Tax reform: Ways and Means Republicans fill in the blanks

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1 Tax reform: Ways and Means Republicans fill in the blanks The Dbriefs Tax Reform series Terri LaRae, Partner, Deloitte Tax LLP Patrice Mano, Partner, Deloitte Tax LLP Jon Traub, Principal, Deloitte Tax LLP Chris Trump, Principal, Deloitte Tax LLP November 9, 2017

3 The long-awaited tax reform bill: House edition / Initial reactions What was expected Rate reductions for individuals and businesses Estate tax and AMT repeal Territoriality and transition tax (though 12% rate was higher than many foresaw) 199 repeal Interest limitations Many other revenue raisers pulled from Camp (2014) Some surprises Nothing on LIFO, advertising costs, R&E expensing, or carried interest Very broad provision on outbound related party payments Limits on mortgage interest deduction and capital gains exclusion on a home sale Bubble rate on individuals to claw back the 12% rate Some challenges Mounting opposition to several provisions, especially excise tax on related party payments State and Local Tax (SALT) deduction has strong supporters in high tax states Distributional challenges (i.e., the number of Americans whose taxes would rise) Deficit concerns (especially in the Senate) Small business concerns about narrow nature of pass-through income that gets 25% rate Byrd rule compliance must not increase the deficit (beyond the $1.5T allowed in the first decade) Copyright 2017 Deloitte Development LLC. All rights reserved. Tax reform: Ways and Means Republicans fill in the blanks 3

4 Polling question 1 How confident are you that the Tax Cuts and Jobs Act will be passed this year or early next year? Very confident Somewhat confident Doubtful Not at all confident Don t know/not applicable Copyright 2017 Deloitte Development LLC. All rights reserved. Tax reform: Ways and Means Republicans fill in the blanks 4

5 The long-awaited tax reform bill: House edition Business taxation Corporate income Passthrough income Current law 35% top rate Taxed at owner s individual rate House bill 2017 (HR 1) 20% flat rate; 25% flat rate for personal services corporations 25% top rate on business profits; with assumed 70/30 split of wages to business profits Estimated revenue impact -$1,461.5B -$448B Notes & observations Higher than President Trump s proposal of 15% Higher than President Trump s proposal of 15% Companies may elect to prove capital percentage of more than 30% 0% default capital percentage for certain personal services businesses, with option to prove higher First serious attempt to separate passthrough entities from individual side of tax code Notes: Joint Committee on Taxation (JCT) revenue estimates for Unless otherwise stated, changes effective for tax years beginning after 1/1/18, and small business means a business with average gross receipts of $25M or less. Copyright 2017 Deloitte Development LLC. All rights reserved. Tax reform: Ways and Means Republicans fill in the blanks 5

6 The long-awaited tax reform bill: House edition Business taxation Current law House bill 2017 (HR 1) Estimated revenue impact Notes & observations Capital expensing MACRS/ADS with bonus depreciation; or accelerated use of AMT credits 100% immediate expensing -$25B Applies to qualifying property placed in service after 9/27/17 Sunsets on 12/31/22 Ability to use AMT in lieu of bonus depreciation repealed for tax years beginning after 1/1/18 Business interest payments Generally deductible Limited to 30% of EBITDA; 163(j) rules repealed $172B 5-year carryforward for disallowed amounts Small businesses and real estate companies exempt Corporate AMT 20% on alternative minimum taxable income Repealed -$40.3B 50% of AMT credit carryforwards refundable in ; remaining credits refundable in 2022 Copyright 2017 Deloitte Development LLC. All rights reserved. Tax reform: Ways and Means Republicans fill in the blanks 6

7 The long-awaited tax reform bill: House edition Business taxation Current law House bill 2017 (HR 1) Estimated revenue impact Notes & observations Manufacturing deduction ( 199) 9% deduction on lesser of qualified production activity income or taxable income Repealed $95.2B Like-kind exchanges No gain or loss recognized for wide range of property held for productive use or investment Allowed only for real property $30.5B Exchanges of personal property permitted to be completed if begun before 12/31/17 Net operating loss deduction 2-year carryback and 20-year carryforward allowed to offset taxable income NOL carryover or carryback of up to 90% of taxable income deductible; carryforwards increased by interest factor $156B Generally repeals all carrybacks except 1-year carryback for small businesses and farms in certain casualty and disaster situations Copyright 2017 Deloitte Development LLC. All rights reserved. Tax reform: Ways and Means Republicans fill in the blanks 7

