On November 2, 2017, the House Ways and Means Committee unveiled the Tax Cuts and Jobs Act (the “Bill”). The Bill could dramatically alter the U.S. approach to domestic and international taxation. Although the possibility of tax reform has been the subject of much discussion since the election of President Donald Trump, many past proposals have been light on details. The Bill represents the first potential legislative language. House Ways & Means Committee Chairman Kevin Brady (R-Texas) released an amendment to the Bill on November 6, 2017 (the “Amendment”). The committee is marking up the Bill this week with a vote expected Thursday. Republican leaders in the House hope for a full vote the week of November 13th.

The Bill proposes dramatic changes to existing U.S. tax rules. For individuals, the Bill reduces the amount of home mortgage indebtedness on which interest payments are deductible and repeals the itemized deduction for state and local income taxes. For businesses, the Bill permanently reduces the corporate income tax rate to 20% and allows taxpayers to fully and immediately expense 100% of the cost of certain qualified property. For multinational groups, the Bill moves the United States toward a territorial system coupled with anti-base erosion measures intended to shore-up the U.S. tax base. The Bill also proposes a one-time transition tax on currently deferred foreign earnings.