The proposed tax reform bill under consideration by Congress will reduce the tax rate paid by those making over $400,000 and eliminate federal income tax for those making less than $25,000 per year, and it will eliminate the federal estate tax, which is imposed on joint estates over $11,000,000. The tax rate paid by corporations will be reduced from 35 percent to 20 percent. The bill will also eliminate substantially all itemized deductions other than mortgage interest and charitable donations.
This means that you will no longer be able to claim a deduction on your federal income tax return for the Oregon income tax and real property taxes that you pay, and substantially all other itemized deductions will be eliminated except mortgage interest and charitable deductions. If you earn between $25,000 and $400,000 and claim itemized deductions on your tax return, you will probably pay more under the proposed tax reform bill. The richest and poorest and the corporations will pay less.
Eighty percent of the income tax benefits will go to people with incomes of more than $740,000 per year. One hundred percent of the estate tax benefits will go to families with estates over $11,000,000. Those of us in the middle class who claim itemized deductions will pay more.
Talk to your tax preparer to confirm that the above facts are true. Then call Greg Walden and let him know how you feel about this. You can guess how I feel about it.