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FACTBOX-What's in the Republican tax cut plan Trump is promoting?
September 27, 2017 / 5:21 PM / 2 months ago

FACTBOX-What's in the Republican tax cut plan Trump is promoting?

    Oct 24 (Reuters) - The Republican tax overhaul framework
being promoted by President Donald Trump calls for slashing
taxes on corporations, repealing some taxes paid primarily by
the wealthy and lowering some taxes on families and individuals.
            
    The plan is intended as a guideline for the House of
Representatives Ways and Means Committee and the Senate Finance
Committee, the two tax-writing panels in Congress that are
already at work drafting detailed tax legislation based on the
framework.
    Questions about the final shape of Republican tax
legislation are swirling in Washington, with Trump himself
raising doubts about certain provisions.
    Here is a look at key provisions in the existing framework.
    
    CORPORATE TAXES
    * Reduce the U.S. corporate income tax rate to 20 percent
from a current statutory 35 percent
    * Eliminate the corporate alternative minimum tax
    * Move to a territorial tax system that no longer taxes U.S.
corporate profits overseas at the U.S. corporate income tax rate
    * Require U.S. corporations to return assets held overseas
at separate, unspecified and lower one-time tax rates for
invested assets and cash or cash equivalents
    * Establish a minimum global tax aimed at the overseas
profits of U.S. corporations operating in tax haven countries

    'PASS-THROUGH' BUSINESSES
    * Limit the maximum tax rate applied to small businesses to
25 percent, compared to current policy that taxes so-called
pass-through income at an individual tax rate of up to 39.6
percent

    ALL BUSINESSES
    * Allow immediate and full expensing of capital investments
for at least five years
    * Partially limit the business tax deduction for debt
interest payments
    
    INDIVIDUAL TAXES
    * Lower the top individual rate from to 35 percent from 39.6
percent
    * Increase the standard deduction for taxpayers to $12,000
from $6,300 for individuals and to $24,000 from $12,600 for
married couples 
    * Reduce the current seven individual income tax brackets to
three brackets of 12 percent, 25 percent and 35 percent
    * Give the two congressional tax-writing committees the
flexibility to set a fourth bracket at a rate higher than 35
percent for the wealthiest Americans, to ensure that the
overhaul plan does not shift the tax burden from higher to lower
income households
    * Repeal the deduction for state and local tax payments
    * Eliminate the $4,050 personal exemption for taxpayers and
their family members
    * Create an unspecified but "substantial" increase in child
tax credit, which currently stands at $1,000, raise the income
limit to qualify for the credit, and eliminate the higher
qualifying income rate for married couples
    * Create a $500 tax credit for taxpayers with non-child
dependents
    * Repeal the individual alternative minimum tax on
high-income taxpayers
    * Eliminate unspecified itemized deductions that would
impact 30 percent of taxpayers and 25 percent of families
    * Repeal the estate tax paid chiefly by the richest
Americans
    

 (Compiled by David Morgan and Amanda Becker; Editing by Kevin
Drawbaugh and Will Dunham)
  

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