Ten Percent Flat Tax Rate Act

Ten Percent Flat Tax Rate Act - Title I: Ten Percent Tax Rate for Individuals; Tax Simplification - Amends the Internal Revenue Code to impose a tax on every individual equal to ten percent of the taxable income for the taxable year. Repeals the alternative minimum tax.

Repeals the following tax credits: (1) interest on certain mortgages; (2) foreign tax credit; (3) tax withheld on wages; (4) tax withheld at source on nonresident aliens and foreign corporations; and (5) certain uses of gasoline and special fuels.

Provides that only the following provisions relating to inclusions in and exclusions from gross income will apply to individuals: (1) certain death benefits provisions; (2) interest on certain governmental obligations; (3) mortgage subsidy bond provisions; (4) compensation for injuries and sickness; (5) amounts received under accident and health plans; (6) contributions by employer to accident and health plans; (7) rental value of parsonages; (8) scholarships and fellowship grants; (9) amounts received under insurance contracts for living expenses; (10) cafeteria plans; (11) certain foster care payments; and (12) fringe benefits provisions.

Expands the exclusion of scholarships from gross income.

Excludes from gross income amounts received or accrued by an individual on account of temporary, permanent, or total disablement and inability to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment.

Repeals the taxation of Social Security and tier one railroad retirement benefits.

Increases the allowance for the personal exemption from $1,000 to $2,000. Provides for the indexing of the personal exemption.

Permits individuals to expense depreciable property rather than taking a depreciation deduction for such property.

Disallows the following deductions for individuals: (1) losses; (2) amortization of pollution control facilities; (3) circulation expenditures; (4) research and experimental expenditures; (5) soil and water conservation expenditures; (6) depreciation or amortization of improvements made by lessee on lessor's property; (7) election to expense certain depreciable property; (8) expenditures by farmers for clearing land; (9) expenditures to remove architectural and transportation barriers to the handicapped and elderly; (10) amortization of reforestation expenditures; and (11) start-up expenditures.

Repeals the individual deductions for medical and dental expenses and the deduction for two-earner married couples.

Provides that individuals are only permitted to use cost depletion.

Prohibits the use of the foreign tax credit by individuals.

Repeals the deduction for capital gains for individuals and repeals the estate and gift taxes.

Title II: Tax Amnesty - Provides for a one-time amnesty from criminal and civil tax penalties for taxpayers who: (1) file a written statement with specified information concerning any underpayment of tax; (2) pay the amount of such underpayment when filing the statement; and (3) within 30 days of notification of the amount of such interest or delinquency. Permits installment payments of tax due in certain cases.

Disallows an amnesty period for taxpayers against whom a tax deficiency has already been assessed, who have committed fraud in seeking amnesty, or against whom a criminal investigation is pending.

Establishes a special fund in the Treasury for taxes recovered under such amnesty program. Requires that revenues from such fund be used to offset possible revenue losses, if any, resulting from title I of this Act.