I 
110TH CONGRESS 
1ST SESSION H. R. 3818 
To amend the Internal Revenue Code of 1986 to repeal the alternative 
minimum tax on individuals and replace it with an alternative tax individ-
uals may choose. 
IN THE HOUSE OF REPRESENTATIVES 
OCTOBER 10, 2007 
Mr. RYAN of Wisconsin (for himself, Mr. HENSARLING, Mr. CAMPBELL of 
California, Mrs. BACHMANN, Mr. HERGER, Mr. PENCE, Mr. FEENEY, 
Mr. GARRETT of New Jersey, Mrs. MUSGRAVE, Mr. ISSA, Mr. PRICE of 
Georgia, Ms. FOXX, Mr. PAUL, Mr. KLINE of Minnesota, Mr. SALI, Mr. 
WILSON of South Carolina, Mr. NEUGEBAUER, Mr. BURTON of Indiana, 
Mr. MCHENRY, Mr. AKIN, Ms. FALLIN, Mr. BROUN of Georgia, Mr. 
LAMBORN, Mr. WALBERG, Mr. PITTS, Mr. MCKEON, Mr. MCCAUL of 
Texas, Mr. MILLER of Florida, Mr. ROYCE, Mr. ADERHOLT, Mr. BART-
LETT of Maryland, Mr. MARCHANT, Mr. DOOLITTLE, and Mr. ALEX-
ANDER) introduced the following bill; which was referred to the Com-
mittee on Ways and Means 
A BILL 
To amend the Internal Revenue Code of 1986 to repeal 
the alternative minimum tax on individuals and replace 
it with an alternative tax individuals may choose. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Taxpayer Choice Act 
of 2007’’. 
VerDate Aug 31 2005 
23:02 Oct 11, 2007
Jkt 069200
PO 00000
Frm 00001
Fmt 6652
Sfmt 6201
E:\BILLS\H3818.IH
H3818
hsrobinson on PROD1PC76 with BILLS
SEC. 2. REPEAL OF ALTERNATIVE MINIMUM TAX FOR NON-
CORPORATE TAXPAYERS. 
(a) IN GENERAL.—Section 55(a) of the Internal Rev-
enue Code of 1986 (relating to alternative minimum tax 
imposed) is amended by adding at the end the following 
new flush sentence: 
‘‘In the case of a taxpayer other than a corporation, no 
tax shall be imposed by this section for any taxable year 
beginning after December 31, 2006, and the tentative 
minimum tax of any taxpayer other than a corporation 
for any such taxable year shall be zero for purposes of 
this title.’’. 
(b) CONFORMING AMENDMENTS.— 
(1) Section 26(c) of such Code is amended by 
striking ‘‘the term ‘tentative minimum tax’ means 
the amount determined under section 55(b)(1)’’ and 
inserting ‘‘the tentative minimum tax is zero.’’. 
(2) Section 911(f)(2) of such Code is amended 
to read as follows: 
‘‘(2) the tentative minimum tax under section 
55 for the taxable year shall be zero.’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2006. 
VerDate Aug 31 2005 
23:02 Oct 11, 2007
Jkt 069200
PO 00000
Frm 00002
Fmt 6652
Sfmt 6201
E:\BILLS\H3818.IH
H3818
hsrobinson on PROD1PC76 with BILLS
SEC. 3. SIMPLIFIED INDIVIDUAL INCOME TAX SYSTEM. 
(a) IN GENERAL.—Part I of subchapter A of chapter 
1 of the Internal Revenue Code of 1986 (relating to tax 
on individuals) is amended by redesignating section 5 as 
section 6 and by inserting after section 4 the following 
new section: 
‘‘SEC. 5. SIMPLIFIED INDIVIDUAL INCOME TAX SYSTEM. 
‘‘(a) ELECTION.— 
‘‘(1) IN GENERAL.—A taxpayer other than a 
corporation may elect in accordance with this sub-
section to be subject to the tax imposed by this sec-
tion in lieu of the tax imposed by section 1 for a tax-
able year and all subsequent taxable years. 
‘‘(2) EFFECT OF ELECTION.—For purposes of 
this title, if an election is in effect under paragraph 
(1) for any taxable year, the tax imposed by this sec-
tion shall be treated as the tax imposed by section 
1 for the taxable year. 
