Breaking down the House’s tax overhaul

The House approved a sweeping overhaul of the tax code crafted by the Republican majority Thursday.

The Senate is working on a different plan that could come up for a vote after Thanksgiving, and both measures must be reconciled before they could be sent to President Trump.

Here are highlights:

For individuals

❚ The current seven brackets would be compressed to four: 12%, 25%, 35% and 39.6%.

❚ The bottom rate would increase from 10%, but sponsors say people in 10% bracket this year would owe no tax next year.

❚ The top rate would apply to couples whose income exceeds $ 1 million, compared with $ 470,700 now.

❚ The standard deduction for a married couple would increase from $ 12,700 this year to $ 24,400 next year.

❚ Personal exemptions, this year worth $ 4,050 each for taxpayers, spouses and children, would be eliminated.

❚ The child tax credit would be increased from $ 1,000 to $ 1,600 and be available to couples earning up to $ 230,000, up from $ 110,000 now.

❚ A new credit of $ 300 each would be created for taxpayers, spouses and adult dependents, though it would expire after five years.

❚ The plan would eliminate the Alternative Minimum Tax and, by 2024, the estate tax.

❚ Deductions for state income taxes, medical expenses, mortgage interest on second homes, and other expenses such as disaster losses, tax- preparation fees and teachers’ costs for classroom supplies would be eliminated.

❚ Taxes on alimony would be charged on the person paying it, rather than the person receiving it.

❚ The property tax deduction would be capped at $ 10,000.

❚ The limit on the mortgage interest deduction for those who itemize would be lowered from $ 1 million now to $ 500,000 for new loans.

❚ Charitable contributions could still be deducted by those who itemize.

Business changes

❚ The top corporate rate would drop from 35% to 20% next year.

❚ The United States would move to a system that only taxes the domestic income of companies based here, rather than their global income.

❚ Those who report business earnings on personal rather than corporate returns, such as sole proprietors or people in partnerships, would get a new 25% top rate for some of their income.

❚ For the next six years, business expenditures for new equipment could be written off all at once, rather than be amortized over a number of years.

❚ The business deduction for interest on purchases would be sharply curtailed.

❚ The deduction for lobbying local governments would be repealed.

❚ Companies could continue to deduct business- related state and local taxes.