The seven tax brackets – ranging from 10% to 39.6% – would be consolidated into three: 12%, 25%, 35%. The standard deduction would nearly double. All itemized deductions other than mortgage interest and charitable contributions would be eliminated. Personal exemptions would be eliminated, but potentially rolled into an additional child tax credit. The alternative minimum tax and estate tax would be eliminated.
The proposal reduces the corporate tax rate to 20%. Income of S corporations and partnerships, which are taxed at the owner level rates as high as 39.6%, would be subject to a top rate of 25%.