President Trump's tax plan: Here's what it includes

originally posted by: Byrd

originally posted by: StallionDuck
Looks like he didn't do squat for the middle class. Everyone got a tax break BUT the middle (The people who actually work their ass off) class.

There's some more subtle and worse things there.

If you itemize (a good way for many of us), he eliminates everything but charitable deductions and mortgage interest (gosh, doncha wonder who has lots of mortgages and charitable claims?)

So...
* medical expenses won't be deductible (how many families are struggling with medical issues right now?)
* the cost of education isn't deductible (back to college being only for the wealthy)
* business expense for small businesses
* mileage (for techs who do a lot of travel)

...are among the things you can't deduct.

Higher taxes for a lot of folks.

Not saying it covers all those expenses because, like others, I would need to see the bill presented as law to determine specifics, but doubling the standard deduction should cover a lot of that for those truly middle class (which to me are families making 100k or less annually). 400k a year does not = middle class ... or if it does, guess I should have identifed myself as working poor my whole life. Almost forgot...15% tax more than makes up for business expense deductions.

I finally had a little time to read up on this, and found this:
2016 proposed brackers

I can't get the old proposed rates to quote, but basically from what I'm seeing, anyone in the 25% tax bracket now (which is pretty well middle class in these parts) is going to be in the new 25% tax bracket- No change for those of us holding the place up.
However, a lot of people currently in the 15% bracket will be bumped down to only 10%. Granted, in that low an income bracket you're only talking about a couple hundred bucks a year- but when you don't have a couple hundred bucks, a few hundred a year is everything. I know a lot of people who will save a few bucks with this.

the upper middle class is getting screwed a bit, paying 35% instead of 28 or 33... But frankly, if you're taking home 200k a year, you can afford it.

I would like to see a fourth bracket, though. 40% for anyone taking home more than 400k. Nobody earns that much money, so they only way to get it is to be screwing over a lot of other people and taking a portion of their share. CEOs, bankers, government officials... Screw 'em.

I don't fully disagree with brackets he proposed last year. I like that it helps those making a below-livable wage (those who are still working, and haven't given up to be part of the problem, anyway). I'd like to see it help me, too- but we've all got our own priorities. Government getting involved in anything and not raising my taxes is probably the best I can hope for, so I'll be happy enough if they stay the same.

Dropping business tax, though, is a+
That will create more jobs. Granted, you can't swing a dead cat around here without hitting a "help wanted" sign, but maybe dropping the business taxes will raise the wages those signs promise, and get some of these bums off the streets and out of their parents basements.

a reply to: lordcomac

But frankly, if you're taking home 200k a year, you can afford it.

There's a good chance you're now paying AMT, which would go away. You're not being screwed.

I swear, the more crap we see the president do, the more I get pissed off at Marty Mcfly for allowing Old Biff to steal the Sports Almanac and alter the timeline..

Now we have this defunct timeline and President Tanen making the bushes look like smart competent leaders.

The space time continuum is a really weird deal, just hope Marty fixes it soon.

/alternative.reality=(off.data)

It sounds like a good deal, but I'm pretty suspect, if the people making money are paying less in taxes, what does that mean for the overall economy in general? Families will just use that money to pay off debt not buy more crap they don't need, most families are already hurting.

originally posted by: Lab4Us
Not saying it covers all those expenses because, like others, I would need to see the bill presented as law to determine specifics, but doubling the standard deduction should cover a lot of that for those truly middle class (which to me are families making 100k or less annually).

They said specifically that the only deductions they are those two. That's why I highlighted the others. If you don't do itemized deductions, you may not be aware of how much it can help to be able to take your medical expenses off your taxes.

And if I understand it correctly, under Trump's plan, you can't count your state taxes against Federal tax.

Now, we don't have a state tax here in Texas but that alone sounds pretty nightmarish.

a reply to: Byrd

It should be noted that only medical expenses which exceed 10% of your AGI are deductible. For example, assume AGI of $50,000. Only unreimbursed medical expenses beyond $5,000 are deductible.

originally posted by: burdman30ott6
The wishes of the individual who earned and owns the wealth entitles the recipient to it.

So you're a fan of not earning ones own way in life?

originally posted by: Phage
a reply to: Byrd
It should be noted that only medical expenses which exceed 10% of your AGI are deductible. For example, assume AGI $50,000. Only unreimbursed medical expenses beyond $5,000 are deductible.

Oh yes, well aware of this. With two people and the kind of middle-age-and-beyond prescriptions, i'm well aware of it.