8 The long-awaited tax reform bill: House edition Business taxation Some other tax incentives fully repealed: Deduction for local lobbying expenses Deduction for entertainment, amusement or recreation activities, facilities, or membership dues, transportation fringe benefits, athletic facilities, or personal amenities provided to employees Credit for clinical testing expenses for certain drugs Credit for employer-provided child care Rehabilitation credit Work opportunity credit Deduction for certain unused business credits New markets credit Private activity bonds, advance refunding bonds, tax credit bonds, tax-exempt bonds for professional stadiums Some other tax incentives modified/limited: Energy investment credit Deduction for FDIC premiums Credit for portion of employer social security taxes paid with respect to employee tips Copyright 2017 Deloitte Development LLC. All rights reserved. Tax reform: Ways and Means Republicans fill in the blanks 8

9 Polling question 2 How is your organization preparing for tax reform? Internal analysis (i.e., situational modelling, scenario planning) Consulting outside tax specialists Engaging in tax planning that would be beneficial in a reform scenario (i.e., accelerating expense deductions) Working to influence the outcomes of reform (i.e., engaging with trade associations or industry groups, working with lobbyists) All of the above Don t know/not applicable Copyright 2017 Deloitte Development LLC. All rights reserved. Tax reform: Ways and Means Republicans fill in the blanks 9

10 The long-awaited tax reform bill: House edition Individual taxation Current law House bill 2017 (HR 1) Estimated revenue impact Notes & observations Individual income Standard deduction Personal exemption 7 brackets, top rate of 39.6% 4 brackets, top rate of 39.6%; Income thresholds: 12% 0-$45k 25% >$45k/$90k 35% >$200k/$260k 39.6% > $500k/$1M Plus 6% bubble tax on income of $1M-$1.2M -$961.2B $6350/$12,700 $12,000/$24,000 -$921.4B $4050 exemption for each member of household, phased out for higher AGIs Repealed $1,562.1B Maintaining current top rate will disappoint Republicans who hoped to cut rates for all Income thresholds indexed for chained CPI instead of CPI Bubble tax likely to draw debate Amounts adjusted for inflation based on chained CPI Copyright 2017 Deloitte Development LLC. All rights reserved. Tax reform: Ways and Means Republicans fill in the blanks 10

11 The long-awaited tax reform bill: House edition Individual taxation Current law House bill 2017 (HR 1) Estimated revenue impact Notes & observations Limitation on itemized deductions Pease limitation for AGI > $261k/$313.8k Repealed Not itemized by JCT Child tax credit Family tax credit $1k credit per child under age 17; phase out for AGI over $75k/$110k N/A $1600 credit per child or $300 per non-child dependent $300 credit for each filer -$640B $300 credits sunset 12/31/22 Refundable portion of child credit still limited to $1k; indexed for inflation based on chained CPI $300 credits non-refundable Phase out increased to $115k/$230k Social Security number required for refundable credits Copyright 2017 Deloitte Development LLC. All rights reserved. Tax reform: Ways and Means Republicans fill in the blanks 11

12 The long-awaited tax reform bill: House edition Individual taxation Current law House bill 2017 (HR 1) Estimated revenue impact Notes & observations AMT 26%/28% on alternative minimum taxable income Repealed -$695.5B 50% of AMT credit carryforwards refundable in ; remaining credits refundable from 2022 Estate tax, generationskipping tax, and gift tax 40% after exemption of $5.5M/$11M; $14k annual exclusion per gift donee 40% after exclusion of $10M/$20M through 2022; estate and generation-skipping taxes repealed in 2023; gift tax 35% from $172.2 Stepped-up basis maintained after repeal Exclusions indexed for inflation Copyright 2017 Deloitte Development LLC. All rights reserved. Tax reform: Ways and Means Republicans fill in the blanks 12

13 The long-awaited tax reform bill: House edition Individual taxation Current law House bill 2017 (HR 1) Estimated revenue impact Notes & observations SALT deduction State and local income and property taxes or sales taxes fully deductible Property taxes up to $10k deductible; other SALT generally non-deductible Not itemized by JCT Deduction still allowed for income or sales taxes paid while carrying on business or producing income $10k not inflation indexed Mortgage interest deduction Deduction on first $1M of debt used to secure primary or secondary residence, or first $100k of home equity debt Interest deductible on first $500k of debt for primary residence only Not itemized by JCT Effective for debt incurred after 11/2/17 Exclusion of gain from sale of principal residence Up to $250k/$500k of gain on sale excluded from gross income; must have been principal residence 2 of past 5 years; allowed once every 2 years Home required to have been principal residence 5 of past 8 years; exclusion allowed once every 5 years $22.4B Exclusion reduced dollar for dollar as income exceeds $500k Copyright 2017 Deloitte Development LLC. All rights reserved. Tax reform: Ways and Means Republicans fill in the blanks 13

