H.R. 7303

119 HR 7303 IH: Middle Class Tax Cut Act
 U.S. House of Representatives
 2026-01-30
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 I  119th CONGRESS  2d Session  H. R. 7303  IN THE HOUSE OF REPRESENTATIVES   January 30, 2026   Mr. Thanedar  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 reform the individual income tax rates.
1.
Short title
This Act may be cited as the   Middle Class Tax Cut Act  .
2.
Increased standard deduction
(a)
In general
 Section 63(c)(2)  of the Internal Revenue Code of 1986 is amended—
(1)
in subparagraph (B), by striking  $4,400  and inserting  $75,000 , and
(2)
in subparagraph (C), by striking  $3,000  and inserting  $50,000 .
(b)
Conforming amendments
Section 63(c)(4) of such Code is amended—
(1)
by inserting  (2026 in the case of the dollar amounts contained in subparagraph (B) or (C) of paragraph (2))  after  1988 , and
(2)
in subparagraph (B)—
(A)
in clause (i)—
(i)
by striking  paragraph (2)(B), (2)(C), or (5)(A)  and inserting  paragraph (5)(A) , and
(ii)
by striking  and  at the end,
(B)
in clause (ii), by striking the period at the end and inserting  , and , and
(C)
by adding at the end the following new clause:
(i)
 calendar year 2025  in the case of the dollar amounts contained in subparagraph (B) or (C) of paragraph (2).
 .
(c)
Effective date
The amendments made by this section shall apply to taxable years beginning after December 31, 2025.
3.
Individual income tax rate reform
(a)
Joint returns and surviving spouses
 Section 1(a)  of the Internal Revenue Code of 1986 is amended by striking the table contained therein and inserting the following:
  If taxable income is:    The tax is:       Not over $200,000  25% of taxable income.    Over $200,000 but not over $400,000  $50,000, plus 30% of the excess over $200,000.     Over $400,000 but not over $1,000,000  $110,000, plus 40% of the excess over $400,000.    Over $1,000,000 but not over $2,000,000  $350,000, plus 50% of the excess over $1,000,000.    Over $2,000,000  $850,000, plus 70% of the excess over $2,000,000.       .
(b)
Heads of households
Section 1(b) of such Code is amended by striking the table contained therein and inserting the following:
  If taxable income is:    The tax is:       Not over $150,000  25% of taxable income.    Over $150,000 but not over $300,000  $37,500, plus 30% of the excess over $150,000.     Over $300,000 but not over $750,000  $82,500, plus 40% of the excess over $300,000.    Over $750,000 but not over $1,500,000  $262,500, plus 50% of the excess over $750,000.    Over $1,500,000  $637,500, plus 70% of the excess over $1,500,000.       .
(c)
Other individuals
Section 1 of such Code is amended by striking subsections (c) and (d) and inserting the following new subsection:
(d)
Other individuals
There is hereby imposed on the taxable income of every individual (other than an individual subject to tax under subsection (a) or (b)) a tax determined in accordance with the following table:
  If taxable income is:    The tax is:       Not over $100,000  25% of taxable income.    Over $100,000 but not over $200,000  $25,000, plus 30% of the excess over $100,000.     Over $200,000 but not over $500,000  $55,000, plus 40% of the excess over $200,000.    Over $500,000 but not over $1,000,000  $175,000, plus 50% of the excess over $500,000.    Over $1,000,000  $425,000, plus 70% of the excess over $1,000,000.
 .
(d)
Estates and trusts
Section 1(e) of such Code is amended by striking the table contained therein and inserting the following new table:
  If taxable income is:    The tax is:       Not over $3,000  25% of taxable income.    Over $3,000 but not over $11,000  $750, plus 30% of the excess over $3,000.     Over $11,000 but not over $15,000  $3,150, plus 40% of the excess over $11,000.    Over $15,000 but not over $20,000  $4,750, plus 50% of the excess over $15,000.    Over $20,000  $7,250, plus 70% of the excess over $20,000.       .
(e)
Repeal of reduced rates of tax on capital gains
Section 1 of such Code is amended by striking subsection (h).
(f)
Conforming amendments
(1)
Section 1(f) of such Code is amended—
(A)
in the heading, by striking
Phaseout of marriage penalty in 15-percent bracket  ,
(B)
in paragraph (1)—
(i)
by striking  1993  and inserting  2026
(ii)
by striking  (c),  ,
(C)
in paragraph (2)—
(i)
by striking  (c), , and
(ii)
by amending subparagraph (A) to read as follows:
(A)
by increasing the minimum and maximum dollar amounts for each bracket for which a tax is imposed under such table by the cost-of-living adjustment for such calendar year, determined by substituting  2026  for  2016  in paragraph (3)(A)(ii),
 ,
(D)
in paragraph (7)(B)—
(i)
in the heading, by striking
married individuals filing separately   and inserting
certain individuals  , and
(ii)
by striking  married individual filing a separate return  and inserting  any individual subject to tax under subsection (d) , and
(E)
by striking paragraph (8).
(2)
Section 1 of such Code is amended by striking subsections (i) and (j).
(g)
Effective date
The amendments made by this section shall apply to taxable years beginning after December 31, 2025.