The Tax Cuts and Jobs Act became law on December 22, 2017. Do you know how the law affects you and your business? Watch this recap to refamiliarize yourself with the new tax laws.
It cuts individual income tax rates, doubles the standard deduction, and eliminates personal exemptions. The top individual tax rate drops to 37 percent. It’s not all good news for taxpayers, however. The TCJA also eliminates or limits many tax breaks, and much of the tax relief is only temporary. It also significantly increases individual alternative minimum tax (AMT) and estate tax exemptions. And it makes major changes related to the taxation of foreign income.
The individual cuts and changes expire at the end of 2025.
The Act cut the corporate tax rate from 35 percent to 21 percent beginning in 2018. It also provides a large new tax deduction for owners of pass-through entities.
The corporate cuts are permanent.