Feeds:
Posts
Comments

Archive for November 10th, 2017

When it comes to tax reform, the political posturing may dominate the news — What’s in? What’s out? Who wins? Who loses? — but what really matters is the math. That’s certainly the case under the current climate, where unilateral control of the White House, House and Senate gives the GOP an opportunity to pass its vision of tax reform without a single vote from a Democrat in the Senate. If, that is, the Republicans can get the math to work.

Specifically, the 2018 budget reconciliation process will allow a tax bill to pass the Senate with a simply majority — rather than the standard 60 votes — only if that bill does not provide for more than $1.5 trillion in tax cuts over the next ten years. Go over that amount, and the GOP will need Democratic buy-in.

But big promises have been made. President Trump declared this THE BIGGEST TAX CUT IN HISTORY. (It is not). Individual rates are going to be slashed. So is the corporate rate. And the rate on business income. The estate tax and alternative minimum tax will be no more. You get the idea…lots of big tax cuts are coming, but how do you get that to fit into a $1.5 trillion-sized box?

You start by adding back as many deductions as politically palatable. But that’s the tricky part of tax reform; for every deep-rooted preference you try to extract from the law, a powerful special interest group will tug just as hard in an effort to keep it in place.

Continue reading on, Forbes.com

Authored by Tony Nitti, Withum Partner and writer for Forbes.com.

Read Full Post »

What a week. Last Thursday, the House released its vision for tax reform, launching a flurry of analysis by the tax geeks, hand-wringing by the middle class, and defensive measures by the GOP.

Then, late last night, just as the House Ways and Means Committee culminated a four-day mark-up of HR 1 by voting to advance the bill along party lines, the Senate decided it was time to get in the mix by releasing its plan to revise the tax law.

There’s a lot to take in, clearly. It was hard enough to fully grasp how current law compared to the House bill, but now we’ve got to layer on the Senate proposal, which varies from both current policy and the House proposal in several significant ways.

What follows is a summary of the opening week of “tax reform season,’ with an item-by-item comparison of current law, the updated House proposal, and the newly-published Senate bill.

Let’s get to it…

Continue reading on, Forbes.com

Authored by Tony Nitti, Withum Partner and writer for Forbes.com.

Read Full Post »