WOW! Trump’s Tax Plan, Massive Changes

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The White House unveiled their tax plan this afternoon, proposing to reduce the number of tax brackets from seven to three.

The brackets would be 10%, 25% and 35%.  The standard deduction will be doubled so that a married couple would not pay taxes on their first $24,000 of income. The tax cuts for individuals and married couples filing separately will increase from $6,300 to $12,600. Far fewer taxpayers need to itemize deductions.

One major change is that under this plan, there will be three tax brackets rather than seven. In the current tax code, the tax brackets are: 10 percent, 15 percent, 25 percent, 28 percent, 33 percent, 35 percent, and 39.60 percent. Here’s how that breaks down at the moment, before any of the proposed changes:

Single Filer Joint Filer Head of Household Filer Rate
$0 – $9,275 $0 – $18,550 $0 – $13,250 10%
$9,275 – $37,650 $18,550 – $75,300 $13,250 – $50,400 15%
$37,650 – $91,150 $75,300 – $151,900 $50,400 – $130,150 25%
$91,150 – $190,150 $151,900 – $231,450 $130,150 – $210,800 28%
$190,150 – $413,350 $231,450 – $413,350 $210,800 – $413,350 33%
$413,350 – $415,050 $413,350 – $466,950 $413,350 – $441,000 35%
$415,050 + $466,950 + $441,000 + 39.6%

Under this Trump plan, there would only be three brackets: 10 percent, 25 percent, and 30 percent.

Deductions are gone except for the mortgage and charitable deductions. Retirement savings will also be protected.

It will put some accountants out of work because most people will be able to do their taxes on one simple page. The rich won’t have as many “loopholes”.

Cohn is proposing a 15% corporate tax rate.

“For the last 25 years, other countries have been aggressively cutting their tax rates and moving to a territorial system in order to attract business and the U.S. has done none of that,” he said.

The plan repeals the alternative minimum tax.

It eliminates the estate tax – taxing the dead who already were taxed to death.

There will be no tariff on imports.

There will be a child care tax credit.

They will seek 10% on offshore earnings.

The middle class seeks to benefit overall.

Treasury Secretary Steve Mnuchin also addressed questions at Wednesday’s presser.