President Trump Announces Tax Plan
The President has recently announced his concept for revising the US tax code.
Click here to read or download the President’s Plan.
“We support a simpler tax code with reduced marginal rates,” said GST Chairman Ray Chadwick. “When Presidents Kennedy, Reagan, Clinton and Bush implemented a similar strategy, the economy expanded and tax receipts increased. That’s essential today in balancing budgets and reducing national debt.”
Following are highlights from the President’s Tax Plan as presented in the Plan document:
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The Goals of the Plan are:
1. Tax relief to let people keep more money in their pockets and increase after-tax wages.
2. Simplify the tax code to reduce effort in preparing taxes and let everyone keep more of their money.
3. Grow the economy by making America globally competitive and discouraging businesses moving overseas.
4. Doesn’t add to our debt and deficit.
The Plan Achieves These Goals:
1. Single taxpayers earning under $25,000, or married jointly earning under $50,000, pay no income tax.
2. All others use a simpler tax code with four brackets – 0%, 10%, 20% and 25% – instead of the current seven.
3. The new tax code eliminates the marriage penalty and the Alternative Minimum Tax (AMT).
3. No business will pay more than 15% of their income in taxes, a rate that is one of the best in the world.
4. No family will have to pay the death tax.
The Tax Plan Is Revenue Neutral since tax cuts are fully paid for by:
1. Reducing or eliminating deductions and loopholes.
2. One-time repatriation of overseas corporate cash at a 10% tax, then end tax deferral on overseas income.
3. Reducing or eliminating corporate deductions made unnecessary by lower tax rates on business income.
When introduced, one percent of Americans paid income tax. It was never intended as a tax on most of us.
The tax plan eliminates the income tax for over 73 million households.
42 million households that currently file but don’t owe income taxes will now file a one page form.
Over 31 million households get the same simplification and see an average tax reduction of nearly $1,000.
Income tax brackets will go from the current seven brackets to four brackets with lower tax rates:
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.Income….Long Term Cap Gain/……….Single Filer………………Married Filer……………Head of Household
…Tax…………Dividends………………….Income…………………….Income……………………..Income
…Rate………….Rate
…..0%……………0%…………………..$0 to $25,000……………….$0 to $ 50,000………………$0 to $ 37,500
…10%……………0%…………….$25,001 to $ 50,000………..$50,001 to $100,000………..$37,501 to $ 75,000
…20%…………..15%……………$50,001 to $150,000………$100,001 to $300,000………..$75,001 to $225,000
…25%…………..20%…………..$150,001 and up……………$300,001 and up……………$225,001 and up
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Deductions:
With lower tax rates, many current exemptions and deductions will become unnecessary or redundant.
Those within the 10% bracket will keep all or most of their current deductions.
Those within the 20% bracket will keep more than half of their current deductions
Charitable giving and mortgage interest deductions will remain unchanged for all taxpayers.
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“As with any plan or legislation, the devil is in the details, said Chadwick. “GST will be monitoring the progress of the proposed tax plan as it is implemented by the Congress.”