The Tax Cuts and Jobs Act of 2017 has lowered the corporate tax rate to 21%. What does this mean to you? Well, if you own a C Corporation, you can now benefit from this flat tax, which is 40% lower than the prior tax rate of 35%. If you are an investor in stocks or mutual funds, you could see businesses passing on the benefit of these lower tax rates to shareholders in the form of dividends or stock buybacks. This change is supposed to allow the US businesses to be more competitive with other countries who have had lower tax rates than the US.
As always, consult with your tax professional at Ketel Thorstenson about these or other tax matters because each situation is different. Don’t navigate the difficult and ever changing tax codes and legislation on your own. Ketel Thorstenson CPAs and tax professionals receive advanced training and continuing education all year long to keep our service on the forefront of the tax industry. Call us today for guidance on tax planning, tax return preparation, and/or Tax Reform (the Tax Cuts and Jobs Act) affects or questions.