On December 22, 2017, President Trump signed the Tax Cuts and Jobs Act into law, which makes a number of changes to the federal tax laws.
The recently signed Tax Cuts and Jobs Act includes far-reaching changes for all United States taxpayers, including individuals, corporations, corporations with substantial international business, and small businesses.
Substantial changes include:
- Standard Deduction increased for single / married filers from $6,350 / $12,700 to $12,000 /$24, 000
- Child Tax Credit increased from $1,000 to $2,000
- Personal exemption Eliminated (previously $4,050 per Taxpayer / Dependent)
Corporations (for holdings within the U.S.)
- Corporate Tax Rate reduced from 35% to 21%
- Alternative Minimum Tax Eliminated
Corporations (for holdings outside the U.S.)
- The Tax Cuts and Jobs Act radically changes the current worldwide taxation model of taxing foreign source income and replaces it with a modified territorial system.
- 20% deduction for qualified income, after which individual rates apply. Note, there are limitations for professional service providers such as lawyers and accountants.