2018: Fitzpatrick Voted For Permanently Extending The Expiring
Provisions Of The 2017 Trump Tax Cuts. In September 2018, Fitzpatrick
voted for a bill that would have, according to Congressional Quarterly,
"ma[d]e permanent a number of tax provisions that would otherwise
expire in 2025. The provisions from the 2017 tax overhaul (PL 115-97)
that would [have] become permanent include: reduced tax rates and
modified tax bracket breakpoints for the seven tax brackets, the
standard deduction amount, the elimination of personal exemptions for
each taxpayer and dependent, and the increased child tax credit." The
House passed the bill by a vote of 220 to 191. The Senate took no
substantive action on the legislation. [House Vote 414,
9/28/18; Congressional
Quarterly, 9/28/18; Congressional
Actions, H.R.
6760]
CBO: Bill Would Increase The Deficit By $631 Billion Over The
Next Ten Years. According to the Congressional Budget Office,
"The staff of the Joint Committee on Taxation (JCT) estimates that
enacting the bill would reduce revenues by about $597 billion over
the 2019-2028 period, and increase outlays by $34 billion over the
same period, leading to an increase in the deficit of $631 billion
over the next 10 years. A portion of the changes in revenues would
be from Social Security payroll taxes, which are off-budget.
Excluding the estimated $687 million increase in off-budget
revenues over the next 10 years, JCT estimates that H.R. 6760 would
increase on-budget deficits by about $632 billion over the period
from 2019 to 2028. Pay-as-you-go procedures apply because enacting
the legislation would affect direct spending and revenues."
[CBO, 9/21/18]
TPC: Bill Would Reduce Federal Revenues By $3.2 Trillion From
2029 To 2038. According to the Tax Policy Center, "The bill would
reduce federal revenues by $631 billion within the budget window
(fiscal years 2019--28) and by almost $3.2 trillion over the
subsequent decade (fiscal years 2029--38)."
[TPC, 9/12/18]
CBPP: The Top 1 Percent Would Get An Average Tax Cut Of More Than
$40,000, While The Bottom 60 Percent Would Get An Average Tax Cut
Of Just $480. According to the Center on Budget and Policy
Priorities, "The 2.0 tax plan would exacerbate that trend by
delivering about twice the after-tax income gain for the top 1
percent than it would for households in the bottom 60 percent. (See
Chart 2.) It would give an average tax cut of $40,180 to households
in the top 1 percent (those with incomes above $836,200 in 2026),
raising their after-tax incomes by 2.0 percent, compared to an
average tax cut of just $480 and a 1.1 percent boost in after-tax
income for households in the bottom 60 percent (those with incomes
below $95,000)."
[CBPP, 9/6/18]
2017: Fitzpatrick Voted Against The GOP FY 2018 Budget Resolution,
Which Started The Process Towards Tax Reform Which Could Reduce The
Deficit By $.5 Trillion Over Ten Years. In October 2017, Fitzpatrick
voted against a budget resolution that would have, according to The
Hill, "The spending blueprint is key to Republicans' efforts to pass tax
reform because it includes instructions that will allow the plan to
avoid a Democratic filibuster. [...] The budget, meant to outline
spending for the fiscal year, was widely viewed as a mere vehicle for
passing tax reform. [...] The budget would allow the Senate GOP's tax
plan to add up to $1.5 trillion to the deficit over a decade, a
proposal that has raised concerns with fiscal hawks in the GOP. Its
instructions call for the Senate Finance Committee to report a tax bill
by Nov. 13. Still, the document outlines the Senate GOP's political
vision. It maintains spending at 2017 levels for the year, but would
then cut nondefense spending in subsequent years, leading to a $106
billion cut in 2027. It would also allow defense levels to continue
rising at their current rates, reaching $684 billion at the end of a
decade. The resolution also proposes $473 billion in cuts to Medicare's
baseline spending over a decade and about $1 trillion from Medicaid,
though those provisions are not enforceable without additional
legislation." The vote was on a motion to concur in the Senate
amendment. The House agreed to the motion, thereby agreeing to the
budget by a vote of 216 to 212. [House Vote 589,
10/26/17; The Hill,
10/19/17;
Congressional Actions, H. Con. Res.