14 The long-awaited tax reform bill: House edition Individual taxation Some other provisions of note: Consolidation of some education credits and of education savings rules; repeal of some education credits Increase in charitable giving deduction from 50% of income to 60% Repeal of casualty loss deduction Repeal of medical expense deduction Repeal of deduction for personal business expenses Limit on exclusion of employer-provided housing, moving expenses, adoption expenses, and dependentcare programs, and employee achievement awards Copyright 2017 Deloitte Development LLC. All rights reserved. Tax reform: Ways and Means Republicans fill in the blanks 14

ASC 740 effect of tax law changes reminders Timing Income tax effects of changes in tax law or rates are not recognized until enacted Intraperiod allocations Income tax effects of changes in tax law

16 ASC 740 effect of tax law changes reminders Timing Income tax effects of changes in tax law or rates are not recognized until enacted Intraperiod allocations Income tax effects of changes in tax law or rates are allocated to continuing operations Impact of effects of changes in tax law or rates on current year taxes is included in AETR after the effective date Interim Impact of effects of changes in law or rates on deferred tax assets and/or liabilities is recognized as discrete item in period change enacted Impact of effects of changes in tax law or rates on deferred tax assets and/or liabilities arising in the current year subsequent to enactment date is included in AETR Copyright 2017 Deloitte Development LLC. All rights reserved. Tax reform: Ways and Means Republicans fill in the blanks 16

ASC 740 impact and considerations Additional financial statement considerations Potential impact to measurement of deferred taxes: Corporate tax rate reduction Investments in foreign subsidiaries

17 ASC 740 impact and considerations Additional financial statement considerations Potential impact to measurement of deferred taxes: Corporate tax rate reduction Investments in foreign subsidiaries Several provisions may impact the need to accrue US taxes related to investments in foreign entities Deferred foreign income on transition Deduction for foreign source dividends Foreign tax credits Subpart F Potential impact to DTA realizability Potential recurring effective tax rate (ETR) impact Foreign high returns Interest expense limitations Removal of other business expenses Elimination of credits Rate reconciliation Excise tax Copyright 2017 Deloitte Development LLC. All rights reserved. Tax reform: Ways and Means Republicans fill in the blanks 17

18 Financial statement disclosure considerations SEC disclosures SEC Reg. S-K ( Risk Factors ) requires disclosures of significant risks that could impact company in future SEC Reg. S-K ( MD&A ) requires disclosures of trends or uncertainties reasonably expected to have a material favorable/unfavorable impact Enactment after balance sheet date but before financial statement issuance Non-recognized subsequent event Disclose impact to keep financial statements from being misleading Companies must estimate impact of new law to determine disclosures Copyright 2017 Deloitte Development LLC. All rights reserved. Tax reform: Ways and Means Republicans fill in the blanks 18

20 US tax reform scope of US international taxation Provision Current Law 2014 Camp Bill Tax Cuts and Jobs Act US Co s US sales/service income Taxable Taxable Taxable US Co s foreign sales/services income Taxable Generally 60% Taxable Taxable US Co s Foreign branch s income Taxable Taxable Taxable Payment to non-us taxpayer for cost of goods sold (COGS) Deductible Deductible International Financial Reporting Group subject to 20% excise tax if related payee, unless ECI Dividends received from foreign corporations Taxable 95% DRD 1 100% DRD Foreign sub s foreign base company sales/services Taxable 2 Taxable at 50% of general tax rate 2 Taxable Foreign sub s foreign personal holding company income Taxable 2 Taxable 2 Taxable Foreign sub s other foreign income Deferral 3 Generally 60% taxable (to extent exceeds 10% of basis in tangible assets) 2 Foreign High Return Amount taxable at 10% rate (less credit for 80% of foreign income taxes) 1 Proposed 95% Participation Exemption for 10%-owned Subsidiaries 2 Deemed Inclusion to US Co. 3 Subject to US Tax upon Future Distribution to US Co Copyright 2017 Deloitte Development LLC. All rights reserved. Tax reform: Ways and Means Republicans fill in the blanks 20

