3 Things to Look for When Trump Unveils His New Tax Plan

A new president always brings with him a new tax plan. While one is never totally sure if the common wisdom will hold with President Trump, his focus on taxes means that a new plan will be out sooner rather than later. Below are just a few things that people can expect from his tax plan.

Big Changes at the Top

The Trump Tax Plan is one that will probably embrace the spirit of Reagan's trickle-down economics. For those in the top one percent, this is going to be a very good thing - one shouldn't expect taxes in this, or any of the other highest brackets, to change much if at all. There's a decent chance that taxes will be lowered on high earners, but it's unlikely that taxes will be raised on anyone at all. Instead, it's likely that most tax changes will end up being regressive rather than progressive in nature on this administration.

Business-First Changes

It's almost certain that the biggest changes in this tax proposal are going to target businesses. Given Trump's background and his pledges to support American businesses, it's likely that mid-to-large companies are going to see a great deal of favor in the current plan. While there are likely going to be fewer changes that impact smaller businesses, there's a very good chance that some general business-related taxes will be reduced. At the very least, there's a good chance that some taxes springing from Obama-era regulatory moves will be done away with in this plan.

Investment Alterations

It's also likely that changes are going to come to the way that investments are taxed. A Republican administration almost always means that things like capital gains are going to see less taxation and under Trump it's quite likely that the United States is going to see changes that are going to encourage more investment. For most investors, this will likely mean that the pain of cashing out an investment count is going to drop. For big spenders, though, it's likely that a great deal of money is about to be freed up by the tax changes.

It's hard to say what the long-term impact of this kind of taxation will be. On one hand, it may go a long way to encourage business growth. On the other, it will likely cause major issues with funding some government initiatives. No matter what the case, though, it's safe to say that change is coming - and soon.

William Doonan is a tax law and legal expert in New York.