Article written by:
Rich Lundy, CPA
Director, Tax & Business Advisory Services


On September 27th, the Trump Administration and the House Ways and Means and Senate Finance Committees released a “unified framework” for tax reform. Click here to view the document.

There is currently no legislation drafted. The framework is intended to serve as a template for the above-mentioned tax-writing committees. The committees are being given significant responsibility and latitude in terms of specifics. Kevin Brady, Chairman of Ways and Means, was quoted as saying his plan is to turn the framework into legislation to be passed by the end of 2017.

While the framework leaves many details to be filled in, highlights in the document include:


  • The top rate would be 35% (down from 39.6%), with the possibility of another, higher rate applied to the highest income taxpayers.
  • Most itemized deductions would be eliminated, other than for mortgage interest and charitable contributions (e.g., deductions for state and local income and real estate taxes, and medical expenses would be eliminated).
  • The standard deduction would be nearly doubled.
  • An expansion of child tax credits.
  • Personal exemptions would be eliminated.
  • The Alternative Minimum Tax (“AMT”) would be repealed.
  • The estate tax would be repealed.


  • The top corporate rate would be 20% (down from 35%).
  • The top rate for income generated by pass-through entities, such as S corporations, partnerships and sole proprietorships, would be 25% (down from 39.6%, since this income is taxed at the individual owner level). Note that this provision has immediately generated a great deal of controversy.
  • Full expensing of fixed assets other than structures purchased after September 27, 2017, for at least five years.
  • Many deductions and credits, other than those related to R&D and low-income housing, would be repealed. The framework specifically mentions that the domestic production activity deduction (the “manufacturer’s” or “Section 199” deduction) would be repealed.
  • Interest expense deductions would be “partially limited” for C corporations, and also potentially for non-corporate taxpayers.
  • The corporate AMT would be repealed.
  • Replaces the current world-wide taxing approach with a territorial system. Part of this change would involve what appears to effectively be a mandatory repatriation of accumulated foreign earnings, at a lower tax rate, payable over several years.
  • Going forward, imposing tax at a lower rate on foreign earnings of U.S. multinational corporations. A “minimum tax” of sorts.

The framework contains many familiar items and themes from various tax-reform related efforts over the past year or so. Because of this, lobbying efforts began months ago, and are already in high gear. Given the lack of detail in the framework and extreme lobbying activity, it is not possible to project what the end result might be at this point. We will continue to report on tax reform efforts as they develop. In the meantime, please contact your GBQ representative if you have any questions, or if you’d like to discuss the potential impact to you and your business’ unique tax circumstances.


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