http://www.cnn.com/2017/09/27/opinions/trump-tax-plan-opinion-mccaffery/index.html
Single-parent households. While loudly trumpeting the doubling of the standard deduction, the Trump plan would not be kind to single parents. It would eliminate the rate structure for single-parent households, which now splits the difference between married taxpayers and singles without children. Millions would suffer.
Larger families. Back to that standard deduction trick. Trump's plan would roughly double the "standard deduction" given to taxpayers who do not itemize their deductions, from roughly $6000 to $12,000 for single persons, twice as much for married couples. But the plan would also eliminate personal exemptions, presently roughly $4,000 per person, including children. So there is a net gain of $2,000 for single persons. Married couples without children gain $4,000 on net ($12,000 in rise in standard deduction, but $8,000 in losses from removing their exemptions.) Having a single child makes the change neutral (gain $12,000, lose $12,000), and having more than one child makes your family a loser. Some of this effect will be affected by the raise in the lower bracket from 10% to 12% and the as-yet unspecified increase in the child credit, but larger families will still lose out in this math.
Blue state earners. The repeal of the state and local tax deduction will mainly hurt upper middle income earners in states with high income taxes -- which means California, New York and Illinois. One can check various color-coded electoral maps available in the White House to see for whom these states voted in 2016.
The future. Even with all the details being nowhere close to in place, the Trump plan would be a "massive" increase in the debt and deficit. .....
Alfred Tennyson wrote:We are not now that strength which in old days
Moved earth and heaven, that which we are, we are;
One equal temper of heroic hearts,
Made weak by time and fate, but strong in will
To strive, to seek, to find, and not to yield.
Revi wrote:My opinion is that they are trying to figure out a way to mess with the middle class so that they can have more and we can have less. And they have hoodwinked the lower middle class into thinking that Our Dear Leader is looking out for them. Eliminating the estate tax is a particularly good way of keeping those who have a lot on top while the rest of us strivers continue to toil away on the bottom.
They haven't pegged the income level where 25% starts and you would pay 12% on the income between $32,100 and wherever the 25% bracket starts.KaiserJeep wrote:My wife the Tax Accountant said that if this plan becomes law our Federal tax rate based on our modest present income (my Social Security and her salary) will increase from around 17% to 25%.
Plantagenet wrote:Doubling the standard deduction is a big tax cut right there. For middle class people who use the standard deduction, this should reduce their final tax bill by about 15-20%.
I like it.
Back to that standard deduction trick. Trump's plan would roughly double the "standard deduction" given to taxpayers who do not itemize their deductions, from roughly $6000 to $12,000 for single persons, twice as much for married couples. But the plan would also eliminate personal exemptions, presently roughly $4,000 per person, including children. So there is a net gain of $2,000 for single persons. Married couples without children gain $4,000 on net ($12,000 in rise in standard deduction, but $8,000 in losses from removing their exemptions.) Having a single child makes the change neutral (gain $12,000, lose $12,000), and having more than one child makes your family a loser......
Trump's plan would roughly double the "standard deduction" given to taxpayers who do not itemize their deductions, from roughly $6000 to $12,000 for single persons, twice as much for married couples. So there is a net gain of $2,000 for single persons. Married couples without children gain $4,000 on net
But the plan would also eliminate personal exemptions, presently roughly $4,000 per person, including children.
drwater wrote:The proposed special pass-through business tax rate is fundamentally disingenuous, even though I would probably end up benefiting from it. Owners in partnerships, LLCs, etc. already avoid most corporate tax plus take advantage of expensing everything they possibly can. Then they only pay their personal tax rate at whatever is left over. So the proposal is to let them not pay corporate tax, get a lower personal tax rate AND get to keep expensing everything they can. That's a steal. Literally.
We are talking about a bare framework here with no final language or rules to agree or disagree with. Given that my view is that that income needs to be taxed one time not twice or three times. I think the rule should be "He who spends it owes the taxes on it." I would consider money skimmed off a company and directed elsewhere including an individuals bank account as "spent".drwater wrote:The proposed special pass-through business tax rate is fundamentally disingenuous, even though I would probably end up benefiting from it. Owners in partnerships, LLCs, etc. already avoid most corporate tax plus take advantage of expensing everything they possibly can. Then they only pay their personal tax rate at whatever is left over. So the proposal is to let them not pay corporate tax, get a lower personal tax rate AND get to keep expensing everything they can. That's a steal. Literally.
Most Economists Agree: Trump Tax Plan Will Widen Budget DeficitAmid all the controversy and questions surrounding President Donald Trump’s tax-reform blueprint, one thing seems pretty clear to most economists: It will increase the federal government’s budget deficits.
The increased red ink also would come after past criticism of President Barack Obama by Republicans -- and by then-candidate Trump -- for allowing government debt to roughly double on his watch. Rather than reducing the deficit, the tax framework Trump and congressional leaders released on Wednesday could add $2.2 trillion to the gap through 2027, according to the Committee for a Responsible Federal Budget.
“With the plan essentially $2 trillion shy of being revenue-neutral, the likelihood of it happening is slim, especially since there are a lot of states that get clobbered by the changes.”
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