The House of Representatives voted on a significant tax reform bill. For many in Congress, the stakes of tax reform have soared after lawmakers failed to repeal and replace Obamacare, with healthcare reform failing to garner enough support. Tax reform would create a palpable impact for Republicans before next year’s midterm elections.
Still undergoing a flurry of changes, the House GOP bill would usher in reforms that impact workers, students, families, and industry, including:
• Scaling back the number of tax brackets
• Slashing corporate tax rates to 20 percent
• Getting rid of tax breaks
• Repealing popular deductions for income tax, sales tax and interest on student loans
• Placing a $10,000 cap on property tax deductions
• Allowing college-savings account for children still “in utero”
• Eliminating teachers’ $250 deduction for school supplies
• Simplifying aspects of the overall code
GOP leaders claim the bill will bring tax relief to middle-class workers; Democrats counter the proposal favors wealthy Americans. As it stands, leaders need to keep the price at $1.5 trillion over a decade to sidestep a Democratic filibuster in the Senate—and some estimates find the bill would increase the deficit beyond the ten-year window.
While prominent Republicans have expressed support for the bill, some who represent suburban districts are struggling with a decision that could become a liability next year. In the sector of higher educations some experts fear the bill will cut into university resources, reduce financial aid packages, compromise fund-raising, and undermine research.
No matter what the result of the proposed reforms, one thing is clear: navigating the labyrinth of tax codes requires a trusted, experienced advisor—one who understands your business’s distinctive needs and takes them into account while crafting strategy and guiding decisions.
Visit www.tysllp.com to stay abreast of tax reform—and what it means for your business.