White House Tax Reform
01.23.2015 - Reactions to the White House Tax Reform Ideas.
The White House’s publication over the weekend of tax recommendations has caused a flurry of reactions from political pundits from both sides of the aisle, as well as the financial community. You can read the full document here.
Some taxpayers will not be pleased with proposals such as:
reducing tax benefits for new contributions to Section 529 Educational Plans
increasing the top rate on long-term capital gains from 20% to 28%, plus the 3.8% tax introduced last year;
further complicating and taxing estates on their capital gains by eliminating the “stepped-up” basis at death;
requiring small businesses to offer automated IRA plans to all full-time and part-time workers; and
penalizing taxpayers for accumulating retirement benefits in excess of $3.4 million.
On the other hand, some of the ideas should appeal to certain taxpayers, including:
increasing the child care tax credit
simplifying the Pell Grant taxation rules
Whatever your reaction to the President’s suggested changes, one thing is certain. Any changes that are eventually incorporated into the already highly complex U.S. tax rules will require a review with your tax professional regarding the ramifications for your personal of business tax situation.