THIS BILL WILL PROVE A DISASTER FOR REPUBLICANS AS DID OBAMACARE FOR DEMOCRATS.
TRUMP’S PROMISE DURING THE CAMPAIGN
“”We will massively cut taxes for the middle class, the forgotten people, the forgotten men and women of this country, who built our country....Tax relief will be concentrated on the working and middle class taxpayer. They will receive the biggest benefit and it won’t even be close.” Donald Trump, Scranton PA, Oct 2016
It’s interesting to me that i haven’t heard one congress critter oppose this bill on the grounds of its evisceration of the middle class. where are the folks that we elected to represent us? oh, that’s right, we are only given lip service at re-election time.
the elimination of most of the itemized deductions should be a deal killer to all those of our duly elected to represent us who vote them into office, and not as thank you gifts to those corporations who donate the fattest envelopes to their re-election campaigns.
so just as the cost of obamacare was being shouldered by all the healthy young people who had to sign up or pay a fine, this tax bill is being paid for by the average middle class taxpayer for the benefit of big permanent tax cuts for corporations and the wealthy. Touting this as a tax cut to all the middle class deplorables who elected Trump is the same as obama promising that you would save $2500 on your insurance premiums and could keep your doctor. This isn’t a tax cut, but a tax increase for the average American.
the standard deduction is being not quite doubled, but then they are eliminating the individual personal exemptions [of $4,050 each] for yourself, your spouse and your dependents. a couple with 2 children filing jointly would then lose $16,200 in deductions. so they give with one hand but take away with the other. in addition, they are eliminating the extra deduction for those over 65 or blind.
if you take the standard deduction, you cannot then itemize; therefore, giving up the normal deductions for medical expenses, long term care insurance expenses, state and local taxes, property taxes [under the senate bill], mortgage interest deduction limits, student loan interest deductions, moving expenses, alimony, dependent care assistance accounts, casualty and theft losses, unreimbursed job expenses and tax preparation fees.
further details about this “wonderful” tax grab:
Exclusions and exemptions.
The measure would repeal personal and dependency exemptions (which is $4,050 per individual in 2017), exclusions for employee achievement awards, employer education assistance, qualified tuition programs, dependent care assistance, qualified moving reimbursements, and adoption assistance. Contribution to Coverdell education savings accounts would be barred, but funds in existing accounts could be rolled over to 529 plans.
Deductions.
Certain deductions from gross income as well as itemized deductions would be eliminated. Deductions from gross income set to be axed include the alimony deduction (for divorce or separation agreements entered into after Dec. 31, 2017, student loan interest (although the Senate version would retain this deduction), interest on U.S. savings bonds redeemed for higher education, the moving expense deduction, the deduction for contributions to Archer medical savings accounts, out-of-pocket educator expenses, and expenses of performing artists and certain government officials.
Itemized deductions on the chopping block include the medical expense deduction, state and local income or sales taxes, the casualty and theft loss deduction (except for casualty losses in federally-declared disaster areas), and miscellaneous itemized deductions for tax return preparation and unreimbursed employee business expenses.
Tax credits.
The bill would repeal the credit for the elderly and permanently disabled, the credit for mortgage certificates, and the credit for plug-in electric vehicles. The bill would eliminate the lifetime learning credit by consolidating it into the American opportunity credit. The credit would be available for five years of higher education (instead of four years), but the amount in the fifth year would half the usual maximum (including the amount eligible for the 40 percent refundable portion of the credit).
Now look at its impact on the economic strata of taxpayers to see who benefits the most:
“...the highest-income taxpayers (0.1 percent of the population, or those with incomes over $3.7 million in 2016 dollars) would experience an average tax cut of nearly $1.1 million, over 14 percent of after-tax income. Households in the middle fifth of the income distribution would receive an average tax cut of $ 1,010, or 1.8 percent of after-tax income, while the poorest fifth of households would see their taxes go down an average of $110, or 0.8 percent of their after-tax income.”