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Senate and House Turn Focus to Tax Reform

Monday, November 13, 2017

(North American Meat Institute)

The Senate Finance Committee today will begin consideration of its version of the Tax Cuts and Jobs Acts, which, similar to the House's legislation, would reduce the top corporate tax rate from 35 to 20 percent. The Senate and House bills, however, propose different approaches to taxing income from pass-through businesses: partnerships, sole proprietorships and S corporations. The House legislation would set a top rate of 25 percent on pass-through income and phase in a new bottom rate of nine percent. The Senate bill, meanwhile, would allow business owners a new 17.4 percent deduction on 50 percent of wage income. Both pieces of legislation would immediately double the estate tax exemption, currently set a $5.5 million per individual, but the House bill also would repeal the estate tax in 2024. The House Ways and Means Committee last week advanced an amended version of the legislation that removed a provision that experts say could have increased many farmers' self-employment tax liability. Meat Institute staff is reviewing and monitoring both bills and will provide additional detail as it becomes available.

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