In 2018, the United States Congress passed the Tax Cuts and Jobs Act (TCJA), a comprehensive tax reform that introduced significant tax reductions for businesses and individuals, along with simplifications in certain tax deductions. Many of these changes were implemented as temporary measures, set to expire in 2025.
Now, seven years later, former President Donald Trump proposes making several TCJA provisions permanent, including the Lifetime Estate Tax Exemption and the Qualified Business Income Deduction, which were initially temporary. This proposal aims to provide fiscal stability and economic predictability in the long term, benefiting both citizens and international investors seeking opportunities in the United States.
Benefits for Brazilian Investors and Immigrants
The plan is also appealing to Brazilian investors and other foreigners interested in immigrating or investing in the U.S., as it allows for the transfer of assets with greater tax efficiency. For instance, the federal estate tax, with rates ranging from 18% to 40%, saw its lifetime exemption doubled by the TCJA, increasing from $5.49 million per person in 2017 to $11.18 million. This amount has been rising annually and will reach $13.6 million in 2024 and $13.9 million in 2025, before reverting to lower levels if the measure is not renewed.
Key Proposals Benefiting Investors and Immigrants:
Individual Income Taxes
Make TCJA tax cuts permanent.
Exempt earnings from tips and overtime.
Create new deductions, such as for auto loan interest.
Corporate Taxes
Reduce the corporate tax rate from 21% to 20%.
Apply a 15% rate for companies producing within the U.S.
Tax Credits and Deductions
Increase the Child Tax Credit from $2,000 to $5,000 per dependent.
Restore unlimited deductions for state and local taxes (SALT), currently capped at $10,000 per year.
Create tax incentives for family caregivers.
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