‘‘(3) ELECTION.— 
‘‘(A) IN GENERAL.— 
‘‘(i) IN
GENERAL.—Except as pro-
vided in clause (ii) of this subparagraph 
and clauses (ii) and (iii) of subparagraph 
(B), the election under paragraph (1) may 
only be made with respect to any taxable 
year beginning before January 1, 2017, on 
VerDate Aug 31 2005 
23:02 Oct 11, 2007
Jkt 069200
PO 00000
Frm 00003
Fmt 6652
Sfmt 6201
E:\BILLS\H3818.IH
H3818
hsrobinson on PROD1PC76 with BILLS
a timely filed return for the first taxable 
year for which the election applies. 
‘‘(ii) NEW TAXPAYERS.—In the case 
of an individual with no tax liability under 
this title before January 1, 2017, the elec-
tion under paragraph (1) may only be 
made for the first taxable year beginning 
after December 31, 2016, for which such 
individual has tax liability under this title. 
‘‘(B) EFFECT OF ELECTION.— 
‘‘(i) IN
GENERAL.—Except as pro-
vided in clauses (ii) and (iii), the election 
under paragraph (1), once made, shall be 
irrevocable. 
‘‘(ii) 
ONE-TIME
REVOCATION
OF 
ELECTION.—A taxpayer may revoke an 
election under paragraph (1) for a taxable 
year and all subsequent taxable years. The 
preceding sentence shall not apply if the 
taxpayer has made a revocation under such 
sentence for any prior taxable year. 
‘‘(iii) FILING STATUS CHANGES DUE 
TO MAJOR LIFE EVENTS.—In the case of 
any major life event described in clause 
(iv), a taxpayer may make an election 
VerDate Aug 31 2005 
23:02 Oct 11, 2007
Jkt 069200
PO 00000
Frm 00004
Fmt 6652
Sfmt 6201
E:\BILLS\H3818.IH
H3818
hsrobinson on PROD1PC76 with BILLS
under paragraph (1) or revoke such an 
election under clause (ii). Any such election 
or revocation shall apply for the taxable 
year for which made and all subsequent 
taxable years until the taxpayer makes an 
election under the preceding sentence for 
any subsequent (and all succeeding) tax-
able year. 
‘‘(iv) MAJOR LIFE EVENT.—For pur-
poses of clause (iii), a major life event de-
scribed in this clause is marriage, divorce, 
and death. 
‘‘(b) TAX IMPOSED.— 
‘‘(1) MARRIED
INDIVIDUALS
AND
SURVIVING 
SPOUSES.—In the case of a taxpayer for whom an 
election under subsection (a) is in effect and who is 
a married individual (as defined in section 7703) 
who makes a single return jointly with his spouse 
under section 6013 or a surviving spouse (as defined 
in section 2(a)), there is hereby imposed on the al-
ternative taxable income of such individual a tax de-
termined in accordance with the following table: 
‘‘If taxable income is: 
The tax is: 
Not over $100,000 ........................
10% of alternative taxable income.
Over $100,000 ...............................
$10,000, plus 25% of the excess over 
$100,000. 
VerDate Aug 31 2005 
02:02 Oct 12, 2007
Jkt 069200
PO 00000
Frm 00005
Fmt 6652
Sfmt 6211
E:\BILLS\H3818.IH
H3818
hsrobinson on PROD1PC76 with BILLS
‘‘(2) UNMARRIED INDIVIDUALS (OTHER THAN 
SURVIVING SPOUSES).—In the case of a taxpayer for 
whom an election under subsection (a) is in effect 
and who is not described in paragraph (1), there is 
hereby imposed on the alternative taxable income of 
such individual a tax determined in accordance with 
the following table: 
‘‘If taxable income is: 
The tax is: 
Not over $50,000 ..........................
10% of alternative taxable income.
Over $50,000 .................................
$5,000, plus 25% of the excess over 
$50,000. 
‘‘(c) MAXIMUM OF TAX ON NET CAPITAL GAIN OF 
NONCORPORATE TAXPAYERS.—If a taxpayer has a net 
capital gain for the taxable year, the tax imposed by sub-
section (b) for such taxable year shall not exceed the sum 
of— 
‘‘(1) the amount determined under subsection 
(b) computed at the rate and in the same manner 
as if this paragraph had not been enacted on modi-
fied taxable income reduced by the lesser of— 
‘‘(A) the net capital gain, or 
‘‘(B) the adjusted net capital gain, plus 
‘‘(2) 5 percent (0 percent in the case of taxable 
years beginning after 2007) of so much of the ad-
justed net capital gain (or, if less, modified taxable 
income) as does not exceed an amount equal to the 
excess described in section 1(h)(1)(B), plus 
VerDate Aug 31 2005 
02:02 Oct 12, 2007
Jkt 069200
PO 00000
Frm 00006
Fmt 6652
Sfmt 6201
E:\BILLS\H3818.IH
H3818
hsrobinson on PROD1PC76 with BILLS
‘‘(3) 15 percent of the adjusted net capital gain 
(or, if less, modified taxable income) in excess of the 
amount on which tax is determined under paragraph 
(2). 
