Tax News Highlights

Tax Reform Details Emerge

Dec. 14, 2017

Details are beginning to emerge about the tax deal brokered by the congressional conference committee. Agreement has been reached on the following key provisions, which will become effective for tax years beginning on or after Jan. 1, 2018.

Corporate tax rate Reduced to 21 percent effective in 2018. The Senate bill would have delayed rate reduction until 2019.
Top individual rate Reduced to 37 percent.
Pass-through entities Provided a 20 percent deduction on taxable income from pass-through entities.
Corporate alternative minimum tax Repealed.
Affordable Care Act individual mandate penalty Repealed; however, the 3.8 percent tax on net investment income and the 0.9 percent payroll tax on income in excess of $250,000 are not repealed and remain in effect.
Mortgage interest deduction Capped on new home purchase loans up to $750,000.
Individual state and local tax deductions Capped at $10,000 for property taxes and state and local income taxes.
The conferees and congressional leaders will continue to negotiate behind the scenes and hope to iron out a final agreement by Friday, Dec. 15. Once the conference committee publishes a final report, the House and Senate are expected to act quickly to get the bill to President Donald Trump to sign.
Authors
Peter Judge
Howard Wagner - 150
Howard M. Wagner
Partner, National Tax Services