1,500,000................
$637,500, plus 70% of the 
excess over 
$1,500,000.''.
(c) Other Individuals.--Section 1 of such Code is amended by 
striking subsections (c) and (d) and inserting the following new 
subsection:
``(d) Other Individuals.--There is hereby imposed on the taxable 
income of every individual (other than an individual subject to tax 
under subsection (a) or (b)) a tax determined in accordance with the 
following table:

``If taxable income is: The tax is:
Not over $100,000..............
25% of taxable income.
Over $100,000 but not over 
$200,000.
$25,000, plus 30% of the excess 
over $100,000.
Over $200,000 but not over 
$500,000.
$55,000, plus 40% of the excess 
over $200,000.
Over $500,000 but not over 
$1,000,000.
$175,000, plus 50% of the 
excess over $500,000.
Over $1,000,000................
$425,000, plus 70% of the 
excess over 
$1,000,000.''.
(d) Estates and Trusts.--Section 1(e) of such Code is amended by 
striking the table contained therein and inserting the following new 
table:

``If taxable income is: The tax is:
Not over $3,000................
25% of taxable income.
Over $3,000 but not over 
$11,000.
$750, plus 30% of the excess 
over $3,000.
Over $11,000 but not over 
$15,000.
$3,150, plus 40% of the excess 
over $11,000.
Over $15,000 but not over 
$20,000.
$4,750, plus 50% of the excess 
over $15,000.
Over $20,000...................
$7,250, plus 70% of the excess 
over $20,000.''.
(e) Repeal of Reduced Rates of Tax on Capital Gains.--Section 1 of 
such Code is amended by striking subsection (h).
(f) Conforming Amendments.--
(1) Section 1(f) of such Code is amended--
(A) in the heading, by striking ``Phaseout of 
Marriage Penalty in 15-percent Bracket'',
(B) in paragraph (1)--
(i) by striking ``1993'' and inserting 
``2026''
(ii) by striking ``(c),'',
(C) in paragraph (2)--
(i) by striking ``(c),'', and
(ii) by amending subparagraph (A) to read 
as follows:
``(A) by increasing the minimum and maximum dollar 
amounts for each bracket for which a tax is imposed 
under such table by the cost-of-living adjustment for 
such calendar year, determined by substituting `2026' 
for `2016' in paragraph (3)(A)(ii),'',
(D) in paragraph (7)(B)--
(i) in the heading, by striking ``married 
individuals filing separately'' and inserting 
``certain individuals'', and
(ii) by striking ``married individual 
filing a separate return'' and inserting ``any 
individual subject to tax under subsection 
(d)'', and
(E) by striking paragraph (8).
(2) Section 1 of such Code is amended by striking 
subsections (i) and (j).
(g) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 2025.
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