21 International tax reform scope of US international taxation (cont d) Tax Cut and Jobs Act US income US Co. Limitations on interest deductions and excise tax applied to related party payments Dividends Dividends Loss Recapture on incorporation Other foreign markets Foreign Co. Taxed by US at 20 percent Income NOT subject to US tax 50% of foreign high return amount include in US Co income Subpart F income High-taxed income, active financing income, active commodities income Other foreign income ( net CFC tested income ) Copyright 2017 Deloitte Development LLC. All rights reserved. Tax reform: Ways and Means Republicans fill in the blanks 21

22 Key provision summary Bill Provision Description IRC Section Effective Date Section 4001 Section 4002 Section % Corporate DRD for Foreign Dividends Repeal Section 956 for domestic corporations 10-yr Revenue Increase ($ billions) Section 245A Distributions made after December 31, 2017 <205.1> Section 956 Transition Tax Section 965 Section 4101 Repeal Section 902/ Modification Section 960 Section 4102 Section 4301 Sections 4302 and 3301 Section 4303 Total Revenue For All Int l Provisions (excludes Bill Section 3301) Modification to Sourcing Rules for Inventory US shareholder inclusion of 50% of Foreign High Return Amount and Credit for 80% of Allocable Foreign Taxes 110% and 30% Interest Limitations Excise Tax On Specified Amounts/Election Out Via ECI Taxation Taxable years of foreign corporations beginning after December 31, 2017 Subpart F of Foreign Corporation Increased for Last Taxable Year Beginning Before January 1, 2018 Sections 902/960 Taxable years beginning after December 31, 2017 <2.0> Included in Section 4004 Section 863(b) Taxable years beginning after December 31, Sections 951A/960(d) Section 163(n) and (j) Sections 4491/882(g) Taxable years of foreign corporations beginning after December 31, 2017 and taxable years of U.S. Shareholders in which or with which such taxable year of foreign corporations end. Taxable years beginning after December 31, Amounts paid or accrued after December 31, Copyright 2017 Deloitte Development LLC. All rights reserved. Tax reform: Ways and Means Republicans fill in the blanks 22

24 Section 965 In general A deferred foreign income corporation (DFIC) will have additional subpart F income, for its last year that begins before 2018, of the greater of: accumulated post-1986 deferred foreign income determined as of November 2, 2017 or accumulated post-1986 deferred foreign income determined as of December 31, 2017 The DFIC s US shareholder s resulting 951(a) inclusion will be reduced by the part of the US shareholder s aggregate foreign E&P deficit allocated to the DFIC the shareholder s aggregate foreign E&P deficit is the sum of the shareholder s pro rata shares of the deficits in post-1986 earnings and profits ( specified E&P deficit ) of its E&P deficit foreign corporations (EDFCs) Copyright 2017 Deloitte Development LLC. All rights reserved. Tax reform: Ways and Means Republicans fill in the blanks 24

25 Section 965 In general (cont d) DFICs and EDFCs are specified foreign corporations (SFCs) that, with respect to a US shareholder, have (respectively): positive accumulated post-1986 deferred foreign income as of the relevant date or a deficit in post-1986 E&P as of the relevant date (a specified E&P deficit ) But to be an EDFC of a US shareholder, the US shareholder must have been a US shareholder with respect to it as of Nov 2, 2017 An SFC includes: any CFC; and any foreign corporation (other than a PFIC) with a domestic corporation as a US shareholder, determined without regard to 958(b)(4) If the SFC is not a CFC, it will be treated as a CFC for 965 purposes. Copyright 2017 Deloitte Development LLC. All rights reserved. Tax reform: Ways and Means Republicans fill in the blanks 25

26 Calculation of accumulated post-1986 deferred foreign income Post-1986 E&P that is neither ECI nor PTI Post-1986 E&P means: Earnings and profits of a foreign corporation (computed in accordance with sections 964(a) and 986), accumulated in taxable years beginning after December 31, 1986 (even if arising from period during which the US shareholder did not own stock in the foreign corporation), and determined: as of either November 2, 2017 or December 31, 2017, whichever is applicable; without diminution by reason of dividends distributed during the taxable year ending with or including such date; and increased by the amount of any qualified deficit arising before January 1, 2018 which is treated as a qualified deficit for purposes of the foreign corporation s first taxable year beginning after December 31, Copyright 2017 Deloitte Development LLC. All rights reserved. Tax reform: Ways and Means Republicans fill in the blanks 26

