TAX PLAN

reduce taxes for businesses large and small. The plan would substantially increase the standard deduction, which reduces a person’s taxable income, and would eliminate some common tax deductions such as those used to offset medical costs or state and local taxes.

Until more details are known, it is difficult to know exactly how some taxpayers will fare. The White House will need to work with Congress on the final plan, which could look very different if lawmakers push back against some of the proposed changes.

Here is a look at some of the major changes that could affect you:

Larger standard deduction would mean lower tax bills

now commonly deducted, such as state and local property taxes and medical expenses. It’s not clear if lawmakers will be willing to eliminate some of the deductions that may be popular in their home states.

Fewer tax brackets

The proposal would simplify the system to go from seven tax brackets to three brackets of 10 percent, 25 percent and 35 percent. Currently, tax brackets range from 10 percent to 39.6 percent. High-earning taxpayers could see an immediate tax break on their income taxes, while low-income families may not feel much of a change, said Alan Cole, an economist with the Tax Foundation, a conservative research group. However, the proposal did not disclose the income ranges for the new tax brackets.

Bigger tax breaks for parents

The alternative minimum tax is intended to prevent high earners from being able to avoid all income taxes but also can affect middleincome taxpayers.

The estate tax, which is also known as the death tax, affects people who inherit wealth or businesses worth more than about $5.5 million. Some people struggle to pay tax bills owed on money and assets they inherit from family members, Cohn said.

Lower tax rate for business owners