· Remember that tax legislation must still go through the political process.
· Tax legislation originates in Congress and is ultimately signed into law by the president.
· These highlights from Mr. Trump’s campaign are not guaranteed to become law as presented. Actual results will almost certainly vary.
· This is not a complete list; it is a summary of the salient provisions that could affect WZZM’s viewers.
INDIVIDUAL TAX ISSUES
· Reduce the number of tax brackets from seven to three
12% ($0 - $75,000 taxable income for a married couple filing jointly)
25% ($75,000 - $225,000 taxable income for a married couple filing jointly)
33% (above $225,000 taxable income for a married couple filing jointly)
· Eliminate head-of-household status
· Increase the standard deduction
Increase from $6,300 to $15,000 for single taxpayers
Increase from $12,600 to $30,000 for married couples filing jointly
· Eliminate personal exemptions.
· Cap itemized deductions at $100,000 for single taxpayers and $200,000 for married couples filing jointly.
· Eliminate the Net Investment Income Tax.
· Eliminate the Alternative Minimum Tax (AMT).
· Implement a new credit for child care expenses for low-income taxpayers (administered through the Earned Income Tax Credit).
· Implement new tax-free dependent care savings accounts to pay for the care of children and/or elderly parents (with the remainder eligible for educational expenses).
· Make child care costs deductible up to a state-specific maximum (phased out for high-income taxpayers).
BUSINESS TAX ISSUES
· Reduce the top corporate tax rate from 35% to 15%.
· Move toward full expensing of capital improvements (choose between this and deducting interest expense).
· Eliminate most tax credits with the exception of the Research & Development Credit.
· Eliminate the Domestic Production Activities Deduction.
· Eliminate the corporate AMT.
· End the deferral of overseas corporate income tax. Tax the “deemed repatriation” of foreign income at a 10% rate.
· Eliminate the estate tax.
· Disallow the basis step-up for estates over $10 million.
Courtesy: Chris Harper, Senior Manager, Hungerford Nichols
(© 2016 WZZM)