Posted on 09/27/2017 11:35:34 AM PDT by Jim Robinson
Congressional Republicans on Wednesday unveiled the framework for their long-awaited tax-reform plan, which simplifies the tax system and cuts rates for businesses -- while attempting to boost household incomes by nearly doubling the standard IRS deduction used by most Americans.
“Today, we move one step closer to fixing our broken tax code," House Speaker Paul Ryan, R-Wis., said. "This is our best opportunity in a generation to deliver real middle-class tax relief, create jobs here at home, and fuel unprecedented economic growth.”
The framework plan calls for increasing the standard deduction to $12,000 for individuals and $24,000 for families, which essentially doubles the amount of personal income that is tax-free.
Congressional Republicans describe the change as creating a larger “zero tax bracket.”
(Excerpt) Read more at foxnews.com ...
That depends on where you live. $300K in my neighborhood gets you 3,500 SF, 1/2 an acre, a basement and a 3-car garage in a pretty upper middle class neighborhood.
“Uh, no. The national median home value is $200,000. Starter homes would be well south of that”
The people that live in the $100,000 homes don’t pay any taxes. The tax payers are the middle income folks and their homes are NORTH of $200,000.
This report states median price for new home sales is $300,000!
https://www.census.gov/construction/nrs/pdf/newressales.pdf
I expect that doubling the deduction will greatly reduce the value of the home mortgage deduction for many homeowners. For me the mortgage is the main thing that causes me to itemize, and I’m only at about 125% of the standard deduction. If the standard deduction were doubled I would stop itemizing. Look for the real estate interests to oppose this.
“Is everyone reading the same article? ....The plan would seek to help families by calling for an increased child tax credit”
I didn’t read that in the article.
it says it removes ALL deductions except mortgage interest and charity ...
which would mean no more deductions for health plans provided by your work
no more medical expense deductions
no more child tax credits (for me for 4 children)
no more deducting your property taxes
no more deductions for college expenses
no more deducting your state sales taxes
no more deducting contributions to retirement accounts
I could go on and on about all the deductions I would be losing. Doubling the standard deduction wouldn’t come close to making up for all that is lost.
The plan retains existing tax benefits for college and retirement savings such as 401(k) contribution plans.
The plan would seek to help families by calling for an increased child tax credit and opening it to families with higher incomes. The credit currently is $1,000 per child. Also proposed is a new tax credit of $500 to help pay for the care of the elderly and the sick who are claimed as dependents by the taxpayer.
The estate tax — which is paid by those with multimillion-inheritances — would be eliminated, a boon for wealthy individuals who inherit businesses, investments and real estate.
The above helps some.
Its all wait and see as to what happens. Business gets tax cuts as well as little folks, Trump has to keep options open on D and R sides to move the legislation, if anyone in Congress is really willing to advance it at the end of the day.
median home value number is useless, because it includes condo’s and other types of real estate that typically cost MUCH less, plus think of all the 1,000’s of 2 bedroom shakes in the sketchy parts of your town driving down median home value numbers.
Are you talking about the median price for NEW homes across the country or the price of "a starter" home?
People that live in the $100K homes don't pay taxes? You are out of touch, my FRiend. I have friends that live in $130K homes that are making 6 figures (household). I am not sure where you live. But the cost of living must be pretty high. Either that or you are very wealthy and skipped the whole "starter home" part of the journey.
“That depends on where you live. $300K in my neighborhood gets you 3,500 SF, 1/2 an acre, a basement and a 3-car garage in a pretty upper middle class neighborhood. “
I live in a county that is NOT one of the metro counties and is considered middle class. Median family income of about $40,000.
A new 2500 sqft three-bedroom two garage home on 1/4 lot starts at $300,000 before landscaping and extras.
I had hoped to have tax relief by the 2017 filing season, early next year.
Now I’ll watch as people rip this tax cut plan to shreds, and prevent any of us from getting relief until at least 2018, if ever.
Lets hear it for the Obamacare methodology every Trump promise will be subject to.
Perfection or nothing.
Yep, we’ll get nothing.
What a pansy-assed group we turned out to be.
Go read post #115. Those are copied and pasted from the article.
“People that live in the $100K homes don’t pay taxes? You are out of touch, my FRiend. I have friends that live in $130K homes that are making 6 figures (household). I am not sure where you live. “
Median family income in my county is $40,000.
I am not sure where you live but most making 6 figures do not live in $100,000 houses!
1) no - people that are renting don't pay taxes. Most people with a mortgage are paying taxes.
2) the link you have is the median home price for NEW homes which are less than 10% of the home market. It's no secret that builders are building at the higher end of the market this economic cycle. The median home price nationally is $200k.
3) The purchase price doesn't include down payments or paying down the mortgage over time. Even if you buy a $300k home, if you put 20% down you only owe $240k to start. But a couple making $40k isn't buying a $300k home, they are buying a $150k home and putting $30k down ($120k loan)
4) For the higher income earners, while your deductions go down, the standard deduction goes up $10k. Also, right now you hit the 15% early - now that goes down to 12%, and if you hit 28% or 33%, that goes to 25%. The only people that lose with the new plan are people with massive deductions in the top 2% of incomes.
Please review post #115. Then go read the article again. It does say that (your first sentence). But if you continue reading, it confuses that by also stating which other deductions will be included and increased.
This is why I can’t understand what everyone is all over the board about yet. It seems like many folks did not FINISH reading the article.
Hell, maybe I’m the idiot. What are the tax brackets and what are the new rates. Did somebody slip me drugs?
“Now I’ll watch as people rip this tax cut plan to shreds, and prevent any of us from getting relief until at least 2018, if ever.”
As stated, it indicates that my taxes will go up.
“But a couple making $40k isn’t buying a $300k home, they are buying a $150k home and putting $30k down ($120k loan)”
The couple making $40k aren’t paying any taxes so they aren’t in the discussion.
Your first post referred to a STARTER home at $300K.
I read some of the commentary on this thread, and some folks couldn’t even figure out what a standard deduction was.
Pardon me if I am a little skeptical of some of the hand-wringing.
Looking at 2016 taxes I would pay taxes on $6000 less in income. That’s good, but at what rate will I be taxed, 12 or 25? Does anyone have any idea where the cut off is anticipated to fall?
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