Tax reform bill could be a huge boon for start-up employees

House GOP to keep income tax rate for wealthiest earners

Kevin Brady's Plan To Push People Out of 401(K)s Puts Middle Class Savings at Risk of Future Tax Hikes

On the individual side, the tax bill would gradually phase out the estate tax - a 40 percent levy applied to estates worth more than $5.49 million for individuals or $10.98 million for couples.

Many illegal immigrants pay taxes using Individual Taxpayer Identification Numbers, which the IRS issues to those who aren't authorized to work in the USA, but whom the government still wants to pony up to Uncle Sam.

Republican leaders on Thursday began the fraught task of selling it to their members before unveiling their proposed legislation in full ahead of a vote in the House of Representatives scheduled for next week. Not a single California Republican voted against a budget setting up this tax bill, even though they knew the GOP meant to end the state and local writeoffs. Wealthy Americans, like Trump, would benefit from the repeal of the alternative minimum tax and phase-out of the estate tax. "We'll continue to listen and work", Brady told reporters late Wednesday night. A spokesman for Republican House Speaker Paul Ryan said it would be formally announced at 11:15 a.m. (1515 GMT).

House Republicans are planning major changes to the US tax system while looking to preserve current rules for retirement accounts popular with middle-class Americans and to retain a top income-tax rate for million-dollar earners.

"So this is a complete redesign of the code, so we can simplify it so much that nine out of 10 Americans can file by using a postcard-style system", Brady said.

The House bill would also slash the number of income tax brackets from seven to four: 12 percent, 25 percent, 35 percent and 39.6 percent.

Critics claim that the bill is written in a way that is meant to benefit Trump and his associates by lowering the amount of taxes they pay.

But the plan would cut a popular mortgage interest deduction in half.

By rejiggering exemptions, deductions, and credits with essentially no change in the highest, most damaging tax rates, the individual side of the Republican "tax cut" is shaping up as a sizable tax increase for well-educated two-earner couples with college-age kids living in high-cost metropolitan areas, among others.

Do you take the home mortgage interest deduction on your federal income tax return? On top of that, companies get some new tax breaks to help lower their bills such as allowing businesses to deduct all the costs of purchasing new equipment, as well as a special low rate on any money they bring back to the United States from low-tax countries such as Ireland.

The National Federation of Independent Business, the influential small business lobby, also came out against the bill, while the U.S. Chamber of Commerce business lobby backed it. Brady already made a key concession when he said that he will still allow individuals to deduct their property taxes in the new bill. Once the theoretical tax plan is a real, publicly available package of ideas, any of these results could easily change. "Like a Trump University degree, it is phony", said Democratic congressman Lloyd Doggett.

The bill will include "no changes" to popular 401 (k) retirement plans, according to a House memo. But it would repeal a personal exemption of $4,050 that taxpayers can now claim for themselves, their spouse and any dependents.

The percent of filers who claim the mortgage interest deduction would fall to 4% from 21% now because the standard deduction would almost double, according to Tax Policy Center estimates. It would also repeal a long standing prohibition on religious institutions being involved in political activities.

-Tax credits: Would increase the per-child tax credit from 1,000 to $1,600 and extends it to families earning up to $230,000.

"What we are seeing today is a plan that exacerbates the unfairness and inequality in our tax code", said top Senate Democrat Chuck Schumer of NY. During World War One, he increased the top individual rate to 77 percent from 7 percent and the corporate rate to 12 percent from 1 percent. Senate Republican leaders have said they aim to finish their work on taxes by year-end.

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