The conference committee that was negotiating the differences between the tax reform bills passed by the House and Senate has reached agreement on the consolidated bill and released the details to the public.
“I’m very excited about this moment. It’s been 31 years in the making and took a lot of hard work by a lot of people to make this day happen. I’m proud of the Tax Cuts and Jobs Act,” said Rep. Kevin Brady (R-Texas), the chairman of the House Ways and Means Committee.
The bill will have to be passed by each house of Congress again before it can be sent to the president for signing. That vote is tentatively set for Tuesday, December 19, 2017. [Read the full final GOP tax bill HERE.]
If you don’t want to read through the gobblygook, here’s what’s in the final version of the Republican tax bill.
Tax Brackets
The bill lays out seven tax brackets – a failure to simplify the tax code down to the three brackets that President Donald Trump had requested.
For single filers:
| Tax Rate | Taxable Income Bracket |
|---|---|
| 10% | 0 - $9,525 |
| 12% | $9,525 - $38,700 |
| 22% | $38,700 - $82,500 |
| 24% | $82,500 - $157,500 |
| 32% | $157,500 - $200,000 |
| 35% | $200,000 - $500,000 |
| 37% | $500,000 and up |
Tax rates for married couples filing jointly:
| Tax Rate | Taxable Income Bracket |
|---|---|
| 10% | 0 - $19,050 |
| 12% | $19,050 - $77,400 |
| 22% | $77,400 - $165,000 |
| 24% | $165,000 - $315,000 |
| 32% | $315,000 - $400,000 |
| 35% | $400,000 - $600,000 |
| 37% | $600,000 and up |
Exemptions/Deductions/Credits
- The personal exemption has been removed but the standard deduction has been almost doubled to $12,000 for single filers and $24,000 for married couples
- The exemption for estate tax will almost double to just over $10 million
- The child tax credit is doubled to $2,000 per child and is refundable up to $1,400
- SALT – State and local taxes: only the first $10,000 of property, income or sales taxes will be deductible
- The AMT deduction will be increased to $42,250 for singles, $84,500 for couples
- The home mortgage deduction remains unchanged for existing homeowners. For homes purchased after 2017, only the interest on the first $750,000 in mortgage debt can be deducted
- No changes to existing rules for contributions to IRA’s, 401k, 403b or charitable organizations
Changes for businesses
- Corporate tax rate drops from 35% to 21%
- The corporate alternative minimum tax is eliminated
- 20% business income deduction for the first $315,000 in income earned by pass-through businesses
Other Changes
- The Obamacare mandate which requires individuals to purchase qualified plans or pay a penalty will be removed as of January, 2019
We are processing information coming from the conference committee as quickly as possible. This article will be updated as new information is gained. Please check back regularly.
