Politics GOP tax plans: 5 big differences between the House and Senate

22:57  09 november  2017
22:57  09 november  2017 Source:   MSN

The Devil Is in the Details: Differences That Could Doom the Tax Bill

  The Devil Is in the Details: Differences That Could Doom the Tax Bill The House and Senate tax plans have much in common, but there are significant differences as well, any number of which could become flash points when the chambers seek to reconcile their versions of the legislation. The House and Senate tax plans have much in common, but there are significant differences as well, any number of which could become flash points when the chambers seek to reconcile their versions of the legislation. “Everybody is looking at that tax plan and wondering exactly what are the devils in the details,” said Bruce McCain, Key Private Bank’s chief investment strategist.

U.S. Senate Majority Leader Mitch McConnell (R-Ky.) talks as House Speaker Paul D. Ryan (R-Wis.), Sen. Orrin G. Hatch (R-Utah) and other congressional Republicans listen during a press event on tax reform on Sept. 27. (Alex Wong/Getty Images).

As to how they will settle what could be grave differences between the House and the Senate bill? “I think this process is a healthy one. Politics. Senate Passes Budget Resolution 51 to 49, a Key Step in GOP Plan to Pass Tax Reform.

Mitch McConnell et al. standing next to a man in a suit and tie: U.S. Senate Majority Leader Sen. Mitch McConnell speaks as Speaker of the House Rep. Paul Ryan, Sen. Orrin Hatch and other congressional Republicans listen during a press event on tax reform September 27, 2017 at the Capitol in Washington, DC. (Photo by Alex Wong/Getty Images). © Provided by WP Company LLC d/b/a The Washington Post U.S. Senate Majority Leader Sen. Mitch McConnell speaks as Speaker of the House Rep. Paul Ryan, Sen. Orrin Hatch and other congressional Republicans listen during a press event on tax reform September 27, 2017 at the Capitol in Washington, DC. (Photo by Alex Wong/Getty Images).

Senate Republicans unveiled their tax plan Thursday, another step forward in President Trump's bid to do the biggest overhaul of the U.S. tax code since President Reagan was in office in the 1980s.

The White House has indicated that the Senate bill, which is starkly different from the House plan, is the one to watch. Earlier this week, Trump told a few Democrats that they would like the Senate bill “a whole lot more.” But eventually, the House and Senate will have to agree on one bill, a major challenge as Republicans try to get legislation to the president's desk by Christmas.

Major differences in House, Senate tax proposals

  Major differences in House, Senate tax proposals The House and Senate tax overhaul plans are broadly similar, but crucial differences are creating headaches for Republican leaders determined to keep myriad interest groups and factions of the GOP satisfied. The most politically challenging decisions involve dealing with popular and widely used tax deductions, structuring tax cuts for business and balancing personal income tax rates between middle-class families and the rich.

White House tax plan vies with House and Senate proposals. As lawmakers scramble to respond, they will need to find answers to five big questions dealing with issues such as revenue and The Trump and House GOP plans eliminate nearly all tax breaks, but would preserve full write-offs for

The Senate also would set the child tax credit at ,650, up from ,600 in the House , but below where some GOP senators want it set. The policy gaps between the House and Senate will require Republicans to reconcile dozens or hundreds of differences .

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Here are five major ways the Senate bill differs from the House plan that came out last week — and what those changes mean for everyday Americans.

All state and local tax deductions (SALT) are gone. Taxpayers would lose the ability to deduct their state and local property and other taxes from their federal taxes, a break used by about 44 million people (or 30 percent of tax filers.) This is a major change to the tax code that mostly affects people earning more than $100,000 a year. Filers have been able to deduct state and local taxes since 1913. Eliminating SALT entirely would disproportionately affect people living in high-tax states such Connecticut, New Jersey, New York and California. A number of Republican House members insisted on only a partial repeal in the House bill, but the Senate has gone for a full repeal in an effort to raise more money to pay for tax cuts elsewhere.

