By: Matt O’Kane
Here’s how the recent legislative changes will affect you:
Spousal Homestead Transfer
Two Legislative Changes to Pay Attention to
Republicans Announce Tax Reform Framework, Which Includes Repealing Estate Tax
By: Amanda Wilson
Reducing the corporate tax rate to 20% (current rate is 35%).
Providing for a 25% tax rate (current maximum rate for individuals is 39.6%) for income from small businesses owned as sole proprietorships, partnerships and S corporations.
Providing for individual tax bracket rates of 12%, 25%, and 35% (a change from the current 7 rates that go from 10% to 39.6%).
Repealing the estate tax and the generation skipping tax.
Repealing the individual alternative minimum tax.
Doubling the standard tax deduction to $12,000 for individuals and $24,000 for married couples.
Increasing the child tax credit.
Eliminating most itemized deductions for individuals (including deductions for state and local taxes). There will still be tax incentives for mortgage interest and charitable contributions.
Limiting corporations ability to deduct interest.
Allowing corporations to expense the cost of new investments in depreciable assets other than structures for at least 5 years.
Repealing Section 199 deduction for domestic production.
Replacing the current tax system for U.S. companies operating abroad. U.S. companies will receive a 100% exemption on dividends from related foreign subsidiaries. Any existing accumulated foreign earnings will be treated as repatriated, with the corresponding tax spread out over several years. Earnings held in illiquid assets will be subject to a lower tax rate than earnings held in cash or cash equivalents.
After months of speculation, President Trump and the Republicans have announced their framework for tax reform. While specific details are not known, the key elements of the framework include:
Treasury Plans to Pull Unpopular Discount Regulation
By: Amanda Wilson
As discussed earlier this summer, Treasury and the IRS identified as a burdensome regulation the Proposed Regulations under Section 2704 of the Internal Revenue Code, which regulations would severely impact discounts on gifts made to family members. (Our prior discussion can be found here.) Today, Treasury issued a report announcing that it proposes revoking the proposed regulations. This is good news for taxpayers.
Proposed Regulations Limiting Discounts on Family Gifts Targeted for Reform
By: Amanda Wilson
Last summer, we discussed the IRS’s issuance of new Proposed Regulations under Section 2704 of the Internal Revenue Code, which regulations would severely impact discounts on gifts made to family members. (Our prior discussion can be found here.) Earlier this year, the Trump Administration issued an executive order instructing the Treasury Department to review all significant tax regulations issued after December 31, 2015 and identify any regulations that impose an undue burden on taxpayers. The Treasury Department and IRS have completed this review, and have identified eight burdensome regulations that should be reformed. The good news for taxpayers is that the Proposed Regulations under Section 2704 are on this list.
The next step is for the Treasury Department and IRS to recommend their proposed reform for these regulations, which could range from modification to outright repeal. We will have to wait and see what they propose, but for now, the fact that the Treasury Department and IRS targeted these Section 2704 regulations for reform is a big step in the right direction.
We will keep you updated as this process moves forward.
Governor Scott’s New Law To Lower Sales Tax Rate On Commercial Leases
On May 25, 2017, Governor Scott signed HB 7109 into law. The new law will lower the sales tax rate on commercial leases under Florida Statute Section 212.031 from 6% to 5.8%. The new law goes into effect January 1, 2018. It is projected to save Florida commercial tenants $61,000,000 per year. Sales tax brackets and sales tax software programs will need to be updated for the new law change in January. For more info, go to:
http://www.flgov.com/gov-scott-announces-100-million-tax-cut-on-business-rents-as-part-of-the-its-your-money-tax-cut-budget-2/