by Kathleen M. Sablone, JD, Director of Wealth Planning
After extensive debate, the Senate passed its version of the Tax Cuts and Jobs Act early Saturday morning. Before it can be signed into law, the bill must be reconciled with the version passed by the House of Representatives in November. Supporters hope to have final legislation for President Trump to sign before the end of the year.
Each bill is over 400 pages long and would result in major changes to the current tax code.
Here are some highlights:
- Both plans increase the standard deduction from $6,250 to $12,000 for individuals and from $12,700 to $24,000 for married couples.
- Both plans would allow a deduction of up to $10,000 for state and local property taxes but no deductions for state and local income, sales, or other taxes.
- Both bills eliminate deductions for moving expenses and tax preparation.
- Both bills would limit exclusion on capital gains from sale of a primary residence to once every five years (current law is two years) and require taxpayer to have owned and resided in house for five of the past eight years (current law is two of the past five years).
Provisions That Will Require Compromise:
If you have any questions on how these proposals may affect your individual tax planning, please contact our Estate and Financial Planning Group at 617-338-8108 or your tax professional.
Important: This article does not contain any legal or tax advice. You should always consult with your attorney, accountant or other professional advisors before changing or implementing any tax, investment or estate planning strategy.
IRS Circular 230 Disclosure: Pursuant to IRS Regulations, we inform you that any tax advice contained in this communication (including any attachments) is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding tax related penalties or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein.