I
105TH CONGRESS
2D SESSION
H. R. 3151
To amend the Internal Revenue Code of 1986 to reduce individual income
taxes by increasing the amount of taxable income which is taxed at
the lowest income tax rate.
IN THE HOUSE OF REPRESENTATIVES
FEBRUARY 3, 1998
Mr. THUNE (for himself and Ms. DUNN) 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 reduce
individual income taxes by increasing the amount of tax-
able income which is taxed at the lowest income tax
rate.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE; AMENDMENT OF 1986 CODE.
(a) SHORT TITLE.—This Act may be cited as the
‘‘Middle Class Tax Relief Act of 1998’’.
(b) AMENDMENT OF 1986 CODE.—Except as other-
wise expressly provided, whenever in this Act an amend-
ment or repeal is expressed in terms of an amendment
to, or repeal of, a section or other provision, the reference
shall be considered to be made to a section or other provi-
sion of the Internal Revenue Code of 1986.
(c) SECTION 15 NOT TO APPLY.—No amendment
made by section 3 shall be treated as a change in a rate
of tax for purposes of section 15 of the Internal Revenue
Code of 1986.
SEC. 2. FINDINGS.
The Congress hereby finds that—
(1) the Congressional Budget Office has pro-
jected a Federal budget surplus at the end of fiscal
year 1998, the first surplus in almost 30 years;
(2) if there is such a surplus, a systematic plan
should 
be 
put 
in 
place 
to 
retire 
our
$5,500,000,000,000 debt while restoring the social
security and other trust funds; and
(3) once such a plan has been adopted in the
context of a balanced Federal budget and as an al-
ternative to new Government spending, Congress
should provide broad-based tax relief that will allow
hard-working Americans to keep more of what they
earn and the freedom to provide for their own needs.
SEC. 3. REDUCTION OF INCOME TAX RATES; ELIMINATION
OF MARRIAGE PENALTY.
(a) GENERAL RULE.—Section 1 (relating to tax im-
posed) is amended by striking subsections (a) through (e)
and inserting the following:
‘‘(a) MARRIED INDIVIDUALS FILING JOINT RETURNS
AND SURVIVING SPOUSES.—There is hereby imposed on
the taxable income of—
‘‘(1) every married individual (as defined in sec-
tion 7703) who makes a single return jointly with
his spouse under section 6013, and
‘‘(2) every surviving spouse (as defined in sec-
tion 2(a)),
a tax determined in accordance with the following table:
‘‘If taxable income is:
The tax is:
Not over $70,000 ..........................
15% of taxable income.
Over 
$70,000 
but 
not 
over
$102,300.
$10,500, plus 28% of the excess over
$70,000.
Over 
$102,300 
but 
not 
over
$155,950.
$19,544, plus 31% of the excess over
$102,300.
Over 
$155,950 
but 
not 
over
$278,450.
$36,175.50, plus 36% of the excess
over $155,950.
Over $278,450 ...............................
$80,275.50, plus 39.6% of the excess
over $278,450.
‘‘(b) HEADS OF HOUSEHOLDS.—There is hereby im-
posed on the taxable income of every head of a household
(as defined in section 2(b)) a tax determined in accordance
with the following table:
‘‘If taxable income is:
The tax is:
Not over $52,600 ..........................
15% of taxable income.
Over 
$52,600 
but 
not 
over
$87,700.
$7,890, plus 28% of the excess over
$52,600.
‘‘If taxable income is:
The tax is:
Over 
$87,700 
but 
not 
over
$142,000.
$17,718, plus 31% of the excess over
$87,700.
Over 
$142,000 
but 
not 
over
$278,450.
$34,551, plus 36% of the excess over
$142,000.
Over $278,450 ...............................
$83,673 plus 39.6% of the excess
over $278,450.
‘‘(c) OTHER INDIVIDUALS.—There is hereby imposed
on the taxable income of every individual (other than an
individual to whom subsection (a) or (b) applies) a tax
determined in accordance with the following table:
‘‘If taxable income is:
The tax is:
Not over $35,000 ..........................
15% of taxable income.
Over 
$35,000 
but 
not 
over
$61,400.
$5,250, plus 28% of the excess over
$35,000.
Over 
$61,400 
but 
not 
over
$128,100.
$12,642, plus 31% of the excess over
$61,400.
Over 
$128,100 
but 
not 
over
$278,450.
$33,319, plus 36% of the excess over
$128,100.
Over $278,450 ...............................
