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Pass-Through Business Taxes Previous law: Businesses organized as sole proprietorships, LLCs and partnerships don’t pay corporate tax rates. Instead, the owners pay individual income taxes on their share of business income – they’re called pass-through business taxes. Those tax rates are the same as the individual income tax rates. New law: Business owners can take a 20 percent deduction on their pass-through business income, with limits for those earning above $157,500 (single) and $315,000 (married, filing jointly).

It also said that economic activity in Europe and Asia was surprisingly stronger than expected last year, and global growth in 2017 was now estimated to have reached 3.7 percent, 0.1 percentage point higher than the Fund projected in October. “The U.S. tax policy changes are expected to stimulate activity, with the short-term impact in the United States mostly driven by the investment response to the corporate income tax cuts,” the IMF said in the update, which was released on the sidelines of the World Economic Forum in Davos, Switzerland. “The effect on the U.S. growth is estimated to be...

WASHINGTON - A loophole in the new U.S. tax law could allow multinational corporations like Apple Inc to avoid paying billions of dollars in taxes on profits stashed overseas, according to experts. Stemming from a Republican overhaul of international business taxes, the loophole involves the tax rates - 15.5 percent or 8 percent - that companies must pay on $2.6 trillion in profits they are holding abroad. By manipulating their foreign cash positions, a determining factor under the new law, a U.S. multinational could potentially save money by shifting profits to the lower rate from the higher one, according to...

Utility companies annouce plans to reduce customers' energy costs. (Screenshot) From Washington, DC to Washington state, utility companies are crediting passage of Republicans’ Tax Cut and Jobs Act for their plans to lower their retail customers’ monthly bills. Company press releases announcing the rate-cut plans specifically cite “the decrease in the Corporate Tax Rate from 35 percent to 21 percent” as the reason for reducing energy rates. The utility companies that have reported plans to cut rates, thus far, include: Pepco plans to lower the bills of 296,000 electric customers in the District of Columbia, Pepco and Delmava Power...

Renters came out winners under the new tax law. For over a century, the federal tax code catered to homeowners and treated renters like second-class citizens. Homeowners have been able to deduct interest on their mortgages and home equity loans, as well as property taxes. Meanwhile, everyone, including renters, footed the bill for these deductions by paying higher rates. The new tax law at last begins leveling the playing field between renters and homeowners. Millions of New Yorkers and Californians reap the benefits, because these states have among the lowest rates of homeownership in the nation, and renting is...

The Republican tax overhaul may not do a great deal to boost overall economic growth — but it’s already having one stimulus effect. Call it the Full Employment Act for Tax Pundits.Ever since the contours of the plan made clear that residents of high-tax states would take the biggest hits, a cottage industry devoted to strategizing blue-state tax work-arounds has emerged. As a reminder, Americans for generations have been able to deduct the amounts paid for state and local income tax, as well as property tax, from their federally taxable income. But the new law caps that amount at $10,000,...

The tax plan that President Trump signed into law last week creates one of the largest new loopholes in decades: a 20% deduction for “pass-through income.” Pass-through income is business income that is immediately “passed through” to the owner’s personal tax return, thereby avoiding the corporate income tax. Proponents of the Republican tax plan claim the cut benefits small businesses, but that’s a red herring. In reality, the new deduction disproportionately benefits the wealthy, penalizes workers and, in part because it is so complex, will ultimately reward those who can afford the best tax advice. The new deduction could have...

Before the bill was even passed through Congress, Trump’s tax cut already started signaling strong signs for the American worker, putting more money in his or her pockets. Corporate America has not only celebrated it, but has literally handed out more money to its employees with the passage of this ultimate Christmas gift, becoming a real life Santa Claus. AT&T expanded its bonus program to additional 200,000 employees, getting $1,000 per person. Then came Boeing announcing a gift of $300 million in investments in its employee-related charitable program “to support our heroes, our homes and our future.” A college friend...

President Donald Trump and his Republican colleagues in both the House and Senate are continuing to work on overhauling the US tax code, and it is now looking increasingly likely that their efforts will be successful. The vote on the final version of the GOP’s tax plan, known as the Tax Cuts and Jobs Act, is expected to happen later this week, with the Republican-controlled House expected to pass the bill on Tuesday before the Senate then votes on the bill either later in the day on Tuesday or Wednesday.

President Trump on Wednesday claimed the Republican tax plan “essentially” repeals former President Obama’s signature health-care law. “When the individual mandate is being repealed, that means ObamaCare is being repealed,” Trump said during a Cabinet meeting at the White House. “We have essentially repealed ObamaCare and we will come up with something much better.” The GOP tax overhaul gets rid of the Affordable Care Act’s individual mandate, which requires almost all Americans to purchase health insurance or pay a fine. Trump said he refrained from playing up that measure because he was worried about how the news media would report...

