The Trump Administration and Your Taxes
In a recent Forbes article, tax attorney Dean Zerbe makes some predictions about what we’ll see from President-elect Trump. President-elect Donald Trump has yet to formalize a tax plan, but based on his proposals, Zerbe believes we can expect the following:
- Ordinary income: Trump campaigned on tax cuts of up to 33% and the elimination of several tax brackets. He has proposed going from 7 tax brackets down to 3.
- Deductions: Zerbe explains, “The thresholds for capping deductions; what is covered in the cap; etc. are fairly fluid at this point – and will be driven by the overall dollars allocated for tax reform.” He expects an increase in the standard deduction, but a cap on overall deductions.
- Estate/death tax: Trump proposed repealing the estate tax during his campaign. That may not be entirely possible, but Zerbe predicts the rate would be brought down to 33 -35%.
- Corporate tax: It’s likely this rate could be reduced to around 25%.
- Research and Development Tax Credit: This tax credit has received bipartisan support, and could possibly be expanded. One idea being considered is a larger tax credit for businesses who do both their research, and their manufacturing, in the United States. This tax credit provides a major boost for manufacturers.
For more information, see Zerbe’s full article from Forbes.