Republicans release long-awaited plan for tax reform
Key aspects of the framework include:
Lowers Rates for Individuals and Families
Individual tax brackets shrink from seven to three (12%, 25%, and 35%) with a chance of a higher top rate added for highest-income taxpayers.
Doubles the Standard Deduction and Enhances the Child Tax Credit
Standard deductions will roughly double, and the Child Tax Credit will significantly increase.
Eliminates Loopholes for the Wealthy, Protects Bedrock Provisions for Middle Class
Tax incentives for home mortgage interest, charitable contributions, work and retirement security, and higher education remain, but some itemized deductions are eliminated.
Repeals the Death Tax and Alternative Minimum Tax (AMT)
The framework repeals the Death Tax and existing individual AMT.
Creates a New Lower Tax Rate and Structure for Small Businesses
Small and family-owned business maximum tax rates will be limited to 25%.
To Create Jobs and Promote Competitiveness, Lowers the Corporate Tax Rate
The corporate tax rate will be 20%.
To Boost the Economy, Allows “Expensing” of Capital Investments
For at least five years, business will be able to immediately write off the cost of new capital investments.
Moves to an American Model for Competitiveness
The framework ends incentives for offshore jobs and keeping foreign profits overseas.
Brings Profits Back Home
Corporations will be able to repatriate profits via a one-time low rate on returning wealth from overseas.
Herbein will continue to provide updates as they become available.