16 THE QUEENS COURIER • JULY 27, 2017 FOR BREAKING NEWS VISIT WWW.QNS.COM
Moving Along With Tax Credits
JOHN J.
CIAFONE, ESQ. Call Now & End Your Tax Nightmare!
MILLION DOLLAR ADVOCATES FORUM
THE TOP TRIAL LAWYERS IN AMERICA TM
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Admitted in NY NJ
and Washington DC
Attorney At Law
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johnjciafone@yahoo.com
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“Breaking the Tax Code”
Salvatore P. Candela, EA, ATA, ABA
Enrolled Agent - Tax Advisor
BY JOHN SAVIGNANO, CPA
Lawmakers are chugging along
on tax reform. Officials in President
Donald Trump’s administration are
meeting regularly with congressional
GOP leaders to come up with a
plan to significantly lower tax rates
for individuals and firms and to simplify
the tax code.
They’re seeking ways to pay for
tax rate cuts, especially now that the
border adjustability provision found
in the House GOP tax blueprint is
nearly dead. It would exempt profits
from exported goods, services and
intangibles from U.S. tax and deny
tax deductions on imports. If enacted,
it would raise lots of money…up
to $1.2 trillion over 10 years. But it
got flak from a wide array of naysayers,
including economists, business
groups, some Senate Republicans
and even Trump.
The most costly tax breaks will get
lots of attention. The more fresh revenue
that can be generated by ending
or trimming them, the deeper
the rate reductions. So we thought
we’d review the 10 largest individual
tax expenditures rounded up by the
staff of the nonpartisan congressional
Joint Committee on Taxation. If
lawmakers want to raise revenue to
offset the cost of rate cuts, these are
key targets. But you can be sure an
army of lobbyists is ready to defend
each of them. The big 10:
Tax breaks for retirement plans and
accounts…Tax-deferred payins to
401(k)s, deductible payins to traditional
IRAs, tax deferral on account
earnings and the like.
The exclusion from tax for employer
provided health insurance…
Employer-paid health insurance premiums
aren’t included in an employee’s
taxable wages, even though
the employer is able to deduct the
amounts as a business expense.
Favorable tax rates on qualified dividends
and long-term capital gains…
The top rate is 23.8%, which includes
the 3.8% surtax on net investment
income.
Treating between 15% and 100% of
Social Security benefits as tax-free.
State and local income and property
taxes…This oft-targeted tax break
is cherished by those who live in
high-tax states as well as homeowners
everywhere.
The home mortgage interest
deduction… This popular Schedule
A write-off isn’t going anywhere, but
tightenings involving second homes
are always possible.
Charitable contributions. Trump
and House GOP leaders say this is
safe.
Three breaks that primarily benefit
lower and middle income earners:
The earned income credit and
child tax credit. Both are refundable.
Eliminating them will be hard,
so lawmakers will likely just tinker
around the edges.
The health premium tax credit…
For health insurance that is purchased
through an exchange by folks
with household incomes ranging
from 100% to 400% of the federal
poverty level, who have no access
to affordable employer coverage.
Congressional Republican proposals
to repeal and replace large parts of
Obamacare would do away with this
break and substitute another refundable
tax credit for it.
John Savignano is a partner with
Savignano Accountants & Advisors
located at 47-46 Vernon Blvd.,
Second Floor, in Long Island City.
If you have any questions or require
additional information, please call
John at 718-707-0955.
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