To come in 2017 regarding taxes: biggest proposed tax changes since 1986
- Lowering corporate tax rate (currently 35% to 20%)
- Taxation of future foreign earnings: bringing money back into the country would not be subject to “double tax”.
- Cost Recovery changing from 5 years depreciation, now can be done in the same year as the purchase. More people would be more inclined to purchase bigger ticket items.
- Simplified individual tax rate. Currently the rates range from 10% to 39.6%.
- New proposed rates would be 12%, 25%, 33%. Significant drop for higher wage earners
- Capital Gains will be decreased
- Estate tax repealed: which means that the heirs would not be paying taxes on money/property that has already been taxed.
- State Tax deduction would not be allowed for Federal. One of the negative changes.
- Mortgage interest deduction; proposing that alternative minimum taxes are going to be raised, the standard deduction would be higher. Which could mean that the higher priced property purchases will be able to qualify for the deduction.
This necessarily doesn’t mean that people will not be purchasing homes. Majority of homes are purchased for the security of having “their own home”. People want the security of knowing where they live without the fear of a landlord raising their rent or asking them to move.