Tax Reform Act of 1986

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Tax Reform Act of 1986

A 1986 law involving a major overhaul of the US tax code.

Tax Reform Act of 1986

Legislation in the United States dictating the reduced marginal tax rates, the number of tax brackets, and the deductions and tax shelters that individuals can have. It also increased corporate tax rates and equalized capital gains tax and income tax rates. It was designed to be revenue neutral; this was accomplished by reducing deductions to offset the lower tax rates. It also changed incentives; for example, it increased the home mortgage interest deduction to encourage home ownership. While proponents hail this Act as a major tax cut, critics maintain that it did little to accomplish its main goal of simplifying the tax code. See also: Economic Recovery Tax Act of 1981.

Tax Reform Act of 1986

Tax legislation that significantly reduced marginal income tax rates for individuals and corporations as well as curtailed many deductions and eliminated numerous preference items. The Act was designed to be revenue-neutral and, in general, it benefited high-income and low-income individuals and corporations that do not spend large amounts of money on long-lived equipment. Although an original goal had been to simplify the tax system, no simplification was evident in the final legislation.
References in periodicals archive ?
The company also said that it will use the financial flexibility it gains from the tax reform bill, which will lower its effective tax rate to about 27%, to make future investments to support the growth of its business, particularly following the acquisition and integration of Aetna.
0% , as the tax reform bill (which includes increases in VAT and corporate income tax) is likely to be contractionary.
The move follows the signing of the tax reform bill.
The tax reform bill has faced stiff opposition from Democrats, who have suggested that it amounts to little more than a tax cut for wealthy Americans that will balloon the deficit.
Last week, "we came together in a House-Senate Conference Committee -- which I had the honor of leading -- to deliver one unified, transformational tax reform bill for the American people," said House Ways and Means Committee Chairman Kevin Brady, R-Texas.
As the Trump administration and Congress negotiate over the provisions of a major tax reform bill, some accounting and tax issues are up for grabs.
As the House begins debate on its tax reform bill, members will be prohibited from offering any amendments--including changes to the credit union tax exemption.
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Some on Capitol Hill believe the BAT will Likely fall out of a final tax reform bill.
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