As a result of our large deficits, every possible deduction and credit is being evaluated by the twelve-member, bipartisan panel appointed by Congress. You can bet that every code provision is up for debate. Although we don't know what tax reform revisions will emerge, here are a few of the more noteworthy that congressional spokesmen are talking about. Knowing these may enable you to plan for the future.

A. Individual tax rate changes: Currently, there are six tax brackets. The maximum tax rate on the last bracket is 35 percent with the lowest rate being 10 percent. This probably won't change in 2012. However, If Congress doesn't act before 2013, the tax rates will revert to a low rate of 15 percent to a high rate of 39.6 percent starting in 2013. The proposals coming out of Congress is to have a three rate structure that would lower the top rate down to a maximum of 30 percent. This would, of course, raise the rates for the middle class.

B. Corporate Tax rate changes: Currently, there are a whopping 8 tax brackets for corporations that range from a low of 10 percent, rising to as much as 39 percent for the middle brackets and ending up at 35 percent for the top corporate bracket. Congress is proposing some simplification in having only one flat rate of 26 percent. This will generally result in a tax increase for small corporations earning less than $75,000 and reduced taxes for the larger, more successful corporations.

C. Alternative minimum tax changes: To many people's surprise, we have two income tax systems in this country. One is our income tax and one for alternative minimum tax (AMT). You get to pay in the higher of these two systems. The AMT is like the normal income tax system but disallows deductions for employee business expenses, some itemized deductions such as interest expense on your home, and other changes. With a flat exemption, the tax rate is 28 percent. If you have been hit with it, it can really surprise a lot of taxpayers. Congress is proposing a much bigger exemption from this tax or even an outright elimination of the tax.

D. Capital gains and dividend rate increases: Right now, dividends and capital gains are taxed at a maximum rate of 15 percent. If you are in the 15 percent tax bracket anyway or lesser bracket, your capital gains tax rate is zero! Congress is proposing an increase in these rates to 20 percent from the current 15 percent and to 10 percent for those who currently would be paying nothing. This would affect retirees who depend on dividends and capital gains. Thus, selling appreciated stocks in 2012 might be a tax-wise move if this increase comes to pass.

E. Reduction in Itemized deductions: The biggest proposed changes are in the itemized deduction area. For many years, interest in homes and charitable deductions were considered "sacred cows" by Congress. Any attempt to change their deductibility was met with a lot of resistance. Now, they are not only not sacred cows but aren't even holy cows. It is likely that the deductions for interest on your principal residence and second homes will be either curtailed or phased out for the higher wage earners. There may even be a floor which disallows part of the deductions similar to the way medical expenses are handled. Some suggestions were made to eliminate charitable deductions and install a tax credit for these deductions. The reasoning is that the wealthy benefit most from deductions. Giving charitable gifts a tax credit would hurt the wealthy the most.

Bottom line: Any tax changes can result in both winners and losers. Stay tuned as to what changes will occur and what you can do about them in order to minimize the tax bite.