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32-2326: In the United States of America, the Tax Reform Act may refer to: Tax Reform Act of 1969 Tax Reform Act of 1976 Tax Reform Act of 1986 v t e United States federal taxation legislation Internal Revenue 1861 1862 1864 1894 1909 1913 1914 1916 1917 1918 1921 1924 1926 1928 1932 1934 1935 1936 1937 1939 Code 1940 1940 (2nd) 1941 1942 1943 1943 1944 1945 1948 1950 1950 1951 1954 1954 Code 1962 1964 1966 1968 1969 1971 1975 1976 1977 1978 1980 1981 1982 Gas Tax 1983 (PL 98-67) 1983 (PL 98-76) 1984 COBRA 1986 1986 Code 1987 1988 1990 1993 1996 1997 1998 2001 (EGTRRA) 2002 2003 2004 2005 2006 2006 2007 2007 (Mortgage) 2008 Crisis 2009 2010 (ACA) 2010 (PL 111–240) 2010 (PL 111-312) 2011 2012 (ATRA) 2012 2014 2015 (BBA) 2016 2017 (TCJA) 2018 (BBA) 2018 (Appropriations) 2019 (SECURE) 2020 (Families First) 2020 (CARES) 2020 (Appropriations) 2021 (Defense Authorization) 2021 (American Rescue Plan) 2021 (Infrastructure, PL 117–58) Tariffs 1789: Hamilton I 1790: Hamilton II 1791: Hamilton III 1792: Hamilton IV 1816: Dallas 1824: Sectional 1828: "Abominations" 1832 1833: Compromise 1842: Black 1846: Walker 1857 1861: Morrill 1872 1875 1883: Mongrel 1890: McKinley 1894: Wilson–Gorman 1897: Dingley 1909: Payne–Aldrich 1913: Underwood 1921: Emergency 1922: Fordney–McCumber 1930: Smoot–Hawley 1934: Reciprocal 1948: GATT 1962 1974/75 1979 1984 1988 1988: Canada FT 1993: NAFTA 1994: WTO 2018/2019: Trump Topics referred to by

64-448: A "catch-up" provision for older workers. EGTRRA allows, for the first time, for participants in non-qualified 401(a) money purchase, 403(b) tax-sheltered annuity, and governmental 457(b) deferred compensation plans (but not tax-exempt 457 plans) to "roll over" their money and consolidate accounts, whether to a different non-qualified plan, to a qualified plan such as a 401(k), or to an IRA. Prior rules only allowed plan moneys to leave

96-440: A return. If an eligible person did not receive a rebate check by December 2001, then they could apply for the rebate in their 2001 tax return. EGTRRA generally reduced the rates of individual income taxes : The EGTRRA in many cases lowered the taxes on married couples filing jointly by increasing the standard deduction for joint filers to between 164% and 200% of the deduction for single filers. Additionally, EGTRRA increased

128-450: Is different from Wikidata All article disambiguation pages All disambiguation pages Tax Reform Act of 1969 It also established individual and corporate minimum taxes and a new tax schedule for single taxpayers. The Act slightly increased standard deductions and personal exemptions and created more stringent requirements on nonprofit organizations, which many argue drove them to professionalization . One requirement in

160-473: Is often referred to as one of the two " Bush tax cuts ". Bush had made tax cuts the centerpiece of his campaign in the 2000 presidential election , and he introduced a major tax cut proposal shortly after taking office. Though a handful of Democrats supported the bill, most support came from congressional Republicans . The bill was passed by Congress in May 2001, and signed into law by Bush on June 7, 2001. Due to

192-465: Is preserved for the employee, the funds may be commingled for investment purposes. It is an improvement upon the unpopular qualified voluntary employee contribution (QVEC) provision developed in the early 1980s. The so-called Roth 401(k)/403(b) is a new tax-qualified employer-sponsored retirement plan to become effective in 2006, and would offer tax treatment in a retirement plan similar to that offered to account holders of Roth IRAs. For plan sponsors,

224-580: The Jobs and Growth Tax Relief Reconciliation Act of 2003 ("JGTRRA"), which cut taxes by another $ 350 billion over 10 years. That law also lowered the capital gains tax and taxes on dividends . Collectively, the Bush tax cuts reduced federal individual tax rates to their lowest level since World War II , and government revenue as a share of gross domestic product declined from 20.9% in 2000 to 16.3% in 2004. A 2012 Congressional Budget Office analysis found that

256-542: The estate tax . In 2003, Bush signed another bill, the Jobs and Growth Tax Relief Reconciliation Act of 2003 , which contained further tax cuts and accelerated certain tax changes that were part of EGTRRA. Due to the rules concerning reconciliation, EGTRRA contained a sunset provision that would end the tax cuts in 2011, but most of the cuts were made permanent with the passage of the American Taxpayer Relief Act of 2012 . Bush's promise to cut taxes

