SLIDE 1
- Origin of the Claim
Taxation of Recoveries Origin of the Claim 21% rate Return of - - PowerPoint PPT Presentation
Taxation of Recoveries Origin of the Claim 21% rate Return of - - PowerPoint PPT Presentation
Taxation of Recoveries Origin of the Claim 21% rate Return of capital Foreign v domestic source State attribution How Tax Reform Impacts Your Company Business taxation 21% corporate tax rate Expensing for purchases
SLIDE 2
SLIDE 3
- Business taxation
– 21% corporate tax rate – Expensing for purchases of tangible assets – Net interest limitations – Repeal of corporate AMT – 20% deduction for non-corporate business
How Tax Reform Impacts Your Company
SLIDE 4
- International taxation
– Territoriality / deemed repatriation of deferred foreign earnings – Minimum tax on payments to foreign affiliates (BEAT) – Revised taxation of income from intellectual property (GILTI and FDII)
How Tax Reform Impacts Your Company
SLIDE 5
- Lower rates!
- Cap on state tax deductions
- Standard deduction
How Tax Reform Impacts You
SLIDE 6
How Tax Reform Impacts You
Taxable Income* Taxes under Prior Law Taxes in 2018 Tax Savings $100,000 $16,478 $13,879 $2,599 $200,000 $42,885 $36,579 $6,306 $300,000 $74,217 $60,579 $13,638 $400,000 $107,217 $91,379 $15,838 $500,000 $143,231 $126,379 $16,852 $600,000 $182,831 $161,379 $21,452 >$600,000
(per $100,000)
$39,600 $37,000 $2,600
* Married filing jointly
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How Tax Reform Impacts You
Taxable Income* Cost of Loss of State Tax Deductions Net Tax Savings (Cost)
Lost deductions
$30,000 $50,000 $30,000 $50,000 $100,000 $6,600 $11,000 ($4,002) ($8,002) $200,000 $7,200 $12,000 ($895) ($5,695) $300,000 $7,200 $12,000 $6,438 $1,368 $400,000 $9,600 $16,000 $6,238 ($162) $500,000 $10,500 $17,500 $6,532 ($648) $600,000 $10,500 $17,500 $10,952 $3,952 >$600,000
(per $100,000)
$780 $1,300 $1,820 $1,300
* Married filing jointly
SLIDE 8
- Legislation introduced in California
– Donate to “California Excellence Fund” – “Charitable contribution” for federal tax purposes (not subject to $10,000 limit) – Dollar-for-dollar offset against state income tax liability
- Treasury Secretary says this is “ridiculous”
- Similar legislation being discussed in NY, NJ, and other
states
How Tax Reform Impacts You
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- Standard deduction: $24,000 (married filing jointly)
- Consider “bunching” charitable contributions
How Tax Reform Impacts You
Separate “Bunched” Year 1 Year 2 Year 1 Year 2 State tax $10,000 $10,000 $10,000 $10,000 Interest $10,000 $10,000 $10,000 $10,000 Contributions $10,000 $10,000 $20,000 $10,000 Annual deduction $30,000 $30,000 $40,000 $24,000 2-year total $60,000 $64,000
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