The House gave the final stamp of approval Wednesday to a sweeping tax reform package, handing President Trump his first major legislative victory and most Americans a tax cut starting next year. In a 224-201 vote, Congress sent the $1.5 trillion package to Trump’s desk. The biggest rewrite of the federal tax code since the Reagan administration will usher in steep rate cuts for American companies, double the deduction millions of families claim on their annual returns and make a host of other changes taking effect in a matter of weeks.

I must confess that I find New York’s senior senator, Chuck Schumer, annoying at best to listen to. He finds it difficult to speak without a tone of condescension in his voice and characteristically assumes a stance of moral, as well as intellectual, superiority to those who dare to disagree. In other words, a singularly repellant man, whose election and re-election by the voters of New York State remains a mystery to me. Who could stand to vote for such an obnoxious man? Evidently, New Yorkers see his behavior as normal and acceptable. But yesterday, on the Senate floor, we...

What's driving the markets? Hopes that the tax bill, which would slash corporate rates, will get approved before Christmas boosted stock markets world-wide and contributed to Monday's record push for U.S. indexes. The House of Representatives is expected to vote on the final version on Tuesday, while the Senate vote is expected to follow either on Tuesday or Wednesday. That should be enough time for the bill to land on President Donald Trump's desk for the final signature before Christmas, which is the Republicans' self-imposed deadline.

In a blue county, financial professionals unwittingly reveal that the tax bill is “bad” because California loses its free ride on the back of poorer states.I was at a party during which I ended up speaking to a CPA and a personal financial adviser. They both assured me that the tax bill was a disaster. Of all the terrible things Trump has done, it is the worst. There is nothing more terrible than this tax bill. I put on my ingenuous face. “I don’t really know much about it. What’s wrong with it?” Said the CPA, “Well, I’m retired, so...

House Republicans will need to pass their tax plan for a second time after the Senate parliamentarian ruled that provisions in the bill violated the rules governing the legislation. "Members are advised that we expect Senate Democrats to insist on a Byrd Point of Order on the Conference Report to Accompany H.R. 1, which is likely to be sustained," said guidance from House Majority Whip Steve Scalise's office, which was sent to GOP lawmakers. "As such, Members are further advised that an additional procedural vote on the Motion to Concur is expected tomorrow morning, which will clear the bill for...

This week, the House and Senate will vote on comprehensive, pro-growth, pro-family tax reform. The legislation, known as the Tax Cuts and Jobs Act, will give families and individuals across the country tax reduction and simplification starting in 2018. The legislation includes rate reduction and a doubling of the standard deduction. Under this change, the first $12,000 for an individual and $24,000 for a family will be tax-free. The standard deduction is already used by 105 million taxpayers across the country, who will see a significant tax reduction. In addition, the plan doubles the child tax credit to $2,000, helping...

The House will vote on major tax reform legislation on Tuesday, Republican aides told the Washington Examiner. The House Rules Committee, which sets the terms of the debate, including whether to allow amendments, will meet Monday on the legislation. The vote timing suggests GOP leaders are confident they have the numbers to pass the legislation, which then heads to the Senate for consideration "likely Tuesday," according to Senate Majority Whip John Cornyn, R-Texas.

President Trump said Sunday that Sen. John McCain, who is battling brain cancer, would return to vote for tax reform this week if needed to pass the bill, though the senator’s office later forecasted a January return to Washington. Mr. McCain had been undergoing treatment for a viral infection at Walter Reed National Military Medical Center near Washington but Sunday returned to Arizona to spend Christmas with his family, according to the senator’s office. Mr. Trump said he had spoken with Mr. McCain’s wife, Cindy, and that the senator would be available for the vote, which is expected as soon...

Sen. John McCain headed back to Arizona today and will miss the tax reform vote this week. Meghan McCain's new husband, The Federalist's Ben Domenech gave an update on the senator's condition after the longtime Arizona senator was hospitalized earlier this week. 'Well, John, I'm happy to say that he's doing well,' Domenech answered Face the Nation host John Dickerson, who had asked about the Republican lawmaker. 'He's in good spirits. And he's looking forward to heading back home in Arizona for the holidays.' CBS News later reported that McCain is heading directly to Arizona and miss key votes on...

After making completely false claims about the GOP tax reform bill on ABC’s Good Morning America earlier on Sunday, Clinton lackey George Stephanopoulos spent most of This Week leading the discussion tearing it down. After spending a couple minutes smearing the bill in his opening monologue, Stephanopoulos interviewed Texas Republican Senator John Cornyn where one of his first questions involved allegations GOP leaders bought off Tennessee Senator Bob Corker with a real estate provision: There's a lot more scrutiny of the bill, which was just released on Friday in these final hours. Including an article in the International Business Times,...