Capital Gains: A 50%
deduction of the net capital gain would be permitted for both individuals and
corporations. Also, many capital assets would be indexed for inflation. Taxpayers who sell
a principal residence at a loss would be entitled to a capital loss.
Estate Taxes: The
Unified Estate and Gift Tax Credit which is currently $600,000 per individual, would be
increased to $700,000 in 1996, $725,000 in 1997 and $750,000 in 1998, with annual indexing
for inflation thereafter.
Family Tax Credit:
For families with adjusted gross income under $200,000, a $500 per child (under age 18)
would be provided, beginning in 1996. The credit would phase out for families with incomes
between $200,000 and $250,000.
American Dream Savings
Account: All individuals, including the unemployed, could establish a savings account
and contribute up to $2,000 per year. The contribution would not be tax deductible, but
the interest earned on the account would not be taxable, so long as the funds in the
account were used for retirement income, a first-time home purchase, qualified higher
education expenses or a qualified medical expense.
Social Security Tax
Roll-Back: The tax increase to 85% will be rolled back to 50% over a period of time.
The Republicans have
released the tax proposals contained in their "Contract with America." Some of
the more ambitious provisions include: 
