Preface: The Tax Cuts and Job Acts passage in Congress this week results in a triumphant step for President Trump towards Making American Great Again. Entrepreneur’s should appreciate the tax bill as pro-business.
Trump is Making American Great Again
Credit: Donald Sauder, CPA
The US Congress passing the Tax Cuts and Jobs Act this week, and President Trump’s subsequent signature is the economic equivalent of Trump’s Washington singing to America taxpayers “We wish you a Merry Christmas and a Happy New Year, good tidings we bring to your and kin, good tidings for Christmas, and a Happy New Year.”
Legendary financial and geopolitical analyst Martin Armstrong, says the Tax Cuts and Job Act passage is very, very positive for the US economy. The pro-business bill, will grow jobs, and help small businesses succeed. “Canadian companies are already saying they will have to relocate to US if this keeps up” to quote Armstrong. This bill could make the US look like the place to be for business. “It’s monumental” Armstrong adds. “We could hire ten more people (just with this bill passage.)” Armstrong continues that he was called to London and Brussels this week as the result of Trumps tax bill being game changing and pro-business with global implication.
So what’s in the new tax bill? The historic bill legislated lower tax rates for both individuals and business, enhanced child tax credit and repealing of the individual shared responsibility payment in 2018; the foreign deferred overseas held earnings repatriation rates and territorial tax system internationally are the major drivers to Armstrong’s opinions.
The standard deduction increased 100% from $12,000 to $24,000 for married individuals, and from $6,000 to $12,000 for individuals. Tax bill incentivizes families with a $2,000 credit per qualifying child.
Education provision provide 529 plan contributions for elementary and secondary schools.
Corporate tax rates are set at 21% and bonus depreciation increases to 100% until 2023. In addition, Section 179 expensing increases to $1,000,000 from the prior $500,000.
Small business owners will receive a deduction of 20% on threshold tax amounts.
The estate and gift tax exclusion increases to $10,000,000 for tax years 2018 – 2025.
The Tax Cuts and Jobs Act is giant step towards Trump’s plan to make American Great Again.
Armstrong continues that he expects interest rates to increase rapidly until 2021, within expectations with Janet Yellen’s Federal Reserve guidance earlier this month. This would result in bond market turbulence, so there is so reason for cautious optimism, but the tax savings for businesses both inside and outside American borders, are very pro-business and will put more money in individual wallets at the end of day.
We will have a more comprehensive report on the tax implication of the bill after the holiday.
This blog is not to be construed as tax, investment, accounting legal advice. It is for informational and entertainment purposes only. Please consult with your trusted advisors with regards to information reported in this blog before making any decisions.