MINIMUM STANDARD DEDUCTION.

SEC. 112. MINIMUM STANDARD DEDUCTION. (a) General Rule.—Section 141 (relating to standard deduction) is amended to read as follows: “SEC. 141. STANDARD DEDUCTION. “(a) Standard Deduction.—Except as otherwise provided in this section, the standard deduction referred to in this title is the larger of the 10-percent, standard deduction or the minimum standard deduction. The standard deduction shall not exceed $1,000, except that in the case of a separate return by a married individual the standard deduction shall not exceed $500. “(b) Ten-percent Standard Deduction.—The 10-percent standard deduction is an amount equal to 10 percent of the adjusted gross income. “(c) Minimum Standard Deduction.—The minimum standard deduction is an amount equal to the sum of— “(1) $100, multiplied by the number of exemptions allowed for the taxable year as a deduction under section 151, plus “(2) (A) $200, in the case of a joint return of a husband and wife under section 6013, “(B) $200, in the case of a return of an individual who is not married, or “(C) $100, in the case of a separate return by a married individual. “(d) Married Individuals Filing Separate Returns.—Notwithstanding subsection (a)— “(1) The minimum standard deduction shall not apply in the case of a separate return by a married individual if the tax of the other spouse is determined with regard to the 10-percent standard deduction. “(2) A married individual filing a separate return may, if the minimum standard deduction is less than the 10-percent standard deduction, and if the minimum standard deduction of his spouse is greater than the 10-percent standard deduction of such spouse, elect (under regulations prescribed by the Secretary or his delegate) to have his tax determined with regard to the minimum standard deduction in lieu of being determined with regard to the 10-percent standard deduction.” 78 Stat. 24 (b) Amendment of Section 2.—The second sentence of section 2(a) (relating to tax in case of joint return or return of surviving spouse) is amended by striking out “and section 3” and inserting in lieu thereof “, section 3, and section 141”. (c) Amendments of Section 144.— (1) The first sentence of section 144(b) (relating to change, of election of standard deduction) is amended to read as follows: “Under regulations prescribed by the Secretary or his delegate, a change of election with respect to the standard deduction for any taxable year may be made after the filing of the return for such year.” (2) Section 144 is amended by adding at the end thereof the following new subsection: “(c) Change of Election Defined.—For purposes of this title, the term ‘change of election with respect to the standard deduction’ means— “(1) a change of an election to take (or not to take) the standard deduction; “(2) a change of an election to pay (or not to pay) the tax under section 3; or “(3) a change of an election under section 141(d)(2).” (d) Conforming Amendments.— (1) Subparagraph (A) of section 6212(c)(2) (relating to cross references) is amended by striking out “to take” and inserting in lieu thereof “with respect to the”. (2) Paragraph (3) of section 6504 (relating to cross references) is amended by striking out “to take” and inserting in lieu thereof “with respect to the”.