288-633: The Bush era rates for taxpayers making less than $ 400,000 per year ($ 450,000 for married couples) were ultimately made permanent by the American Taxpayer Relief Act of 2012 . The sunset provision allowed EGTRRA to sidestep the Byrd Rule , a Senate rule that amends the Congressional Budget Act to allow Senators to block a piece of legislation if it purports a significant increase in the federal deficit beyond ten years. The sunset allowed

320-459: The IRA to a new employer's 403(b) or the entire transfer could be directly from the old employer's 403(b) to the new employer's 401(k). That the new Tax Act allows employers to do so does not mean that any employer is forced to accept new money from the outside. The so-called "catch-up" provision allows employees over the age of 50 to make additional contributions to their retirement plans over and above

352-469: The Joint Committee on Internal Revenue Taxation says: 20. Alternative capital gains tax rate.—The Act gradually eliminates the alternative tax on long-term capital gains for individual taxpayers to the extent they have capital gains of more than $ 50,000. Long-term capital gains up to $ 50,000 received by individuals continue to qualify for the 25-percent alternative capital gains tax rate. However,

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384-813: The bill to stay within the letter of the PAYGO law while removing nearly $ 700 billion from amounts that would have triggered PAYGO sequestration. In addition to the tax cuts implemented by the EGTRRA, it initiated a series of rebates for all taxpayers that filed a tax return for 2000. The rebate was up to a maximum of $ 300 for single filers with no dependents, $ 500 for single parents, and $ 600 for married couples. Anybody who paid less than their maximum rebate amount in net taxes received that amount, meaning some people who did not pay any taxes did not receive rebates. The rebates were automatic for anybody who filed their 2000 tax return on time, or filed for an extension and quickly sent

416-402: The first time an Alternative Minimum Tax , set at 10%. The change was explained as follows: The prior treatment imposed no limit on the amount of income which an individual or corporation could exclude from tax as the result of various tax preferences. As a result, there were large variations in the tax burdens placed on individuals or corporations with similar economic incomes, depending upon

448-593: The government again run deficits. The Economic Growth and Tax Relief Reconciliation Act won the support of congressional Republicans and a minority of congressional Democrats, passing in the House on May 16. The bill was then passed in the Senate on May 26. President Bush signed it into law in June of 2001. The narrow Republican majority in the Senate necessitated the use of the reconciliation , which in turn necessitated that

480-410: The law requires involuntary cash-out distributions of 401(k) accounts into a default IRA. It accelerates the mandatory vesting schedule applied to matching contributions, but increases the portion of employer contributions permitted from profit sharing. Small employers are granted tax incentives to offer retirement plans to their employees, and sole proprietors, partners and S corporation shareholders gain

512-618: The law was that foundations were unable to control a private company. The Office of Tax Analysis of the United States Department of the Treasury summarized the tax changes as follows. The Act provided a government definition of " private foundation " for the first time (albeit indirectly). The law enacted these requirements of private philanthropic foundations. The explanation of the Act prepared by Congress's Staff of

544-416: The maximum tax rate on that part of long-term capital gains above $ 50,000 is increased to 29.5 percent in 1970, 32.5 percent in 1971, and 35 percent (one-half the 70 percent top tax rate applicable to ordinary income) in 1972 and later years. The alternative tax rate on corporate long-term capital gains income is increased to 28 percent in 1970 and 30 percent in 1971 and later years." The Act also included for

576-537: The narrow Republican majority in the United States Senate , EGTRRA was passed using the reconciliation process, which bypasses the Senate filibuster . EGTRRA lowered federal income tax rates, reducing the top tax rate from 39.6 percent to 35 percent and reducing rates for several other tax brackets. The act also reduced capital gain taxes, raised pre-tax contribution limits for defined contribution plans and Individual Retirement Accounts , and reduced

608-475: The normal limits. For workers who are already retired, the law raises the age for minimum required distributions (MRDs), directing the Treasury to revise its life expectancy tables and simplify MRD rules. EGTRRA created two new retirement savings vehicles. The Deemed IRA or Sidecar IRA is a Roth IRA attached as a separate account to an employer-sponsored retirement plan; while the differing tax treatment

640-479: The per-child tax credit and the amount eligible for credit spent on dependent child care, phased out limits on itemized deductions and personal exemptions for higher income taxpayers, and increased the exemption for the Alternative Minimum Tax, and created a new depreciation deduction for qualified property owners. The capital gains tax on qualified gains of property or stock held for five years

672-428: The plan and maintain its tax deferred status only if the money went directly to an IRA or to an IRA and back into a "like kind" defined contribution retirement account. For example, 403(b) moneys leaving the old employer could only go to the new employer's defined contribution plan if it were also a 403(b). Now the old 401(k) plan money could be transferred directly in a trustee-to-trustee "rollover" to an IRA and then from

