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1 1 (December 5, 2017)

handle is hein.crs/govcgxt0001 and id is 1 raw text is: 01;0i E.$~ & Updated December 5, 2017 Comparing Key Tax Reform Elements: Tax Cuts and Jobs Act Legislation has been proposed in the House and the Senate that would substantially modify the federal tax system. On November 16, 2017, the House passed the Tax Cuts and Jobs Act (H.R. 1). The Senate passed its own version of the Tax Cuts and Jobs Act on December 2, 2017. This In Focus compares selected key elements of the House and Senate proposals. This comparison is not intended to be complete or comprehensive; such a comparison is beyond the scope of this product. Table I. Comparison of Major Provisions in the Tax Cuts and jobs Act to Current Law Tax Provision Current Law (2017) House (H.R. I) Senate (H.R. I, as amended) Individual Provisions Individual tax 7 brackets: 10% I 15% I 25% rates I 28% 133% 135% 139.6%. Personal exemptions and standard deduction Inflation adjustment Child-related provisions/ personal credits Itemized and other deductions Education incentives Other individual tax expenditures Individual AMT Estate tax Personal exemption: $4,050 for taxpayer, spouse, and dependents. Standard deduction: $6,350 (single) and $12,700 (married). Consumer Price Index (CPI). Refundable child tax credit of $1,000. Various itemized and above-the-line deductions. Mortgage interest deductible on up to $1 million loan, plus $100,000 for home equity loan. Various credits and deductions for education- related expenses. Various exclusions, credits, and other individual provisions. Alternative Minimum Tax (AMT). Tax above exemption ($5.49 million, 2017). 4 brackets: 12% 125% I 35% 139.6%. 12% bracket phased out at higher income levels. Personal exemptions repealed. Standard deduction: $12,200 (single) and $24,400 (married) in 2018. $300 family flexibility credit for taxpayer and spouse through 2022. Chained CPI. $1,600 credit per child (up to $1,000 refundable). Phase-out thresholds increased. $300 non-refundable credit for non-child dependents. New identification requirements for claiming credits. Repeal state and local income taxes, medical expenses, tax preparation expenses, personal casualty losses (with some exceptions), expenses attributable to being an employee, moving expenses (military exception), educator expenses, alimony payments. Modified deductions include property taxes limited to $10,000; mortgage interest on up to $500,000 on new loans and for principal residence; alimony not deductible or taxable. Reform the American Opportunity Tax Credit and repeal other higher-education incentives. Repeal exclusion for moving expenses (military exception), other nonrefundable credits (excluding adoption credit). Modify exclusion of gain from sale of principal residence. Repealed. Double exemption amount. Repeal after 2024 but retain step-up in basis. 7 brackets: 10% I 12% I 22% I 24% 132% I 35% 138.5%. (Expires 1/1/2026.) Personal exemptions repealed. Standard deduction: $12,000 (single) and $24,000 (married) in 2018. (Expires 1/1/2026.) Chained CPI. $2,000 credit per child (up to $1,000 refundable). Phase-out thresholds increased. $500 non-refundable credit for non-child dependents. Social Security number requirement for refundable credits. (Expires 1/1/2026.) Repeal state and local income taxes, tax preparation expenses, non-disaster personal casualty losses, moving expenses (military exception), certain miscellaneous itemized deductions. Modified deductions include property taxes limited to $10,000; no deduction for mortgage interest on home equity loans. (Expires I / 1/2026.) Generally not addressed (some smaller modifications). Repeal exclusion for moving expenses (military exception). Modify exclusion of gain from sale of principal residence. (Expires I / 1/2026.) Increase exemption amount and phaseout threshold. (Expires 1/1/2026.) Double exemption amount. (Expires 1/1/2026.) mppm qq\ a ' p\w gn'a', ggmm I 'S 11\111WILiN,

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