In summary, based on an analysis prepared by the Tax Policy Center, President Trump’s revised tax plan would cut taxes on every income level. However, high wage earners will receive the biggest tax cuts, both in terms of dollars, as well as in percentage of income. According to the analysis, the Trump revised tax plan would reduce the top individual income tax rate to 33 percent, and reduce the corporate rate to 15 percent.
The plan will allow owners of pass-through businesses (such as sole proprietorships, partnerships, and S corporations) to elect to be taxed at a flat rate of 15 percent, rather than under the regular individual income tax rates. Capital gains and dividends would be taxed under the current preferential rate structure. Distributions from “large” pass-through businesses received by owners who elected the 15 percent flat rate would be taxed as dividends. Read more