Architects and engineers are still in. Accountants, doctors and lawyers remain out – mostly. New rules floated by the Trump administration lay out what kinds of businesses can take a 20 percent deduction against income taxes under the new tax law.
With the proposed rules issued Wednesday , the Treasury Department and the IRS had worked for six months to bring clarity to Congress’ blueprint. But as with many aspects of the sweeping Republican tax law hustled through Congress last year, the requirements for the millions of “pass-through” businesses to score generous tax breaks are stunningly complex.
Some business owners earning over certain income levels, for example, are excluded, as are companies that are organized in certain ways or that lease their equipment rather than own it.
“They’ve attempted to draw lines that are clearer than the language” of the tax law, said Andrew Howlett, an attorney at law firm Miller & Chevalier who specializes in tax issues. “There are still questions that remain to be answered for taxpayers.”
Steven Rosenthal, a senior fellow at the nonpartisan Urban-Brookings Tax Policy Center, said the new regulations “allow a lot of different businesses the 20 percent deduction. They allowed a lot of latitude for businesses to claim it.”