Tax Reform Act Of 1993

AAA

DEFINITION of 'Tax Reform Act Of 1993'

Legislation aimed at reducing the federal deficit through a combination of increased taxes and reduced spending. This act was created by the Clinton Administration in 1993 and contained several major provisions for individuals, such as the addition of the 36% tax bracket, an increase in gasoline taxes and an additional tax of 10% on married couples with income above $250,000. It also raised taxation on Social Security benefits and eliminated the tax cap on Medicare.

INVESTOPEDIA EXPLAINS 'Tax Reform Act Of 1993'

This legislation is also known as the Revenue Reconciliation Act of 1993. Individuals were not the only ones affected by this legislation; the corporate tax rate was raised as well, along with a lengthening of the goodwill depreciation period and the elimination of deductibility for congessional lobbying expenses. Many other taxes were raised and deductions reduced or eliminated as well.

RELATED TERMS
  1. Total Tax

    The composite total of all taxes that is owed by a taxpayer for ...
  2. Formal Tax Legislation

    The process by which a proposed tax rule or tax change may become ...
  3. Tax Equity And Fiscal Responsibility ...

    Federal tax legislation passed in 1982 that modified some aspects ...
  4. Tax Reform Act Of 1986

    A law passed by the United States Congress to simplify the income ...
  5. Progressive Tax

    A tax that takes a larger percentage from the income of high-income ...
  6. Smart Traveler Enrollment Program

    A service of the U.S. Department of State that lets U.S. citizens ...
RELATED FAQS
  1. What are common reasons for governments to implement tariffs?

    A tariff is a tax imposed by a governing authority on goods or services entering or leaving the country and is typically ... Read Full Answer >>
  2. How are transfer prices set?

    The United States, like most nations, does not want to allow transfer pricing methods that reduce the amount of taxes the ... Read Full Answer >>
  3. What are some of the arguments in favor of a value-added tax (VAT)?

    A value-added tax (VAT) offers several advantages over an income tax or traditional sales tax. It raises needed government ... Read Full Answer >>
  4. How does a company derecognize a deferred tax liability?

    Under U.S. generally accepted accounting principles, or GAAP, deferred tax positions must be derecognized during the first ... Read Full Answer >>
  5. How is compound interest taxed?

    Compound interest is money that is earned and added to a principal balance and then earns additional interest. Adding interest ... Read Full Answer >>
  6. According to the law of supply and demand, what is the effect of an increase or decrease ...

    Standard economic analysis shows that taxes of any form, including income taxes, tend to cause deadweight loss in the market. ... Read Full Answer >>
Related Articles
  1. Taxes

    Changes In Tax Legislation And Regulation

    Keeping on top of these amendments can help you avoid penalties and take advantage of benefits.
  2. Retirement

    Bankruptcy Protection For Your Accounts

    Will the plan assets you've worked hard for be safe if you experience a personal financial crisis?
  3. Taxes

    Dividend Tax Rates: What Investors Need To Know

    Find out how legislation enacted in 2003 is benefiting both investors and corporations, and when it's scheduled to expire.
  4. Personal Finance

    Get Ready For The Estate Tax Phase-Out

    Changes to federal legislation will affect how your assets are treated once you're gone - be prepared.
  5. Options & Futures

    The Chinese Wall Protects Against Conflicts Of Interest

    After the crash of 1929, this barrier helped define ethical limits, but it did little to prevent fraud.
  6. Options & Futures

    Changing The Face Of Bankruptcy

    A 2005 law attempts to unmask fraudulent debtors and still save those who are struggling. Will it affect you?
  7. Retirement

    Some Tax Considerations For Your Retirement Income

    Even if you don’t plan to retire, it’s still a good idea to think ahead about where to live, your income and how it all interacts with Social Security.
  8. Economics

    The Field So Far: US 2016 Presidential Candidates

    Over the past several months, there has been a lot of speculation as to who will make a run at the Republican and Democratic nominations.
  9. Taxes

    Tips on Charitable Contributions: Limits and Taxes

    An overview of the limits and tax deductions of charitable donations.
  10. Taxes

    What is Withholding Tax?

    Withholding tax is the income tax federal and state governments require employers to withhold from employee paychecks.

You May Also Like

Hot Definitions
  1. Fixed-Income Arbitrage

    An investment strategy that attempts to profit from arbitrage opportunities in interest rate securities. When using a fixed-income ...
  2. Venture-Capital-Backed IPO

    The selling to the public of shares in a company that has previously been funded primarily by private investors. The alternative ...
  3. Merger Arbitrage

    A hedge fund strategy in which the stocks of two merging companies are simultaneously bought and sold to create a riskless ...
  4. Market Failure

    An economic term that encompasses a situation where, in any given market, the quantity of a product demanded by consumers ...
  5. Unsystematic Risk

    Company or industry specific risk that is inherent in each investment. The amount of unsystematic risk can be reduced through ...
  6. Security Market Line - SML

    A line that graphs the systematic, or market, risk versus return of the whole market at a certain time and shows all risky ...
Trading Center