The company blamed its Q2 content slate and price increases for the subscriber miss.Technologyread more
Corporate earnings forecasts for the second quarter were lowered so much that companies are easily beating them.Market Insiderread more
The central bank is not normally in the business of easing into an economy that is showing few signs of a recession, generally holding fire until more pronounced signs of a...The Fedread more
IBM's year-over-year revenue has now declined for four quarters in a row. Impact from Red Hat is not yet factored into the company's guidance.Technologyread more
Netflix can sustain its lofty valuation only if global subscriber growth can support increasing content spending and debt. And growth is entirely dependent on Netflix's...Technologyread more
Prosecutors in Masschusetts have dropped a criminal case against actor Kevin Spacey, who had been accused of groping an 18-year-old man.Entertainmentread more
Kushner and campaign chief Brad Parscale regularly hold strategy sessions on how to improve messaging about Trump's accomplishments to small-dollar donors, according to people...2020 Electionsread more
Yes, Netflix is losing "The Office" and "Friends" in the next two years. But that may not be a bad thing for the streaming company.Entertainmentread more
Challenging conditions in the U.S. housing market, along with tighter currency controls by the Chinese government, cause a stunning drop in foreign demand for American homes.Real Estateread more
Trade negotiations between the world's two largest economies are stuck at a standstill, the Wall Street Journal reported Wednesday.Marketsread more
House Speaker Nancy Pelosi says she wants her chamber to vote on a debt ceiling and budget deal by July 26.Politicsread more
The Republican tax reform plan being unveiled Wednesday shows that while two popular deductions would remain intact, they'd become useless to the majority of taxpayers who now take advantage of them.
GOP lawmakers want to retain the tax breaks for mortgage interest and charitable contributions. Yet given that the plan is to nearly double the standard deduction, "many current itemizers would choose that instead, so a lot less people would use those deductions," said Joseph Rosenberg, a senior research associate at the Urban-Brookings Tax Policy Center.
The plan is facing stiff opposition from elements of the real estate industry, most notably the National Association of Home Builders (NAHB). On Saturday, The Wall Street Journal reported that the association made a decision to formally oppose the GOP plan after top Republicans told them they wouldn't replace the deductions, or give credit for property taxes.
Currently, taxpayers choose between the standard deduction or itemized deductions and use whichever amount is greater to reduce their tax bill. For 2017, the standard deduction is $6,350 for individual taxpayers, $9,350 for heads of households and $12,700 for joint filers.
In other words, if those amounts nearly double, a married couple would need deductions to exceed $24,000 to make itemizing worthwhile.
The Tax Policy Center estimates that of the 45 million tax filers who itemize, 38 million, or 84 percent, would opt for the $24,000 standard deduction because it would exceed the combined value of other deductions available to them.
The deductions for mortgage interest and charitable contributions have been a political third rail in the past, due largely to the idea that they spur homeownership and charitable giving. Yet of all taxpayers, only about 20 percent take advantage of each deduction for mortgage interest and charitable contributions, according to the Tax Policy Center.
Of the roughly one-third of taxpayers who do itemize, roughly three-quarters use each of the deductions. The biggest benefits tend to go to higher-income taxpayers.
For instance, the 7.18 million filers with incomes of $200,000 or more will reduce their taxable income by $29.78 billion this year from using the mortgage interest deduction, according to tax expenditure estimates from the congressional Joint Committee on Taxation.
In comparison, the 14.6 million filers with incomes of $100,000 to $200,000 will save less: $24.85 billion. Filers with incomes below that have even smaller tax savings.
Likewise, the 8.2 million filers with incomes above $200,000 will save a collective $40.7 billion this year by using the charitable deduction. The 15.2 million filers with incomes of $100,000 to $200,000 will reduce their tax bill by $11.9 billion.
Nonprofit groups and the homebuilding industry are concerned about what reduced utilization of those deductions would mean for homeownership and charitable giving.
"It marginalizes the mortgage interest deduction," said J.P. Delmore, assistant vice president of government affairs at the NAHB. "We'd see the effect where a small number of homeowners would benefit, and that's not the direction anyone is looking to go with tax reform."
The National Association of Realtors also has expressed concern that home prices would suffer if the mortgage interest deduction were to become useless to most homeowners.
The group released a study in May showing that if elements similar to a 2016 version of the GOP's tax plan went into effect, home values would fall by more than 10.2 percent on average in the near term.
The study also found that homeowners with income of $50,000 to $200,000 would face an average tax increase of $815 while nonhomeowners in that range would get an average tax cut of $516.
"This is an emerging issue [lawmakers] don't intend to create," Delmore said. "But we hope there's an opportunity to find a solution so that homeowners have a meaningful tax incentive that doesn't involve being marginalized and benefiting only the wealthy."