A bill to amend the Internal Revenue Code of 1986 to make permanent the individual tax provisions of the tax reform law, and for other purposes.

Bill: 118-s-1226
Sponsor: full_name: Sen. Cruz, Ted [R-TX]
Introduced: 2023-04-20
Policy area: Taxation
Latest action: action_date: 2023-04-20
text: Read twice and referred to the Committee on Finance.

Summaries:
action_date: 2023-04-20
action_desc: Introduced in Senate
text: <p>This bill makes permanent several tax provisions for individual taxpayers that were enacted by the Tax Cuts and Jobs Act of 2017 and are scheduled to expire at the end of 2025. These provisions include a reduction of individual income tax rates, an increase in the child tax credit, limitations on the tax deduction for state and local taxes and the mortgage interest deduction, and an increase in the exemption amount for estate and gift taxes.</p>

tv_txt: II 118th CONGRESS 1st Session S. 1226 IN THE SENATE OF THE UNITED STATES April 20, 2023 Mr. Cruz (for himself and Mr. Braun ) introduced the following bill; which was read twice and referred to the Committee on Finance A BILL To amend the Internal Revenue Code of 1986 to make permanent the individual tax provisions of the tax reform law, and for other purposes.

1. Permanent modification of individual rate brackets (a) Married individuals filing joint returns and surviving spouses The table contained in subsection (a) of section 1 of the Internal Revenue Code of 1986 is amended to read as follows: If taxable income is: The tax is: Not over $19,050 10% of taxable income. Over $19,050 but not over $77,400 $1,905, plus 12% of the excess over $19,050. Over $77,400 but not over $165,000 $8,907, plus 22% of the excess over $77,400. Over $165,000 but not over $315,000 $28,179, plus 24% of the excess over $165,000. Over $315,000 but not over $400,000 $64,179, plus 32% of the excess over $315,000. Over $400,000 but not over $600,000 $91,379, plus 35% of the excess over $400,000. Over $600,000 $161,379, plus 37% of the excess over $600,000. . (b) Heads of households The table contained in subsection (b) of section 1 of the Internal Revenue Code of 1986 is amended to read as follows: If taxable income is: The tax is: Not over $13,600 10% of taxable income. Over $13,600 but not over $51,800 $1,360, plus 12% of the excess over $13,600. Over $51,800 but not over $82,500 $5,944, plus 22% of the excess over $51,800. Over $82,500 but not over $157,500 $12,698, plus 24% of the excess over $82,500. Over $157,500 but not over $200,000 $30,698, plus 32% of the excess over $157,500. Over $200,000 but not over $500,000 $44,298, plus 35% of the excess over $200,000. Over $500,000 $149,298, plus 37% of the excess over $500,000. . (c) Unmarried individuals other than surviving spouses and heads of households The table contained in subsection (c) of section 1 of the Internal Revenue Code of 1986 is amended to read as follows: If taxable income is: The tax is: Not over $9,525 10% of taxable income. Over $9,525 but not over $38,700 $952.50, plus 12% of the excess over $9,525. Over $38,700 but not over $82,500 $4,453.50, plus 22% of the excess over $38,700. Over $82,500 but not over $157,500 $14,089.50, plus 24% of the excess over $82,500. Over $157,500 but not over $200,000 $32,089.50, plus 32% of the excess over $157,500. Over $200,000 but not over $500,000 $45,689.50, plus 35% of the excess over $200,000. Over $500,000 $150,689.50, plus 37% of the excess over $500,000. . (d) Married individuals filing separate returns The table contained in subsection (d) of section 1 of the Internal Revenue Code of 1986 is amended to read as follows: If taxable income is: The tax is: Not over $9,525 10% of taxable income. Over $9,525 but not over $38,700 $952.50, plus 12% of the excess over $9,525. Over $38,700 but not over $82,500 $4,453.50, plus 22% of the excess over $38,700. Over $82,500 but not over $157,500 $14,089.50, plus 24% of the excess over $82,500. Over $157,500 but not over $200,000 $32,089.50, plus 32% of the excess over $157,500. Over $200,000 but not over $300,000 $45,689.50, plus 35% of the excess over $200,000. Over $300,000 $80,689.50, plus 37% of the excess over $300,000. . (e) Estates and trusts The table contained in subsection (e) of section 1 of the Internal Revenue Code of 1986 is amended to read as follows: If taxable income is: The tax is: Not over $2,550 10% of taxable income. Over $2,550 but not over $9,150 $255, plus 24% of the excess over $2,550. Over $9,150 but not over $12,500 $1,839, plus 35% of the excess over $9,150. Over $12,500 $3,011.50, plus 37% of the excess over $12,500. . (f) Adjustment for inflation Subsection (f) of section 1 of the Internal Revenue Code of 1986 is amended— (1) by striking 1993 in paragraph (1) and inserting 2018 , (2) by striking determined— and all that follows in paragraph (2)(A) and inserting determined by substituting 2017 for 2016 in paragraph (3)(A)(ii), , (3) by striking a married individual filing a separate return in paragraph (7)(B) and inserting any unmarried individual other than a surviving spouse or head of household , (4) by striking married individuals filing separately in the heading of subparagraph (B) of paragraph (7) and inserting certain unmarried individuals , and (5) by striking paragraph (8). (g) Capital gains brackets Subsection (h) of section 1 of the Internal Revenue Code of 1986 is amended— (1) by striking which would (without regard to this paragraph) be taxed at a rate below 25 percent in paragraph (1)(B)(i) and inserting below the maximum zero rate amount , (2) by striking which would (without regard to this paragraph) be taxed at a rate below 39.6 percent in paragraph (1)(C)(ii)(I) and inserting below the maximum 15-percent rate amount , and (3) by adding at the end the following new paragraph: (12) Maximum amounts defined For purposes of this subsection— (A) Maximum zero rate amount The maximum zero rate amount shall be— (i) in the case of a joint return or surviving spouse, $77,200, (ii) in the case of an individual who is a head of household (as defined in section 2(b)), $51,700, (iii) in the case of any other individual (other than an estate or trust), an amount equal to ½ of the amount in effect for the taxable year under clause (i), and (iv) in the case of an estate or trust, $2,600. (B) Maximum 15-percent rate