Most individuals expect significant changes to the US Tax Code once President (elect) Trump takes office. High on his agenda are the following:
INDIVIDUALS: Cut the number of individual income tax brackets (from 6 to 3) and bring income tax rates down to 12%, 25% and 33% - that would benefit everyone who works across the board. Elimination of the 3.8% Obamacare tax - if Obama Care goes away this extra tax on the wealthy will go away with it. Tax carried interest gains as ordinary income. Retain 20% capital gains rate for non-corporations. Increase the standard deduction for joint filers to $30,000 from $12,600, while eliminating personal exemptions - basically a wash. $200,000 cap for itemized deductions for joint filers - this will only impact high earners. Most importantly, repeal of the estate tax (a double tax for those who leave an inheritance to their children, etc..). This would be offset by no step-up in basis at death, except on first $10 million of assets.
CORPORATIONS | BUSINESS: Lower the business tax rate for corporations and small businesses alike to 15%, but with elimination of many deductions - we have one of the highest corporate tax rates in the world. Ever wonder why so many companies leave the US for foreign shores. Elimination of corporate alternative minimum tax - to bring american business back home. A 10% one-time tax on repatriation of corporate profits held offshore - could raise trillions of dollars. Allow U.S. manufacturers to elect to expense capital investment and lose the deductibility of corporate interest expense.
