I 

112TH CONGRESS 

1ST SESSION H. R. 2710 

To amend the Internal Revenue Code of 1986 to repeal certain tax cuts 

extended for high income individuals. 

IN THE HOUSE OF REPRESENTATIVES 

JULY 29, 2011 

Mr. TONKO 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 repeal 

certain tax cuts extended for high income individuals. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Fair and Impartial 

5 Reform Tax Act of 2011’’. 

6 SEC. 2. REPEAL OF CERTAIN TAX CUTS EXTENDED FOR 

7 HIGH INCOME INDIVIDUALS. 

8 (a) INDIVIDUAL INCOME TAX RATES.—Subsection (i) 

9 of section 1 of the Internal Revenue Code of 1986 is 

10 amended by striking paragraph (2), by redesignating 


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1 paragraph (3) as paragraph (4), and by inserting after 

2 paragraph (1) the following new paragraphs: 

3 ‘‘(2) 25- AND 28-PERCENT RATE BRACKETS.— 

4 The tables under subsections (a), (b), (c), (d), and 

5 (e) shall be applied— 

6 ‘‘(A) by substituting ‘25%’ for ‘28%’ each 

7 place it appears (before the application of sub8 paragraph (B)), and 

9 ‘‘(B) by substituting ‘28%’ for ‘31%’ each 

10 place it appears. 

11 ‘‘(3) 33-PERCENT RATE BRACKET.— 

12 ‘‘(A) IN GENERAL.—In the case of taxable 

13 years beginning after December 31, 2011— 

14 ‘‘(i) the rate of tax under subsections 

15 (a), (b), (c), and (d) on a taxpayer’s tax16 able income in the fourth rate bracket shall 

17 be 33 percent to the extent such income 

18 does not exceed an amount equal to the ex19 cess of— 

20 ‘‘(I) the applicable amount, over 

21 ‘‘(II) the dollar amount at which 

22 such bracket begins, and 

23 ‘‘(ii) the 36-percent rate of tax under 

24 such subsections shall apply only to the 

25 taxpayer’s taxable income in such bracket 


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1 in excess of the amount to which clause (i) 

2 applies. 

3 ‘‘(B) APPLICABLE AMOUNT.—For purposes 

4 of this paragraph, the term ‘applicable amount’ 

5 means the excess of— 

6 ‘‘(i) the applicable threshold, over 

7 ‘‘(ii) the sum of the following amounts 

8 in effect for the taxable year: 

9 ‘‘(I) the basic standard deduction 

10 (within the meaning of section 

11 63(c)(2)), and 

12 ‘‘(II) the exemption amount 

13 (within the meaning of section 

14 151(d)(1)) (or, in the case of sub15 section (a), 2 such exemption 

16 amounts). 

17 ‘‘(C) APPLICABLE THRESHOLD.—For pur18 poses of this paragraph, the term ‘applicable 

19 threshold’ means— 

20 ‘‘(i) $500,000 in the case of sub21 section (a), 

22 ‘‘(ii) $400,000 in the case of sub23 sections (b) and (c), and 

‘‘(iii) 1 24 ⁄2 the amount applicable under 

25 clause (i) (after adjustment, if any, under 


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1 subparagraph (E)) in the case of sub2 section (d). 

3 ‘‘(D) FOURTH RATE BRACKET.—For pur4 poses of this paragraph, the term ‘fourth rate 

5 bracket’ means the bracket which would (deter6 mined without regard to this paragraph) be the 

7 36-percent rate bracket. 

8 ‘‘(E) INFLATION ADJUSTMENT.—For pur9 poses of this paragraph, a rule similar to the 

10 rule of paragraph (1)(C) shall apply with re11 spect to taxable years beginning in calendar 

12 years after 2011, applied by substituting ‘2009’ 

13 for ‘1992’ in subsection (f)(3)(B).’’. 

14 (b) PHASEOUT OF PERSONAL EXEMPTIONS AND

15 ITEMIZED DEDUCTIONS.— 

16 (1) OVERALL LIMITATION ON ITEMIZED DEDUC17 TIONS.—Section 68 of such Code is amended— 

18 (A) by striking ‘‘the applicable amount’’ 

19 the first place it appears in subsection (a) and 

20 inserting ‘‘the applicable threshold in effect 

21 under section 1(i)(3)’’, 

22 (B) by striking ‘‘the applicable amount’’ in 

23 subsection (a)(1) and inserting ‘‘such applicable 

24 threshold’’, 


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1 (C) by striking subsection (b) and redesig2 nating subsections (c), (d), and (e) as sub3 sections (b), (c), and (d), respectively, and 

4 (D) by striking subsections (f) and (g). 

5 (2) PHASEOUT OF DEDUCTIONS FOR PERSONAL

6 EXEMPTIONS.— 

7 (A) IN GENERAL.—Paragraph (3) of sec8 tion 151(d) of such Code is amended— 

9 (i) by striking ‘‘the threshold amount’’ 

10 in subparagraphs (A) and (B) and insert11 ing ‘‘the applicable threshold in effect 

12 under section 1(i)(3)’’, 

13 (ii) by striking subparagraph (C) and 

14 redesignating subparagraph (D) as sub15 paragraph (C), and 

16 (iii) by striking subparagraphs (E) 

17 and (F). 