amount The maximum 15-percent rate amount shall be— (i) in the case of a joint return or surviving spouse, $479,000 ( ½ such amount in the case of a married individual filing a separate return), (ii) in the case of an individual who is the head of a household (as defined in section 2(b)), $452,400, (iii) in the case of any other individual (other than an estate or trust), $425,800, and (iv) in the case of an estate or trust, $12,700. (C) Inflation adjustment In the case of any taxable year beginning after 2018, each of the dollar amounts in subparagraphs (A) and (B) shall be increased by an amount equal to— (i) such dollar amount, multiplied by (ii) the cost-of-living adjustment determined under subsection (f)(3) for the calendar year in which the taxable year begins, determined by substituting calendar year 2017 for calendar year 2016 in subparagraph (A)(ii) thereof. If any increase under this subparagraph is not a multiple of $50, such increase shall be rounded to the next lowest multiple of $50. . (h) Conforming amendments (1) Section 1 of the Internal Revenue Code of 1986 is amended by striking subsections (i) and (j). (2) Section 3402(q)(1) of such Code is amended by striking third lowest and inserting fourth lowest . (i) Section 15 not To apply Section 15 of the Internal Revenue Code of 1986 shall not apply to any change in a rate of tax by reason of this section. (j) Effective date The amendments made by this section shall apply to taxable years beginning after December 31, 2022. 2. Permanent extension of deduction for qualified business income of pass-thru entities (a) In general Section 199A of the Internal Revenue Code of 1986 is amended by striking subsection (i). (b) Effective date The amendment made by this section shall apply to taxable years beginning after December 31, 2022. 3. Permanent extension of limitation on losses for taxpayers other than corporations (a) In general Paragraph (1) of section 461(l) of the Internal Revenue Code of 1986 is amended to read as follows: (1) Limitation In the case of taxable year of a taxpayer other than a corporation, any excess business loss of the taxpayer for the taxable year shall not be allowed. . (b) Conforming amendment Section 461 of the Internal Revenue Code of 1986 is amended by striking subsection (j) (relating to limitation on excess farm losses of certain taxpayers). (c) Effective date The amendments made by this section shall apply to taxable years beginning after December 31, 2022. 4. Permanent extension of increase in standard deduction (a) In general Section 63(c)(2) of the Internal Revenue Code of 1986 is amended— (1) by striking $4,400 in subparagraph (B) and inserting $18,800 , and (2) by striking $3,000 in subparagraph (C) and inserting $12,000 . (b) Inflation adjustment Paragraph (4) of section 63(c) of the Internal Revenue Code of 1986 is amended to read as follows: (4) Adjustments for inflation (A) In general In the case of any taxable year beginning in a calendar year after 2018, the $18,000 and $12,000 amounts in paragraph (2) shall each be increased by an amount equal to— (i) such dollar amount, multiplied by (ii) the cost-of-living adjustment determined under section 1(f)(3) for the calendar year in which the taxable year begins, by substituting 2017 for 2016 in subparagraph (A)(ii) thereof. (B) Certain amounts In the case of any taxable year beginning in a calendar year after 1988, each dollar amount contained in paragraph (5) or subsection (f) shall be increased by an amount equal to— (i) such dollar amount, multiplied by (ii) the cost-of-living adjustment determined under section 1(f)(3) for the calendar year in which the taxable year begins, by substituting for calendar year 2016 in subparagraph (A)(ii) thereof— (I) calendar year 1987 in the case of the dollar amounts contained in paragraph (5)(A) or subsection (f), and (II) calendar year 1997 in the case of the dollar amount contained in paragraph (5)(B). . (c) Conforming amendment Section 63(c) of the Internal Revenue Code of 1986 is amended by striking paragraph (7). (d) Effective date The amendments made by this section shall apply to taxable years beginning after December 31, 2022. 5. Permanent increase and modification of child tax credit (a) Increase in credit amount Section 24(a) of the Internal Revenue Code of 1986 is amended by striking $1,000 and inserting $2,000 . (b) Limitation Paragraph (2) of section 24(b) of the Internal Revenue Code of 1986 is amended to read as follows: (2) Threshold amount For purposes of paragraph (1), the term threshold amount means— (A) $400,000 in the case of a joint return, and (B) $200,000 in any other case. . (c) Partial credit allowed for certain other dependents Subsection (h) of section 24 of the Internal Revenue Code of 1986 is amended to read as follows: (h) Partial credit allowed for certain other dependents (1) In general The credit determined under subsection (a) shall be increased by $500 for each dependent of the taxpayer (as defined in section 7706) other than a qualifying child described in subsection (c). (2) Exception for certain noncitizens Paragraph (1) shall not apply with respect to any individual who would not be a dependent if subparagraph (A) of section 7706(b)(3) were applied without regard to all that follows resident of the United States . (3) Certain qualifying children In the case of any qualifying child with respect to whom a credit is not allowed under this section by reason of subsection (e)(1), such child shall be treated as a dependent to whom subparagraph (A) applies. . (d) Maximum amount of refundable credit Subsection (d) of section 24 of the Internal Revenue Code of 1986 is amended by inserting after paragraph (2) the following new paragraph: (3) Limitation (A) In general The amount determined under paragraph (1)(A) with respect to any qualifying child shall not exceed $1,400, and such paragraph shall be applied without regard to subsection (h). (B) Adjustment for inflation In the case of a taxable year beginning after 2018, the $1,400 amount in subparagraph (A) shall be increased by an amount equal to— (i) such dollar amount, multiplied by (ii) the cost-of-living adjustment determined under section 1(f)(3) for the calendar year in which the taxable year begins, determined by substituting 2017 for 2016 in subparagraph (A)(ii) thereof. If