Nov 2, 2017

The winners and losers of the GOP tax plan

House Ways & Means Chairman Rep. Kevin Brady, R-Texas, arrives for a news conference. Photo: Jose Luis Magana / AP

House Republicans unveiled their new tax plan Thursday, and although there will likely be some changes as it moves through Congress, here's who stands to gain and who stands to lose from the current plan. Trump wants to pass the plan through the House by Thanksgiving and through the Senate by late December.

Winners
  • Most Americans who take the standard deduction, since it would be doubled from to $12,000 for individuals or $24,000 for families.
  • Parents, since the child tax credit and new family credit would be increased (although the employer-provided child care credit would be repealed and dependent exemptions would be nixed).
  • Small business owners, who will see limits for expensing new business equipment raised, and could pay lower rates.
  • Businesses generally, due to the reduction in the corporate tax rate.
  • Owners of pass-through entities, particularly high-earners like hedge fund managers and lawyers, as the plan allows business owners to have more income classified as business income (and taxed at a lower rate), rather than wages.
  • Corporations with business abroad, since they would be able to get a reduced rate at 12% on overseas earnings on liquid assets, per Politico — although they would face a new 10% foreign minimum tax, which is aimed at companies storing money in offshore tax havens.
  • People with inheritances, since the plan would double the exemption for inheritance taxes and eliminate the tax after 6 years.
  • Wealthy taxpayers, since the plan would repeal of the alternative minimum tax and doesn't change the carried interest rate, which benefits private equity managers and venture capitalists.
Losers
  • Families with dependents, since the plan would take away the dependent exemption, per CNBC.
  • People making alimony payments, since that deduction would be repealed.
  • People with student loans to pay off, since the student loan interest deduction could be nixed in the plan. In 2015, more than 12 million borrowers said they took this deduction on their Form 1040, per CNBC.
  • Wealthy, private colleges, since the plan says universities with at least 500 full time students will pay a 1.4% excise tax on annual investment income. More on this impact via Axios' Dan Primack.
  • People who take the medical expenses deduction, including seniors or people with large medical expenses, since the deduction would be repealed. More from Axios' Sam Baker.
  • People with rare diseases, since the credit that encourages drug companies to develop new treatments for those diseases would be repealed. More details via Axios' Sam Baker.
  • People with disabilities and companies hiring them, since the plan would repeal the credit for small businesses that do so.
  • Life insurance companies would lose some tax benefits, per Politico.
  • Electric vehicle companies, due to the eliminated electric vehicle credit.
  • Homebuilders and new homebuyers, since mortgage interest deductions would be capped for new homeowners at $500,000 instead of $1 million. (Current homeowners would be grandfathered in).
  • People rehabilitating old or historic buildings, since this credit would be repealed.
  • Those who want to build stadiums tax-free. (The NFL currently benefits from the tax-exempt bonds that state and local governments use to finance new stadiums.)
  • People in high-tax states, like New York and New Jersey, since the plan limits deductibility of local property taxes to $10,000 and eliminates the state and local income tax deduction.
  • Charities. Although there are no changes directly to the charitable tax deduction, other deductions are changing — so people may be more likely to take the standard deduction instead, per CNBC.

Correction: We took out the third bullet in the Winners list on startup employees since the provision, which would allow a deferral on taxes for exercised options without a liquid market to sell them, is not yet in the bill. It's expected to be added during markups in the coming days.

Editor's Note: Sign up for Axios newsletters to get our Smart Brevity delivered to your inbox every morning.

Go deeper

World coronavirus updates: Global death toll surpasses 34,000

Data: The Center for Systems Science and Engineering at Johns Hopkins, the CDC, and China's Health Ministry. Note: China numbers are for the mainland only and U.S. numbers include repatriated citizens and confirmed plus presumptive cases from the CDC

The novel coronavirus has now killed more than 34,000 people and infected over 723,000 others globally, per Johns Hopkins data. Italy reported more than 10,700 deaths early Monday.

The big picture: Governments around the world have stepped up public health and economic measures to stop the spread of the virus and soften the financial impact. In the U.S., now the site of the largest outbreak in the world, President Trump said Sunday that his administration will extend its "15 Days to Slow the Spread" guidelines until April 30,

Go deeperArrowUpdated 2 hours ago - Health

Coronavirus dashboard

Illustration: Sarah Grillo/Axios

  1. Global: Total confirmed cases as of 1 a.m. ET: 722,435 — Total deaths: 33,997 — Total recoveries: 151,991.
  2. U.S.: Leads the world in cases. Total confirmed cases as of 1 a.m.. ET: 142,502 — Total deaths: 2,506 — Total recoveries: 4,856.
  3. Federal government latest: President Trump says his administration will extend its "15 Days to Slow the Spread" guidelines until April 30.
  4. Public health updates: Fauci says 100,000 to 200,000 Americans could die from virus.
  5. State updates: Louisiana governor says state is on track to exceed ventilator capacity by end of this week — Cuomo says Trump's mandatory quarantine comments "panicked" some people into fleeing New York
  6. World updates: Italy on Sunday reports 756 new deaths, bringing its total 10,779. Spain reports almost 840 dead, another new daily record that bring its total to over 6,500.
  7. What should I do? Answers about the virus from Axios expertsWhat to know about social distancingQ&A: Minimizing your coronavirus risk
  8. Other resources: CDC on how to avoid the virus, what to do if you get it.

Subscribe to Mike Allen's Axios AM to follow our coronavirus coverage each morning from your inbox.

U.S. coronavirus updates: Infections number tops 140,000

Data: The Center for Systems Science and Engineering at Johns Hopkins; Map: Andrew Witherspoon/Axios

The novel coronavirus has now infected over 142,000 people in the U.S. — more than any other country in the world, per Johns Hopkins data.

The big picture: COVID-19 had killed over 2,400 people in the U.S. by Sunday night. That's far fewer than in Italy, where over 10,000 people have died — accounting for a third of the global death toll. The number of people who've recovered from the virus in the U.S. exceeded 2,600 Sunday evening.

Go deeperArrowUpdated 6 hours ago - Health