115TH CONGRESS HOUSE OF REPRESENTATIVES …

1 115TH CONGRESS HOUSE OF REPRESENTATIVES REPORT 1st Session 115 ___ TAX cuts AND jobs ACT _____, 2017 . Ordered to be printed Mr. Brady of Texas, from the committee of conference, submitted the following CONFERENCE REPORT [To accompany 1] The committee of conference on the disagreeing votes of the two Houses on the amendment of the Senate to the bill ( 1), to provide for reconciliation pursuant to titles II and V of the concurrent resolution on the budget for fiscal year 2018, having met, after full and free conference, have agreed to recommend and do recommend to their respective Houses as follows: That the HOUSE recede from its disagreement to the amendment of the Senate and agree to the same with an amendment as follows: In lieu of the matter proposed to be inserted by the Senate amendment, insert the following: And the Senate agree to the same.

2 TITLE I 1 SEC. 11000. SHORT TITLE, ETC. 2(a) SHORTTITLE. This title may be cited as the 3 Tax cuts and jobs Act . 4(b) AMENDMENT OF1986 CODE. Except as other-5wise expressly provided, whenever in this title an amend-6ment or repeal is expressed in terms of an amendment 7to, or repeal of, a section or other provision, the reference 8shall be considered to be made to a section or other provi-9sion of the Internal Revenue Code of 1986. 10 Subtitle A Individual Tax Reform 11 PART I TAX RATE REFORM 12 SEC. 11001. MODIFICATION OF RATES. 13(a) INGENERAL. Section 1 is amended by adding 14at the end the following new subsection: 15 (j) MODIFICATIONS FORTAXABLEYEARS2018 16 THROUGH2025. 17 (1) IN GENERAL. In the case of a taxable 18year beginning after December 31, 2017 , and before 19 January 1, 2026 20 (A) subsection (i) shall not apply, and 21 VerDate Nov 24 2008 09:32 Dec 15, 2017 Jkt 000000 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 C:\USERS\HWCHRI~1\APPDATA\ROAMING\SOFTQU AD\XMETAL\ \GEN\C\CONFRP~1 December 15, 2017 (9:32 )G:\P\15\TAX\TR\CONF\ :\VHLC\121517\ (683052|2)2 (B) this section (other than subsection 1(i)) shall be applied as provided in paragraphs 2(2) through (6).

3 3 (2) RATE TABLES. 4 (A) MARRIED INDIVIDUALS FILING JOINT 5 RETURNS AND SURVIVING SPOUSES. The fol-6lowing table shall be applied in lieu of the table 7contained in subsection (a): 8 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 fol-9lowing table shall be applied in lieu of the table 10contained in subsection (b): 11 If taxable income is: The tax is: Not over $13,600.

4 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. VerDate Nov 24 2008 09:32 Dec 15, 2017 Jkt 000000 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 C:\USERS\HWCHRI~1\APPDATA\ROAMING\SOFTQU AD\XMETAL\ \GEN\C\CONFRP~1 December 15, 2017 (9:32 )G:\P\15\TAX\TR\CONF\ :\VHLC\121517\ (683052|2)3 If taxable income is: The tax is: Over $500,000 .. $149,298, plus 37% of the excess over $500,000. (C) UNMARRIEDINDIVIDUALSOTHER 1 THAN SURVIVING SPOUSES AND HEADS OF 2 HOUSEHOLDS.

5 The following table shall be ap-3plied in lieu of the table contained in subsection 4(c): 5 If taxable income is: The tax is: Not over $9,525 .. 10% of taxable income. Over $9,525 but not over $38,700 .. $ , plus 12% of the excess over $9,525. Over $38,700 but not over $82,500 .. $4, , plus 22% of the excess over $38,700. Over $82,500 but not over $157,500 .. $14, , plus 24% of the excess over $82,500. Over $157,500 but not over $200,000 .. $32, , plus 32% of the excess over $157,500. Over $200,000 but not over $500,000 .. $45, , plus 35% of the excess over $200,000. Over $500,000 .. $150, , plus 37% of the ex-cess over $500,000. (D) MARRIED INDIVIDUALS FILING SEPA-6 RATE RETURNS. The following table shall be 7applied in lieu of the table contained in sub-8section (d): 9 If taxable income is: The tax is: Not over $9,525.

6 10% of taxable income. Over $9,525 but not over $38,700 .. $ , plus 12% of the excess over $9,525. Over $38,700 but not over $82,500 .. $4, , plus 22% of the excess over $38,700. Over $82,500 but not over $157,500 .. $14, , plus 24% of the excess over $82,500. Over $157,500 but not over $200,000 .. $32, , plus 32% of the excess over $157,500. VerDate Nov 24 2008 09:32 Dec 15, 2017 Jkt 000000 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 C:\USERS\HWCHRI~1\APPDATA\ROAMING\SOFTQU AD\XMETAL\ \GEN\C\CONFRP~1 December 15, 2017 (9:32 )G:\P\15\TAX\TR\CONF\ :\VHLC\121517\ (683052|2)4 If taxable income is: The tax is: Over $200,000 but not over $300,000 .. $45, , plus 35% of the excess over $200,000. Over $300,000 .. $80, , plus 37% of the excess over $300,000. (E) ESTATES AND TRUSTS. The fol-1lowing table shall be applied in lieu of the table 2contained in subsection (e): 3 If taxable income is: The tax is: Not over $2,550.