18 (B) CONFORMING AMENDMENT.—Para19 graph (4) of section 151(d) of such Code is 

20 amended— 

21 (i) by striking subparagraph (B), 

22 (ii) by redesignating clauses (i) and 

23 (ii) of subparagraph (A) as subparagraphs 

24 (A) and (B), respectively, and by indenting 


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1 such subparagraphs (as so redesignated) 

2 accordingly, and 

3 (iii) by striking all that precedes ‘‘in 

4 a calendar year after 1989,’’ and inserting 

5 the following: 

6 ‘‘(4) INFLATION ADJUSTMENT.—In the case of 

7 any taxable year beginning’’. 

8 (c) REDUCED RATE ON CAPITAL GAINS AND DIVI9 DENDS.— 

10 (1) IN GENERAL.—Paragraph (1) of section 

11 (1)(h) of such Code is amended by striking subpara12 graph (C), by redesignating subparagraphs (D) and 

13 (E) as subparagraphs (E) and (F) and by inserting 

14 after subparagraph (B) the following new subpara15 graphs: 

16 ‘‘(C) 15 percent of the lesser of— 

17 ‘‘(i) so much of the adjusted net cap18 ital gain (or, if less, taxable income) as ex19 ceeds the amount on which a tax is deter20 mined under subparagraph (B), or 

21 ‘‘(ii) the excess (if any) of— 

22 ‘‘(I) the amount of taxable in23 come which would (without regard to 

24 this subsection) be taxed at a rate 

25 below 36 percent, over 


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1 ‘‘(II) the sum of the amounts on 

2 which tax is determined under sub3 paragraphs (A) and (B), 

4 ‘‘(D) 20 percent of the adjusted net capital 

5 gain (or, if less, taxable income) in excess of the 

6 sum of the amounts on which tax is determined 

7 under subparagraphs (B) and (C),’’. 

8 (2) DIVIDENDS.—Subparagraph (A) of section 

9 1(h)(11) of such Code is amended by striking 

10 ‘‘qualified dividend income’’ and inserting ‘‘so much 

11 of the qualified dividend income as does not exceed 

12 the excess (if any) of— 

13 ‘‘(i) the amount of taxable income 

14 which would (without regard to this sub15 section) be taxed at a rate below 36 per16 cent, over 

17 ‘‘(ii) taxable income reduced by quali18 fied dividend income.’’. 

19 (3) MINIMUM TAX.—Section 55 of such Code is 

20 amended by adding at the end the following new 

21 subsection: 

22 ‘‘(f) APPLICATION OF MAXIMUM RATE OF TAX ON

23 NET CAPITAL GAIN OF NONCORPORATE TAXPAYERS.—In 

24 the case of taxable years beginning after December 31, 


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1 2011, the amount determined under subparagraph (C) of 

2 subsection (b)(3) shall be the sum of— 

3 ‘‘(1) 15 percent of the lesser of— 

4 ‘‘(A) so much of the adjusted net capital 

5 gain (or, if less, taxable excess) as exceeds the 

6 amount on which tax is determined under sub7 paragraph (B) of subsection (b)(3), or 

8 ‘‘(B) the excess described in section 

9 1(h)(1)(C)(ii), plus 

10 ‘‘(2) 20 percent of the adjusted net capital gain 

11 (or, if less, taxable excess) in excess of the sum of 

12 the amounts on which tax is determined under sub13 section (b)(3)(B) and paragraph (1).’’. 

14 (4) CONFORMING AMENDMENTS.— 

15 (A) The following provisions are amended 

16 by striking ‘‘15 percent’’ and inserting ‘‘20 per17 cent’’: 

18 (i) Section 1445(e)(1) of such Code. 

19 (ii) The second sentence of section 

20 7518(g)(6)(A) of such Code. 

21 (iii) Section 53511(f)(2) of title 46, 

22 United States Code. 

23 (B) Sections 531 and 541 of the Internal 

24 Revenue Code of 1986 are each amended by 

25 striking ‘‘15 percent of’’ and inserting ‘‘the 


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1 product of the highest rate of tax under section 

2 1(c) and’’. 

3 (C) Section 1445(e)(6) of such Code is 

4 amended by striking ‘‘15 percent (20 percent in 

5 the case of taxable years beginning after De6 cember 31, 2011)’’ and inserting ‘‘20 percent’’. 

7 (d) APPLICATION OF EGTRRA SUNSET.—Section 

8 901 of the Economic Growth and Tax Relief Reconcili9 ation Act of 2001 shall apply to the amendments made 

10 by this section. 

11 (e) EFFECTIVE DATES.— 

12 (1) IN GENERAL.—Except as provided in para13 graph (2), the amendments made by this section 

14 shall apply to taxable years beginning after Decem15 ber 31, 2011. 

16 (2) WITHHOLDING.—The amendments made by 

17 subparagraphs (A)(i) and (C) of subsection (c)(4) 

18 shall apply to amounts paid on or after January 1, 

19 2012. 

Æ 


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