Trump's Proposed Tax Plan...will it crush our dreams?

[Meghan McCallum]

Hey guys,

I'm not sure how many of you have taken the time or energy to read Trump's proposed tax plan. But, we should all pause and read it with careful consideration. @Brandon Hall  has already done a great summary of the plan. https://www.biggerpockets.com/renewsblog/tax-plan-... I will seriously suggest that those who are looking to captalize on captial gains tax advantages on the sale of their primary home do so before Jan. 1 if that was on your radar. @Linda Weygant and @Amanda Han, I'd love to get you to weigh in your opinions on the proposed tax bill. This could be a doozy folks!!!

I also want to encourage everyone to read Brandon's blog. His info he shared about better tax strategies on the BRRRR process should NOT be missed. https://www.biggerpockets.com/renewsblog/author/br...

[Linda Weygant]

While I do read up on proposed changes and absorb what is likely to affect me and my clients, I honestly can't get myself worked up over these proposals, even though on the surface they seem pretty bad.  

This particular proposal still has to get through committee before heading back to house and senate and the odds that it will look anything close to what it looks like now is, in my opinion, pretty slim.

There are a few reasons why I think that this is unlikely to pass as written:

1.  The proposal has been completely written by one party with no input from the other.  There has been no attempt to reach across the aisle on this.  However, the ways and means committee this has to go through, while definitely not balanced along partisan lines, does have several moderates on both sides.  I think there will be quite a bit of meeting in the middle on several of the most heinous proposals.  When committees meet, usually cooler and more moderate heads prevail when the cameras are away from the floor.

2.  Voters sent a pretty strong message last Tuesday that they are leaning away from Trump and Republicans.  Many a savvy politician will look at that and realize that some of the hard line stances they have been taking are no longer going to fly politically.

3.  The longer the public and press has to review the proposals, the more there is a tidal wave of criticism of it.  Along with item #2, I believe that smart politicians will mark the proposal up so that it is a lot more palatable.

4.  This Congress is probably going to go down in history as being unable to pass anything, regardless of them labeling it as "must pass".  It's been almost a year and there has been no significant legislation coming out.  While I think this may make them feel even more pressured to pass this, I think cooler heads will prevail.

I may be a bit too optimistic on this, but honestly, only time will tell.  My best advice is to adopt a Wait and See attitude.  As Brandon mentioned in his blog post, other than trying to hurry up and dump a primary residence you've had between 2 and 5 years by the end of December, there is very little action anybody can take on a lot of this.  

Once we know the final law that is passed, we'll be able to start taking action and recommending new structures where applicable.

TL;dr - don't panic.