The House Ways and Means committee released the Tax Cuts and Jobs Act. This finally gives the American people insight into the tax reform that President Trump and the Republicans have been talking about since April. The Act is being touted as the first major tax reform since the Tax Reform Act of 1986. The Ways and Means committee is indicating that this will save the average American family $1,182 in taxes. In addition, due to simplification, an individual or family will be able to file their taxes on a form as simple as a postcard.
This Act has a long journey to make it through Congress and ultimately President Trump. What may be signed into law by President Trump will most likely not be exactly what was released today, but this at least gives us a road map to the tax reform the Republicans would like enact.
Below is a highlight of some of the provisions that are contained in the Tax Cuts and Jobs Act. There are many other provisions included within the Act, along with many details and limitations to the provisions included in the act. If planning, make sure the Act is fully reviewed, and plan cautiously - remember this is not law yet.
No deduction for student loan interest
Repeal of the 3 percent reduction of itemized deductions for higher income individuals
Taxpayer must own and use home as a principal residence for at least 5 out of the last 8 years in order to qualify for the $500,000 joint filers ($250,000 for other filers) exclusion of gain on the sale of a principal residence
Increase of basic exclusion from $5,000,000 to $10,000,000 indexed for inflation.
KEY FOREIGN PROVISIONS
Stay tuned as we will keep you informed as this tax reform continues through the legislative process. For more information contact your UHY LLP professional at one of our many locations.