Terms used in this paragraph which are also used in sec-
tion 1(h) shall have the respective meanings given such 
terms by section 1(h) but computed with the adjustments 
under this section. 
‘‘(d) ALTERNATIVE TAXABLE INCOME.—For pur-
poses of this section— 
‘‘(1) IN GENERAL.—The term ‘alternative tax-
able income’ means— 
‘‘(A) gross income, minus 
‘‘(B) the sum of— 
‘‘(i) the personal exemption, 
‘‘(ii) the dependent allowance, plus 
‘‘(iii) the alternative standard deduc-
tion. 
‘‘(2) PERSONAL EXEMPTION.—The personal ex-
emption is— 
‘‘(A) 200 percent of the dollar amount in 
effect under subparagraph (B) in the case of— 
‘‘(i) a joint return, or 
‘‘(ii) a surviving spouse (as defined in 
section 2(a)), and 
VerDate Aug 31 2005 
23:02 Oct 11, 2007
Jkt 069200
PO 00000
Frm 00007
Fmt 6652
Sfmt 6201
E:\BILLS\H3818.IH
H3818
hsrobinson on PROD1PC76 with BILLS
‘‘(B) $3,500 in the case of an individual— 
‘‘(i) who is not married and is not a 
surviving spouse, or 
‘‘(ii) who is a married individual filing 
a separate return. 
‘‘(3) DEPENDENT
ALLOWANCE.—The depend-
ent allowance is $3,500 for each dependent (as de-
fined in section 152). 
‘‘(4) ALTERNATIVE
STANDARD
DEDUCTION.— 
The alternative standard deduction means— 
‘‘(A) $25,000 in the case of— 
‘‘(i) a joint return, or 
‘‘(ii) a surviving spouse (as defined in 
section 2(a)), and 
‘‘(B) $12,500 in the case of an indi-
vidual— 
‘‘(i) who is not married and is not a 
surviving spouse, or 
‘‘(ii) who is a married individual filing 
a separate return. 
‘‘(e) INFLATION ADJUSTMENTS.— 
‘‘(1) IN GENERAL.—In the case of any taxable 
year beginning in a calendar year after 2007, each 
of the dollar amounts for the rate brackets in sub-
section (b) and each of the dollar amounts in sub-
VerDate Aug 31 2005 
23:02 Oct 11, 2007
Jkt 069200
PO 00000
Frm 00008
Fmt 6652
Sfmt 6201
E:\BILLS\H3818.IH
H3818
hsrobinson on PROD1PC76 with BILLS
section (d)(2)(B), (d)(3), and (d)(4) shall be in-
creased by an amount equal to— 
‘‘(A) such dollar amount, multiplied by 
‘‘(B) the cost-of-living adjustment deter-
mined under section 1(f)(3) for the calendar 
year in which the taxable year begins, by sub-
stituting ‘calendar year 2006’ for ‘calendar year 
1992’ in subparagraph (B) thereof. 
‘‘(2) ROUNDING.—If any amount as adjusted 
under clause (i) is not a multiple of $100, such 
amount shall be rounded to the nearest multiple of 
$100.’’. 
(b) CONFORMING AMENDMENT.—The table of sec-
tions for part I of subchapter A of chapter 1 of such Code 
is amended by striking the item relating to section 5 and 
inserting after the item relating to section 4 the following: 
‘‘Sec. 5. Simplified Individual Income Tax System. 
‘‘Sec. 6. Cross references relating to tax on individuals.’’. 
(c) CAPITAL GAINS AND DIVIDENDS RATE MADE 
PERMANENT.—The Jobs and Growth Tax Relief Rec-
onciliation Act of 2003 is amended by striking section 
303. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2006. 
Æ 
VerDate Aug 31 2005 
23:02 Oct 11, 2007
Jkt 069200
PO 00000
Frm 00009
Fmt 6652
Sfmt 6301
E:\BILLS\H3818.IH
H3818
hsrobinson on PROD1PC76 with BILLS