Tax Code Proposal 2014

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Lower rates: Currently there are seven individual income tax rates ranging from 10% to 39.6%. Camp would reduce them to three: 10%, 25% and 35%. The highest bracket would essentially apply to the income that today is subject to the 39.6% bracket -- income over $400,000 for singles and $450,000 for married couples filing jointly.
But many tax breaks, such as the one workers get for employer contributions to their health coverage, would only be allowed against income up to the 25% bracket. So their total value would be reduced or even eliminated for very high-income filers.

Increased child tax credit: The per-child tax credit would be increased to $1,500 from $1,000 and would be allowed for kids up to the age of 18, versus 17 today. But again the credit would phase out for very high income filers.

Reduced mortgage interest deduction: The mortgage interest deduction currently is allowed on mortgages up to $1 million. Under Camp's proposal the cap would be lowered to $500,000.
The plan would also place new restrictions on the tax-free gains homeowners enjoy when they sell their home.

No more state and local income tax deduction: Taxpayers are allowed today to deduct their state and local income taxes on their federal return. That would no longer be allowed under the proposal.

Change in how long-term gains are taxed: Camp would tax 60% of capital gains at ordinary income tax rates and exclude the other 40% from tax. For many people, their bill would work out to be exactly the same as it is now.

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