How the House and Senate tax bills could affect Georgia

The House bill compresses the current seven-bracket tax system into four brackets — 12 percent, 25 percent, 35 percent and 39.6 percent. The top rate remains the same and these cuts are permanent.

The bill also increases standard deductions to $12,200 for individuals, $24,400 for joint filing and $18,300 for heads of households.

The House bill leaves the Obamacare individual insurance mandate intact.

It gets rid of the provision allowing tax deductions for medical expenses.

The House bill bumps the child tax credit up to $1,600 per child. However, this is available only to families that pay income tax. For those who don’t, the bill introduces a $300-per-person family tax credit that expires in five years.

The House bill allows interest deductions on mortgage loans only up to $500,000. Current law allows deductions up to $1.1 million in debt.

The House bill will count graduate tuition waivers as taxable income. This means students will pay tax on money they never make. This has been a cause of concern for students in Georgia, which is a major education hub with several universities in and around Atlanta.

The bill also does away with the tax-free status for bonds, which are used by the University System of Georgia to raise money to build student dorms and facilities.

The House has reduced the corporate tax to 20 percent, starting next year. This tax cut is permanent.

For businesses that aren’t corporations — sole proprietorships, partnerships, limited liability corporations, etc. — the bill cuts the pass-through tax rate to 25 percent, with 30 percent of this income qualifying as business income and the rest being counted as personal income.

The House bill doubles the estate tax exemption for both individuals and couples. After six years, this tax is set to be repealed.

The House bill includes no provisions demanded by airline carriers. American airline operators have been lobbying Congress to punish Persian Gulf-based carriers, saying that their Mideast counterparts are being subsidized by their oil-rich governments.

The House bill will prove to be a boon for Georgia’s Vogtle nuclear power project. The legislation gave the project $800 million in nuclear tax credits, which would have otherwise expired in 2020, a year before the plant’s generators start operations.

However, the bill cuts tax credits to the wind industry by more than a third.