What Taxes May Look Like Under President Trump
With Donald Trump as president-elect, in conjunction with a republican-majority in both the House and Senate, we have to ask ourselves as Tax Professionals, what this entails for the American public and what impact this will have on the future financial landscape of our country. What we do know is that president-elect Trump has pledged legislation to reduce taxes and a vote to repeal “Obamacare.”
More specifically, Trump proposes condensing our current five tax brackets ranging from 10% to 39.6%, down to three: 12%, 25% and 33%. The Trump plan eliminates personal exemptions, currently $4,050 per taxpayer and increases the standard deduction to $30,000 married and $15,000 single. And while itemized deductions for 2016 are limited based on income, the Trump plan instead uses a deduction limit of $200,000 married and $100,000 single, and would also eliminate the head of household status.
Americans will also see certain reductions in taxes on Capital Gains, as well as the elimination of federal estate taxes. The Trump plan reduces the corporate tax rate to 15% and repeals the AMT, and there will be a “deemed” repatriation of offshore corporate profits at a one-time 10% tax.
These are dramatic changes to the way in which we calculate taxes. Proposals may change during the legislative process, before a final bill is enacted. For additional changes proposed by the president-elect and other relevant tax information, refer to the Winter 2016/2017 Edition of the Bormel, Grice & Huyett NewsletterBack To List