$87,445, plus 39.6% of the excess
over $278,450.
‘‘(d) ESTATES AND TRUSTS.—There is hereby im-
posed on the taxable income of—
‘‘(1) every estate, and
‘‘(2) every trust,
taxable under this subsection a tax determined in accord-
ance with the following table:
‘‘If taxable income is:
The tax is:
Not over $1,700 ............................
15% of taxable income.
Over $1,700 but not over $4,000 ..
$255, plus 28% of the excess over
$1,700.
Over $4,000 but not over $6,100 ..
$899, plus 31% of the excess over
$4,000.
Over $6,100 but not over $8,350 ..
$1,550, plus 36% of the excess over
$6,100.
Over $8,350 ...................................
$2,360, plus 39.6% of the excess over
$8,350.’’.
(b) INFLATION ADJUSTMENT TO APPLY IN DETER-
MINING RATES FOR 1999.—Subsection (f) of section 1 is
amended—
(1) by striking ‘‘1993’’ in paragraph (1) and in-
serting ‘‘1998’’,
(2) by striking ‘‘1992’’ in paragraph (3)(B) and
inserting ‘‘1997’’, and
(3) by striking paragraph (7).
(c) CONFORMING AMENDMENTS.—
(1) The following provisions are each amended
by striking ‘‘1992’’ and inserting ‘‘1997’’ each place
it appears:
(A) Section 25A(h).
(B) Section 32(j)(1)(B).
(C) Section 41(e)(5)(C).
(D) Section 68(b)(2)(B).
(E) Section 135(b)(2)(B)(ii).
(F) Section 151(d)(4).
(G) Section 221(g)(1)(B).
(H) Section 512(d)(2)(B).
(I) Section 513(h)(2)(C)(ii).
(J) Section 877(a)(2).
(K) Section 911(b)(2)(D)(ii)(II).
(L) Section 4001(e)(1)(B).
(M) Section 4261(e)(4)(A)(ii).
(N) Section 6039F(d).
(O) Section 6334(g)(1)(B).
(P) Section 7430(c)(1).
(2) Subparagraph (B) of section 1(f)(6) is
amended to read as follows:
‘‘(B) MARRIED INDIVIDUALS FILING SEPA-
RATELY.—In the case of a married individual
filing a separate return, subparagraph (A) shall
be applied by substituting ‘$25’ for ‘$50’ each
place it appears for purposes of determining
any increase in the dollar amount under section
63(c)(2)(D), the $50,000 amount in section
68(b)(1), and the dollar amount in section
151(d)(3)(C)(iv).’’
(3) Subclause (II) of section 42(h)(6)(G)(i) is
amended by striking ‘‘1987’’ and inserting ‘‘1997’’.
(4) Subparagraph (B) of section 59(j)(2) is
amended by striking ‘‘, determined by substituting
‘1997’ for ‘1992’ in subparagraph (B) thereof ’’.
(5) Subparagraph (B) of section 63(c)(4) is
amended by striking ‘‘by substituting for’’ and all
that follows and inserting ‘‘by substituting for ‘cal-
endar year 1997’ in subparagraph (B) thereof ‘cal-
endar year 1987’ in the case of the dollar amounts
contained in paragraph (2) or (5)(A) or subsection
(f).’’
(6) Subparagraph (B) of section 132(f)(6) is
amended by inserting before the period ‘‘, deter-
mined by substituting ‘calendar year 1992’ for ‘cal-
endar year 1997’ in subparagraph (B) thereof ’’.
(7) Paragraph (2) of section 220(g) of such
Code is amended by striking ‘‘by substituting ‘cal-
endar year 1997’ for ‘calendar year 1992’ in sub-
paragraph (B) thereof ’’.
(8) Subparagraph (B) of section 685(c)(3) is
amended by striking ‘‘, by substituting ‘calendar
year 1997’ for ‘calendar year 1992’ in subparagraph
(B) thereof ’’.
(9) Subparagraph (B) of section 2032A(a)(3) is
amended by striking ‘‘by substituting ‘calendar year
1997’ for ‘calendar year 1992’ in subparagraph (B)
thereof ’’.
(10) Subparagraph (B) of section 2503(b)(2) is
amended by striking ‘‘by substituting ‘calendar year
1997’ for ‘calendar year 1992’ in subparagraph (B)
thereof ’’.
(11) Paragraph (2) of section 2631(c) is
amended by striking ‘‘by substituting ‘calendar year