Disabilities tend to be invisible for the most part (even temporary ones.) Middle-aged people are often juggling with raising grandkids (kids are NOT cheap) and adult parents needing assistance and their own medical problems. Being able to do medical deductions can ease the tax burden considerably.

originally posted by: burdman30ott6

originally posted by: BubbaJoe
Not to mention Trump's 24% tariff on Canadian softwood lumber, they are saying this alone will remove the ability of many to buy homes. Go Trump, screw the middle class.

...the beauty of the free market will manifest itself on this in due time, allowing America's timber industry to operate as it should with fewer choking restrictions and less federal legislation. Homes will be built with American lumber, as they should have been all along.

Hahaha, I love it. Advocating free markets while simultaneously invoking tariffs as a good thing. Trade protectionism and free trade go together like water and oil.

a reply to: Mishmashum

What part of national protectionism and domestic free market confuses you?

originally posted by: Aazadan

originally posted by: burdman30ott6
The wishes of the individual who earned and owns the wealth entitles the recipient to it.

So you're a fan of not earning ones own way in life?

I'm a fan of he who earns it decides where best to bequeath it.

originally posted by: burdman30ott6
a reply to: Mishmashum

What part of national protectionism and domestic free market confuses you?

LOL, domestic free markets. Any other caveats and modifiers we should add? Should we restrict free trade to specific states. You are hilarious.

Experts across the board say that the tax plan proposed, will be drastically different by the time it's voted into law...for better or worse.

a reply to: Mishmashum

So your answer is that the entire concept confuses you, gotcha. If you want to clear up that confusion, read a little on "Free trade nationalism," Pat Buchanan has written some solid articles on it over years... National economic protectionism, as well. Pay careful attention to the non-neocon movement by DC conservatives to block the fast track trade negotiation bill awhile back, that's when the idea really started to bear fruit. It's greater than ever presently, as it was the top issue that voters supported Trump over... MAGA, in other words.

It isn't just the US, either, it was one of the reasons the UK voted for Brexit.

Global free trade is only a win for the world's cheap labor crapholes. It makes zero logical sense for the country that holds the world reserve currency status.

a reply to: burdman30ott6

You know that was an honest, good reply that warrants a reasoned response. Basically when it comes to the service economy, especially countries that undercut us every which way possible in a fight to the bottom, yeah I am right there with you. However, when it comes to materials I think it is in the best interest of the United States to be able to use other countries goods for the lowest dollar amount before we go destroying our own environment. Sure, it is more of a Lawrence Summers style approach, some would even say it is evil to use our leverage over other countries to externalize our costs, but in reality the world is getting strapped for space and resources quickly. We need to be smart going into the future if we don't want to end up beholden to other countries for raw resources.

originally posted by: lordcomac
I finally had a little time to read up on this, and found this:
2016 proposed brackers

I can't get the old proposed rates to quote, but basically from what I'm seeing, anyone in the 25% tax bracket now (which is pretty well middle class in these parts) is going to be in the new 25% tax bracket- No change for those of us holding the place up.
However, a lot of people currently in the 15% bracket will be bumped down to only 10%. Granted, in that low an income bracket you're only talking about a couple hundred bucks a year- but when you don't have a couple hundred bucks, a few hundred a year is everything. I know a lot of people who will save a few bucks with this.

the upper middle class is getting screwed a bit, paying 35% instead of 28 or 33... But frankly, if you're taking home 200k a year, you can afford it.

I would like to see a fourth bracket, though. 40% for anyone taking home more than 400k. Nobody earns that much money, so they only way to get it is to be screwing over a lot of other people and taking a portion of their share. CEOs, bankers, government officials... Screw 'em.

I don't fully disagree with brackets he proposed last year. I like that it helps those making a below-livable wage (those who are still working, and haven't given up to be part of the problem, anyway). I'd like to see it help me, too- but we've all got our own priorities. Government getting involved in anything and not raising my taxes is probably the best I can hope for, so I'll be happy enough if they stay the same.

Dropping business tax, though, is a+
That will create more jobs. Granted, you can't swing a dead cat around here without hitting a "help wanted" sign, but maybe dropping the business taxes will raise the wages those signs promise, and get some of these bums off the streets and out of their parents basements.

I am a CPA / Tax Advisor. First, this plan has so little detail out, it is hard to determine the potential effects. Second, the shot at people making $400K or more a year is unwarranted. I am higher than that, but, under $1M per year. Making $600K is certainly, well off, but not rich. The are much further out of my league than say someone making $100K compared to me. Also, my wife and I came from families that never earned more than $50K per year. I am a partner at a professional service firm and we pride ourselves that we keep increasing our average employees pay. We are now over $80K per year per employer. We want our employees to succeed. It helps us as well as them. So we are not all evil.

