On Wednesday, the Trump administration released a long-awaited tax reform plan to help simplify the system and alleviate pressure on Americans struggling under the burden of excessively high rates.
President Trump’s Treasury Secretary, Steve Mnuchin, earlier called their ambitious plan the “biggest tax cut and the largest tax reform in the history of our country.”
What’s in the plan that will help achieve such lofty goals? Let’s break down some of the top aspects of the plan …
Massive Tax Cuts for Businesses
The plan seeks to cut corporate tax rates on many owner-operated business from nearly 40% down to 15%.
Trump readies plan to cut top tax rate on many owner-operated businesses to 15%, from 39.6% https://t.co/VdWMzQdw6G
— Wall Street Journal (@WSJ) April 25, 2017
Small businesses would also be eligible for this rate.
Middle Class Tax Cuts
In addition to a “middle-income tax cut and simplification,” President Trump also plans to include a tax break for child-care expenses.
The Hill reports, “There would be tax relief for middle-income families and provisions aimed at helping people with childcare costs.”
The childcare relief plan emulates one proposed during the campaign at the behest of daughter, Ivanka Trump.
Lowers Tax Rate for Individuals
The New York Times reports, that the administration “would double the standard deduction, essentially eliminating taxes on the first $24,000 of a couple’s earnings.”
“In essence, we are creating a zero tax rate — yes, a zero tax rate — for the first $24,000 a couple earns,” National Economic Council director Gary Cohn explained. “Families will benefit from tax relief that will help them with child and dependent care expenses.”
They’re also seeking to slash individual rates to 10 percent, 25 percent and 35 percent.
The plan looks to leave in place popular deductions for mortgage interest and charitable contributions.
Streamlining Tax Brackets
The current seven individual income tax brackets would be reduced to just three.
BREAKING: Trump tax plan will consolidate seven existing income tax brackets down to three: 10%, 25% and 35%
— Gabby Morrongiello (@gabriellahope_) April 26, 2017
The administration has long complained that the process of filing taxes has grown far too complicated.
On the campaign trail, Trump promised his plan would “simplify the tax code” yet still “grow the American economy at a level that it hasn’t seen for decades.”
Repeals Death Tax and Alternative Minimum Tax
The administration’s plan would finally put an end to the ‘death tax,’ as well as the alternative minimum tax (AMT).
Trump tax plan repeals the death tax. Excellent!
— Katie Pavlich (@KatiePavlich) April 26, 2017
Another campaign promise delivered, it would seem.
“It’s just plain wrong and most people agree with that,” Trump vowed in August. “We will repeal it.”
Grover Norquist, President of Americans for Tax Reform, rates Trump’s overall proposed tax plan in terms that even a Charlie Sheen-loving liberal can appreciate – WINNING!
WINNING:
Trump/GOP plan cuts tax on business income from 35% to 15%.
Death tax and AMT gone
Cap gains 20%
Personal rates: 35/25/12%— Grover Norquist (@GroverNorquist) April 26, 2017
We tend to agree.
What do you think? Share your thoughts with us below!
