White House Releases Tax Reform Proposal
Yesterday, the White House released highlights of the President's tax reform plan. The proposal would reduce tax rates on individuals and businesses. It would also double the standard deduction for individual taxpayers, which would reduce the number of people who itemize their deductions. The plan also states that it would close many of the deductions available to itemizers, except for the home mortgage interest deduction and the charitable deduction.
More details about the plan will continue to evolve along with Congressional proposals for tax reform. While the charitable deduction is preserved in the current proposal, its impact could actually be weakened by the fact that many middle-class taxpayers would no longer be able to itemize their deductions, like charitable contributions, because of the larger standard deduction. While the standard deduction assumes that taxpayers make charitable contributions, there is no specific incentive nor requirement to prove charitable donations were made.
Click here to read more and to see a copy of the plan's summary.
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