Question

Perform a brainstorming for tax

Brainstorming should include at least 10 concepts or ideas

Answer 1

Internal Revenue Service (IRS) is the key responsible authority of U.S. government agency for the tax collection and implementation & enforcement of tax laws in U.S. which works under the United States Department of Treasury. Further, IRS is also trying to determine possible and simple ways to calculate the tax. Even Tax Cuts and Job Act (TCJA) was also introduced to reform both tax system for Individual as well as for Corporate and help to move the United State to a territorial business taxation system. It has introduces various changes in Individual and Corporate tax codes and following are some examples of these major changes done by Tax Cuts and Job Act in taxation system:

Lower Tax Rate for Individual: TCJA has reduced the tax rate for individuals as compare to previous taxation system. There are 7 tax brackets for individuals out of which 5 are lower from previous tax rates. Therefore, now individual can also take addition advantage of marginal tax bracket in comparison to previous tax bracket which is mainly affect the singles and heads of households.

Higher Standard Deduction: TCJA has increase the standard deduction for individuals but the personal and dependent exemptions are not increase so it may reduce tax liability for those tax payers who have no more dependents because the standard deduction is almost double but due to lower exemption for personal and dependent may affect the taxpayers.

Lower Tax Rate for Corporate: TCJA has also reduced the tax rate for corporate permanently to 21% from 2018 and also eliminated the corporate alternate minimum tax which a major relief for corporate in comparison to previous corporate tax system.

Above changes are the illustrative list changes done by TCJA for individual and corporate. These changes will also help in improving the economy in long run, provide boost to corporate and will allow major relief to individual tax payer.