CORPORATE TAXES
- A 15% minimum tax on corporate profits. This would only apply to corporations with more than 1 BILLION in annual profits. Clearly , companies that could fit this tax profile are probably very large publicly traded corporations that have significant tax deductions and tax credits that would potentially reduce their corporate taxes down to zero under current tax law.
- A huge increase in hiring of thousands of new IRS agents to audit high earners, especially successful owners of S Corps and LLCs “pass-through” entities that have high incomes
- A 5% surtax on personal incomes above $10 million per year and an additional 3% surtax on personal incomes above $25 million per year
- Close a current loophole that allow certain “pass-through” business owner taxpayers (i.e. S Corp and LLC owners) to avoid paying the extra 3.8% Net Investment Income Tax (NIIT) on their K-1 “pass-through” profits. Under current law, the 3.8% NIIT surtax only applies to capital gains and dividends of certain high earning taxpayers and not to K-1 “pass-through” profits.
- Increases the State and Local Tax (SALT) deduction limit from current $10,000 per year up to $ 80,000 per year. Hard to figure out why this provision is in the bill (politics?) since it would decrease the tax bills of certain high income taxpayers. This would especially benefit those taxpayers in states with high state income tax rates and high local property tax rates.
- Would impose an IRA contribution limit on high income taxpayers ($400,000 single and $450,000 married) who also have IRA account balances of $10 million and up.
- Would impose extra Required Minimum Distributions (RMDs) on high income taxpayers who have IRA account balances of $10 million and up. This would force out as taxable income 50% of the excess above $10 million in the first year and the other 50% excess above $10 million in the following year.