Ways and Means Chairman Kevin Brady gathering feedback for changes to be made before Monday markup
House Republicans’ long awaited tax overhaul bill will keep the top individual rate at 39.6 percent for high-income earners and will immediately and permanently cut the corporate rate to 20 percent.
The legislation seeks to revamp the tax code in a major way for the first time since 1986, incorporating long-sought goals of congressional Republicans to keep more money in the pockets of individuals and families and boost incentives for businesses by closing loopholes.
The bill would collapse seven tax brackets for individuals to four brackets with rates of 12, 25, 35 and 39.6 percent.
The bill would also increase the standard deduction so single filers earning up to $12,000 and joint filers earning up to $24,000 would pay zero in taxes.
The measure includes an increase in the child tax credit from $1,000 to $1,600 per qualifying child. The child tax credit expansion is part of a new family credit that also includes a $300 credit for each parent and non-child dependent to help with everyday expenses.
The mortgage interest deduction is maintained in full for existing mortgages, but future home-buyers would only be eligible to claim the deduction on interest paid on the first $500,000 of the total cost of their mortgage.
Retirement incentives for 401(k)s and IRAs are also maintained.
And the estate tax, criticized by Republicans as a “death tax,” will be fully repealed under the plan, but not for six years. In the interim the bill would double the estate tax exemption.
A provision in the bill that is expected to draw some opposition is capping an itemized deduction for state property taxes at $10,000. The measure would eliminate the incentive that allows taxpayers to deduct state income or sales taxes.
Ways and Means Chairman Kevin Brady has said feedback received on the bill will be considered as he looks to make additional changes in a chairman’s mark to be released in advance of the committee markup, which is scheduled to begin Monday and last for several days.
The initial round of feedback will come as Brady and GOP leaders brief the House Republican Conference on the plan this morning. Interest group and lobbyist feedback will start flooding in soon after.
Brady and his fellow Ways and Means Committee members and the House Republican leadership team are scheduled to meet this afternoon with President Donald Trump at the White House.
House GOP leaders want to hold a vote on the measure before Thanksgiving.