| Summary of selected "Tax Cuts and Jobs Act" tax rates and thresholds |
| Individuals |
Individual rates | • 10% rate – first $9,525 (individual)/$19,050 (joint)
12% rate — $9,525/$19,050
22% rate — $38,700/$77,400
24% rate — $82,500/$165,000
32% rate — $157,500/$315,000
35% rate — $200,000/$400,000
37% rate — $500,000/$600,000 | • Taxable years beginning after 2017 and before 2026 |
Individual Alternative Minimum Tax (AMT) | • Exemption – $70,300/$109,400 • Phase-out – $500,000/$1,000,000 | • Taxable years beginning after 2017 and before 2026 |
Standard deduction | • $12,000/$24,000 (indexed) | • Taxable years beginning after 2017 and before 2026 |
Estate, Gift, and Generation-skipping Tax (GST) | • Exemption – $10 million (indexed from 2011) | • Taxable years beginning after 2017 and before 2026 |
| Businesses |
Top corporate rate | • 21% (no graduated rates) | • January 1, 2018 |
Corporate Alternative Minimum Tax (AMT) | • AMT credit refunds – 50% per year (100% for years beginning in 2021) | • Taxable years beginning after 2017 |
Top pass-through rate | • 29.6% (20% deduction) • Wage limitation – $157,500/$315,000 • Specified service business exclusion (phase-in) – $157,500-$207,500/ $315,000-$415,000 | • Taxable years beginning after 2017 and before 2026 |
Limitation on pass-through losses | • $250,000/$500,000 (indexed) | • Taxable years beginning after 2017 |
| Tax Exempt Organizations |
Excise tax on executive compensation | • 21% (on compensation > $1 million) | • Taxable years beginning after 2017 |
1.4 % Excise tax on private colleges and universities | • 1.4% (on net investment income of private colleges/universities with at least 500 students, more than 50% of students in the US, and assets valued at the close of the preceding tax year of at least $500,000 per full-time student other than assets used directly in carrying out the institution’s educational purposes). | • Taxable years beginning after 2017 |
| International |
Transition tax | • 15.5% (cash, etc.)/8% (other) | • Greater of E&P on November 2, 2017 or December 31, 2017 |
Global Intangible Low-Taxed Income (GILTI) | • GILTI – Net CFC Tested Income minus (10% x QBAI) • Deemed-paid foreign tax credit – 80% | • Taxable years beginning after 2017 |
Foreign-Derived Intangible Income (FDII) and GILTI Deduction | • GILTI (before 2026) – 50% (10.5% effective tax rate)
• GILTI (after 2025) – 37.5% (13.125% effective tax rate)
• FDII (before 2026) – 37.5% (13.125% effective tax rate)
• FDII (after 2025) – 21.875% (16.406% effective tax rate) | |
Base Erosion and Anti-Abuse Tax (BEAT) | • Gross receipts test – $500 million average preceding 3 years • Base erosion percentage test – 3% (base erosion payments to total deductions) for non-banks/dealers and 2% for banks/dealers • Base erosion minimum tax – excess of [%] of modified taxable income (MTI) over regular tax, reduced by a portion of credits other than R&D • [%] of MTI: — First taxable year beginning after 2017 – 5% (6% for banks/dealers)
— Taxable years beginning after 2018 and before 2025 – 10% (11% for banks/dealers)
— Taxable years beginning after 2025 – 12.5% (13.5% for banks/dealers)
— For taxable years beginning after 2025, regular tax is reduced by all credits in full | • Taxable years beginning after 2017 |
