Plain Language of Change:
- Reduced rates for individual taxpayers from January 1, 2018 until December 31, 2025
- Creates a seven bracket structure ranging from 10% to 37%
- It reduces every income tax bracket for individuals
- Income tax brackets are adjusted annually for inflation starting in 2019
- Simplifies the “kiddie tax” by taxing net unearned income at estate & trust tax rates
- Complicates capital gains tax some what by leaving the prior law rates and income thresholds.
- Capital gains brackets are indexed for inflation using the Changed Consumer Price Index (C-CPI-U) which is generally at a slower rate of growth (adjustment)
Cordasco & Company PC is a boutique CPA firm specializing in federal and state tax issues. We provide customized tax and accounting services specifically designed to help our clients capitalize on the rapidly changing tax and accounting environments.