71]
2017: Fitzpatrick Voted Against The House GOP FY 2018 Budget
Resolution, Which Started The Process Towards Tax Reform And Called For
Ending Medicare As We Know It. In October 2017, Fitzpatrick voted
against the House GOP FY 2018 budget resolution. According to
Congressional Quarterly, "Adoption of the concurrent resolution that
would provide for $3.2 trillion in new budget authority in fiscal 2018,
not including off-budget accounts. It would assume $1.22 trillion in
discretionary spending in fiscal 2018. It would assume the repeal of the
2010 health care overhaul law. It also would propose reducing spending
on mandatory programs such as Medicare and Medicaid and changing
programs such as the Supplemental Nutrition Assistance Program (also
known as food stamps). It would call for restructuring Medicare into a
'premium support' system beginning in 2024. I would also require the
House Ways and Means Committee to report out legislation under the
budget reconciliation process that would provide for a revenue-neutral,
comprehensive overhaul of the U.S. tax code and would include
instructions to 11 House committees to trigger the budget reconciliation
process to cut mandatory spending. The concurrent resolution would
assume that, over 10 years, base (non-Overseas Contingency Operations)
discretionary defense spending would be increased by a total of $929
billion over the Budget Control Act caps and non-defense spending be
reduced by $1.3 trillion." The vote was on passage. The House passed
the budget resolution by a vote of 219 to 206. A modified version was
later agreed to by both the House and the Senate. [House Vote 557,
10/5/17; Congressional
Quarterly, 10/5/17; Congressional
Actions, H. Con. Res.
71]
2017: Fitzpatrick Voted To Go To Conference With The Senate On Tax
Reform. In December 2017, Fitzpatrick voted for a motion that stated
that, according to Congressional Quarterly, "the House disagree[s]
with the Senate amendment and request[s] a conference with the Senate
on the bill that would revise the federal income tax system by lowering
individual and corporate tax rates, repealing various deductions through
2025." The vote was on a motion to go to conference with the Senate. The
House agreed to the motion by a vote of 222 to 192. The eventual
conference report was later signed into law. [House Vote 653,
12/4/17; Congressional
Quarterly, 12/4/17; Congressional
Actions, H.R.
1]
2017: Fitzpatrick Voted For The Final Version Of Trump's Tax Reform
Plan, Which Substantially Cut Taxes For Rich Americans And
Corporations. In December 2017, Fitzpatrick voted for the Tax Cut and
Jobs Act, also known as Trump's tax reform bill. According to
Congressional Quarterly, "This Conference Summary deals with the
conference report on HR 1, Tax Cuts and Jobs Act, which the House will
consider Tuesday. The agreement significantly cuts corporate and
individual taxes and seeks to simply the tax code, although most
individual tax provisions would expire after 2025. It reduces the
corporate tax from 35% to 21% and reduces taxation of so-called
'pass-through' businesses where profits are taxed at the individual
rate. For corporate taxes it also establishes a 'territorial' tax system
that exempts most overseas income from U.S. taxation. Most individual
tax rate rates would be reduced, including by dropping the top rate from
39.6% to 37%, and it eliminates personal exemptions but nearly doubles
the standard deduction so fewer taxpayers will itemize deductions." The
vote was on a motion to concur with the Senate amendment, effectively on
passage. The House agreed to the motion, thereby passing the bill by a
vote of 224 to 201. President Trump signed the bill into law. [House
Vote 699, 12/20/17;
Congressional Quarterly,
12/18/17; Congressional Actions,
H.R.
1]
The House Had To Vote Again Because Three Provisions Violated
Reconciliation Rules. According to The Hill, "In a 224-201 vote,
the House passed the bill for the second time in two days on
Wednesday, after three provisions had to be stripped out because
they ran afoul of Senate budget rules. The Senate approved the bill
early Wednesday morning." [The Hill,
12/20/17]
The Bill's Name And Two Education Related Provisions From The
House Passed Version Violated The Byrd Rule. According to The
Hill, "The Senate parliamentarian on Tuesday ruled that the GOP tax
bill's short name, 'The Tax Cuts and Jobs Act,' violates budget
rules, according to the office of Senate Budget Committee ranking
member Bernie Sanders (I-Vt.). The title was found to violate the
'Byrd rule' that applies to bills moving under the 'budget
reconciliation' process that allows legislation to avoid a
Democratic filibuster in the Senate. Under the rule, reconciliation
bills can't include provisions that don't have an impact on the
budget. [...] The parliamentarian also ruled that two other
provisions in the bill violate the Byrd rule. One would allows 529
college savings plans to be expanded to be used for home-schooling
expenses. The other offending provision was part of the criteria
used to determine what colleges qualify for a new excise tax.
