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Tax reform details to be submitted by Nov. 13

October 1, 2017
Tax reform talk

Congress hopes to move beyond talk and have tax reform details in writing by mid-November.

The Senate Budget Committee released its 2018 budget blueprint on Sept. 29, setting the stage for up to $1.5 trillion in tax cuts over the next 10 years.

That's an astounding, alarming, amazing, pick-your-adjective amount. But the figure that caught my eye, and which earns this week's By the Numbers honor, is 13. As in Nov. 13.

That's the date set in the Senate budget resolution by which it wants some legislative flesh attached to the framework of a tax reform that Republicans released on Sept. 27.

Intentionally vague: Representatives and Senators have their work cut out for them.

The nine-page tax reform draft is intentionally vague, both to allow policy wonks freedom to do their jobs and to hamper criticism with the rote answer "that's not yet determined."

That second goal hasn't worked so well in the last few days. Analysts on both sides, as well as politicians and policy groups, are having a field day with what-if tax reform scenarios.

We'll see if lawmakers have any more luck with their deadline to tax writers.

Tight time table: Some believe that if tax details are provided by Nov. 13, that will be enough time to get a tax overhaul enacted by the end of the year.

I am not one of those people.

True, the GOP-controlled Senate's budget resolution now means the upper chamber can pass tax reform under reconciliation rules. That's via a simple majority of all Republican "yeas," including the tie-breaking vice-presidential vote, without worrying about any Democratic support.

But as we saw with the three failed Affordable Care Act/Obamacare repeal votes, such a quest is not so simple. Or assured.

Some think Republicans will have a similarly difficult job of corralling enough members to get the necessary tax reform votes.

I am one of those people.

Increased deficit concerns: While the GOP leadership is willing to add to the country's deficit to achieve tax law changes, some members are not.

And the decade worth of $1.5 trillion added to our debt that some Republicans are ready to accept is, argue some, on the low side.

They discount White House arguments that the tax cuts will spur enough economic oomph to offset their price. Instead, they project the deficit will grow under this tax plan by between $2.2 trillion and $2.4 trillion over the next 10 years.

Conflicting tax cut goals: Then there are the messy changes that are mentioned in the framework.

It's one thing to say the House Ways and Means and Senate Finance Committees "will work on additional measures to meaningfully reduce the tax burden" and quite another to get there.

Some of the ideas that have been floated — changes to tax-deferred workplace retirement plans and the loss of state and local tax deductions have been getting the most attention — will be staunchly opposed even by some Republicans.

And that's before industry groups, lobbyists and constituents once they learn how changes will affect them have even fully mobilized for the fight.

Efforts to reduce or eliminate tax breaks have been tried in recent Congressional sessions. They failed then. Will this time be different?

It depends in large part on how all these disparate views are incorporated, or not, into any ultimate tax reform measure.

We'll get an idea of that synthesis on Nov. 13. If Congressional tax writers meet that deadline.

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TAX-SAVVY WAYS 
TO WRAP UP 2026

It’s over! With October’s extended filing deadline behind us, it is now time to focus on year-end moves to reduce your 2026 tax bill. 

You’ll find ways to do just that on the Tax Tips page (see the More Tax Posts drop-down menu at the top of the blog), as well as the separate tax tip pages for each month, notably October through December. If you’re on the Tax Tips page, you’ll find a monthly list at the end of this column. If you’re on another blog page, you can head straight to the October tips; at the bottom of that tips page you’ll find links to all the other 11 months’ collections of tax advice.

Not to spoil what you’ll find in that tax advice, but it does cover such things as tax deductions for charitable donations, investment moves that could reduce tax due, and ways to max out your tax-favored retirement savings. 

Finally, as the year winds down, things get hectic. There are lots of other things to occupy our time, like the much more fun upcoming holidays. But don’t lose sight of taxes, since timing is key. To be of use, most tax moves must be made by the end of the tax year. That’s Thursday, Dec. 31, which also is the last business day of the year. 

So that you don’t miss that final tax year deadline, also keep an eye on the countdown clock below. It will keep you on top of just how much time is left to make important, tax-saving moves. (Note: I’m in the Central Time Zone, so adjust accordingly for where you live.)

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