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November 9, 2017
Tax reform has been a hot topic for the Trump administration, with discussion of assisting the lower-middle class. In late October, the House finally released their tax reform plan, The Tax Cuts and Jobs Act. The goal of this plan is to help increase the amount of money people actually receive out of their paychecks. Under the new plan, Corporations would receive a large reduction in their tax rates, from 35% to 20%, and there would be no more alternative minimum tax. Pass-through entities would only be taxed up to 25% and increases Section 179 deduction to $5,000,000.
This eliminates the domestic production activities deduction, as well as other business deductions and credits. For individuals, the standard deduction would approximately be doubled, but eliminates the personal exemption. There is an increase in the child tax credit, as well as the threshold to claim this credit. It also eliminates all standard deductions, besides mortgage interest, charitable contributions, and deductions for state and local property taxes.
These changes can be set in place as early as January 2018, but there is still the chance that this will be changed. For more information, read the full analysis here.