7 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, , plus 37% of the excess over $12,500. (F) REFERENCES TO RATE TABLES. 4 Any reference in this title to a rate of tax under 5subsection (c) shall be treated as a reference to 6the corresponding rate bracket under subpara-7graph (C) of this paragraph, except that the 8reference in section 3402(q)(1) to the third low-9est rate of tax applicable under subsection (c) 10shall be treated as a reference to the fourth 11lowest rate of tax under subparagraph (C). 12 (3) ADJUSTMENTS. 13 (A) NO ADJUSTMENT IN 2018. The ta-14bles contained in paragraph (2) shall apply 15without adjustment for taxable years beginning 16 VerDate Nov 24 2008 09:32 Dec 15, 2017 Jkt 000000 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 C:\USERS\HWCHRI~1\APPDATA\ROAMING\SOFTQU AD\XMETAL\ \GEN\C\CONFRP~1 December 15, 2017 (9:32 )G:\P\15\TAX\TR\CONF\ :\VHLC\121517\ (683052|2)5 after December 31, 2017 , and before January 11, 2019.

8 2 (B) SUBSEQUENT YEARS. For taxable 3years beginning after December 31, 2018, the 4 Secretary shall prescribe tables which shall 5apply in lieu of the tables contained in para-6graph (2) in the same manner as under para-7graphs (1) and (2) of subsection (f) (applied 8without regard to clauses (i) and (ii) of sub-9section (f)(2)(A)), except that in prescribing 10such tables 11 (i) subsection (f)(3) shall be applied 12by substituting calendar year 2017 for 13 calendar year 2016 in subparagraph 14(A)(ii) thereof, 15 (ii) subsection (f)(7)(B) shall apply 16to any unmarried individual other than a 17surviving spouse or head of household, and 18 (iii) subsection (f)(8) shall not apply. 19 (4) SPECIAL RULES FOR CERTAIN CHILDREN 20 WITH UNEARNED INCOME.

9 21 (A) IN GENERAL. In the case of a child 22to whom subsection (g) applies for the taxable 23year, the rules of subparagraphs (B) and (C) 24 VerDate Nov 24 2008 09:32 Dec 15, 2017 Jkt 000000 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 C:\USERS\HWCHRI~1\APPDATA\ROAMING\SOFTQU AD\XMETAL\ \GEN\C\CONFRP~1 December 15, 2017 (9:32 )G:\P\15\TAX\TR\CONF\ :\VHLC\121517\ (683052|2)6 shall apply in lieu of the rule under subsection 1(g)(1). 2 (B) MODIFICATIONSTOAPPLICABLE 3 RATE BRACKETS. In determining the amount 4of tax imposed by this section for the taxable 5year on a child described in subparagraph (A), 6the income tax table otherwise applicable under 7this subsection to the child shall be applied with 8the following modifications: 9 (i) 24-PERCENTBRACKET. The 10maximum taxable income which is taxed at 11a rate below 24 percent shall not be more 12than the sum of 13 (I) the earned taxable income of 14such child, plus 15 (II) the minimum taxable in-16come for the 24-percent bracket in the 17table under paragraph (2)(E) (as ad-18justed under paragraph (3)) for the 19taxable year.

10 20 (ii) 35-PERCENTBRACKET. The 21maximum taxable income which is taxed at 22a rate below 35 percent shall not be more 23than the sum of 24 VerDate Nov 24 2008 09:32 Dec 15, 2017 Jkt 000000 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 C:\USERS\HWCHRI~1\APPDATA\ROAMING\SOFTQU AD\XMETAL\ \GEN\C\CONFRP~1 December 15, 2017 (9:32 )G:\P\15\TAX\TR\CONF\ :\VHLC\121517\ (683052|2)7 (I) the earned taxable income of 1such child, plus 2 (II) the minimum taxable in-3come for the 35-percent bracket in the 4table under paragraph (2)(E) (as ad-5justed under paragraph (3)) for the 6taxable year. 7 (iii) 37-PERCENTBRACKET. The 8maximum taxable income which is taxed at 9a rate below 37 percent shall not be more 10than the sum of 11 (I) the earned taxable income of 12such child, plus 13 (II) the minimum taxable in-14come for the 37-percent bracket in the 15table under paragraph (2)(E) (as ad-16justed under paragraph (3)) for the 17taxable year.