When President Donald J. Trump took office, the Republican Party took control of all three branches of the federal government and the party had big plans for making substantial changes to Obamacare and to the tax code.
However, several Obamacare repeal attempts were unsuccessful, leaving Republicans desperate for a legislative win. That win could come from the passage of tax reform.
Tax reform would make major changes to both the individual and corporate tax codes. A Virginia tax lawyer can provide assistance to companies and to individuals in understanding what their rates would be under the new tax reform proposals and can also help taxpayers to ensure they are doing everything possible under the current tax code to avoid paying more than is necessary in income taxes.
The GOP’s Tax Reform Proposals Have Gained Momentum
The tax reform proposals put forth by the GOP would lower the corporate rate from the current 35% to 25% and would reduce the number of tax brackets for individual filers. Other major changes would occur as well, including some credits or deductions being eliminated or reduced and a new larger standard deduction being put in place.
The tax reform proposal that has been put forth is unlikely to get support from any Democrats, so the Republicans will need to secure enough votes from among their house majority to pass the bill without any votes from the opposition party. Republicans do not have a filibuster proof majority in the senate, but can pass reforms through reconciliation if they can get 51 votes.
In mid October, the tax reform effort gained momentum when the U.S. Senate agreed to adopt a budget resolution that cleared the way for the passage of reforms through reconciliation. The budget received 51 votes, all from Republicans, and Bloomberg described the vote as a show of unity that could help to speed up the passage of tax reform.
The budget included an amendment that removed the need to spend weeks reconciling it to the House version of the budget, instead allowing the House to vote on the version that passed the senate so time which would otherwise have been spent on the budgeting process can instead be spent focusing on reforming the tax code.
Republicans have expressed a desire to pass tax reform by the end of 2017, and President Trump has indicated that he is eager to sign a bill if the House and Senate can pass one and get it to his desk. Because the passage of the budget is seen as a sign of consensus within a divided republican party, some are expressing hope that it is a sign that tax reform will actually be able to pass.
Because of the uncertainty surrounding tax rules going forward, businesses and individuals should consider consulting with a Virginia tax lawyer to get advice on how to develop a strategy to reduce their tax exposure and protect personal or corporate assets. Contact an attorney for help today with all of your tax concerns.
