Trump’s Tax Proposal

Now that summer is here and we are approaching the end of the first half of the year I think it makes sense to take a look at what big tax news may be coming our way in the second half of the year.  One thing on President Trump’s agenda has been tax reform.  In late April, the Trump administration outlined the broad strokes of what the President was looking to accomplish.  Here are some of the highlights of the plan that was referred to as the “Biggest Individual and Business Tax Cut In American History”:

  • Simplify the tax code
  • Reduce the number of tax brackets from seven to three (10%, 25% and 35%)
  • Double the standard deduction
  • Provide tax relief for families with child and dependent care expenses
  • Eliminate targeted tax breaks that mainly benefit the wealthiest taxpayers
  • Repeal the Alternative Minimum Tax
  • Repeal the Estate Tax
  • Repeal the 3.8% Obamacare tax that hits small businesses and investment income
  • Create a flat 15% business tax rate
  • One-time tax on trillions of dollars held overseas
  • Eliminate tax breaks for special interests

Of course, this outline is very skeletal.  Most notably missing from the outline is the level of income needed to trigger each of the tax brackets and how this plan will fit within the budget.  Tax reform should be a hot topic in the second half of the year and I will continue to send updates as new information arises.