The bill would cut $5.9 trillion in taxes over a decade, including a reduction in the corporate tax rate, a larger normal deduction and cuts to individual income taxes.
To help pay for these changes, it would raise $4.5 trillion partly by cutting numerous deductions for individuals and repealing the personal exemption.
The plan would not completely pay for itself; it would add a lot more than $1.4 trillion to the federal debts over a decade. (Republicans signed off on a $1.5 trillion upsurge in their latest budget.)
To individual taxes, the bill would make $4.1 trillion in cuts and include $3.1 trillion in latest tax increases.
The bill calls for a significant cut to individual tax rates …
… a standard deduction roughly double its current size …
… and a repeal of the alternative minimum tax, which primarily affects households with incomes from $200,000 to $1 million.
The bill also contains an increase in the child tax credit to $1,600 from $1,000 and a fresh, temporary, $300 family credit …
“pass-through” income of specific business owners … … a large taxes cut for someof person business owners …
estate tax in five years (how big is estate that the taxes currently affects would be increased in the meantime). … and a repeal of thein five years (how big is estate that the taxes currently affects would be increased in the meantime).
To help pay for these cuts, the bill would repeal the personal exemption, a deduction currently worth $4,050 for every single filer and for every single dependent.
The bill runs on the less generous measure of inflation that would tax more individual income and devalue certain tax credits over the long run.
It would repeal other taxes credits and exclusions and recently require a work-eligible Social Security number to claim certain credits. In addition, it would make alterations to retirement plan rules.
The bill would also repeal many education-related tax breaks, including for interest on student loans.
As well as the alterations for households, the bill would produce several major alterations to organization taxes, including $1.8 trillion in cuts and $1.3 trillion in latest tax increases.
The most expensive change in the bill is a reduction of the corporate tax rate to 20 percent from a top rate of 35 percent.
Other tax cuts include alterations to small business expensing and accounting methods and the repeal of the alternative minimal tax for businesses.
Full and immediate expensing for certified investments would price $25 billion to include. Other cuts come from changes to rules for certain foreign income, tax-exempt companies and excise taxes on Puerto Rican rum.
To help pay for the rate cut, the bill includes shifts to more than a dozen corporate exclusions and deductions, incorporating scaling back deductions for net interest and getting rid of the deduction for domestic production.
The establishment of a fresh territorial tax system, which would only tax income earned domestically to the U.S. corporate taxes fee, is estimated to cover itself over the initial a decade, because it will be paired with a one-time repatriation of international earnings.
The bill includes new rules to prevent companies from avoiding U.S. taxes and implements a fresh excise tax on specific foreign payments.
It would make changes to organization taxes credits, including repealing those for tests certain medicines for rare diseases. More than a few tax-exempt bonds would as well be terminated, incorporating one for professional stadiums.
Other taxes increases would come from changes to rules for insurance firms and the elimination of taxes benefits for certain highly compensated employees.