President-elect Donald Trump has proposed cutting the top marginal income tax rate to 33% as well as eliminating the 3.8% net investment income tax.
Mr. Trump has also proposed an overall cap on total itemized deductions ($200,000 for married individuals filing joint tax returns). As a result of these proposals, high income taxpayers may benefit by deferring gains that would be subject to net investment income tax until 2017. Additionally, high income taxpayers should consider paying expenses eligible to be taken as itemized deductions now, rather than waiting until 2017 when the tax benefit of these deductions may be reduced, or capped.
This post was written by Nicholas Holland.