The House Republican Leadership unveiled their much-awaited Tax Cuts and American Jobs act.
At first glance, the measure would:
- cut the corporate tax rate to 20%;
- reduce the seven individual tax brackets into four;
- nearly double the standard deduction to $24K (married), $18,300 (head of household), and 12,200 (single);
- increase the child care tax credit to $1,600 (from $1000);
- change the mortgage interest deduction to apply to house loans up to $500,000 on new home purchases while existing homes would be grandfathered;
- repeal the student-loan interest deduction;
- private universities with assets exceeding $100,000 a student would pay a new 1.4% excise tax on their net investment income; and
- businesses would no longer be able to deduct entertainment expenses, though today’s rules for business meals would remain.
The charitable deduction will not change, and the tax provisions related to 401(k)s are unchanged.
A section-by-section of the measure is here.
Federal Relations is still going thought the measure and will continue to provide updates.