Because of the parliamentarian's ruling, the House will have to
revote on the tax bill on Wednesday. The Senate is expected to vote
on the bill Tuesday evening with the offending provisions stricken."
[The Hill,
12/19/17]
2017: Fitzpatrick Voted For The Final Version Of Trump's Tax Reform
Plan, Which Substantially Cut Taxes For Rich Americans And
Corporations. In December 2017, Fitzpatrick voted for the Tax Cut and
Jobs Act, also known as Trump's tax reform bill. According to
Congressional Quarterly, "This Conference Summary deals with the
conference report on HR 1, Tax Cuts and Jobs Act, which the House will
consider Tuesday. The agreement significantly cuts corporate and
individual taxes and seeks to simply the tax code, although most
individual tax provisions would expire after 2025. It reduces the
corporate tax from 35% to 21% and reduces taxation of so-called
'pass-through' businesses where profits are taxed at the individual
rate. For corporate taxes it also establishes a 'territorial' tax system
that exempts most overseas income from U.S. taxation. Most individual
tax rate rates would be reduced, including by dropping the top rate from
39.6% to 37%, and it eliminates personal exemptions but nearly doubles
the standard deduction so fewer taxpayers will itemize deductions." The
vote was on passage. The House passed the bill by a vote of 227 to 203.
The Senate later passed a slightly modified version of the bill, which
the House later agreed to. President Trump later signed an amended
version of the bill into law. [House Vote 692,
12/19/17; Congressional
Quarterly, 12/18/17;
Congressional Actions, H.R.
1]
Tax Rates Would Start At 10 Percent; Top Rate Would Be Reduced To
37 Percent. According to Bloomberg, "Current law: Seven rates,
starting at 10 percent and reaching 39.6 percent for incomes above
$418,401 for singles and $470,701 for married, joint filers.
Proposed: Seven rates, starting at 10 percent and reaching 37
percent for incomes above $500,000 for singles and $600,000 for
married, joint filers. For joint filers: 10 percent: $0 to $19,050
12 percent: $19,050 to $77,400 22 percent: $77,400 to $165,000
24 percent: $165,000 to $315,000 32 percent: $315,000 to
$400,000 35 percent: $400,000 to $600,000 37 percent: $600,000
and above For single filers: 10 percent: $0 to $9,525 12 percent:
$9,525 to $38,700 22 percent: $38,700 to $82,500 24 percent:
$82,500 to $157,500 32 percent: $157,500 to $200,000 35 percent:
$200,000 to $500,000 37 percent: $500,000 and above."
[Bloomberg,
12/15/17]
Bill Would Nearly Double The Standard Deduction, But Eliminate The
Personal Exemptions. According to Bloomberg, "Current law: $6,350
standard deduction for single taxpayers and $12,700 for married
couples, filing jointly. Personal exemptions of $4,050 allowed for
each family member. Proposed: $12,000 standard deduction for single
taxpayers and $24,000 for married couples, filing jointly. Personal
exemptions repealed." [Bloomberg,
12/15/17]
Bill Capped The State And Local Tax Deduction At $10,000, For
Individuals Or Married Couple. "You can deduct just $10,000 in
state, local and property taxes: One of the most controversial parts
of the GOP tax plan is the push to greatly scale back how much state
and local taxes Americans can deduct on their federal income taxes.
