Update on Tax Reform: Will It Happen, Now That Congress Has Returned?

This update was prepared by a tax partner with our affiliate, Wipfli LLP. With more than 1,800 associates, 41 offices in the United States and two offices in India, Wipfli ranks among the top accounting and business consulting firms in the nation.

When President Trump took office in January, his broad and ambitious agenda included (among other things) significant tax reform for businesses and individuals. We discussed some of the parameters of Trump’s tax reform proposals on February 1, shortly after his inauguration — click here to see that discussion. Unfortunately, to this point, an old saying can sum up how far tax reform has actually progressed in Congress:

“When all is said and done, more is said than done.”

Congress was unable to craft — let alone pass — any tax reform legislation prior to its August recess. Tax reform largely took a backseat to the many summer debates and votes related to healthcare.

Now that Congress has returned from recess, there’s no doubt that tax reform will remain on the agenda. However, that agenda has become more crowded due to the status of the national debt ceiling; a possible government shutdown over spending related to a border wall; emergency aid for people and areas impacted by Hurricane Harvey; and the ongoing debate over healthcare. Exactly where tax reform sits on the upcoming agenda is difficult to predict, especially given some of the apparent infighting between Congressional Republicans and the President.

Will Congress make the move on tax reform?

Prior to the August recess, though, the White House released a joint statement on tax reform, which was joined by several prominent Republicans, including Speaker of the House Paul Ryan (R-WI), Senate Majority Leader Mitch McConnell (R-KY), Treasury Secretary Steven Mnuchin, National Economic Council Director Gary Cohn, Chairman of the Senate Finance Committee Orrin Hatch (R-UT) and House Ways and Means Committee Chairman Kevin Brady (R-TX). The statement clearly indicated the importance of tax reform to the authors; in fact, the statement called tax reform “the single most important action we can take to grow our economy and help the middle class.”1

Although the statement clearly indicated the strong preference to pass tax reform, it provided very few details as to what that tax reform would actually look like. The only specific item cited in the statement was the exclusion of a border adjustability tax from any tax reform proposals to come this fall. The statement otherwise included only broad guidelines that tax reform should support, including:

– Reducing tax rates “as much as possible.”2

– Allowing “unprecedented capital.”3

– Placing a priority on permanence.

– Encouraging American companies to bring back jobs and profits trapped overseas.

Unfortunately, this statement was released prior to the August recess. Events since then (e.g., Hurricane Harvey, civil unrest in parts of the country, Republican infighting, etc.) have only increased and clouded the agenda for Congress to tackle prior to elections in November. Tax practitioners are still hopeful that tax reform legislation will be crafted, passed and signed into law; however, when that actually happens is far from certain.

Have questions?

Wipfli’s tax professionals will continue to monitor developments and communicate information as soon as it becomes available, including any planning opportunities that develop. Visit Wipfli.com or tune into OneBite to stay up-to-speed.

Wipfli Financial Advisors, LLC (“Wipfli Financial”) is an investment advisor registered with the U.S. Securities and Exchange Commission (SEC); however, such registration does not imply a certain level of skill or training and no inference to the contrary should be made. Wipfli Financial is a proud affiliate of Wipfli LLP, a national accounting and consulting firm. Information pertaining to Wipfli Financial’s management, operations, services, fees and conflicts of interest is set forth in Wipfli Financial’s current Form ADV Part 2A brochure and Form CRS, copies of which are available from Wipfli Financial upon request at no cost or at www.adviserinfo.sec.gov. Wipfli Financial does not provide tax, accounting or legal services. The views expressed by the author are the author’s alone and do not necessarily represent the views of Wipfli Financial or its affiliates. The information contained in any third-party resource cited herein is not owned or controlled by Wipfli Financial, and Wipfli Financial does not guarantee the accuracy or reliability of any information that may be found in such resources. Links to any third-party resource are provided as a courtesy for reference only and are not intended to be, and do not act as, an endorsement by Wipfli Financial of the third party or any of its content or use of its content. The standard information provided in this blog is for general purposes only and should not be construed as, or used as a substitute for, financial, investment or other professional advice. If you have questions regarding your financial situation, you should consult your financial planner, investment advisor, attorney or other professional.
Ryan P. Laughlin

CPA, MST, JD | Partner, Wipfli LLP

With more than 15 years of professional experience with regional, national and global public accounting firms, Ryan Laughlin, CPA, MST, JD, currently serves as a partner in Wipfli LLP’s tax practice, based in Green Bay, WI. He utilizes a unique blend of accounting, tax and legal expertise to provide tax and transactional planning to business owners, individuals and families.

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Update on Tax Reform: Will It Happen, Now That Congress Has Returned?

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