[HOT] – Republicans Release Tax Plan, Cutting Corporate and Middle-Class Taxes

WASHINGTON – Republican lawmakers unveiled the most radical revision of the code Decades Taxes, Thursday, outlining a $ 1.51 trillion plan to reduce corporate taxes, reduce them for some middle-class families and bring the United States closer, but not entirely, to the kind of tax system long defended by companies.

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The Run-Up

The podcast that gives meaning to the party the More Delusional of the 2016 Campaign.

Representative Kevin Brady, Chair The House Ways and Means Committee stated that the plan had the "full support" of President Trump and predicts that he would be on his desk this year.

The bill would cost $ 1.51 trillion over a decade. Lawmakers must keep the cost of the bill at $ 1.5 trillion if they want to spend along the party lines and avoid a tollibuster by the Democrats. Lawmakers have struggled for days to find a way to make cuts that would cost billions of dollars in a $ 1.5 trillion hole. This has led to a host of corporate and personal changes, including a new twist that would limit the deduction of mortgage interest by capping at $ 500,000

Anticipating the resistance of industrial groups, Mr. Brady has said: "We will prove them the opposite once and for all."

"This is not the latest product," said Rep. Carlos Curbelo, a Florida Republican and member of the House Ways and Means Committee. "This is just the kickoff to this tax reform exercise."

Individual tax rates will change

The plan establishes three tax brackets, 12, 25 and 35 percent, and also maintains a higher rate of 39, 6 percent for the highest incomes, reducing the total number of slices of seven. The brackets follow the following lines:

Those who earn up to $ 24,000 will not pay any income tax . For married taxpayers filing jointly, those earning up to $ 90,000 will be in the 12% bracket; those who earn up to $ 260,000 will go in the 25% bracket and those who earn up to $ 1 million will fall in the 35% bracket. Those making more than $ 1 million will be in the 39.6% range, which is currently the highest rate for millionaires. For singles and those who file separately, the parenthetical thresholds would be half of these amounts, other than the 35%, which would be $ 200,000 for singles

Changes for the middle class

The proposal roughly doubles the standard deduction for middle-class families, increasing it to $ 24,000 for married couples, from $ 12,700 to $ 12,000 for individuals, against $ 6,530 today. Republicans also plan to increase the child tax credit from $ 1,000 to $ 1,600 and add a $ 300 credit for each parent and non-dependent child, such as members Elders of the family

includes a host of changes that will have different repercussions on taxpayers. For example, it repeals certain tax credits, including a 15% credit for people aged 65 or older or who are retired because of a disability. Currently, these individuals can claim up to $ 7,500 for a joint return, $ 5,000 for a single person, or $ 3,750 for a married person filing a joint return.

The bill would completely repeal this tax credit. It would also repeal the adoption tax credit, allow more deductions for the preparation of tax returns and repeal the credits for support payments. And deductions for moving expenses would no longer be allowed

No changes to pension plans 401 (k)

After an exciting debate, the House will not make any changes to the salary pre-tax plans 401 (k). "The Americans will be able to continue to make both traditional, pre-tax contributions and Roth contributions in the way that suits them best," say the talking points

Changing the deduction mortgage interest

One of the biggest flash points will be proposed changes to the deduction of popular mortgage interest. Under the Republican plan, existing homeowners can keep the deduction, but future purchases will be capped at $ 500,000.

The National Association of Real Estate Agents Is Revolted Against the Bill, Suggesting a Huge Fight on How Real Estate is Treated "

" The elimination or cancellation of tax incentives for homeownership endangers family values ​​and middle-class owners and, based on a cursory examination, this law appears to be do exactly that, "said William E. Brown. National Association of Realtors. "We will have additional details on a more in-depth reading of the bill."

Jerry Howard, head of the National Association of Homebuilders, said that he was very disappointed with the Republican tax plan and warned that he could create "

" That so much limits the ability of homebuyers to use the mortgage interest deduction that home values ​​will fall, "said Howard in an interview. "If a home seller suffers a loss, it is the money on which he relied for his retirement."

Howard says the bill amounts to a broken promise.

"Contrary to their claims, Republicans choose winners and losers," he said. "They choose wealthy Americans and corporations over small businesses and the middle class."

Eliminating the deduction for medical expenses

A big change could be reserved for those who deduct their medical fees. The points of discussion highlighted by Republicans say that the deduction will disappear, but that families will be supplemented by the overall lowering of tax rates and the doubling of the standard deduction. But those who make heavy use of the medical expense deduction – including many middle class families – can oppose this change.

Repeal of estate tax

The proposal will double the estate tax exemption to about $ 11 million, from $ 5.49 million, which means that families can avoid paying taxes on large legacies. And he ends up completely repealing the estate tax, abandoning it entirely in six years.

Adding Limits to the Federal Tax and Federal Tax

One of the biggest flashpoints will be the way the project of law deals with the state and local tax deduction, which legislators propose to limit to property taxes and ceiling at $ 10,000. This will not be enough for Republicans in some high-tax states, where middle-class families make extensive use of the deduction, which currently applies to national and local income taxes and general sales taxes as well. than to property taxes.

Republicans in the House had planned to roll out the tax proposal Wednesday, but ended up delaying its publication for one day, providing a stiff challenge signal that they face to make it work. the math while collecting the votes they need to get a bill Representative Dan Donovan, a Republican from New York, said that he remained concerned about the impact of the tax deduction of the state and local while he was leaving a briefing on the bill but said that he would evaluate the proposed changes on

"I am looking for a benefit to the people I represent, "he said. "New Yorkers deserve a tax break."

Multinationals face big changes

For the first time, the United States proposes to have an overall minimum tax of 10%, which would apply to the revenues that American companies earn anywhere in the world. The effort is aimed at preventing companies from transferring their profits abroad and recovering a portion of the tax revenue on income earned abroad. These profits are not currently taxed until they are returned to the United States, which encourages companies to keep this money abroad as they are subject to the US dollar rate. Current corporate taxation of 35%

by companies, with guardrails

Republicans have kept their promise to lower the tax rate for businesses "pass" at 25 percent. But to prevent the rate from becoming a loophole for all kinds of people, tax writers have created a formula that they believe will ensure that business owners will pay a higher tax rate on the property. income that they receive as salary. The formula would be applied depending on the circumstances of the business

Republican leaders are encouraged

Upon entering the men's toilet, representative Kevin McCarthy, a Republican from California, said his colleagues: he looks very positive, these people are excited. He added: "That's why they came to Congress. "

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