Under current law, the state and local deduction (SALT) is
unlimited. In the final GOP plan, people can deduct up to $10,000
(married couples are also limited to just $10,000). [...] The
move is widely viewed as a hit to blue states such as New York,
Connecticut and California, and there are concerns it could cause
property values to fall in high-tax cities and leave less money for
public schools and road repairs." [Washington Post,
12/15/17]
The State And Local Tax Deduction Is Effectively A Subsidy For
Local Services. According to the Center on Budget and Policy
Priorities, "Second, the SALT deduction helps state and local
governments fund public services that provide widely shared
benefits. That's because, with this deduction, higher-income filers
are more willing to support state and local taxes. Repealing the
deduction would almost certainly make it harder for states and
localities --- many of which already face serious budget strains ---
to raise sufficient revenues in the coming years to invest in
high-quality education, infrastructure, and other priorities crucial
to the nation's long-term economic prospects. State borrowing costs
could also rise as bond rating agencies react to the reduced
capacity of states to raise adequate revenue, making needed
infrastructure projects more expensive. States and localities could
also respond by raising taxes or fees that fall less heavily on the
higher-income residents most affected by the deduction's loss. That
would push more costs to middle- and low-income people, and make
state and local tax systems even more regressive overall than they
already are." [Center on Budget Policy Priorities,
10/24/17]
Bill Caps The Mortgage Interest Deduction For New Loans At Up To
$750,000. According to Congressional Quarterly, "Limits the
amount of mortgage interest that can be deducted to just that
associated with the first $750,000 of a home loan (down from $1
million), and eliminates through 2025 the deduction for interest on
second homes and home equity loans (the House bill would have set
the mortgage interest limit at $500,000)" [Congressional
Quarterly, 12/18/17]
Legislation Increased The Child Tax Credit. According to the
Washington Post, "The current child tax credit is $1,000 per child.
The House and Senate bills expanded the child tax credit, with the
Senate going up to a maximum of $2,000 per child. The final bill
keeps the $2,000-per-child credit (families making up to about
$400,000 get to take the credit), but it also makes more of the tax
credit refundable, meaning families that work but don't earn enough
to actually owe any federal income taxes will get a large check back
from the government. Benefits for those families were initially
limited to about $1,100, but through changes Rubio and Lee pushed
for, it's now up to $1,400." [Washington Post,
12/15/17]
Legislation Increased The Exemption For The Individual AMT.
According to Bloomberg, "Current law: Individual AMT can apply after
exemption level of $54,300 for singles and $84,500 for married,
joint filers, and the exemptions phase out at higher incomes.
Proposed: Increase the exemption to $70,300 for singles and
$109,400 for joint filers. Increase the phase-out threshold to
$500,000 for singles and $1 million for joint filers. The higher
limits would expire on Jan. 1, 2026." [Bloomberg,
12/15/17]
Bill Changed The Inflation Rate For The Tax Brackets To The
So-Called Chained CPI, Which Grows At A Slower Rate; This Would Lead
To Many Americans Into Joining A Higher Bracket. According to
Congressional Quarterly, "Like both the House and Senate bills, the
agreement changes the manner in which tax brackets are increased
each year to account for inflation and thereby prevent people from
being pushed into higher tax rates as their income grows without an
actual increase in purchasing power. Specifically, the measure
switches to so-called 'chained CPI,' which many economists say
represents a more accurate estimate of inflation because it factors
in consumer substitution of cheaper products. Chained CPI is usually
lower than the current inflationary index used (the CPI-U; the
Consumer Price Index for All Urban Consumers), which means that tax
brackets would not rise as rapidly and more taxpayers may end up in
higher tax rates. Under the measure, new tax brackets each year
would be set by using chained CPI and then rounding down to the next
lowest multiple of $100. And unlike most other individual and
family tax provision, the use of chained CPI would be permanent."
[Congressional Quarterly,
12/18/17]
Legislation Doubles The Estate Tax Exemption. According to the
Washington Post, "You can pass your heirs up to $22 million
tax-free: In the end, the estate tax (often called the 'death tax'
by opponents) would remain part of the U.S. tax code, but far fewer
families will pay it. Under current law, Americans can pass on up to
$5.5 million tax-free (that threshold is $11 million for married
couples). The House wanted to do away with the estate tax entirely,
but some senators felt that was too much of a giveaway to the
mega-rich. The final compromise was to double the threshold, so now
the first $11 million that people pass on to their heirs in
property, stocks and other assets won't be taxed (and yes, that
means $22 million for married couples)." [Washington Post,
12/15/17]
Only 2 Out Of 1,000 Estates Will Face A Tax Under Current Law.
