What did not change?
The new Act encompasses many new and updated provisions including the new code §199A, addressing the taxation of income generated from pass through entities. However, the followings are sections that were unchanged:
- No Change to Capital Gains Rates – qualified dividends from C-Corp. are taxed at capital gains rates 15% for many taxpayers, and 20% for high-income taxpayers.
- No Change to Net Investment Income Tax (NIIT) – qualified dividends from C-Corp. may be subject to the NIIT.
- 3.8% surtax on investment income for taxpayers with modified adjusted gross income exceeding $200,000 and married filing joint exceeding $250,000 (these thresholds are not indexed for inflation).
No Change to Health Savings Accounts (HSA) Deduction – $3,450 for individual coverage and $6,900 for family coverage, $1,000 catch‐up for those over 55 for those with High Deductible Health Plans (HDHP) through employer, purchased on the open market, or through the health exchanges.
- No Change to IRA and Qualified Plans Deductions, but Roth conversions are repealed.
If you have questions about Business Planning & Estate/Trust Planning, call Attorney Ali Talai @ 818-992-2901 or visit our website @ www.TalaiLaw.com.