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704-433: The right to take loans from their company pension plans. House Republicans pushed Congress to provide incentives for those investing in education. One bill in the house was proposed to remove the time limit on student loan interest deductions. Their push was successful and was included in the final bill. The EGTRRA made sweeping changes to the estate tax, gift tax , and generation-skipping transfer tax . Because EGTRRA

736-534: The same term [REDACTED] This disambiguation page lists articles associated with the title Tax Reform Act . If an internal link led you here, you may wish to change the link to point directly to the intended article. Retrieved from " https://en.wikipedia.org/w/index.php?title=Tax_Reform_Act&oldid=1004370540 " Categories : Disambiguation pages Taxation in the United States Hidden categories: Short description

768-818: The size of their preference income. In general, those individual or corporate taxpayers who received the bulk of their income from personal services or manufacturing were taxed at relatively higher tax rates than others. On the other hand, individuals or corporations which received the bulk of their income from such sources as capital gains or were in a position to benefit from net lease arrangements, from accelerated depreciation on real estate, from percentage depletion, or from other tax-preferred activities tended to pay relatively low rates of tax. In fact, many individuals with high incomes who could benefit from these provisions paid lower effective rates of tax than many individuals with modest incomes. In extreme cases, individuals enjoyed large economic incomes without paying any tax at all. This

800-452: The tax cut's size and the possibility of future deficits, Vice President Cheney took charge of writing the bill, which the administration proposed to Congress in March 2001. Bush initially sought a $ 1.6 trillion tax cut over a ten-year period, but ultimately settled for a $ 1.35 trillion tax cut. The administration rejected the idea of "triggers" that would phase out the tax reductions should

832-538: The tax cuts would phase out in 2011 barring further legislative action. One of the most notable characteristics of EGTRRA is that its provisions were designed to sunset (or revert to the provisions that were in effect before it was passed) on January 1, 2011 (that is, for tax years, plan years, and limitation years that begin after December 31, 2010). After a two-year extension by the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 ,

864-585: Was included in the Tax Reform Act of 1969 in order to require these high-income people to pay some income tax. By 2003, 1.8% of all taxpayers (or 2.4   million income tax returns) paid Alternative Minimum Tax. The Tax Policy Center reports that 4.3   million taxpayers paid Alternative Minimum Tax in 2011. However, those who pay the Alternative Minimum Tax may be eligible to take a tax credit in future years in which they are not required to pay Alternative Minimum Tax. The Alternative Minimum Tax

896-433: Was not indexed for inflation until 2013. Corrected for inflation by CPI: Economic Growth and Tax Relief Reconciliation Act of 2001 The Economic Growth and Tax Relief Reconciliation Act of 2001 was a major piece of tax legislation passed by the 107th United States Congress and signed by President George W. Bush . It is also known by its abbreviation EGTRRA (often pronounced "egg-tra" or "egg-terra"), and

928-544: Was reduced from 10% to 8% for those in the 15% income tax bracket. EGTRRA introduced sweeping changes to retirement plans , incorporating many of the so-called Portman - Cardin provisions proposed by those House members in 2000 and earlier in 2001. Overall it raised pre-tax contribution limits for defined contribution plans and Individual Retirement Accounts (IRAs), increased defined benefit compensation limits, made non- qualified retirement plans more flexible and more similar to qualified plans such as 401(k)s , and created

960-588: Was subject to a "sunset" provision, the estate, gift, and generation-skipping taxes were automatically supposed to be reinstated in 2011. After the tax bill was passed, Senator Jim Jeffords left the Republican Party and began caucusing with the Democrats, giving them control of the Senate. After Republicans re-took control of the Senate during the 2002 mid-term elections, Bush proposed further tax cuts. With little support among Democrats, Congress passed

992-741: Was the centerpiece of his 2000 presidential campaign, and upon taking office, he made tax cuts his first major legislative priority. A budget surplus had developed during the Bill Clinton administration , and with the Federal Reserve Chairman Alan Greenspan 's support, Bush argued that the best use of the surplus was to lower taxes. By the time Bush took office, reduced economic growth had led to less robust federal budgetary projections, but Bush maintained that tax cuts were necessary to boost economic growth. After Treasury Secretary Paul O'Neill expressed concerns over

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1024-515: Was true for example in the case of 154 returns in 1966 with adjusted gross incomes of $ 200,000 a year (apart from those with income exclusions which do not show on the returns filed). Similarly, a number of large corporations paid either no tax at all or taxes which represented very low effective rates." Before 1969, there were people with income exceeding $ 200,000 (equivalent to $ 1.66   million in 2023) who had paid zero income tax because of tax deductions and tax credits. The Alternative Minimum Tax

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