With a Consensus Tax Bill, Christmas May Come Early for Republicans

An agreement between Senate and House Republicans on a tax bill was finalized Wednesday morning. According to lawmakers and reports from aides, Senate and House Republicans have agreed to provisions including the following:

• Corporate tax rate will drop from 35% to 21%, to go in effect in 2018.
• Individuals will be allowed to deduct up to $10,000 in state and local taxes, split between property taxes and income or sales taxes paid.
• Corporate alternative minimum tax will be rescinded.
• The individual income tax rate will drop from 39.6% to 37%, however the threshold for this top rate will be expanded to apply to income levels below $1 million.
• The individual alternative minimum tax will be maintained but will purportedly apply to even fewer taxpayers than in the Senate bill.
• The Senate bill’s approach to pass-through companies will be kept, and the deduction for such companies is likely to be lower than the Senate’s proposed 23%. However, a House provision will be included to allow some pass-through with few employees to bypass an income limit that qualifies for the preferred deduction.
• The Senate’s approach to taxing multinational companies is expected to be largely retained.

The first and only scheduled public meeting of the congressional conference committee will take place this afternoon. Republicans appear to be on track for final votes within the next week with a goal to deliver the bill to President Trump by Christmas.

Read more: Republicans Say They Have a Deal on Tax Bill