any increase under this clause is not a multiple of $100, such increase shall be rounded to the next lowest multiple of $100. . (e) Earned income threshold for refundable credit Section 24(d)(1)(B) of the Internal Revenue Code of 1986 is amended by striking $3,000 and inserting $2,500 . (f) Social Security number required Paragraph (1) of section 24(e) of the Internal Revenue Code of 1986 is amended to read as follows: (1) Qualifying child Social security number requirement No credit shall be allowed under this section to a taxpayer with respect to any qualifying child unless the taxpayer includes the name and social security number of such child on the return of tax for the taxable year. For purposes of the preceding sentence, the term social security number means a social security number issued to an individual by the Social Security Administration, but only if the social security number is issued— (A) to a citizen of the United States or pursuant to subclause (I) (or that portion of subclause (III) that relates to subclause (I)) of section 205(c)(2)(B)(i) of the Social Security Act, and (B) before the due date for such return. . (g) Repeal of deadwood (1) In general Section 24 of the Internal Revenue Code of 1986 is amended by striking subsections (i) and (j) and by redesignating subsection (k) as subsection (i). (2) Conforming amendments Subsection (i) of section 24 of such Code, as redesignated by paragraph (1), is amended— (A) by striking paragraph (2)(A), (B) in paragraph (2)(B)— (i) by striking and all that precedes In the case , and (ii) by redesignating clauses (i) and (ii) as subparagraphs (A) and (B), respectively, and by moving such subparagraphs 2 ems to the left, (C) in paragraph (3)(A), by striking and without regard to the application of this section to bona fide residents of Puerto Rico under subsection (i)(1) , and (D) in paragraph (3)(C)(ii)— (i) by striking under subparagraph (B) and all that follows through December 31, 2021, and inserting under subparagraph (B), , and (ii) by striking paragraph (2)(B) and inserting paragraph (2) . (h) Effective date The amendments made by this section shall apply to taxable years beginning after December 31, 2022. 6. Permanent extension of increased limitation for certain charitable contributions (a) In general Section 170(b)(1)(G) of the Internal Revenue Code of 1986 is amended— (1) by striking for any taxable year beginning after December 31, 2017, and before January 1, 2026, in clause (i), (2) by striking for any taxable year described in such clause in clause (ii), and (3) by striking For each taxable year described in clause (i), and each taxable year to which any contribution under this subparagraph is carried over under clause (ii), subparagraph (A) in clause (iii) and inserting Subparagraph (A) . (b) Effective date The amendments made by this section shall apply to contributions in taxable years beginning after December 31, 2025. 7. Permanent extension of increased contributions to ABLE accounts (a) In general Section 529A(b)(2)(B)(ii) of the Internal Revenue Code of 1986 is amended by striking before January 1, 2026 . (b) Allowance of savers credit Section 25B(d)(1)(D) of the Internal Revenue Code of 1986 is amended by striking before January 1, 2026, . (c) Effective date The amendments made by this section shall apply to taxable years beginning after the date of the enactment of this Act. 8. Permanent extension of rollovers to ABLE programs from 529 programs (a) In general Section 529(c)(3)(C)(i)(III) is amended by striking before January 1, 2026, . (b) Effective date The amendments made by this section shall apply to distributions made after the date of the enactment of this Act. 9. Permanent extension of treatment of certain individuals performing services in the Sinai Peninsula of Egypt (a) In general Subsection (c) of section 11026 of Public Law 115–97 is amended— (1) by striking beginning before January 1, 2026 in paragraph (1)(B), and (2) by striking beginning before January 1, 2026 in paragraph (2)(B). (b) Effective date The amendments made by this section shall take effect on the date of the enactment of this Act. 10. Permanent extension of treatment of student loans discharged on account of death or disability (a) In general Subparagraph (A) of section 108(f)(5) of the Internal Revenue Code of 1986 is amended by striking and before January 1, 2026, . (b) Effective date The amendment made by this section shall apply to discharges of indebtedness after December 31, 2022. 11. Repeal of deduction for personal exemptions (a) In general Part V of subchapter B of chapter 1 of the Internal Revenue Code of 1986 is hereby repealed. (b) Definition of dependent retained Section 152 of the Internal Revenue Code of 1986, prior to repeal by subsection (a), is hereby redesignated as section 7706 of such Code and moved to the end of chapter 79 of such Code. (c) Application to estates and trusts Subparagraph (C) of section 642(b)(2) of the Internal Revenue Code of 1986 is amended— (1) by striking the exemption amount under section 151(d) in clause (i) and inserting $4,150 , and (2) by striking clause (iii) and inserting the following: (iii) Inflation adjustment In the case of any taxable year beginning in a calendar year after 2018, the $4,150 amount in clause (i) shall be increased by an amount equal to— (I) such dollar amount, multiplied by (II) the cost-of-living adjustment determined under section 1(f)(3) for the calendar year in which the taxable begins, determined by substituting 2017 for 2016 in subparagraph (A)(ii) thereof. If any increase determined under the preceding sentence is not a multiple of $100, such increase shall be rounded to the next lowest multiple of $100. . (d) Application to nonresident aliens Section 873(b) of the Internal Revenue Code of 1986 is amended by striking paragraph (3). (e) Modification of return requirement (1) In general Section 6012 of the Internal Revenue Code of 1986 is amended— (A) by striking paragraph (1) of subsection (a) and inserting the following: (1) Every individual who has gross income for the taxable year, except that a return shall not be required of— (A) an individual who is not married (determined by applying section 7703) and who has gross income for the taxable year which does not exceed the standard deduction applicable to such individual for such taxable year under section 63, or (B) an individual entitled to make a joint return if— (i) the gross income of such individual, when combined with the gross income of such individual’s spouse, for the taxable year does not exceed the standard deduction which would be applicable to the taxpayer for such taxable year under section 63 if such individual and such individual’s spouse made a joint return, (ii) such individual and such individual’s spouse have the same household as their home at the close of the taxable year, (iii) such individual’s spouse does not make a separate return, and (iv) neither such individual nor such individual’s spouse is an individual described in section 63(c)(2) who has income (other than earned income) in excess of the amount in effect under section 63(c)(2)(A). , and (B) by striking subsection (f). (2) Bankruptcy estates Paragraph (8) of section 6012(a) of such Code is amended by striking the sum of the exemption amount plus the basic standard deduction under section 63(c)(2)(D) and inserting the standard deduction in effect under section 63(c)(1)(B) . (f) Conforming amendments (1) Section 1(f)(7) of the Internal Revenue Code of 1986 is amended— (A) by striking section 151(d)(4) in subparagraph (A) and inserting section 7706(d)(6) , and (B) by striking 151(d)(4) in subparagraph (B) and inserting 7706(d)(6) . (2) Section 2(a)(1)(B) of the Internal Revenue Code of 1986 is amended by striking a dependent and all that follows through section 151 and inserting a dependent who (within the meaning of section 7706, determined without regard to subsections (b)(1), (b)(2), and (d)(1)(B) thereof) is a son, stepson, daughter, or stepdaughter of the taxpayer . (3) Section 21 of such Code is amended— (A) in subsection (b)(1)(A), by striking section 152(a)(1) and inserting section 7706(a)(1) , (B) in subsection (b)(1)(B), by striking section 152 and inserting section 7706 , (C) in subsection (e)(5)— (i) by striking section 152(e) in subparagraph (A) and inserting section 7706(e) , and (ii) by striking section 152(e)(4)(A) and inserting section 7706(e)(4)(A) , and (D) in subsection (e)(6)(B), by striking section 152(f)(1) and inserting section 7706(f)(1) . (4) Section 24(a) of such Code is amended by striking for which the taxpayer is allowed a deduction under section 151 and inserting which is a dependent of the taxpayer . (5) Section 24(c) of such Code is amended— (A) in paragraph (1), by striking section 152(c) and inserting section 7706(c) , and (B) in paragraph (2), by striking section 152(b)(3) and inserting section 7706(b)(3) . (6) Section 25A(f)(1)(A)(iii) of such Code is amended by striking with respect to whom the taxpayer is allowed a deduction under section 151 . (7) Section 25A(g)(3) of such Code is amended by striking If a deduction under section 151 with respect to an individual is allowed to another taxpayer and inserting If an individual is a dependent (as defined in section 7706) of another taxpayer . (8) Section 25B(c)(2) of such Code is amended— (A) in subparagraph (A), by striking with respect to whom a deduction under section 151 is allowed to another taxpayer and inserting who is a dependent of another taxpayer , and (B) in subparagraph (B), by striking section 152(f)(2) and inserting section 7706(f)(2) . (9) Section 25E(c)(3)(C) is amended by striking with respect to whom no deduction is allowable with respect to another taxpayer under section 151 and inserting who is a dependent (as defined in section 7706) of another taxpayer . (10) Section 32(c)(1)(A)(iii) of such Code is amended by striking for whom a deduction is allowable under section 151 to and inserting of . (11) Section 32(c)(3) of such Code is amended— (A) in subparagraph (A)— (i) by striking section 152(c) and inserting section 7706(c) , and (ii) by striking section 152(e) and inserting section 7706(e) , (B) in subparagraph (B), by striking unless the taxpayer is entitled to a deduction under section 151 for such taxable year with respect to such individual (or would be so entitled but for section 152(e)) and inserting unless such individual is a dependent (as defined in section 7706) of such taxpayer for such taxable year (or would be a dependent bu for section 7706(e) , and (C) in subparagraph (C), by striking section 152(c)(1)(B) and inserting section 7706(c)(1)(B) . (12) Section 35(d)(1) of such Code is amended by striking with respect to whom the taxpayer is entitled to a deduction under section 151(c) . (13) Section 35(d)(2) of such Code is amended— (A) by striking section 152(e) and inserting section 7706(e) , and (B) by striking section 152(e)(4)(A) and inserting section 7706(e)(4)(A) . (14) Section 35(g)(4) of such Code is amended by striking with respect to whom a deduction under section 151 is allowable to and inserting is a dependent (as defined in section 7706) of . (15) Section 35(g)(10)(C)(ii) of such Code is amended by striking the taxpayer to whom the deduction under section 151 is allowable and inserting the taxpayer of whom such individual is a dependent of . (16) Section 36(d)(3) of such Code is amended by striking a deduction under section 151 with respect to such taxpayer is allowable to another taxpayer for such taxable year and inserting such taxpayer is a dependent of another taxpayer for such taxable year . (17) Section 36B(b)(2)(A) of such Code is amended by striking section 152 and inserting section 7706 . (18) Section 36B(b)(3)(B) of such Code is amended— (A) by striking who is not allowed a deduction under section 151 for the taxable year with respect to a dependent and inserting who does not have any dependents for the taxable year , and (B) by striking unless a deduction is allowed under section 151 for the taxable year with respect to a dependent in the flush matter at the end and inserting unless the taxpayer has a dependent for the taxable year . (19) Section 36B(c)(1)(D) of such Code is amended by striking with respect to whom a deduction under section 151 is allowable to another taxpayer and inserting who is a dependent of another taxpayer . (20) Section 36B(d)(1) of such Code is amended by striking equal to the number of individuals for whom the taxpayer is allowed a deduction under section 151 (relating to allowance of deduction for personal exemptions) for the taxable