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Trump Tax Changes Increase Middle Class Taxes

Although there are no guarantees, following are several tax changes that Donald Trump promises. The financial impact will hit the middle class and small business owners the hardest.

Individual tax rates: Trump has said that wants to revamp the current seven-tier tax rate structure. Currently, the lowest tax rate is 10 percent, with a high of 39.6 percent. This setup would be replaced by a three-tier bracket structure of 12 percent, 25 percent and 33 percent.

Itemized deductions: Trump intends to curb most itemized deductions, but would allow certain exceptions, such as deductions for charitable donations and mortgage interest. Residents of states with high income tax rates could be hurt.

Alternative minimum tax: Congress has band-aided the alternative minimum tax (AMT) several times in recent years. Trump would make a clean break by repealing the AMT outright.

Child care expenses: Among other modifications, Trump would replace the existing child care credit with an above-the-line deduction available to both itemizers and non-itemizers, while creating tax-favored accounts for child care.

Corporate taxes: Trump has previously proposed slashing taxes for corporations. Notably, he would reduce the top corporate income tax rate of 35 percent to 15 percent – or less than half of the current top tax rate. If you own an LLC or SUB S Corp, you may want to switch to a regular C Corp.

We’ll have to wait and see.

About 

Gustavo A Viera is the managing partner of Gustavo A Viera, PA. His experience spans more than 25 years. He started his career in public accounting at PriceWaterHouseCoopers where reached the level senior audit manager. His Fortune 500 experience includes positions as CFO – Latin America Region for both Hewlett Packard and Telefonica of Spain. Gustavo also writes a blog twice a week that addresses trending accounting and tax issues. He is an SBA Advisor and teaches workshops for aspiring entrepreneurs. His offices are located in Palmetto Bay, Coral Gables and Brickell Avenue in Miami FL, and is admitted to practice in the State of Florida as a licensed Certified Public Accountant. Gus welcomes questions and he can be reached at Gustavo A Viera PA 15715 S Dixie Hwy. Ste 409, Miami Fl. 33157, 2332 Galiano Street, 2nd Floor, Coral Gables, Fl 33134 or 1111 Brickell Avenue11th Floor Miami, FL 33131 Telephone 786-250-4450.

About the Author

Gustavo VieraGustavo A Viera is the managing partner of Gustavo A Viera, PA. His experience spans more than 25 years. He started his career in public accounting at PriceWaterHouseCoopers where reached the level senior audit manager. His Fortune 500 experience includes positions as CFO - Latin America Region for both Hewlett Packard and Telefonica of Spain. Gustavo also writes a blog twice a week that addresses trending accounting and tax issues. He is an SBA Advisor and teaches workshops for aspiring entrepreneurs. His offices are located in Palmetto Bay, Coral Gables and Brickell Avenue in Miami FL, and is admitted to practice in the State of Florida as a licensed Certified Public Accountant. Gus welcomes questions and he can be reached at Gustavo A Viera PA 15715 S Dixie Hwy. Ste 409, Miami Fl. 33157, 2332 Galiano Street, 2nd Floor, Coral Gables, Fl 33134 or 1111 Brickell Avenue11th Floor Miami, FL 33131 Telephone 786-250-4450.View all posts by Gustavo Viera →

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