The “Kiddie-Tax”, on passive income of minors, has been largely modified.
While in the recent past these incomes were taxed by applying the parental tax bracket, starting from 2018, this will no longer be the case.
In fact, income over $ 2,100 will be taxed at the rates set forth for trusts and inheritance taxes.
Table no. 5 – kiddie tax
|Up to $ 2,550||10%|
|$ 2,551 to $ 9,150||24%|
|$ 9,151 to $ 12,500||35%|
Corporate Taxation in the United States
It is the part that has undergone the most changes, starting with the reduction in the taxation of business profits which go from 35% to 21%.
Before the reform, the federal corporate income tax was configured as a progressive tax by income brackets.
Four brackets ranging from 15% to 35% made the United States the country, among the economically developed ones, with the highest taxation.
Starting from 1 January 2018, however, taxation passes to a single flat rate, flat tax, of 21%, below the average of European countries (22%) and OECD countries (24%).
This rate, combined with those of state and local taxes, reaches 25.75%, keeping the United States below the average for European countries of 26.9%.
There is no doubt that such a drastic reduction benefits both companies and start-ups who, unlike changes on individuals, will be able to enjoy such reductions, without time limits.
Taxation in the United States: Bonus Depriciation
The abatement of the corporate tax is certainly the change that has had the greatest media coverage, even among non-professionals.
However, it is not the only significant tax measure for companies. Equally important is the possibility of “paying” in full, in the year of purchase, the investments of plants and equipment, qualified property.
These are investments purchased and put into service by the company between 27 September 2017 and 31 December 2022.
This is an accelerated depreciation, bonus depreciation, already provided for by the US tax code in section § 168, which passes from the previous 50% to 100%. Starting from 2023, the bonus will be progressively reduced by 20% per year.
In other words, for goods purchased and put into service in 2023, the deduction will be 80%, 60% for investments made in 2024 and so on.
Assets with a longer “useful life”, Longer Production Period (LPP) and Noncommercial Aircraft (NCA), will benefit from an additional year of 100% deduction, until December 31, 2023. They will then also decrease by 20% the year until 2027.
Table no. 7 – bonus depreciation
|Year of Commissioning||Instrumental Goods||Assets BVG – NCA|
|28/09 / 2017-31 / 12/2022||100%||100%|
|2028 and beyond||0||0|
The reform allows, upon election, to maintain 50% of the depreciation bonus instead of the current 100%.
Closely related to the depreciation bonus is the amendment from section 179 of the I.R.C.
The rule provides for the possibility for the taxpayer to deduct, through an election, the purchase cost of the capital goods starting from the year they come into operation.
The pre-reform section § 179 (b) (1) allowed for deductibility not exceeding an amount of $ 500,000.
The next paragraph, of section § 179 (b) (2), specified that the deduction was phased out, phase-out, dollar for dollar, based on the inclusive level of the investment, when it exceeded the annual limit of $ 2,000,000 .
The reform, for assets put into service from January 1, 2018, doubled the deductibility, now bringing it to $ 1 million and increased the phase-out to $ 2,500,000 million.
The aim is to help small businesses and start-ups by giving them the ability to deduct these costs, instead of amortizing them.
The American Revenue Agency requires that to take advantage of this deduction, the assets are:
1-Qualified property, i.e. tangible, depreciable assets owned by the company that are interconnected to the company production management system;
2-They come into operation in the tax year in which they are purchased.
The amendment has expanded the definition of qualified property, pursuant to section § 179, by inserting in the list of capital goods: alarm and fire prevention systems, air conditioning and conditioning systems, industrial machinery, computer software and also the costs of remaking the roof. of the roofs of the company.