27 Polling question 3 How impactful would the international provisions of the bill be on your business? Very impactful Somewhat impactful Not impactful Don t know/not applicable Copyright 2017 Deloitte Development LLC. All rights reserved. Tax reform: Ways and Means Republicans fill in the blanks 27

29 New category of undeferred income: High return category In General: Each person who is a US Shareholder of any CFC for any taxable year shall include in gross income for such taxable year 50% of such shareholder s foreign high return amount" for such taxable year. Foreign High Return Amount: Net CFC Tested Income over Applicable Percentage of aggregate of shareholder s pro rata share of Qualified Business Asset Investment for each CFC less interest expense taken into account in computing net CFC tested income. High return category appears to require both separate CFC calculations and global CFC calculations Ultimate Impact: To the extent foreign income taxes on tested income are imposed at an average global effective rate of 12.5% or greater, and assuming timing rules for US and foreign tax purposes are the same, no additional US income tax need result Copyright 2017 Deloitte Development LLC. All rights reserved. Tax reform: Ways and Means Republicans fill in the blanks 29

31 New Limitations on interest expense: Section 163(n) In addition to a revised section 163(j) limitation, the bill provides an additional limitation for certain multinational groups [section 163(n)]. The more restrictive limitation applies to the taxpayer each year. Section 163(n): for any domestic corporation which is a member of any international reporting group, the interest expense deduction is limited to: Allowable percentage of 110 percent of corporation s net interest expense plus corporation s interest income Also applies to: Partnerships that are members of such group at the entity level. Foreign corporations engaged in a U.S. trade or business Allowable Percentage Corporation s allocable share of financial reporting group s total reported net interest expense over Corporation s reported net interest expense for such reporting year Group s reported net interest generally, net interest expense reported on consolidated financial statements Corporation s reported net interest generally, net interest expense reported on its books and records Copyright 2017 Deloitte Development LLC. All rights reserved. Tax reform: Ways and Means Republicans fill in the blanks 31

32 New limitations on interest expense: Section 163(n) Allocable Share Group s reported net interest * (EBITDA of Corporation/EBITDA of Group) Note: EBITDA is computed without regard to any distribution from a corporation that is a member of the international financial reporting group. International Financial Reporting Group Any group of entities which includes either: i. one foreign corporation engaged in a U.S. trade or business or ii. one domestic and one foreign corporation; That prepares consolidated financial statement; and Has average gross receipts in excess of $100 million (over 3-year period). Any interest amounts disallowed under this provision would be carried forward to the succeeding five taxable years. Key Observation: This provision applies to U.S. parented and foreign parented multinational groups equally Copyright 2017 Deloitte Development LLC. All rights reserved. Tax reform: Ways and Means Republicans fill in the blanks 32

33 New Section 163(j) Every business, regardless of its form, would be subject to a limitation on its deductions for business interest based on a fixed percentage of its adjusted taxable income Business interest expense: interest paid or accrued on debt properly allocable to a trade or business. The amount allowed as a deduction for business interest cannot exceed the sum of: The business interest income of such taxpayer for the taxable year, plus 30% of the adjusted taxable income of such taxpayer for such taxable year. Business interest income: interest income properly allocable to a trade or business Certain exceptions apply Businesses with average gross receipts of $25M or less Regulated public utilities and real property trades or businesses Copyright 2017 Deloitte Development LLC. All rights reserved. Tax reform: Ways and Means Republicans fill in the blanks 33

34 New section 163(j) Adjusted taxable income is computed without regard to: Any item of income, gain, deduction, or loss not properly allocable to a trade or business; Any business interest or business interest income; Amount of any NOL deductions under section 172; and Depreciation, amortization, or depletion deductions. Any interest amounts disallowed under this provision would be carried forward to the succeeding five taxable years and would be an attribute of the business (as opposed to its owners). Key Provisions: Applies to all business interest deductions vs. disqualified (related party) interest only under current law. Determined at the tax filer level for example, at the partnership level instead of the partner level. Copyright 2017 Deloitte Development LLC. All rights reserved. Tax reform: Ways and Means Republicans fill in the blanks 34

35 Polling question 4 Which elements of the bill unveiled last week is most important to your organization? Corporate tax rate reduction Full expensing of capital investment Deemed repatriation/transition to territoriality Other Don t know/not applicable Copyright 2017 Deloitte Development LLC. All rights reserved. Tax reform: Ways and Means Republicans fill in the blanks 35

