How Could a Tax Change Affect You? This Is What the Senate and House Propose
You can generally deduct the amount you pay for state and local tax income taxes, including property taxes, on your federal income tax return.
For instance, the Senate plan would completely eliminate the ability to deduct state
and local taxes; there is no exception for up to $10,000 in property taxes each year, as there is in the House bill.
What the Senate proposed:
Seven brackets, with a top rate of 38.5 percent that you pay on income beyond $1 million annually if you’re married or $500,000 if you’re single.
The House bill would create a new 25 percent tax rate for what it refers to as “pass-through”
businesses, for a portion of the business net income that passes through to the owners.
The Senate bill’s lowest tax bracket is at 10 percent for individuals, while the House bill had raised it to 12 percent.
As it stands, taxpayers can deduct moving expenses — even if they do not itemize their tax returns — as long as the
new workplace is at least 50 miles farther from the old home than the old job location was from the old home.
