On September 27, 2017, the Trump Administration, the House Committee on Ways and Means, and the Senate Committee on Finance released a long-awaited tax reform proposal, titled the Unified Framework for Fixing Our Broken Tax Code (the “United Framework”). Most notably, the United Framework proposes to completely repeal the estate and generation-skipping transfer tax while also lowering the income tax rates for businesses and individuals.
At the individual level, the United Framework proposes to:
For U.S. businesses, the United Framework proposes to:
To be sure, the proposals in the Framework are broad and in many cases, short on specifics. Ostensibly, this was done on intentionally to allow Congress the opportunity to work out the details. Critics of the Unified Framework contend that the proposed changes benefit the wealthy to the detriment of lower-income taxpayers. In particular, they point to the fact that the proposed repeal of the estate tax and generation skipping transfer-tax benefits only the top 1% of Americans, while the proposed increase in the lowest income tax bracket from 10% to 12% negatively impacts the country’s poor. Another common criticism of the Unified Framework is that it is more or less silent on how to pay for all of the proposed tax cuts. It remains to be seen how the proposals in the Unified Framework will be adopted by Congress. If enacted, the lower tax rates for businesses may create incentives for individuals to create new business entities to take advantage of the proposed tax cuts for businesses. For now, Nabhan Law will continue to monitor the developments coming out of Washington closely. 10/20/2022 07:28:34 pm
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AuthorHaroun Nabhan is an attorney in Pasadena, California, specializing in estate planning, probate, conservatorships and trust litigation. Archives
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