(WTVM) - Finally, we have a tax plan and we know what’s in it…for the most part.
For almost everyone, the House Republican tax plan offers some real tax relief. It’s not perfect but we think Congress needs to step up, work together on a final bill and get it passed.
The truly bad tax ideas that were once part of the plan, the ones that were denounced as soon as they were floated, are gone: like limiting 401k retirement plan contributions. President Trump’s plan now leaves your 401k contributions alone.
That’s important because your retirement contributions are not counted as taxable income, which lowers the amount you owe.
To change that would be to discourage retirement savings, which is a terrible idea for a population that doesn’t save enough money as it is. The tax plan flirted with other bad ideas like eliminating the mortgage interest deduction before coming to their senses.
One of the best parts of the tax plan is the reduction in corporate income taxes from 35 percent to 20 percent, a much more competitive tax rate for U.S. businesses used to paying one of the highest rates in the world.
Only the United Arab Emirates with a corporate rate of 55 percent and Puerto Rico with a 39 percent rate pay more than businesses in the U.S.
The other reason the Trump tax plan is more good than bad is that the standard deduction is being doubled for married couples to $24,000 or $12,000 for single taxpayers.
The child tax credit, currently $1,000, would grow to $1,600, and there would be a brand new $300 credit for parents and other non-child dependents in the house.
All of this is better than nothing, which is exactly what we will get if our Congressmen and Senators cannot get together to do their jobs - which is to craft a final version of the tax bill and pass it.
It’s time taxpayers start to get some relief.
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