Working Families Tax Cut Act

I 118TH CONGRESS 1ST SESSION H. R. 3864 To amend the Internal Revenue Code of 1986 to rename the standard deduc- tion the guaranteed deduction, and to add a bonus amount to the guaranteed deduction for taxable years 2024 and 2025. IN THE HOUSE OF REPRESENTATIVES JUNE 6, 2023 Ms. MALLIOTAKIS (for herself and Mrs. STEEL) 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 rename the standard deduction the guaranteed deduction, and to add a bonus amount to the guaranteed deduction for taxable years 2024 and 2025. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Working Families Tax 4 Cut Act’’. 5 VerDate Sep 11 2014 22:56 Jul 06, 2023 Jkt 039200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H3864.IH H3864 pbinns on DSKJLVW7X2PROD with $$_JOB 2 •HR 3864 IH SEC. 2. STANDARD DEDUCTION RENAMED GUARANTEED 1 DEDUCTION. 2 (a) IN GENERAL.—Section 63 of the Internal Rev- 3 enue Code of 1986 is amended— 4 (1) by striking ‘‘standard deduction’’ each place 5 it appears and inserting ‘‘guaranteed deduction’’, 6 and 7 (2) in subsection (c)— 8 (A) in the heading, by striking ‘‘STAND- 9 ARD DEDUCTION’’ and inserting ‘‘GUARANTEED 10 DEDUCTION’’, 11 (B) in the heading of paragraph (2), by 12 striking ‘‘STANDARD DEDUCTION’’ and inserting 13 ‘‘GUARANTEED DEDUCTION’’, 14 (C) in the heading of paragraph (3), by 15 striking ‘‘STANDARD DEDUCTION’’ and inserting 16 ‘‘GUARANTEED DEDUCTION’’, 17 (D) in the heading of paragraph (5), by 18 striking ‘‘STANDARD DEDUCTION’’ and inserting 19 ‘‘GUARANTEED DEDUCTION’’, 20 (E) in the heading of paragraph (6), by 21 striking ‘‘STANDARD DEDUCTION’’ and inserting 22 ‘‘GUARANTEED DEDUCTION’’, and 23 (F) in the heading of paragraph (7)(A), by 24 striking ‘‘STANDARD DEDUCTION’’ and inserting 25 ‘‘GUARANTEED DEDUCTION’’. 26 VerDate Sep 11 2014 22:56 Jul 06, 2023 Jkt 039200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H3864.IH H3864 pbinns on DSKJLVW7X2PROD with $$_JOB 3 •HR 3864 IH (b) CONFORMING AMENDMENTS.— 1 (1) Section 1(g)(4)(A) of such Code is amended 2 by striking ‘‘standard deduction’’ and inserting 3 ‘‘guaranteed deduction’’. 4 (2) Section 56(b)(1)(D) of such Code is amend- 5 ed— 6 (A) in the heading, by striking ‘‘STAND- 7 ARD DEDUCTION’’ and inserting ‘‘GUARANTEED 8 DEDUCTION’’, and 9 (B) by striking ‘‘standard deduction’’ and 10 inserting ‘‘guaranteed deduction’’. 11 (3) Section 861(b) of such Code is amended by 12 striking ‘‘standard deduction’’ and inserting ‘‘guar- 13 anteed deduction’’. 14 (4) Section 862(b) of such Code is amended by 15 striking ‘‘standard deduction’’ and inserting ‘‘guar- 16 anteed deduction’’. 17 (5) Section 1398(c) of such Code is amended— 18 (A) in the heading, by striking ‘‘STAND- 19 ARD DEDUCTION’’ and inserting ‘‘GUARANTEED 20 DEDUCTION’’, 21 (B) in the heading of paragraph (3), by 22 striking ‘‘STANDARD DEDUCTION’’ and inserting 23 ‘‘GUARANTEED DEDUCTION’’, and 24 VerDate Sep 11 2014 22:56 Jul 06, 2023 Jkt 039200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H3864.IH H3864 pbinns on DSKJLVW7X2PROD with $$_JOB 4 •HR 3864 IH (C) by striking ‘‘standard deduction’’ and 1 inserting ‘‘guaranteed deduction’’. 2 (6) Section 3402 of such Code is amended by 3 striking ‘‘standard deduction’’ each place it appears 4 and inserting ‘‘guaranteed deduction’’. 5 (7) Section 6012 of such Code is amended by 6 striking ‘‘standard deduction’’ each place it appears 7 and inserting ‘‘guaranteed deduction’’. 8 (8) Section 6013(b)(3)(A) of such Code is 9 amended by striking ‘‘standard deduction’’ and in- 10 serting ‘‘guaranteed deduction’’. 