Simplified USA Tax Act of 2003

Bill: 108-hr-269
Sponsor: Rep. English, Phil [R-PA-3]
Introduced: 2003-01-08 in the House
Policy area: Taxation
Subjects: Accounting
Administrative procedure
Agriculture and Food
Aliens
Alimony
Americans in foreign countries
Annuities
Armed Forces and National Security
Athletics
Bank accounts
Business travel
Capital gains tax
Cemeteries and funerals
Charitable contributions
Child support
College costs
College sports
Colleges
Commemorations
Commerce
Conservation of natural resources
Contracts
Cooperative societies
Corporate governance
Corporate mergers
Corporation taxes
Cost of living adjustments
Crime and Law Enforcement
Damages
Debt
Department of the Treasury
Depreciation and amortization
Disability insurance
Disabled
Dividends
Divorce
EBB Terrorism
Economics and Public Finance
Education
Education savings accounts
Employee ownership
Employee training
Environmental Protection
Estate tax
Expatriation
Families
Finance and Financial Sector
Financial services
Foreign Trade and International Finance
Foreign corporations
Foster home care
Foundations
Fringe benefits
Gift tax
Gifts
Government Operations and Politics
Government corporations
Habitat conservation
Health
Health insurance
Higher education
Historic sites
History
Home ownership
Housing and Community Development
Housing finance
Immigration
Imports
Income tax
Indexing (Economic policy)
Individual retirement accounts
Insurance companies
Insurance premiums
Interest
Intergovernmental tax relations
International Affairs
Labor and Employment
Land use
Law
Leases
Life insurance
Loan defaults
Lobbying
Losses
Marketing
Medical economics
Medical research
Medical savings accounts
Medicare
Military pay
Military pensions
Mortgages
Officer personnel
Old age, survivors and disability insurance
Open space lands
Outdoor recreation
Partnerships
Profit
Public Lands and Natural Resources
Railroad retirement plans
Real estate business
Real estate development
Recreation areas
Rent
School personnel
Science, Technology, Communications
Social Welfare
Social security taxes
Sports and Recreation
Sports facilities
Stocks
Tax administration
Tax credits
Tax deductions
Tax deferral
Tax evasion
Tax exclusion
Tax exemption
Tax penalties
Tax rates
Tax refunds
Tax returns
Tax simplification
Tax treaties
Tax-deferred compensation plans
Tax-exempt organizations
Tax-exempt securities
Taxation of foreign income
Teachers
Telecommunication industry
Telephone
Territories (U.S.)
Terrorism
Torts
Transportation and Public Works
Travel costs
Trusts and trustees
Unemployment
Unrelated business income tax
Vocational and technical education
Withholding tax
Workers' compensation

Summary:
action_date: 2003-01-08
text: Simplified USA Tax Act of 2003 - Renames the Internal Revenue Code (IRC) the "USA Tax Code." Establishes a new chapter 1, "Simplified USA Tax for Individuals."
Establishes tax rates at 15, 25, and 30 percent. Sets forth provisions defining gross income, exclusions from gross income, alimony and child support deductions, personal and dependency deductions, the family living allowance, the homeowner deduction, the education deduction (equal, as a general rule, to the sum of all qualified education expenses), the philanthropic transfer deduction, the kiddie tax (concerning taxable income of children), and tax credits (including allowing a payroll tax credit).
Sets forth provisions concerning a Roth IRA, a deductible IRA, annuities, endowment contracts, and life insurance contracts. Permits contributions to a Roth IRA of up to the amount of an individual's adjusted gross income. Provides, as a general rule, for the exclusion from gross income of Roth IRA distributions. Sets forth provisions concerning basis, business transactions, and nonrecognition transactions.
Establishes rules for exclusion from gross income, rules relating to deductions, and rules for the rental of real estate.
Requires a trust or estate to prepay the Simplified USA Tax for individuals. Sets the tax rate at 30 percent on the taxable income of a trust or estate when the taxable income exceeds $3,800. Sets forth rules concerning trusts and estates, including rules for credits, deductions, trust income, distributions, beneficiaries, charitable remainder trusts, reversionary interests, and funeral trusts.
Renumbers the current chapter 2 (Tax on Self-Employment Income) of the IRC as chapter 3. Establishes a new chapter 2, "Simplified USA Tax for Businesses." States that the tax equals the amount by which the business tax exceeds the payroll tax credit. Defines the "business tax" as the sum of: (1) 8 percent of the portion of the gross profits of the business entity for the taxable year that does not exceed $150,000; and (2) 12 percent of such portion of the gross profits of the business entity for the taxable year that exceeds $150,000. Directs the Secretary to prescribe rules under which the gross profits of business entities under common control are aggregated for purposes of applying the benefit of the lower rate. States that such rules shall be similar to rules applicable under IRC sections 1551 (Disallowance of the benefits of the graduated corporate rates and accumulated credit) and 1561 (Limitations on certain multiple tax benefits in the case of controlled corporations). Defines the "payroll tax credit" as a credit for the social security, railroad retirement, and hospital insurance taxes paid by an employer.
Sets forth subchapters governing: (1) the basic rules for the business tax; (2) capital contributions, mergers, acquisitions, and distributions; (3) accounting method rules; (4) land and rental property; (5) insurance and financial products; (6) financial intermediation and financial institutions; (7) tax-exempt organizations; (8) cooperatives; (9) sourcing rules; (10) business conducted in a possession; (11) the payroll tax credit; (12) the import tax (as a general rule, eleven percent of the customs value of property or services); and (12) transition, administration, and consolidated returns (permitted, if it would have been permitted under the IRC provisions governing consolidated returns and such provisions were applied by treating each business entity as a corporation and its owners or partners as shareholders).
Provides, in general, that subchapter D (Deferred Compensation) of chapter 1 of the IRC is saved.
Repeals Subtitle B (Estate and Gift Taxes) of the IRC.

Legislative actions:
action_date: 2003-01-08
text: Referred to the House Committee on Ways and Means.
action_date: 2003-01-08
text: Introduced in House
action_date: 2003-01-08
text: Introduced in House