Happy New Year. And welcome to 2019, a year when several important tax policy issues are likely to hit the news. Watch for these: Whether Congress will make changes to the 2017 Tax Cuts and Jobs Act (TCJA), the potentially chaotic 2018 tax filing season, how states respond to last year’s Wayfair decision on online sales taxes and to their TCJA tax windfall, the fate of President Trump’s tariffs, the future of Europe’s digital taxes, and the tax policy ideas likely to surface in the battle over the Democratic nomination for president.
Here is a quick rundown on each:
Will Congress revise the TCJA?
There is no chance a divided Congress will overhaul the TCJA this year, but lawmakers may fiddle around the edges. Congress has dozens of technical corrections to the law on its plate, as well as other changes that seem widely popular. One would fix a provision that (seemingly inadvertently) requires restaurants and retailers to depreciate the cost of certain equipment over an even longer period than under prior law. This found its way into a bill that made depreciation more generous for most other assets. Democrats who now control the House also may try to adjust the $10,000 cap on the state and local tax deduction.