By:  Amanda Wilson

Today, House Ways and Means Committee Chairman Brady introduced the much anticipated House Tax Reform Bill – The Tax Cuts and Jobs Act.  The bill is 429 pages, so it will take a little time to digest all the key provisions.  In the meantime, here are a few of the key points:

For individuals:

  • The individual tax rates are reduced from 7 brackets to 4, but the maximum rate remains 39.6%.
  • The standard deductions is approximately doubled for individuals and married couples.
  • Introduces a new family credit, which expands the existing child tax credit.
  • Continues the charitable contribution deduction.
  • Retains the home mortgage interest deduction, but for loans up to $500,000.
  • Continues to allow deduction for state and local property taxes, but only up to $10,000.
  • Retains 401(k) plans.
  • Repeals the much disliked alternative minimum tax for individuals.
  • Doubles the existing estate tax exemption immediately, with a repeal of the estate tax after 6 years.

For businesses:

  • Lowers corporate tax rate to 20%.
  • Lowers maximum tax rate for certain pass-through businesses to 25%.
  • Allows businesses to immediately write-off the full cost of new equipment.
  • Replaces the existing world-wide tax system imposed on corporations with operations overseas.
  • Retains low-income housing tax credits.

Stay tuned for more in-depth discussion of the tax bill.