11 (9) Section 6014(b)(4) of such Code is amend- 12 ed by striking ‘‘standard deduction’’ and inserting 13 ‘‘guaranteed deduction’’. 14 (10) Section 6334 of such Code is amended by 15 striking ‘‘standard deduction’’ each place it appears 16 and inserting ‘‘guaranteed deduction’’. 17 (c) EFFECTIVE DATE.—The amendments made by 18 this section shall apply to taxable years beginning after 19 December 31, 2023. 20 SEC. 3. BONUS GUARANTEED DEDUCTION FOR 2024 AND 21 2025. 22 (a) IN GENERAL.—Section 63(c) of the Internal Rev- 23 enue Code of 1986 (as amended by section 2) is amended 24 by adding at the end the following new paragraph: 25 VerDate Sep 11 2014 22:56 Jul 06, 2023 Jkt 039200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H3864.IH H3864 pbinns on DSKJLVW7X2PROD with $$_JOB 5 •HR 3864 IH ‘‘(8) BONUS GUARANTEED DEDUCTION FOR 1 TAXABLE YEARS 2024 AND 2025.— 2 ‘‘(A) IN GENERAL.—In the case of a tax- 3 able year beginning after December 31, 2023, 4 and before January 1, 2026, the guaranteed de- 5 duction shall be increased by the amount of the 6 bonus guaranteed deduction. 7 ‘‘(B) BONUS GUARANTEED DEDUCTION.— 8 For purposes of this paragraph, the bonus 9 guaranteed deduction is— 10 ‘‘(i) $4,000 in the case of a joint re- 11 turn or a surviving spouse (as defined in 12 section 2(a)), 13 ‘‘(ii) $3,000 in the case of a head of 14 household, and 15 ‘‘(iii) $2,000 in any other case. 16 ‘‘(C) ADJUSTMENT FOR INFLATION.—In 17 the case of a taxable year beginning after 2024, 18 each dollar amount in subparagraph (B) shall 19 be increased by an amount equal to— 20 ‘‘(i) such dollar amount, multiplied by 21 ‘‘(ii) the cost-of-living adjustment de- 22 termined under section 1(f)(3) for the cal- 23 endar year in which the taxable year be- 24 VerDate Sep 11 2014 22:56 Jul 06, 2023 Jkt 039200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H3864.IH H3864 pbinns on DSKJLVW7X2PROD with $$_JOB 6 •HR 3864 IH gins, determined by substituting ‘2023’ for 1 ‘2016’ in subparagraph (A)(ii) thereof. 2 If any increase under this subparagraph is not 3 a multiple of $50, such increase shall be round- 4 ed to the next lowest multiple of $50. 5 ‘‘(D) LIMITATION ON BONUS GUARANTEED 6 DEDUCTION BASED ON MODIFIED ADJUSTED 7 GROSS INCOME.— 8 ‘‘(i) IN GENERAL.—The bonus guar- 9 anteed deduction determined under sub- 10 paragraph (B) shall be reduced (but not 11 below zero) by 5 percent of so much of the 12 taxpayer’s modified adjusted gross income 13 as exceeds the threshold amount. For pur- 14 poses of the preceding sentence, the term 15 ‘modified adjusted gross income’ means 16 adjusted gross income increased by any 17 amount excluded from gross income under 18 section 911, 931, or 933. 19 ‘‘(ii) THRESHOLD AMOUNT.—For pur- 20 poses of clause (i), the threshold amount 21 is— 22 ‘‘(I) $400,000 in the case of a 23 joint return or a surviving spouse (as 24 defined in section 2(a)), 25 VerDate Sep 11 2014 22:56 Jul 06, 2023 Jkt 039200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H3864.IH H3864 pbinns on DSKJLVW7X2PROD with $$_JOB 7 •HR 3864 IH ‘‘(II) $300,000 in the case of a 1 head of household, and 2 ‘‘(III) $200,000 in any other 3 case.’’. 4 (b) EFFECTIVE DATE.—The amendments made by 5 this subsection shall apply to taxable years beginning after 6 December 31, 2023. 7 Æ VerDate Sep 11 2014 22:56 Jul 06, 2023 Jkt 039200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6301 E:\BILLS\H3864.IH H3864 pbinns on DSKJLVW7X2PROD with $$_JOB