Mitch McConnell says Senate GOP will release its tax proposal on Friday

  Mitch McConnell says Senate GOP will release its tax proposal on Friday McConnell said the Senate will aim to mark up, or debate and amend, the tax bill next week.

But others will raise hackles. The Senate GOP plan would fully repeal the state and local tax deduction. If the House and Senate get to the point where they each pass their own bills and move to reconcile the differences between them, the SALT deduction could be a huge sticking point.

Wolters Kluwer Tax & Accounting provides briefing on proposed GOP tax plan . “With the House having passed its resolution, if the Senate has difficulty passing a resolution or there is a delay in resolving difference between the House and the Senate , that will be an indication as to how hard it

The mortgage interest deduction stays. The current mortgage interest deduction rules remain intact in the Senate plan: Americans would still be able to deduct the interest they pay on the first $1 million of mortgage debt. The House plan reduced that threshold for new mortgages to $500,000, causing outcry from some real estate agents and builders as well as congressmen who represent areas with extremely hefty real estate costs. While there was pushback on the House plan, the reality is only about 6 percent of new mortgages are valued at more than $500,000, according to a report by the United for Homes campaign.

The estate tax stays. The estate tax (often called the “death tax” by critics) affects about 5,000 wealthy families a year. It is only assessed on property, stocks or other assets worth more than $5.49 million when they are passed on to heirs after the owner dies. Sen. Susan Collins (R-Maine), a key swing vote, has said she will not vote for a bill that gets rid of the estate tax. The House bill would eliminate the estate tax entirely in 2024, a move that was heavily criticized as a giveaway to the mega-rich, including the Trump family. The Senate bill keeps the estate tax.

Senate GOP tax bill could delay corporate tax cut and make other major changes that break sharply with House plan

  Senate GOP tax bill could delay corporate tax cut and make other major changes that break sharply with House plan <p>Senate Republican leaders are considering a one-year delay in the implementation of a major corporate tax cut, four people familiar with a draft of the legislation said, a move that would postpone a centerpiece of the GOP tax plan in order to comply with Senate rules.</p>Senate Republican leaders are considering a one-year delay in the implementation of a major corporate tax cut, four people familiar with a draft of the legislation said, a move that would postpone a centerpiece of the GOP tax plan in order to comply with Senate rules.

WASHINGTON - The new GOP tax plan delivers a big tax cut to the wealthiest Americans while some in lower tax brackets would end up paying more, according to an analysis Friday from prominent The tax legislation can advance only after House and Senate passage of the budget blueprint.

Senate Republicans also do not plan to collapse the seven income tax brackets that families and individuals pay down to four brackets, another major difference from the House GOP approach.

Corporations don't get the 20 percent rate until 2019. The centerpiece of the GOP tax bill is lowering the tax rate for big businesses, since many argue American companies have to pay far more than their overseas competitors. The Senate bill would still reduce the top corporate rate from 35 percent to 20 percent, but it wouldn't start the new lower rate until 2019. The House bill starts the 20 percent rate in 2018. The Trump administration wants the lower rate to begin next year because the White House believes that would help boost growth, but the Senate needed to find savings somewhere to make the bill comply with a Senate accounting rule known as the Byrd Rule.

The Senate bill keeps seven tax brackets. In an effort to simplify the tax code, the House plan cut that to four brackets, but the change cost $1 trillion over the next decade because some filers (especially those earning between roughly $500,000 to $1 million) ended up paying less. The Senate bill keeps all seven brackets.

GOP nears initial victory on tax reform .
<p>House Republicans are on the precipice of a big victory on tax reform, but the legislation still faces enormous hurdles before it can reach President Trump's desk and be signed into law.</p>

Source: http://us.pressfrom.com/news/politics/-98459-gop-tax-plans-5-big-differences-between-the-house-and-senate/

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