Rates: There would be two tax rates, 15 percent and 27 percent, rather than the current 15 rates ranging from 11 percent to 50 percent. The 27 percent rate would kick in at taxable income of $17,600 for single taxpayers, $29,300 for married couples filing jointly and $23,500 for a single head of household.

Personal exemption: $1,900 for each taxpayer and dependent in 1987; $2,000 thereafter, indexed for inflation. It is $1,080 this year and scheduled to be about $1,120 next year.

Limitations at high incomes: The value of the personal exemption would be reduced to zero on a gradual basis between the following income levels: $87,240 and $127,240 for singles, $145,320 and $185,320 for marrieds, $111,400 and $151,400 for single heads of household.

Also, upper-income taxpayers would lose the benefit of the 15 percent bracket gradually between the following income levels (above those levels, all income would be taxed at a flat rate of 27 percent): $45,000 and $87,240 for singles, $75,000 and $145,320 for marrieds, $55,000 and $111,400 for single heads of household.

Standard deduction: $3,000 for single taxpayers, $5,000 for a married couple and $4,400 for a single head of household. The current standard deduction is lower for all three categories.

Adjustments: The standard deduction, personal exemption, rate brackets and earned income credit would be rounded down to the nearest $50 after each year's inflation adjustment.

State and local taxes: Sales taxes would no longer be deductible, except in states with little or no income tax; income, real property and personal property taxes would remain fully deductible.

Elderly and blind: The extra personal exemption for elderly or blind taxpayers would be replaced by an additional $600 increase in the standard deduction. The tax credit for low-income elderly or disabled taxpayers would be retained.

Medical: Medical expenses could be deducted to the extent they exceeded 9 percent of adjusted gross income, rather than the current 5 percent.

Employe and miscellaneous expenses: Costs of tax preparation, union dues, periodical subscriptions, uniforms, telephone for work and other miscellaneous business expenses would no longer be deductible.

Interest: Interest on nonmortgage loans, such as for car purchases and credit-card debt, would no longer be deductible. Interest on money borrowed to make investments could be deducted only to the extent it was less than or equal to income from the investment.

Capital gains: The exclusion of 60 percent of capital gains would be repealed, so that profits on the sale of an asset would be taxed at the same rates as ordinary income -- a top rate of 27 percent.

Two-earner deduction: Repealed.

Income averaging: Repealed, except for farmers.

Earned income tax credit for the working poor: Would be raised to 14 percent of the first $5,000 of salary income for a maximum credit of $700. Could be taken at increased income levels and would be adjusted for inflation. Child care and adoption: Dependent-care credit, covering 30 percent of day-care costs of up to $2,400 per child for up to two children, would be continued. Tax deduction of up to $1,500 for costs of adoption of disadvantaged children would be continued or converted to a spending program.

Scholarships and awards: Would remain untaxed.

Worker benefits: Unemployment benefits, now tax-free up to certain income levels, would be taxed as income; workers' compensation and black-lung disability payments would remain untaxed.

IRA: For workers not covered by any employer-sponsored pension plan, Individual Retirement Accounts would remain tax-deferred. Up to $2,000 per year could be deposited and deducted and the interest would be tax-free until withdrawn at retirement. For workers covered by a company plan, deposits into IRA accounts could not be deducted but no tax would be owed on the interest, until withdrawn.

Other pensions: Employes could put no more than $7,000 per year into a 401(k) plan, although employers could still add more. Employes would have to be vested in a pension plan in five years rather than 10, and more employes would be covered by company plans.

Federal workers: Federal retirees and other worker covered by similar pension plans would pay taxes on a portion of benefits immediately upon retirement, rather than receiving tax-free benefits in the first years of retirement and paying taxes on benefits later. The provision would cover those retiring after Jan. 1, 1989, and would be phased in over two years.

Minimum tax: An expanded minimum tax with a rate of 20 percent would cover high-income taxpayers and profitable corporations.

Compliance: Penalties would be increased for failure to submit information, file a return or pay taxes. Interest rates on delinquent payments would be increased. Taxpayers would be required to list the Social Security numbers of dependents in order to claim a personal exemption for them.

Political: The tax credit covering half of political contributions up to $50 for a single taxpayer and $100 for a joint return would be repealed. The $1 checkoff on the tax form to finance presidential campaigns would be retained.

Tax shelters: Paper losses from investments where the taxpayer is not a manager could not be deducted unless the taxpayer received at least the same amount of income from such investments. The provision excepts oil and gas but includes most real estate rentals, and would be phased in over four years. Corporate rate: The corporate rate would be reduced from the current 46 percent to 33 percent.

Investment: The investment tax credit, which subsidizes up to 10 percent of the cost of investment in new equipment and machinery, would be repealed. Companies holding unused credits could carry only 70 percent of their value into future years, and their use would be further restricted by a stiff corporate minimum tax. Steel companies would be allowed to use their credits against 15 years of past income -- but at only 50 percent of their value.

Industries: Taxation of the banking, timber, oil and gas and mining industries would be relatively unchanged, although the tax-shelter crackdown would affect oil and gas and timber would be affected by the end of special capital-gains rates for individuals.

Real estate: Business write-offs for new investments would be made somewhat more generous for investments in all but real estate. There, the period over which the cost of the investment can be written off would be extended from 19 years to 30 years.

Research: The tax credit for research and development would be extended at the current 25 percent until 1989.

Expense accounts: Only 80 percent of the cost of business meals and entertainment could be deducted.

Bonds: The volume of quasi-governmental tax-exempt bonds that could be issued each year by state and local authorities would be reduced. Bonds paying for mortgage loans, mass transit and private-business development could no longer be tax-exempt.

Effective dates: Generally Jan. 1, 1987, except for rate reductions, which would take effect July 1, 1987.