I 
117TH CONGRESS 
1ST SESSION H. R. 1040 
To amend the Internal Revenue Code of 1986 to provide taxpayers a flat 
tax alternative to the current income tax system. 
IN THE HOUSE OF REPRESENTATIVES 
FEBRUARY 15, 2021 
Mr. BURGESS introduced the following bill; which was referred to the Com-
mittee on Ways and Means, and in addition to the Committee on Rules, 
for a period to be subsequently determined by the Speaker, in each case 
for consideration of such provisions as fall within the jurisdiction of the 
committee concerned 
A BILL 
To amend the Internal Revenue Code of 1986 to provide 
taxpayers a flat tax alternative to the current income 
tax system. 
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 ‘‘Flat Tax Act’’. 
SEC. 2. THE FLAT TAX. 
(a) IN GENERAL.—Subchapter A of chapter 1 of the 
Internal Revenue Code of 1986 is amended by inserting 
after part VII the following new part: 
VerDate Sep 11 2014 
21:17 Mar 19, 2021
Jkt 019200
PO 00000
Frm 00001
Fmt 6652
Sfmt 6201
E:\BILLS\H1040.IH
H1040
pbinns on DSKJLVW7X2PROD with BILLS
‘‘PART VIII—THE FLAT TAX 
‘‘Sec. 60. Irrevocable election to be subject to flat tax. 
‘‘Sec. 60A. Tax imposed on individuals. 
‘‘Sec. 60B. Tax imposed on business activities. 
‘‘Sec. 60C. Tax on noncash compensation provided to employees not engaged in 
business activity. 
‘‘SEC. 60. IRREVOCABLE ELECTION TO BE SUBJECT TO 
FLAT TAX. 
‘‘(a) INDIVIDUAL.— 
‘‘(1) IN GENERAL.—Except as provided in para-
graph (2), in lieu of the tax imposed by sections 1 
(relating to tax imposed) and 55 (relating to alter-
native minimum tax imposed), under regulations 
prescribed by the Secretary, an individual may make 
an irrevocable election to be subject to the tax im-
posed by this part. 
‘‘(2) INNOCENT SPOUSE EXCEPTION.—An indi-
vidual who has made an election under paragraph 
(1) and who subsequently obtains relief of liability 
for tax under section 6015(b) may, not later than 1 
year after the date such relief is granted, revoke the 
election made under paragraph (1). 
‘‘(b) PERSON ENGAGED IN BUSINESS ACTIVITY.—In 
lieu of the tax imposed by sections 11 (relating to tax im-
posed) and 55 (relating to alternative minimum tax im-
posed), under regulations prescribed by the Secretary, a 
person engaged in business activity may make an irrev-
VerDate Sep 11 2014 
21:17 Mar 19, 2021
Jkt 019200
PO 00000
Frm 00002
Fmt 6652
Sfmt 6201
E:\BILLS\H1040.IH
H1040
pbinns on DSKJLVW7X2PROD with BILLS
ocable election to be subject to the tax imposed by this 
part. 
‘‘(c) DISALLOWANCE OF CREDITS.—No credit shall 
be allowed under this chapter for any taxable year to any 
person with respect to whom an election under subsection 
(a) or (b) is in effect. 
‘‘SEC. 60A. TAX IMPOSED ON INDIVIDUALS. 
‘‘(a) IN GENERAL.—There is hereby imposed on the 
taxable income of every individual who makes an election 
to be subject to this part a tax equal to— 
‘‘(1) 19 percent of the taxable income of such 
individual for such taxable year in the case of the 
first 2 taxable years of the individual beginning with 
the taxable year for which the election is made, and 
‘‘(2) 17 percent of the taxable income of such 
individual for such taxable year in the case of all 
taxable years subsequent to the taxable years de-
scribed in paragraph (1). 
‘‘(b) TAXABLE INCOME.—For purposes of this part, 
the term ‘taxable income’ means the excess of— 
‘‘(1) the sum of— 
‘‘(A) wages (as defined in section 3121(a) 
without regard to paragraph (1) thereof) which 
are paid in cash and which are received during 
VerDate Sep 11 2014 
21:17 Mar 19, 2021
Jkt 019200
PO 00000
Frm 00003
Fmt 6652
Sfmt 6201
E:\BILLS\H1040.IH
H1040
pbinns on DSKJLVW7X2PROD with BILLS
the taxable year for services performed in the 
United States, 
‘‘(B) retirement distributions which are in-
cludible in gross income for such taxable year, 
plus 
‘‘(C) amounts received under any law of 
the United States or of any State which is in 
the nature of unemployment compensation, over 
‘‘(2) the standard deduction. 
‘‘(c) STANDARD DEDUCTION.—For purposes of this 
part— 
‘‘(1) IN GENERAL.—The term ‘standard deduc-
tion’ means the sum of— 
‘‘(A) the basic standard deduction, plus 
‘‘(B) the additional standard deduction. 
‘‘(2) BASIC STANDARD DEDUCTION.—For pur-
poses of paragraph (1), the basic standard deduction 
is— 
‘‘(A) $32,496 in the case of— 
‘‘(i) a joint return, or 
‘‘(ii) a surviving spouse (as defined in 
section 2(a)), 
‘‘(B) $20,739 in the case of a head of 
household (as defined in section 2(b)), and 
VerDate Sep 11 2014 
21:17 Mar 19, 2021
Jkt 019200
PO 00000
Frm 00004
Fmt 6652
Sfmt 6201
E:\BILLS\H1040.IH
H1040
pbinns on DSKJLVW7X2PROD with BILLS