year and inserting the sum of 1 (2 in the case of a joint return) plus the number of the taxpayer’s dependents for the taxable year . (21) Section 36B(e)(1) of such Code is amended by striking 1 or more individuals for whom a taxpayer is allowed a deduction under section 151 (relating to allowance of deduction for personal exemptions) for the taxable year (including the taxpayer or his spouse) and inserting 1 or more of the taxpayer, the taxpayer’s spouse, or any dependent of the taxpayer . (22) Section 42(i)(3)(D)(ii)(I) of such Code is amended by striking section 152 and inserting section 7706 . (23) Section 45R(e)(1)(A)(iv) of such Code is amended— (A) by striking section 152(d)(2) and inserting section 7706(d)(2) , and (B) by striking section 152(d)(2)(H) and inserting section 7706(d)(2)(H) . (24) Section 51(i)(1) of such Code is amended— (A) by striking section 152(d)(2) each place it appears and inserting section 7706(d)(2) , and (B) by striking section 152(d)(2)(H) in subparagraph (C) thereof and inserting section 7706(d)(2)(H) . (25) Section 56(b)(1)(D) of such Code is amended by striking , the deduction for personal exemptions under section 151, . (26) Section 63(b) of such Code is amended by striking paragraph (2) and by redesignating paragraphs (3) and (4) as paragraphs (2) and (3), respectively. (27) Section 63(c)(5) is amended by striking with respect to whom a deduction under section 151 is allowable to and inserting who is a dependent of . (28) Subparagraph (B) of section 63(f)(1) of such Code is amended to read as follows: (B) for the spouse of the taxpayer if— (i) the spouse has attained age 65 before the close of the taxable year, and (ii) a joint return is not made by the taxpayer and his spouse, and the spouse, for the calendar year in which the taxable year of the taxpayer begins, has no gross income and is not the dependent of another taxpayer. . (29) Subparagraph (B) of section 63(f)(2) of such Code is amended to read as follows: (B) for the spouse of the taxpayer if— (i) the spouse is blind as of the close of the taxable year, and (ii) a joint return is not made by the taxpayer and his spouse, and the spouse, for the calendar year in which the taxable year of the taxpayer begins, has no gross income and is not the dependent of another taxpayer. . (30) Section 72(t)(2)(D)(i)(III) of such Code is amended by striking section 152 and inserting section 7706 . (31) Section 72(t)(7)(A)(iii) of such Code is amended by striking section 152(f)(1) and inserting section 7706(f)(1) . (32) Section 105(b) of such Code is amended— (A) by striking as defined in section 152 and inserting as defined in section 7706 , (B) by striking section 152(f)(1) and inserting section 7706(f)(1) , and (C) by striking section 152(e) and inserting section 7706(e) . (33) Section 105(c)(1) of such Code is amended by striking section 152 and inserting section 7706 . (34) Section 125(e)(1)(D) of such Code is amended by striking section 152 and inserting section 7706 . (35) Section 129(c) of such Code is amended— (A) by striking with respect to whom, for such taxable year, a deduction is allowable under section 151(c) (relating to personal exemptions for dependents) to in paragraph (1) and inserting who is a dependent of , and (B) by striking section 152(f)(1) in paragraph (2) and inserting section 7706(f)(1) . (36) Section 132(h)(2)(B) of such Code is amended— (A) by striking section 152(f)(1) and inserting section 7706(f)(1) , and (B) by striking section 152(e) and inserting section 7706(e) . (37) Section 135(c)(2)(A)(iii) is amended by striking with respect to whom the taxpayer is allowed a deduction under section 151 . (38) Section 139D(c)(5) of such Code is amended by striking section 152 and inserting section 7706 . (39) Section 139E(c)(2) of such Code is amended by striking section 152 and inserting section 7706 . (40) Section 162(l)(1)(D) of such Code is amended by striking section 152(f)(1) and inserting section 7706(f)(1) . (41) Section 170(g)(1) of such Code is amended by striking section 152 and inserting section 7706 . (42) Section 170(g)(3) of such Code is amended by striking section 152(d)(2) and inserting section 7706(d)(2) . (43) Section 172(d) of such Code is amended by striking paragraph (3). (44) Section 213(a) of such Code is amended by striking section 152 and inserting section 7706 . (45) Section 213(d)(5) of such Code is amended by striking section 152(e) and inserting section 7706(e) . (46) Section 213(e)(11) of such Code is amended by striking section 152(d)(2) and inserting section 7706(d)(2) . (47) Section 220(b)(6) of such Code is amended by striking with respect to whom a deduction under section 151 is allowable to and inserting who is a dependent of . (48) Section 220(d)(2)(A) of such Code is amended by striking section 152 and inserting section 7706 . (49) Section 221(c) of such Code is amended by striking a deduction under section 151 with respect to such individual is allowed to and inserting such individual is a dependent of . (50) Section 221(d)(4) of such Code is amended by striking section 152 and inserting section 7706 . (51) Section 223(b)(6) of such Code is amended by striking with respect to whom a deduction under section 151 is allowable to and inserting who is a dependent of . (52) Section 223(d)(2)(A) of such Code is amended by striking section 152 and inserting section 7706 . (53) Section 401(h) of such Code is amended by striking section 152(f)(1) in the last sentence and inserting section 7706(f)(1) . (54) Section 402(l)(4)(D) of such Code is amended by striking section 152 and inserting section 7706 . (55) Section 409A(a)(2)(B)(ii)(I) of such Code is amended by striking section 152(a) and inserting section 7706(a) . (56) Section 443 is amended by striking subsection (c). (57) Section 501(c)(9) of such Code is amended by striking section 152(f)(1) and inserting section 7706(f)(1) . (58) Section 529(c)(9)(C)(iii) of such Code is amended by striking section 152(d)(2)(B) and inserting section 7706(d)(2)(B) . (59) Section 529(e)(2)(B) of such Code is amended by striking section 152(d)(2) and inserting section 7706(d)(2) . (60) Section 529A(e)(4) of such Code is amended— (A) by striking section 152(d)(2)(B) and inserting section 7706(d)(2)(B) , and (B) by striking section 152(f)(1)(B) and inserting section 