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ElectroFile Income Tax Service Newsletters
Income Tax Service
5200 W Market St
Greensboro, NC 27409
June 01, 2017
President Trumpís Tax Plan Summary
Here is some information about the proposals included in President Trumpís
tax plan. Remember that
this plan is not a law
and has not yet even been
introduced to Congress as a bill, and that a bill must be passed by both the
House and the Senate and then signed by the President. So there is no way to
know what will be passed (if anything).
This is just a summary of the proposals, without comment. The plan released by
the President is a one page plan, so most other details are not available
beyond this summary.
C corporation tax rates would be reduced from the current highest rate of 35%
to a new flat rate of 15%. Pass-through S corporation and LLC income would also
be taxed at 15% rate for small and medium sized businesses (which were not
Corporations would no longer be taxed on a worldwide system, but would be taxed
on a territorial system, and a one-time repatriation tax would apply on the
foreign earnings of US companies.
The proposal does not include a provision allowing expensing of all business
assets, as originally discussed.
The President wants to reduce the current seven different individual tax
brackets to three brackets, with rates set at 10 percent, 25 percent, and 35
percent. The President also wants to double the standard deduction to $24,000
for MFJ, repeal alternative minimum tax and the estate tax and expand the
credit for child and dependent care expenses, while also repealing the dreaded
net investment income 3.8% surtax.
With the new standard deduction and changed brackets, individual taxpayers with
taxable income less than $25,000 and married taxpayers with taxable income less
than $50,000 would owe no Federal income tax.
Most individual itemized deductions would be repealed, but the deduction for
mortgage interest and charitable donations would be retained.