Trump tax plan: Relief for his voters but lots of unknowns

Treasury Secretary Steven Mnuchin left and Gary Cohn chief economic advisor to Donald Trump speak at the White House in Washington

Christie Concerned About Trump's Tax Plan

Rick McVey, owner of Dilly Lily, works at his shop Wednesday, April 26, 2017, in Chicago.

Though most market participants are not sure if Congress will pass any of these tax proposals, the Trump administration seems confident about the materialization of the tax plan, even if a second attempt at canceling the Affordable Care Act flops. The florist has a range of possibilit.

President Trump's new tax plan proposes some dramatic changes.

As promised, President Trump's administration announced a tax plan on Wednesday that mainly revolved around cutting corporate taxes and adjusting personal tax rates. But Trump's top economic adviser used some bad math to describe the proposal, raising questions. But that's not double. Currently, individuals can deduct $6,350 and married couples can claim $12,700 from their taxable income.

Conservatives emphasize that the official top corporate tax rate in the too high, and they have a point.

The NYT cites a Tax Policy Center estimate which says the similar tax plan Trump released during the campaign would contribute "about $7 trillion in additional debt over the first 10 years and almost $21 trillion by 2036".

The 28 percent alternative minimum tax for high-income households would disappear.

If the plan actually increases the prosperity of the economy, "Trump will have accomplished something his tax-cutting Republican predecessors were unable to do", Max Ehrenfreund writes in the Washington Post.

Even with the standard deduction doubling, the average taxpayer may not save much money from the new tax plan.

But the top one percent of earners would see a 14 percent increase in after-tax income.

For individuals, the plan would shrink the number of tax brackets from 7 to 3, with the highest tax rate at 35 percent. But the administration has yet to determine the income levels for people who would be put in each bracket.

The 40 percent estate tax, which applies to anyone who inherits $5.5 million or more, would be scrapped. Without it, he would have paid just $5.5 million, according to a leaked copy of that year's return.

What might be are his state and local taxes, which Rosenthal suspects made up a big chunk of Trump's $17 million of itemized deductions in 2005. Many claim the standard deduction every year. The Government Accountability Office found that two-thirds of active corporations paid no federal tax.

If your parents' estate is worth less than $10.9 million, you don't have to worry about this tax.

Lowering the corporate tax rate from 35 percent to 15 percent, and allowing many S-Corps to file under that 15 percent mark.

Steve Witkoff, a New York-based real estate developer and a friend of Trump, defended the proposed tax changes, arguing that they could foster an environment in which more Americans take the sort of financial risks that create jobs and feed prosperity.

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