7706(f)(1)(B) . (61) Section 703(a)(2) of such Code is amended by striking subparagraph (A) and by redesignating subparagraphs (B) through (F) as subparagraphs (A) through (E), respectively. (62) Section 873(b) is amended by striking paragraph (3). (63) Section 874 of such Code is amended by striking subsection (b) and by redesignating subsection (c) as subsection (b). (64) Section 891 of such Code is amended by striking under section 151 and . (65) Section 904(b) of such Code is amended by striking paragraph (1). (66) Section 931(b)(1) of such Code is amended by striking (other than the deduction under section 151, relating to personal exemptions) . (67) Section 933 of such Code is amended— (A) by striking (other than the deduction under section 151, relating to personal exemptions) in paragraph (1), and (B) by striking (other than the deduction for personal exemptions under section 151) in paragraph (2). (68) Section 1212(b)(2)(B)(ii) of such Code is amended to read as follows: (ii) in the case of an estate or trust, the deduction allowed for such year under section 642(b). . (69) Section 1361(c)(1)(C) of such Code is amended by striking section 152(f)(1)(C) and inserting section 7706(f)(1)(C) . (70) Section 1402(a) of such Code is amended by striking paragraph (7). (71) Section 2032A(c)(7)(D) of such Code is amended by striking section 152(f)(2) and inserting section 7706(f)(2) . (72) Section 3402(f)(1)(A) of such Code is amended by striking for whom a deduction is allowed with respect to another taxpayer under section 151 and inserting who is a dependent of another taxpayer . (73) Section 3402(m)(1) of such Code is amended by striking other than the deductions referred to in section 151 and . (74) Section 3402(r)(2) of such Code is amended by striking the sum of— and all that follows and inserting the standard deduction in effect under section 63(c)(1)(B). . (75) Section 5000A(b)(3)(A) of such Code is amended by striking section 152 and inserting section 7706 . (76) Section 5000A(c)(4)(A) of such Code is amended by striking the number of individuals for whom the taxpayer is allowed a deduction under section 151 (relating to allowance of deduction for personal exemptions) for the taxable year and inserting the sum of 1 (2 in the case of a joint return) plus the number of the taxpayer’s dependents for the taxable year . (77) Section 6013(b)(3)(A) of such Code is amended— (A) by striking had less than the exemption amount of gross income in clause (ii) and inserting had no gross income , (B) by striking had gross income of the exemption amount or more in clause (iii) and inserting had any gross income , and (C) by striking the flush language following clause (iii). (78) Section 6103(l)(21)(A)(iii) of such Code is amended to read as follows: (iii) the number of the taxpayer’s dependents, . (79) Section 6213(g)(2)(H) of such Code is amended by striking or section 151 (relating to allowance of deductions for personal exemptions) . (80) Section 6334(d)(2) of such Code is amended to read as follows: (2) Exempt amount (A) In general For purposes of paragraph (1), the term exempt amount means an amount equal to— (i) the sum of the amount determined under subparagraph (B) and the standard deduction, divided by (ii) 52. (B) Amount determined For purposes of subparagraph (A), the amount determined under this subparagraph is $4,150 multiplied by the number of the taxpayer’s dependents for the taxable year in which the levy occurs. (C) Inflation adjustment In the case of any taxable year beginning after 2018, the $4,150 amount in subparagraph (B) shall be increased by an amount equal to— (i) such dollar amount, multiplied by (ii) the cost-of-living adjustment determined under section 1(f)(3) for the calendar year in which the taxable year begins, by substituting calendar year 2017 for calendar year 2016 in subparagraph (A) thereof. If any increase determined under the preceding sentence is not a multiple of $100, such increase shall be rounded to the next lowest multiple of $100. (D) Verified statement Unless the taxpayer submits to the Secretary a written and properly verified statement specifying the facts necessary to determine the proper amount under subparagraph (A), subparagraph (A) shall be applied as if the taxpayer were a married individual filing a separate return with no dependents. . (81) Section 6334(d) of such Code is amended by striking paragraph (4). (82) Section 7702B(f)(2)(C)(iii) of such Code is amended by striking section 152(d)(2) and inserting section 7706(d)(2) . (83) Section 7703(a) of such Code is amended by striking part V of subchapter B of chapter 1 and . (84) Section 7703(b)(1) of such Code is amended— (A) by striking section 152(f)(1) and all that follows and inserting section 7706(f)(1), , and (B) by striking section 152(e) and inserting section 7706(e) . (85) Section 7706(a) of such Code, as redesignated by this section, is amended by striking this subtitle and inserting subtitle A . (86) (A) Section 7706(d)(1)(B) of such Code, as redesignated by this section, is amended by striking the exemption amount (as defined in section 151(d)) and inserting $4,150 . (B) Section 7706(d) of such Code, as redesignated by this section, is amended by adding at the end the following new paragraph: (6) Inflation adjustment In the case of any calendar year beginning after 2018, the $4,150 amount in paragraph (1)(B) shall be increased by an amount equal to— (A) such dollar amount, multiplied by (B) the cost-of-living adjustment determined under section 1(f)(3) for such calendar year, determined by substituting calendar year 2017 for calendar year 2016 in subparagraph (A)(ii) thereof. If any increase determined under the preceding sentence is not a multiple of $100, such increase shall be rounded to the next lowest multiple of $100. . (87) The table of sections for chapter 79 of such Code is amended by adding at the end the following new item: Sec. 7706. Dependent defined. . (g) Effective date The amendments made by this section shall apply to taxable years beginning after December 31, 2022. 12. Permanent extension of limitation on deduction for State and local, etc., taxes (a) In general Paragraph (6) of section 164(b) of the Internal Revenue Code of 1986 is amended— (1) by striking , and before January 1, 2026 , and (2) by striking 2018 through 2025 in the heading and inserting after 2017 . (b) Effective date The amendments made by this section shall apply to taxable years beginning after December 31, 2022. 