President Trump has introduced his tax reform plan and it appears that it will benefit most U.S. households but how will it affect YOUR money? Paul was recently interviewed by NBC’s Knoxville affiliate, WBIR:
PAUL, WHAT ARE SOME OF THE MAIN PROVISIONS OF THE TRUMP TAX PROPOSAL?
- Doubles the Standard Deduction.
- Reduces or eliminates some Itemized Deductions.
- Streamlines Tax Brackets: The current seven tax brackets will be streamlined to three –
The top rate will drop to 35% from 39.6%. (Income brackets were not announced). Goal? The premise is that lower tax rates will stimulate economic growth.
WHAT OTHER TAXES WOULD BE REDUCED OR ELIMINATED?
- Would cut the “Death Tax” – also known as the estate tax. (The current estate tax exemption is $5.5mm per person or $11mm per couple)
- Would cut the 3.8% “Medicare” tax – on the interest, dividends and capital gains of higher income households.
THERE IS CONCERN ABOUT THE FEDERAL DEFICIT AND DEBT…
It is an eternal struggle: does the Federal deficit and debt matter? If it does, there are basically three mechanisms to utilize —
- Raise taxes?
- Cut spending?
- Grow a bigger pie? (economic growth)