Published: Tue, May 09, 2017
Markets | By Erika Turner

Fact check: Claims about Trump's tax plan don't hold up

Fact check: Claims about Trump's tax plan don't hold up

Where the tax plan would have a big impact is in empowering some very wealthy people, because of another bit of chicanery in the proposal: Trump apparently would allow some business owners to dodge personal income tax by paying at the much lower corporate rate.

The package is expected to hike the individual's standard deduction, providing modest cut for middle-income people and abridging the process of filing tax returns, as people briefed its details. Those savings would disappear under Trump's plan, though their loss might be offset by other tax cuts.

Democrats are using the possibility of presidential profits to bash the proposal.

"His tax outline is a wish-list for billionaires, trickle-down all over again - and guess who it is trickling all over?" It would eliminate the alternative minimum tax, without which Trump would have paid less than 4 percent in taxes for 2005; with it, he paid 25 percent.

Treasury Secretary Steven Mnuchin says Trump's tax "plan" would be paid for partly "with growth" - which means that he has no idea how to pay for it.

Not everyone makes itemized claims on their tax returns.

Overall, Marr notes the Tax Policy Center has estimated the top 1% of households would see a 14% increase in after-tax income, while low and middle-class Americans would see gains of just 1.2% to 1.8%. In big families, this tax exemption can add up.

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Under current tax rules, your heirs must pay 40 percent in taxes on any assets they inherit in excess of $5.49 million ($10.98 million for married couples). In addition to reducing the rate from 39.6 percent to 35 percent, Trump would also eliminate the estate tax - which is paid nearly exclusively by wealthy heirs when a family member passes away - and a 3.8 percent surcharge that the rich pay on income from their investments imposed as part of President Barack Obama's health-care reforms, also known as Obamacare.

Read on to learn how Trump's tax plan could affect you.

Cuomo said losing the ability to deduct the state and local taxes could even "expedite" wealthier New Yorkers leaving the state.

If the rules work in Trump's favor, he could receive more than half off on the "pass through" portion of his tax bill. These are key Republican goals that would require lawmakers to eliminate or reduce precious tax breaks enjoyed by millions of Americans. The benefit to Trump could run as high as tens of millions of dollars a year. Without it, he would have owed just $5.5 million. Claudia Tenney, a conservative-leaning Republican who represents parts of central NY, said until the state overhauls its own tax codes, New Yorkers "cannot afford" to lose their itemized deductions because the benefit offers state residents one of their few forms of tax relief.

Under Trump's tax plan, these itemized deductions would disappear.

Condon reported from NY.

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