One of the pressing issues of President-elect Donald Trump’s campaign was his proposed tax reform. It is clear that not everything will be passed into law, and in fact changes were made over the course of the presidential race before arriving at the current proposal. Of course, it is too early to know exactly what will change and by how much, but it is clear that some major changes will be made. With the backing of a Republican majority in both the House and Senate, it should not take long for these changes to happen. Furthermore, many of the changes are not significantly different than previously proposed tax reforms by some Congressmen, which should help ease their passage into law. Read more
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On November 2nd, the House of Representatives unveiled the first draft of the Trump Tax Reform Bill. Here we look at how it will affect expats.
Citizen Based Taxation and FATCA
There is no mention in the draft Tax Reform Bill of any change to citizen based taxation for individuals, or of repealing FATCA.
It is proposed that corporations are only taxed on their US profits (rather than globally), as taxing corporations globally has (conversely to expectations) reduced government revenue, as globally operating firms have simply relocated to other countries with more favorable tax regimes.
Despite ACA (American Citizens Abroad) lobbying to make a similar change away from global taxation for expat individuals, there is no mention of this in the draft bill. Read more
How will OFAC implement the changes to the Cuba sanctions program announced by the President on June 16, 2017? Are the changes effective immediately?
OFAC will implement the Treasury-specific changes via amendments to its Cuban Assets Control Regulations. The Department of Commerce will implement any necessary changes via amendments to its Export Administration Regulations. OFAC expects to issue its regulatory amendments in the coming months. The announced changes do not take effect until the new regulations are issued. Read more
This is the second article in TaxConnections series of developing a better understanding of the how our Federal tax laws are initiated and implemented, and the various participants in Congress, including Members of Congress, their qualified technical and administrative staffs involved in that process. It also highlights the techniques utilized by the private sector (individuals, businesses large and small, plus associations) in that effort. (To read the first article, click here)
When one embarks on looking at what might happen with taxes, that path is fraught with many hazards. What a candidate says may not be what is actually proposed. What the elected candidate proposes may be modified or totally shot down by Congress. What Congress passes may not be signed by the President. However, I have my crystal ball and can foresee what the future holds in terms of future changes in taxes. Yeah, right. Unfortunately, that crystal ball is extremely cloudy and I cannot say with certainty what will happen.