By Nick Hopkins, CPA, CFP®
Partner, Director of Tax Services
[email protected]
We previously discussed some of the possible changes in tax policy that could come with the presidential election. Now that Donald Trump has pulled off an upset victory, as well as Republicans retaining control of both the House and Senate, here is a quick overview of the president-elect’s most significant proposed tax bills.
This comes from our friends at Wolters Kluwer. Please click here to download their entire report. Some of the highlights of Trump’s proposed plans are listed below:
- Individual Taxation:
- Income Tax – Trump’s proposal would reduce rates on ordinary income to 12, 25, and 33 percent.
- Capital Gains / Dividends – The current rate structure for capital gains would apparently remain unchanged under Trump’s plan; however, Trump has proposed to repeal the 3.8 percent net investment income tax.
- Estate and Gift Tax – During the campaign, Trump proposed to repeal the federal estate and gift tax.
- Alternative Minimum Tax – Trump has also proposed to eliminate the alternative minimum tax.
- Business Taxation:
- Corporate Income Tax – Trump proposed to lower the business tax rate to 15 percent and eliminate the corporate alternative minimum tax.
- Section 179 – Trump has indicated that he would increase the annual cap on Sec 179 expensing from $500,000 to $1 million.
- Manufacturing Expensing – Trump proposed during the campaign that manufacturing firms would be able to immediately deduct all new investments in the business, in lieu of deducting interest expenses.
- Healthcare:
- Repeal and Replace Obamacare – Trump and his GOP allies seem intent to eradicate the ACA, though details on what would replace it remain in limbo.
- Infrastructure Spending:
- American Energy & Infrastructure Act – This bill proposes to spur $1 trillion in investments to national infrastructure over the next decade by leveraging public-private partnerships and private investments.
Keep in mind, these are simply proposals at this time. Even if they come to pass, they could be subject to changes during the approval process. We’ll endeavor to keep you posted in the time to come.
Please call Nick Hopkins at (317) 608-6695 or email [email protected].