Ten Percent Tax Rate Act

Ten Percent Tax Rate Act - Amends the Internal Revenue Code to impose a flat rate tax of ten percent on the taxable income of individuals.

Disallows income tax credits for any taxpayer who is not a corporation. Repeals the income tax credits for: (1) the elderly; (2) contributions to candidates for public office; (3) earned income; (4) the purchase of a new principal residence; (5) dependent care services expenses; and (6) residential energy conservation expenditures.

Repeals the alternative minimum tax for individuals. Excludes from the gross income of individuals: (1) alimony and separate maintenance payments; (2) scholarships and fellowship grants; (3) supplemental security income provided under the Social Security Act; (4) disability payments; (5) railroad retirement benefits; (6) Federal civil service retirement benefits; (7) interest received on State and municipal bonds; and (8) employee fringe benefits.

Defines "taxable income" of individuals as gross income minus: (1) trade and business deductions; (2) trade and business deductions of employees; and (3) expenses relating to the production of income. Defines "taxable income" of corporations as gross income minus the income tax deductions allowed for corporations.

Disallows, for individuals, the income tax exclusions for: (1) interest on certain governmental obligations; (2) interest of qualified mortgage subsidy bonds; (3) income from discharge of indebtedness; (4) improvements by a lessee on a lessor's property; (5) recovery of bad debts, prior taxes, and delinquency amounts; and (6) certain cost-sharing payments. Repeals specified itemized deductions applicable only to individual taxpayers.

Increases the amount of the personal exemption for a taxpayer, spouse, and dependents from $1,000 each to $2,000 each. Provides for a cost-of-living adjustment for such amount.

Specifies that certain income tax deductions shall be allowed for corporations only. Allows individuals an income tax deduction for social security and railroad retirement taxes.

Repeals the itemized income tax deductions for: (1) medical and dental expenses; (2) alimony payments; (3) taxes, interest, and business depreciation of a cooperative housing corporation tenant-stockholder; (4) adoption expenses; and (5) the deduction for two-earner married couples.

Provides that income tax deductions, exclusions, and special capital gains treatment with respect to natural resources shall not apply to individuals.

Imposes a flat rate tax of ten percent on estates and trusts. Repeals special rules and deductions and credits relating to estates and trusts.

Revises rules relating to the income and credits of a partner. Requires that each partner shall take into account separately his distributive share of the partnership's: (1) gains and losses; (2) taxes; and (3) taxable income or loss.

Disallows the foreign tax credit for individuals.

Repeals the estate tax.