On April 26, 2017 we posted Trump Proposes 15% Corp. Tax Rate & Repeal of 3.8% Obama Tax where we discussed that 15 percent tax rate for corporations, cutting the top individual tax rate from 39.6% to 35%, reducing the number of rates from seven to three and the repeal of a 3.8 percent tax on net investment income are the top priorities in the Trump administration’s tax reform agenda, according to a plan released by the White House today April 26, 2017
On April 27, 2017 we posted Trump Proposes To Repeal Estate Tax, Alt Min Tax and 3.8% Obama Tax where we discussed that it also provides for repeal of:
- the Estate Tax
- the Alternative Minimum Tax along will
- the 3.8 per cent Surtax on investment income (capital gains, interest and dividends) introduced by the Obama administration to fund the Affordable Care Act.
The president's plan also proposes in addition to slashing the top corporate tax rate to 15 percent from 35 percent the following:
1. 15% Corporate Tax Rate For Pass-Through Businesses
The 15 percent corporate rate would also apply to profits of pass-through businesses, such as S Corporations and LLCs, whose profits currently flow through to individual taxpayers and are taxed at a current rate as high as 39.6 percent.
2. One-Time Tax on Repatriated Overseas Profits
A new, one-time tax on the repatriation of previously untaxed overseas profits at a to-be-determined rate, which might be as low as 10 percent or even 3.5 percent, as proposed by certain congressional leaders.
3 . Conversion From a World Wide Tax System to Territorial Tax System
To convert from the current system of taxation on worldwide profits to a territorial-tax system in which foreign profits are not taxed until repatriated back to the US.
But also see our April /25/17 post Tax Reform Announcement Coming on April 24 but Tax Reform Is 'Impossible' This Year - So Where Does That Leave Tax Advisers? where we discuss that there may not be enough time to get the tax bill passed in 2017. Warren Payne, a former House Ways and Means Committee policy director now with Mayer Brown LLP, believes that passing tax reform by August will be ‘‘impossible’’ this year. Rather, he suggested during a conference call March 16 that it is more likely to be addressed in early 2018.
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