Comparing Congressional Tax Plans

Over the past few years, several members of Congress have issued comprehensive tax reform proposals. These tax plans will likely play a large role in framing the tax policy debate in 2017 and beyond.

The chart below summarizes the major provisions in five recent Congressional tax reform proposals:

To learn more about this chart, see this post.

Plans

  • Dave Camp
  • Ben Cardin
  • Devin Nunes
  • House GOP, 2016
  • Jim Renacci
  • Deselect All

Issues

individual Taxes:

  • Rates on Ordinary Income
  • Itemized Deductions
  • Credits
  • Alternative Minimum Tax
  • Rates on Capital Gains and Dividends

business Taxes:

  • Corporate Income Tax Rate
  • Capital Expenses
  • International Income
  • Pass-through Business

other Taxes:

  • Payroll Taxes
  • Estate Tax
  • Other
Deselect All

Issue Plan

Rates on Ordinary Income

Dave Camp

Establishes two tax brackets with rates of 10% and 25%, as well as an additional 10% surtax on income over $400,000. Consolidates the standard deduction and the personal exemption into a larger standard deduction of $11,000 ($22,000 for joint filers), which phases out for high-income earners. Adds an additional deduction of $5,500 for single taxpayers with at least one child.

Ben Cardin

Establishes three tax brackets with rates of 15%, 25%, and 28%. The top rate applies to taxable income over $250,000 ($500,000 for joint filers). Replaces the standard deduction and personal exemption with family allowances of $50,000 for singles, $75,000 for heads of household, and $100,000 for joint filers.

Devin Nunes

No specific proposal.

House GOP, 2016

Establishes three tax brackets with rates of 12%, 25%, and 33%. The top rate applies to taxable income over $190,150 ($231,450 for joint filers). Consolidates the standard deduction and the personal exemption into a larger standard deduction of $12,000 ($24,000 for joint filers). Adds an additional deduction of $6,000 for single taxpayers with at least one child.

Jim Renacci

Establishes three tax brackets with rates of 10%, 25%, and 35%. The top rate applies to taxable income over $750,000 ($1,500,000 for joint filers). Increases the standard deduction to $15,000 ($30,000 for joint filers). Increases the personal exemption to $5,000.

Itemized Deductions

Dave Camp

Eliminates the state and local tax deduction, as well as several other itemized deductions. Caps the mortgage interest deduction at $500,000 of debt. Eliminates the Pease limitation on itemized deductions.

Ben Cardin

Eliminates several deductions but preserves most major itemized deductions, including the charitable contributions deduction, the state and local tax deduction, and mortgage interest deduction. Eliminates the Pease limitation on itemized deductions.

Devin Nunes

No specific proposal.

House GOP, 2016

Eliminates all itemized deductions except the mortgage interest deduction and the charitable contributions deduction.

Jim Renacci

Eliminates all itemized deductions except the mortgage interest deduction and the charitable contributions deduction. Caps the mortgage interest deduction at $500,000 of debt.

Credits

Dave Camp

Eliminates several personal credits. Expands the child tax credit from $1,000 per child to $1,500 per child and $500 for non-child dependents, with credit amuounts indexed to chained CPI. Modifies the parameters of the earned income tax credit.

Ben Cardin

Eliminates most personal credits, including the earned income tax credit and the child tax credit. Creates a comprehensive earned income rebate, which is structured similarly to the current earned income tax credit, phasing in at low levels of earned income, phasing out as earned income rises, and offering a larger rebate to households with children.

Devin Nunes

No specific proposal.

House GOP, 2016

Increases the child tax credit to $1,500, the first $1,000 of which is refundable. Raises the phaseout threshold for the child tax credit for married households from $110,000 to $150,000.

Jim Renacci

Eliminates most personal credits. Retains the child tax credit. Expands the earned income tax credit by increasing phase-in rates by 100% for childless workers and 40% for others.

Alternative Minimum Tax

Dave Camp

Eliminates the alternative minimum tax.

Ben Cardin

Eliminates the alternative minimum tax.

Devin Nunes

Eliminates the alternative minimum tax.

House GOP, 2016

Eliminates the alternative minimum tax.

Jim Renacci

Eliminates the alternative minimum tax.

Rates on Capital Gains and Dividends

Dave Camp

Taxes capital gains, dividends, and interest as ordinary income, with a 40% exclusion. This is equivalent to taxing investment income at 60% the marginal rates of ordinary income (6%, 15%, and 21%).

