2&2 Slider To Leyritz
Well-known member
The elimination of itemization for most people is a massive, undeniable simplification.
The elimination of itemization for most people is a massive, undeniable simplification.
Only 30% of households itemize now. Some of them will still need to itemize if this bill becomes law. So your "massive" simplification will impact probably less than a quarter of households.
Most itemizers without small business (s corp, LLC) income just itemize a few items, basically charity, mortgage, childcare. A lot of itemizers have pass-through income. This bill looks to make small business income more complicated, not less. So out of that population of households who itemize now, a substantial portion - small business owners, perhaps you yourself - will have more complexity.
If that's your big "simplification" selling point, I'm not buying it.
Only 30% of households itemize now. Some of them will still need to itemize if this bill becomes law. So your "massive" simplification will impact probably less than a quarter of households.
Most itemizers without small business (s corp, LLC) income just itemize a few items, basically charity, mortgage, childcare. A lot of itemizers have pass-through income. This bill looks to make small business income more complicated, not less. So out of that population of households who itemize now, a substantial portion - small business owners, perhaps you yourself - will have more complexity.
If that's your big "simplification" selling point, I'm not buying it.
Saw that adoption tax credit is eliminated? And these are the people who also want to eliminate abortion too. Neat.
It would be nice if some reporters ask them to defend this.
It would be nice if some reporters ask them to defend this.
The credit’s cost is small compared with the tax plan's projected cost of $1.5 trillion to the debt over a decade. The government lost $355 million in revenue because of the credit in 2014, the most recent year data was available. Fewer than 74,000 taxpayers claimed the credit.
From my math, a married couple Homeowner with a $750,000 house who makes $150k/yr and no kids is worse off by about $2,500. Renters are better off by about $3,500. In the long term everyone may be better off as home prices might drop some, but those who own their own home currently may feel some pain both in a drop in home prices and the $2,500/yr more taxes they'll pay.
The corporate tax change will be a significant change, although its hard to say what it will do. People who own their own businesses will see a huge benefit. In theory wages should rise pretty significantly, but that will take some time, the business owner will profit the most in the short-term.
Estate tax repeal is stupid.
Having a kid got slightly more expensive, as raising the tax credit $600 doesn't offset losing the exemption of $4,100. It would be fairly breakeven if they raised it $1,000, which they may do.
Young renters should be significantly better off. (5-10% more income)
Ok, this thread is 20 pages, I've read a bit about the proposed reforms and here's what I gather:
Elimination or simplification (modification) of tons of deductions and credits, and then a giant boost in the standard deduction to essentially curb filers from doing anything but the standard deduction.
I'll probably go back and read the 20 pages of this thread, but is that pretty much the consensus here as well?
Saw that adoption tax credit is eliminated? And these are the people who also want to eliminate abortion too. Neat.
Look, I was a real life tax lawyer for a lot of years. I guess now I'm in recovery. I completely get that the complexity of the tax code and the perverse incentives therein are a drag on business. I have seen plenty of business decisions derailed or slowed or altered by tax issues. I am in support of lowering the headline corporate rate to make the US more internationally competitive (but it should be revenue neutral by trimming corporate deductions, since we know that the actual net rate paid by US corps is not that high). I am in favor of tax code simplification to free up capital for investment and to reduce tax planning drag on business decisions.25% percent of American households is not a massive impact? That's only what, 30 million households? But okay. And again, I see that Atlantic says it will "make life hell" for some small business owners, but I don't see how proving at-risk investment is difficult for said small business owners. Especially if it is a one-time thing.