Senate bill passes: Plan now for tax reform
Early Saturday morning (12-02-17), the Senate passed H.R. 1, the Tax Cuts and Jobs Act. Here are a few of the changes that are included in the current version of the bill:
- Allow a deduction for up to $10,000 in property taxes paid to state and local governments;
- Keep the individual and corporate AMT, with AMT exemption amounts and phase-out thresholds increased by approximately 39%;
- Lower the threshold in 2017 and 2018 for individuals to deduct medical expenses from 10% of AGI to 7.5% of AGI;
- Provide new due diligence requirements for preparers filing client returns as head of household;
- Allow funds from §529 savings accounts to be used toward K–12 school tuition;
- Extend the 100% expensing for qualified business property by four more years, while gradually phasing it out over time; and
- Increase the deduction for qualifying passthrough entities from 17.4% to 23%.
The next step is for the bill to go to the Joint Conference committee. If both houses can agree on a final bill, we will have tax reform.
