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Nolan Elder Law and Estate Planning, LLC Blog

Tuesday, December 13, 2016

What Donald Trump’s Tax Plan May Mean for You

Will President-elect Trump’s tax plan benefit me?

Donald Trump is officially President-elect and will be sworn into office in January.  With the upcoming change of power, many individuals are wondering now how their finances may fare under a Trump presidency.  Trump and his rivals often spoke of taxes during the debates, and Trump himself became embroiled in a controversy over his tax practices.  Trump admitted on the campaign trial to taking a $916 million net operating loss that allowed him to not pay taxes for years.  Amidst talks of his own taxes, Trump has promised to cut taxes for the middle class and eliminate loopholes.  

The following is a look at some tax changes you can expect to see under a Donald Trump presidency.  For assistance planning for upcoming tax changes and help evaluating how taxes can impact your estate plan, contact a Birmingham, Alabama estate planning lawyer as soon as possible.  

  1. Elimination of the estate tax:  Donald Trump has announced that he will eliminate the estate tax, also referred to as the death tax.  This could have an impact on elderly individuals with substantial assets who otherwise could have faced hefty taxes that would diminish funds left to their heirs.
  2. Personal income tax cuts:  Trump plans to create just three tax brackets of 12, 25, and 33 percent.  Some individuals will pay less in taxes under Trump’s plan, but just how many middle-class Americans will benefit is unclear.  Economists differ in their reviews of the plan.  
  3. Business tax cuts:  One significant change Trump will enact is cutting corporate taxes from the current rate of 35 percent to 15 percent.  It is hoped that this rate reduction will allow businesses to employ more individuals at better pay rates.
  4. Tax cuts for the highest earners:  Analysts at the Tax Policy Center have stated that President Trump’s plan will result in tax cuts for the wealthiest one percent of Americans.  Some analysts dispute this conclusion, which goes against statements made by Trump on the campaign trial.  

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