Ben Cardin

Taxes long-term capital gains and qualified dividends as ordinary income. Eliminates the 3.8% net investment income surtax.

Devin Nunes

Prserves the current rates on long-term capital gains and qualified dividends, and taxes interest income at these rates as well.

House GOP, 2016

Taxes capital gains, dividends, and interest as ordinary income, with a 50% exclusion. This is equivalent to taxing investment income at half the marginal rates of ordinary income (6%, 12.5%, and 16.5%).

Jim Renacci

Taxes capital gains and dividends as ordinary income.

Corporate Income Tax Rate

Dave Camp

Lowers the corporate tax rate to 25% over 5 years.

Ben Cardin

Lowers the corporate tax rate to 17%.

Devin Nunes

Lowers the corporate tax rate to 25%.

House GOP, 2016

Lowers the corporate tax rate to 20%.

Jim Renacci

Eliminates the corporate income tax.

Capital Expenses

Dave Camp

Eliminates the modified accelerated cost recovery system (MACRS) and replaces it with a system similar to the alternative depreciation system (ADS). Adjusts the basis of depreciable assets for inflation. Repeals last-in, first-out accounting and adds existing business LIFO reserves into the taxable income over a three-year period.

Ben Cardin

No specific proposal.

Devin Nunes

Moves to full expensing of capital investment. Allows businesses to carry back unused deductions up to five years or carry them forward with interest.

House GOP, 2016

Moves to full expensing of capital investment. Preserves the last-in, first-out method of accounting.

Jim Renacci

No specific proposal.

International Income

Dave Camp

Shifts to a territorial tax system. Enacts a deemed repatriation of foreign income at a tax rate of 8.75% for cash and cash-equivalent profits and 3.5% on other profits. Modifies several rules related to the tax treatment of foreign-source income, such as Subpart F and the foreign tax credit. Creates several new anti-abuse rules regarding the taxation of foreign-source income, including a minimum tax rate on foreign-source intangible income and a new limitation on business interest deductions.

Ben Cardin

No specific proposal.

Devin Nunes

Shifts to a territorial tax system. Enacts a charge of 5% on unrepatriated foreign-source income.

House GOP, 2016

Shifts to a territorial tax system. Enacts a deemed repatriation of foreign income at a tax rate of 8.75% for cash and cash-equivalent profits and 3.5% on other profits. Makes the federal income tax border-adjustable, exempting business from paying taxes on exports but denying them a deduction for cost of imported goods.

Jim Renacci

Enacts a deemed repatriation of foreign income at a tax rate of 8.75% for cash and cash-equivalent profits and 3.5% on other profits.

Pass-through Business

Dave Camp

Taxes domestic manufacturing income of pass-through businesses at a maximum rate of 25%, by exempting it from the 10% "surtax" on incomes over $400,000.

Ben Cardin

No specific proposal.

Devin Nunes

Lowers the top rate on pass-through businesses to 25%.

House GOP, 2016

Lowers the top rate on pass-through businesses to 25%.

Jim Renacci

Allows pass-through businesses to elect to be treated as corporations, with no entity-level income tax.

Payroll Taxes

Dave Camp

Requires some owners of pass-through businesses to pay self-employment taxes.

Ben Cardin

No specific proposal.

Devin Nunes

No specific proposal.

House GOP, 2016

No specific proposal.

Jim Renacci

No specific proposal.

Estate Tax

Dave Camp

No specific proposal.

Ben Cardin

No specific proposal.

Devin Nunes

No specific proposal.

House GOP, 2016

Eliminates the estate tax.

Jim Renacci

No specific proposal.

Other

Dave Camp

Modifies, limits, and eliminates dozens of individual and business tax provisions. Significantly modifies rules for IRAs and 401(k) retirement savings plans. Indexes several tax parameters to chained CPI-U.

Ben Cardin

Enacts a 10% credit-invoice value-added tax, or a rate modified to achieve revenue neutrality. The tax is border-adjusted. It exempts non-commercial government sales, most of the nonprofit sector, financial services, residential rents, and sales of exisiting residential housing.

Devin Nunes

Eliminates several business tax deductions and credits, including the domestic production activities deduction and various alternative energy credits. Eliminates the deductibility of net interest.

House GOP, 2016

Eliminates several business credits and deductions, including the domestic production activities deduction. Eliminates the deductibility of net interest.

Jim Renacci

Enacts a 7% credit-invoice value-added tax. The tax is border-adjusted and exempts non-profits and state and local governments.


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