36 Excise tax on related party payments

37 New excise tax on related party payments Imposes a 20% excise tax on payments by domestic corporations (and foreign corporations with a U.S. trade or business) to related foreign corporations. Exception: The payor and payee can elect to treat the payment as ECI, in which case the excise tax should not apply. No deduction is allowed under section 275 for the excise tax paid Applies to any amount with respect to which the payor takes a deduction, includes an amount in cost of goods sold, or includes the amount in the basis of any depreciable or amortizable asset. Exceptions: Interest Any amount paid or incurred for the acquisition of certain securities or commodities Any amount with respect to which tax is already imposed under section 881(a), with a haircut if the amount is reduced below 30%; Any amount paid for services if the amount is the total services cost, with no markup Copyright 2017 Deloitte Development LLC. All rights reserved. Tax reform: Ways and Means Republicans fill in the blanks 37

38 New excise tax on related party payments Calculation of ECI in the Case of the Election: Foreign recipient must include in income the gross amount received as a payment; No deductions are allowed with respect to computing any net ECI and instead the foreign corporation shall be able to take into account the deemed expenses with respect to such amount. Deemed Expenses is the amount of expenses such that the net income ratio of the foreign corporation is equal to the net income ratio of the international financial reporting group multiplied by 104 percent plus the relevant federal short term rate Net income ratio: Net income (without regard to interest and taxes)/revenues determined by reference to the International financial reporting group on the basis of consolidated financials Key Point: This provision applies in both the inbound and outbound context. Copyright 2017 Deloitte Development LLC. All rights reserved. Tax reform: Ways and Means Republicans fill in the blanks 38

40 Additional provisions Section 902 Repealed; Section 960 Retained (with special rules for distributions of PTI) Section 901(m) repealed with respect to Section 960 deemed paid credits IMPACT: Hyping potentially available to offset 960 inclusions Gains from the sale of inventory property is sourced based on the location of production, irrespective of title passage Subpart F Changes: 30 Day Rule Repealed Section 958(b) modified to allow attribution of shares from Foreign Shareholders to Domestic Corporations IMPACT: Will result in all foreign corporations in foreign parented structures with a Domestic Corporation being a CFC. FORI Repealed De Minimis Rule indexed for inflation Section 956 Repealed for Domestic Corporations Copyright 2017 Deloitte Development LLC. All rights reserved. Tax reform: Ways and Means Republicans fill in the blanks 40

42 Join us November 29 at 2 p.m. ET for our next Tax Reform webcast US tax reform: What businesses and individual taxpayers should know Copyright 2017 Deloitte Development LLC. All rights reserved. Tax reform: Ways and Means Republicans fill in the blanks 42

43 Eligible viewers may now download CPE certificates. Click the CPE icon in the dock at the bottom of your screen. CPE Copyright 2017 Deloitte Development LLC. All rights reserved. Tax reform: Ways and Means Republicans fill in the blanks 43

44 Contact information Terri LaRae Partner Deloitte Tax LLP Patrice Mano Partner Deloitte Tax LLP Jon Traub Principal Deloitte Tax LLP Chris Trump Principal Deloitte Tax LLP Connect with me on LinkedIn Copyright 2017 Deloitte Development LLC. All rights reserved. Tax reform: Ways and Means Republicans fill in the blanks 44

45 This presentation contains general information only and Deloitte is not, by means of this presentation, rendering accounting, business, financial, investment, legal, tax, or other professional advice or services. This presentation is not a substitute for such professional advice or services, nor should it be used as a basis for any decision or action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a qualified professional advisor. Deloitte shall not be responsible for any loss sustained by any person who relies on this presentation. Copyright 2017 Deloitte Development LLC. All rights reserved. Tax reform: Ways and Means Republicans fill in the blanks 45

About Deloitte Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee ( DTTL ), its network of member firms, and their related entities.

46 About Deloitte Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private company limited by guarantee ( DTTL ), its network of member firms, and their related entities. DTTL and each of its member firms are legally separate and independent entities. DTTL (also referred to as Deloitte Global ) does not provide services to clients. Please see for a detailed description of DTTL and its member firms. Please see for a detailed description of the legal structure of Deloitte LLP and its subsidiaries. Certain services may not be available to attest clients under the rules and regulations of public accounting. Copyright 2017 Deloitte Development LLC. All rights reserved. 36 USC

Tax Reform Policy, Process and Prospects: What s next?

Tax Reform Policy, Process and Prospects: What s next? Jeff Kummer Deloitte Tax LLP December 18, 2017 The long-awaited tax reform bill: Initial reactions What was expected Rate reductions for individuals