Will the Wealthy Benefit From Trump’s New Tax Plan?

Will the Wealthy Benefit From Trump’s New Tax Plan?

By Alan Olsen

Trump will have a cooperative GOP house and senate and it is likely that overall tax rates for the wealthy will be heading lower starting in 2017. Therefore, now is the time to begin your tax planning. That means it’s time to put the campaign and the election behind us and start thinking about the future.
A Trump presidency means a lot of different things to a lot of different people, but one of the biggest topics throughout the election process was how Trump’s tax plan would affect the country. That has been an ongoing debate and it will surely continue to be a hot topic in the coming weeks and months before he takes control of the Oval Office in January. It’s certainly been a well-covered theme here at GROCO over the past several months.
So how will Trump’s tax plan affect the country, especially the wealthy?

Top Earners to See Tax Bracket Drop

It’s true that the president-elect proposed a lot of changes to the country’s tax system. However, it’s also very important to remember that he can’t change the tax code without the help of Congress. So, it remains to be seen how many of his proposals will become law and how many will quietly drift away into the tax-change idea graveyard. However, there are some changes that could likely be made and they will most likely effect the wealthy.

Across the board, almost all taxpayers would fall to a lower tax bracket. However, those who are currently in the 28 percent bracket, with income between roughly $225,000 and $231,450, could be bumped up to the 33 percent bracket. The wealthiest taxpayers could see their tax rate dropped from 39.6 percent down to 33 percent as well, which means anyone making $225,000 or more would pay the same income tax rate.

Repeal Key Taxes Affecting the Wealthy

There are other Trump tax proposals that could benefit the wealthy, including repealing the estate tax and the Affordable Care Act (ACA) net investment income tax, which adds a 3.8 percent tax to one’s net investment income.

Repealing the estate tax would be beneficial to those who inherit more than $5.45 million, while anyone who makes more than $250,000 annually, or earns much of his or her income from capital gains, would benefit from repealing the ACA tax.  However, on the downside, any capital gains exceeding $10 million that are held until death could be taxed.

That means taxpayers could not donate appreciated assets to a private charity that they or their relatives created.

Helping Big Business

On the business side of things, Trump’s tax plan should be well received by large corporations, even if many of them aren’t happy he won the election. Trump has proposed reducing the corporate tax rate to 15 percent. He has also said that he wants to impose a one-time 10 percent tax on all foreign earnings that have not been taxed by the U.S.

This could be a huge boost to the bottom line of many of the nation’s largest companies, including man of the big name tech companies that call Silicon Valley home. In fact, while any company that does business overseas could benefit, the companies holding the most cash overseas are currently headquartered in Silicon Valley.

Time Will Tell

The Bottom line is the majority of the country’s wealthiest individuals and corporations would likely see their tax numbers reduced if Trump successfully gets his tax proposals pushed through Congress. However, it remains to be seen if the legislative branch on Capitol Hill will fully corporate with the president-elect’s proposals.

//www.cbsnews.com/news/how-your-taxes-may-change-in-a-trump-presidency/

//www.forbes.com/sites/mattdrange/2016/11/11/why-trumps-tax-plan-will-be-good-news-for-silicon-valleys-biggest-companies/#4102bf8a24b4

//www.zerohedge.com/news/2016-11-11/what-donald-trumps-proposed-tax-cut-means-you

 

We hope you found this article about “Will the Wealthy Benefit From Trump’s New Tax Plan?” helpful.  If you have questions or need expert tax or family office advice that’s refreshingly objective (we never sell investments), please contact us or visit our Family office page  or our website at www.GROCO.com.  Unfortunately, we no longer give advice to other tax professionals gratis.

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Alan Olsen, CPA

Alan Olsen, is the Host of the American Dreams Show and the Managing Partner of GROCO.com.  GROCO is a premier family office and tax advisory firm located in the San Francisco Bay area serving clients all over the world.

 

Alan L. Olsen, CPA, Wikipedia Bio

 

 

GROCO.com is a proud sponsor of The American Dreams Show.

 

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The American Dreams show was the brainchild of Alan Olsen, CPA, MBA. It was originally created to fill a specific need; often inexperienced entrepreneurs lacked basic information about raising capital and how to successfully start a business.

Alan sincerely wanted to respond to the many requests from aspiring entrepreneurs asking for the information and introductions they needed. But he had to find a way to help in which his venture capital clients and friends would not mind.

The American Dreams show became the solution, first as a radio show and now with YouTube videos as well. Always respectful of interview guest’s time, he’s able to give access to individuals information and inspiration previously inaccessible to the first-time entrepreneurs who need it most.

They can listen to venture capitalists and successful business people explain first-hand, how they got to where they are, how to start a company, how to overcome challenges, how they see the future evolving, opportunities, work-life balance and so much more.

American Dreams discusses many topics from some of the world’s most successful individuals about their secrets to life’s success. Topics from guest have included:

Creating purpose in life / Building a foundation for their life / Solving problems / Finding fulfillment through philanthropy and service / Becoming self-reliant / Enhancing effective leadership / Balancing family and work…

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MyPaths.com (Also sponsored by GROCO) provides free access to content and world-class entrepreneurs, influencers and thought leaders’ personal success stories. To help you find your path in life to true, sustainable success & happiness.  It’s mission statement:

In an increasingly complex and difficult world, we hope to help you find your personal path in life and build a strong foundation by learning how others found success and happiness. True and sustainable success and happiness are different for each one of us but possible, often despite significant challenges. Our mission at MyPaths.com is to provide resources and firsthand accounts of how others found their paths in life, so you can do the same.

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