13. Permanent extension of limitation on deduction for qualified residence interest (a) Repeal of home equity indebtedness (1) In general Section 163(h)(3)(A) of the Internal Revenue Code of 1986 is amended by striking during the taxable year on and all that follows through For purposes of and inserting during the taxable year on acquisition indebtedness with respect to any qualified principal residence of the taxpayer. For purposes of . (2) Conforming amendment Section 163(h)(3) of such Code is amended by striking subparagraph (C). (b) Limitation on acquisition indebtedness (1) In general Section 163(h)(3)(B)(ii) of the Internal Revenue Code of 1986 is amended by striking $1,000,000 ($500,000 and inserting $750,000 ($375,000 . (2) Treatment of indebtedness incurred on or before December 31, 2017; refinancings Section 163(h)(3) of the Internal Revenue Code of 1986, as amended by subsection (a)(2), is amended by inserting after subparagraph (B) the following new subparagraph: (C) Treatment of indebtedness incurred on or before December 15, 2017; refinancings (i) In general In the case of any indebtedness incurred on or before December 15, 2017, subparagraph (B)(ii) shall apply as in effect immediately before the enactment of the Public Law 115–97 , and, in applying such subparagraph to any indebtedness incurred after such date, the limitation under such subparagraph shall be reduced (but not below zero) by the amount of any indebtedness incurred on or before December 15, 2017, which is treated as acquisition indebtedness for purposes of this subsection for the taxable year. (ii) Binding contract exception In the case of a taxpayer who enters into a written binding contract before December 15, 2017, to close on the purchase of a principal residence before January 1, 2018, and who purchases such residence before April 1, 2018, subclause (III) shall be applied by substituting April 1, 2018 for December 15, 2017 . (iii) Treatment of refinancings of indebtedness (I) In general In the case of any indebtedness which is incurred to refinance indebtedness, such refinanced indebtedness shall be treated for purposes of clause (i) as incurred on the date that the original indebtedness was incurred to the extent the amount of the indebtedness resulting from such refinancing does not exceed the amount of the refinanced indebtedness. (II) Limitation on period of refinancing Subclause (I) shall not apply to any indebtedness after the expiration of the term of the original indebtedness or, if the principal of such original indebtedness is not amortized over its term, the expiration of the term of the 1st refinancing of such indebtedness (or if earlier, the date which is 30 years after the date of such 1st refinancing). . (c) Coordination with exclusion of income from discharge of indebtedness Section 108(h)(2) of the Internal Revenue Code of 1986 is amended by striking , applied by substituting and all that follows through section 163(h)(3)(F)(i)(II) . (d) Conforming amendments Section 163(h)(3) of the Internal Revenue Code of 1986 is amended— (1) in the heading of subparagraph (D)(ii), by striking $1,000,000 , and (2) by striking subparagraph (F). (e) Effective date The amendments made by this section shall apply to taxable years beginning after December 31, 2022. 14. Permanent extension of modifications to deduction for personal casualty losses (a) In general Paragraph (5) of section 165(h) of the Internal Revenue Code of 1986 is amended— (1) by striking , and before January 1, 2026 in subparagraph (A), and (2) by striking 2018 through 2025 in the heading and inserting after 2017 . (b) Effective date The amendments made by this section shall apply to losses incurred in taxable years beginning after December 31, 2022. 15. Repeal of miscellaneous itemized deductions (a) In general Section 67 of the Internal Revenue Code of 1986 is amended— (1) by striking subsection (a) and inserting the following: (a) General rule No miscellaneous itemized deduction shall be allowed for any taxable year beginning after December 31, 2017. , (2) by striking subsection (g), and (3) by striking 2-percent floor on in the heading and inserting Treatment of . (b) Conforming amendment The table of sections for part I of subchapter B of chapter 1 of the Internal Revenue Code of 1986 is amended by striking 2-percent floor on in the item relating to section 67 and inserting Treatment of . (c) Effective date The amendments made by this section shall apply to taxable years beginning after December 31, 2022. 16. Repeal of overall limitation on itemized deductions (a) In general Part 1 of subchapter B of chapter 1 of the Internal Revenue Code of 1986 is amended by striking section 68 (and the item relating to such section in the table of sections for such part). (b) Conforming amendments (1) Section 1(f)(7) of the Internal Revenue Code of 1986, as amended by this Act, is amended by striking section 63(c)(4), or section 68(b)(2) and inserting or section 63(c)(4) . (2) Section 56(b)(1) of such Code is amended by striking subparagraph (E). (3) Section 164(b)(5)(H)(ii)(III) of such Code is amended by inserting (as in effect before the date of the enactment of the Tax Cuts and Jobs Act) after 68(b) . (4) Section 642(b)(2)(C)(i)(I) of such Code is amended by striking as an individual described in section 68(b)(1)(C) and inserting as an individual who is not married and who is not a surviving spouse or head of household . (5) Section 773(a)(3)(B) of such Code is amended by striking clause (i) and redesignating clauses (ii) through (iv) as clauses (i) through (iii), respectively. (c) Effective date The amendments made by this section shall apply to taxable years beginning after December 31, 2022. 17. Repeal of exclusion for qualified bicycle commuting reimbursement (a) In general Section 132(f)(1) of the Internal Revenue Code of 1986 is amended by striking subparagraph (D). (b) Conforming amendments (1) Section 132(f)(2) of the Internal Revenue Code of 1986 is amended by inserting and at the end of subparagraph (A), by striking , and at the end of subparagraph (B) and inserting a period, and by striking subparagraph (C). (2) Section 132(f)(4) of such Code is amended by striking (other than a qualified bicycle commuting reimbursement) . (3) Section 132(f)(5) of such Code is amended by striking subparagraph (F). (4) Section 132(f) of such Code is amended by striking paragraph (8). (c) Effective date The amendments made by this section shall apply to taxable years beginning after December 31, 2022. 