Making Changes to Corporate and Individual Income Taxes, Indian Tribe Resource Programs and Previous Legislation

Tax Cuts and Jobs Act (H.R. 1) – The GOP-sponsored tax reform bill made final passage through Congress on Dec. 20. The following are provisions with the widest-ranging impact:

• Lowers the corporate tax rate from 35 percent to 21 percent
• Allows companies a one-time repatriation of overseas cash
• Retains seven individual tax brackets: 10 percent, 12 percent, 22 percent, 24 percent, 32 percent, 35 percent and 37 percent
• Nearly doubles the standard deduction, but repeals personal exemptions
• Eliminates the Affordable Care Act’s individual mandate starting in 2019
• Eliminates the alternative minimum tax (AMT) for corporations, but keeps it for individuals (Exemption: $500,000 for single taxpayers; $1 million for couples)
• $2,000 credit for each qualifying child under the age of 17; fully refundable up to $1,400
• Estate tax remains at 40 percent but approximately doubles the exemption ($11 million for individuals; $22 million for married couples)
• May deduct up to $10,000 in local property taxes and state and local income taxes
• May deduct interest on mortgages up to $750,000 (down from $1 million)
• Gives pass-through businesses a 20 percent deduction for the first $315,000 of joint income
• Retains current deduction for student loan interest
• Retains tax-free status for tuition waivers received by graduate students
• Allows deduction of medical expenses that exceed 7.5 percent of AGI

Indian Employment, Training and Related Services Consolidation Act of 2017 (H.R. 228) – Sponsored by Rep. Don Young (R-AK) on Jan. 3, 2017, this bill amends the Indian Employment, Training and Related Services Demonstration Act of 1992. The goal is to integrate the employment, training and related services from diverse federal sources for Indian tribes under a single plan and budget. The bill clarifies the plan approval process and timelines, as well as reporting and audit requirements that tribes must fulfill for funding. The bill passed in the House in February 2017 and passed in identical form by the Senate on Nov. 29. It was signed into law by the president on Dec. 18.

Department of State Authorities Act, Fiscal Year 2017, Improvements Act (S. 371) – Sponsored by Sen. Bob Corker (R-TN) on Feb. 14, 2017, this bill makes technical changes and improvements to the original Department of State Authorities Act, Fiscal Year 2017. Amendments include replacing a specific reference to anti-Semitism with a reference to intolerance; the definition of “change to the federal status” with respect to the Cuba Service and the Television Marti Service; the report on the costs, strengths and limitations of U.S. and U.N. peacekeeping operations; U.N. peacekeeper training to reduce sexual exploitation; completion of the Western Hemisphere Drug Policy Commission report; and ransoms to foreign terrorist organizations. This bill was enacted on Dec. 18.

Combating Human Trafficking in Commercial Vehicles Act (S. 1536) – Sponsored by Sen. Amy Klobuchar (D-MN) on July 12, 2017, this bill authorizes a human trafficking prevention coordinator to expand the scope of activities under the Federal Motor Carrier Safety Administration’s program. The scope extends to include human trafficking prevention activities as part of its outreach and education initiative. This bill was passed by Congress on Dec. 19 and goes to the president next.

Women in Aerospace Education Act (H.R. 4254) – Sponsored by Rep. Steve Knight (R-CA) on Nov. 6, this Act amends the National Science Foundation Authorization Act of 2002. The objective is to strengthen the aerospace workforce pipeline by promoting the Robert Noyce Teacher Scholarship Program and National Aeronautics and Space Administration internship and fellowship opportunities for women. Ultimately, this bill is part of a movement to encourage young women to enter the previously male-dominated fields of science, technology, engineering and mathematics. The bill passed in the House on Dec. 19 and goes to the Senate next for consideration.

These articles are intended to provide general resources for the tax and accounting needs of small businesses and individuals. Service2Client LLC is the author, but is not engaged in rendering specific legal, accounting, financial or professional advice. Service2Client LLC makes no representation that the recommendations of Service2Client LLC will achieve any result. The NSAD has not reviewed any of the Service2Client LLC content. Readers are encouraged to contact their CPA regarding the topics in these articles.

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