To Blue Aja that thinks reducing taxes will create jobs. See this link. www.taxhistory.org...
This article, which is very technical, describes what happened when multinationals received an opportunity to bring back overseas cash at a very low tax rate during the end of 2004 and all of 2005. At the time, I was the VP of tax at a large multinational and we took back about $200M and saved approximately $65M in taxes not paid to the government. My company kept employment flat and paid $0 of that to the rank and file employees. My boss, the CFO, myself and the CEO collected a nice bonus...

As you can read, the article states, "Finally, the prevalence of layoffs at repatriating companies, while only observable on an anecdotal level, also suggests that the repatriation tax holiday did not necessarily save jobs that had become redundant or were eliminated for strategic reasons. As shown in Table 2, many of the large multinational firms that repatriated well above the average amount of cash also had significant layoffs in the years following the tax holiday. Again, regardless of the tax incentive, management of those firms could not be persuaded to make investments or spend cash in a manner that was not within their corporate strategy or in the best interest of shareholders."

Regarding the estate tax. For a married couple, the exemption, is $10M. That will hit very few people. I agree it should never cause a business to be sold. Rules should be put in place for asset rich cash poor companies to manage this issue. But, we have a joke around the office about the super rich. The first generation that earns the money are hard working, generally respectful and outstanding people. The second generation, has some hobby businesses and act like they are working, do some charity work because they have guilt. The third generation are generally party animals with no sense of how or why they have what they have. The estate tax on the uber rich, $50M or more makes sense. Most people who have more than say $100M probably had more government support than they are willing to admit and paying some percentage back is fair. For example, CEO's of large multinationals that amass $100s of millions in pay had the U.S. military enforcing U.S. law and policy on a global basis which provides a large assist to U.S. multinationals. I have a lot more examples. Real estate developers who obtain government TIF financing or other government funding to make developments "economic" You could argue they would have zero wealth without the government. Making them pay is not only fair, they should probably pay interest as well since they effectively had an interest free loan their whole life from the government. I could go on...

a reply to: Mishmashum

Softwood is the ultimate renewable resource, though. It's from seed to harvest able size in 10 years. I don't totally disagree with you where nonrenewables are concerned.

originally posted by: burdman30ott6
a reply to: Mishmashum

Softwood is the ultimate renewable resource, though. It's from seed to harvest able size in 10 years. I don't totally disagree with you where nonrenewables are concerned.

The real concern is phosphorous. Phosphorous is a basic chemical necessity for life and most people have very little clue how quickly it is being stripped from the environment.

Here is a quick visual of what's left on planet Earth. Pay particular attention to "Proportion of Consumption Met by Recycled Materials %" and "US Annual Consumption".

However, even use of forests by removing only logs exported 0.08–1.02 kg P per ha per year, whereas whole-tree harvest removed 0.24–1.75 kg P per ha per year. These harvested systems lost P regardless of harvest intensity and were considered unsustainable in the absence of fertilizer. Not surprisingly, forest harvesting has required inputs of 15–30 kg P per ha per year to compensate.
Flueck, BioScience (2011) 61 (8): 582

There is a good paper published in BioScience titled "Protected Areas and Extensive Productions Systems: A Phosphorus Challenge beyond Human Food" that spells out what's awaiting us in the not too distant future.

Just playing devils advocate with the left leaning people here: What if 10% of the corporate tax cut was used to boost company
Wages for their rank and file workers? Would you be for or against it?

originally posted by: pavil
Just playing devils advocate with the left leaning people here: What if 10% of the corporate tax cut was used to boost company
Wages for their rank and file workers? Would you be for or against it?

Its easy to say that. But, if you read my reply above, in 2004 Congress passed a huge tax break with the conditions that it be used for just that. The companies found ways around it and didn't do that. They actually cut employment. It sounds great in principal. Its just that is not how it works. I am not left leaning. I am a practitioner in the field.

Corporate taxes are too high in the U.S. now. To be globally competitive, the corporate rate needs to be in the 20-25% range, not the current 35%. Individual rates don't directly impact global competitiveness. One big issue in the U.S. is that the states are imposing higher and higher rates. I don't think anyone at any income level should pay more than 50% combined federal and state. However, given the current situation that can happen. The constitution prevents the federal government from capping state income tax rates. Given that, a 35% top federal tax bracket is fine. I think it should start somewhere around $600,000 of taxable income. 25% between $200 - $600 and 15% below that is fair.