18. Permanent extension of modification of exclusion for qualified moving expense reimbursement (a) In general Section 132(g) of the Internal Revenue Code of 1986 is amended— (1) in paragraph (1), by striking individual and inserting qualified military member , and (2) by striking paragraph (2) and inserting the following: (2) Qualified military member For purposes of paragraph (1), the term qualified military member means a member of the Armed Forces of the United States on active duty who moves pursuant to a military order and incident to a permanent change of station. . (b) Effective date The amendments made by this section shall apply to taxable years beginning after December 31, 2022. 19. Repeal of deduction for moving expenses (a) In general Subsection (a) of section 217 of the Internal Revenue Code of 1986 is amended to read as follows: (a) Deduction allowed There shall be allowed as a deduction moving expenses paid or incurred during the taxable year in connection with the commencement of work by a member of the Armed Forces of the United States on active duty who moves pursuant to a military order and incident to a permanent change of station. . (b) Conforming amendments (1) Section 217 of the Internal Revenue Code of 1986 is amended— (A) by striking subsections (c), (d), (f), and (i), (B) by redesignating subsections (g), (h), and (j) as subsections (c), (d), and (e), respectively, and (C) in subsection (c), as so redesignated— (i) by striking paragraph (1) and redesignating paragraphs (2) and (3) as paragraphs (1) and (2), respectively, and (ii) in paragraph (2) (as so redesignated), by striking moving expenses of his spouse and dependents and all that follows and inserting moving expenses of his spouse and dependents as if his spouse commenced work as an employee at a new principal place of work at such location. . (2) Section 23 of such Code is amended by striking 217(h)(3) each place it appears in subsections (d)(3) and (e) and inserting 217(d)(3) . (c) Effective date The amendments made by this section shall apply to taxable years beginning after December 31, 2022. 20. Permanent extension of limitation on wagering losses (a) In general The second sentence of section 165(d) of the Internal Revenue Code of 1986 is amended by striking in the case of taxable years beginning after December 31, 2017, and before January 1, 2026, . (b) Effective date The amendments made by this section shall not apply to taxable years beginning after December 31, 2022. 21. Increase in estate and gift tax exemption made permanent (a) In general Section 2010(c)(3)(A) of the Internal Revenue Code of 1986 is amended by striking $5,000,000 and inserting $10,000,000 . (b) Conforming amendments (1) Section 2010(c)(3) of the Internal Revenue Code of 1986 is amended by striking subparagraph (C). (2) Subsection (g) of section 2001 of such Code is amended to read as follows: (g) Modifications To gift tax payable To reflect different tax rates For purposes of applying subsection (b)(2) with respect to 1 or more gifts, the rates of tax under subsection (c) in effect at the decedent's death shall, in lieu of the rates of tax in effect at the time of such gifts, be used both to compute— (1) the tax imposed by chapter 12 with respect to such gifts, and (2) the credit allowed against such tax under section 2505, including in computing— (A) the applicable credit amount under section 2505(a)(1), and (B) the sum of the amounts allowed as a credit for all preceding periods under section 2505(a)(2). . (c) Effective date The amendments made by this section shall apply to estates of decedents dying and gifts made after December 31, 2022. 22. Increase in alternative minimum tax exemption made permanent (a) In general Section 55(d) of the Internal Revenue Code of 1986 is amended— (1) in paragraph (1)— (A) by striking $78,750 in subparagraph (A) and inserting $109,400 , and (B) by striking $50,600 in subparagraph (B) and inserting $70,300 , and (2) in paragraph (2)— (A) by striking $150,000 in subparagraph (A) and inserting $1,000,000 , and (B) by striking subparagraphs (B) and (C) and inserting the following: (B) 50 percent of the dollar amount applicable under subparagraph (A) in the case of a taxpayer described in subparagraph (B) or (C) of paragraph (1), and (C) 50 percent of $150,000 in the case of a taxpayer described in paragraph (1)(D). . (b) Inflation adjustment (1) In general Section 55(d)(3)(A)(ii) of the Internal Revenue Code of 1986 is amended to read as follows: (ii) the cost-of-living adjustment determined under section 1(f)(3) for the calendar year in which the taxable year begins, by substituting for calendar year 2016 in subparagraph (A)(ii) thereof— (I) calendar year 2011 in the case of the dollar amounts described in clauses (i), (iv), and (v) of subparagraph (B), and (II) calendar year 2017 in the case of the dollar amounts described in clauses (ii) and (iii) of subparagraph (B). . (2) Conforming amendments Section 55(d)(3)(B) of such Code is amended— (A) by striking subparagraphs (A), (B), and (D) of paragraph (1), and in clause (ii) and inserting subparagraphs (A) and (B) of paragraph (1), , (B) by striking subparagraphs (A) and (B) of paragraph (2). in clause (iii) and inserting paragraph (2)(A), , and (C) by adding at the end the following: (iv) the dollar amount contained in paragraph (1)(D), and (v) the dollar amount contained in paragraph (2)(C). . (c) Treatment of unearned income of minor children Section 59 of the Internal Revenue Code of 1986 is amended by striking subsection (j). (d) Effective date The amendments made by this section shall apply to taxable years beginning after December 31, 2022. 23. Technical amendment Section 11000 of Public Law 115–97 is amended by redesignating subsection (a) as subsection (b) and by inserting before subsection (b) (as so redesignated) the following new subsection: (a) Short title This title may be cited as the Tax Cuts and Jobs Act . .