1、 March 5, 2014 The Tax Reform Act of 2014 Background and Proposed Changes Context. On February 26, 2014, House Committee on Ways and Means Chairman Dave Camp introduced the Tax Reform Act of 2014 as a discussion draft. This comprehensive draft builds on earlier discussion drafts released by Chairman
2、 Camp, which had addressed international tax, financial products, and small business. Individual Income Tax. Under the proposal, there would be two regular income tax brackets, with rates of 10% and 25%. A third bracket would apply to an alternative definition of income, making for a top statutory r
3、ate of 35%. The 35% bracket results from a 10% tax on modified adjusted gross income (MAGI) above certain income thresholds ($400,000 for single filers; $450,000 for joint filers). The 10% bracket is phased-out for certain higher-income taxpayers. Brackets would be adjusted for inflation using chain
4、ed-CPI. Dividends and capital gains would be taxed as ordinary income, but 40% of net capital gains and qualified dividends would be excluded from taxable income. The proposal would also repeal the Alternative Minimum Tax (AMT). Other substantial changes to the structure of the individual income tax
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