Tax Reform Would Target Carried Interest Loophole

President Donald Trump's administration has frequently proclaimed its intent to overhaul the nation's tax system. Although theĀ tax plan released last week by Treasury Secretary Mnuchin left many pundits and tax experts questioning its lack of specifics, the bulleted points, if achieved, would be a dramatic change from the current tax structure.

Well, some additional details are starting to emerge. On the ABC Sunday news show "This Week," Trump's chief of staff Reince Priebus said the reform plan in the works would eliminate the carried interest rule. Some claim this is a loophole that allows financial managers at hedge funds, equity funds and other financial services groups to pay the capital gains rate instead of their personal income tax rate.

"Carried interest is on the table," Priebus said. "The president wants to get rid of carried interest so that balloon is not going to stay inflated very long, I assure you of that."

Also on Sunday, Vice President Mike Pence went on NBC's Meet the Press, where he acknowledged that the Trump tax plan would temporarily widen the budget deficit, but that it would be "in the short term." He said that nicreaesd economic growth as a result of the tax cuts would increase revenue. Some members of Congress are insisting that a tax reform measure reduce the deficit.