According to the Center on Budget and Policy Priorities, "Only the
heirs of the wealthiest 2 out of every 1,000 estates will face any
estate tax. [...] Repeal would provide the top 0.2 percent of
estates with tax-cut windfalls averaging more than $3 million
apiece. About 330 estates worth more than $50 million would get tax
cuts averaging more than $20 million apiece." [Center on Budget
Policy Priorities, Accessed
11/22/17]
2001 New York Times Article Noted That Not A Single Example Of A
Farm Was Lost Due To The Estate Tax. According to the Center on
Budget and Policy Priorities, "As the New York Times reported in
2001, when the estate tax applied to far more estates than it does
today: 'Even one of the leading advocates for repeal of estate
taxes, the American Farm Bureau Federation, said it could not cite a
single example of a farm lost because of estate taxes.'" [Center on
Budget Policy Priorities, Accessed
11/22/17]
Legislation Reduces The Threshold For The Medical Expense
Deduction Through 2018. According to Bloomberg, "Current law:
Qualified medical expenses that exceed 10 percent of the taxpayer's
adjusted gross income are deductible. Proposed: Reduce the threshold
to 7.5 percent of AGI for 2017 and 2018." [Bloomberg,
12/15/17]
Tax Policy Center: From 2018 -- 2025, Average Taxes Fall For Most
Americans, But By 2027, 53 Percent Of Americans Would Pay More.
According to the Tax Policy Center, "The Tax Policy Center has
released distributional estimates of the conference agreement for
the Tax Cuts and Jobs Act as filed on December 15, 2017. We find the
bill would reduce taxes on average for all income groups in both
2018 and 2025. In general, higher income households receive larger
average tax cuts as a percentage of after-tax income, with the
largest cuts as a share of income going to taxpayers in the 95th to
99th percentiles of the income distribution. On average, in 2027
taxes would change little for lower- and middle-income groups and
decrease for higher-income groups. Compared to current law, 5
percent of taxpayers would pay more tax in 2018, 9 percent in 2025,
and 53 percent in 2027." [Tax Policy Center,
12/18/17]
In 2027, 83 Percent Of The Total Tax Benefit Would Go To The Top
One Percent. According to Tax Policy Center, "In 2027, the overall
average tax cut would be $160, or 0.2 percent of after-tax income
(table 3), largely because almost all individual income tax
provisions would sunset after 2025. On average, taxes would be
little changed for taxpayers in the bottom 95 percent of the income
distribution. Taxpayers in the bottom two quintiles of the income
distribution would face an average tax increase of 0.1 percent of
after-tax income; taxpayers in the middle income quintile would see
no material change on average; and taxpayers in the 95th to 99th
income percentiles would receive an average tax cut of 0.2 percent
of after-tax income. Taxpayers in the top 1 percent of the income
distribution would receive an average tax cut of 0.9 percent of
after-tax income, accounting for 83 percent of the total benefit for
that year." [Tax Policy Center,
12/18/17]
In 2027, 86 Million Americans Would See A Tax Increase.
According to ABC News, "The bill, which carries an estimated $1.5
trillion price tag over 10 years, is not expected to win any
Democratic support. House Minority Leader Nancy Pelosi points to a
new analysis from the non-partisan Tax Policy Center that predicts
86 million people would see a tax increase compared to current law
by 2027, while 83 percent of the anticipated benefits would be
reaped by the wealthiest one percent of taxpayers." [ABC News,
12/19/17]
Last Minute Added Provision Gave A Tax Break To Real-Estate
Moguls. According to the International Business Times, "President
Donald Trump has made tens of millions of dollars of a specific kind
of income that could be subjected to a last-minute tax break
inserted into the Republicans' tax legislation released Friday,
according to federal records reviewed by International Business
Times. The same is true for Tennessee GOP Sen. Bob Corker --- a
commercial real estate mogul who suddenly switched his vote to 'yes'
on the tax bill after the provision was added to the legislation.
Previously, Corker was the only Republican to vote against the
Senate version of the bill. [...] The reconciled tax bill includes
a new 20 percent deduction for so-called 'pass-through' entities,
business structures such as LLCs, LPs and S-Corporations that don't
pay corporate taxes, but instead 'pass through' income to partners
who pay individual tax rates on that money. The Senate version of
the bill included safeguards that would only allow businesses to
take advantage of the new break if they paid out significant wages
to employees. But the new provision, which wasn't included in either
version of the bill passed by the House and Senate, and was only
added during the reconciliation process, gives owners of
income-producing real estate holdings a way around that safeguard,
effectively creating a new tax break for large landlords and real
estate moguls." [International Business Times,
12/16/17]
Bill Repealed The Corporate AMT. According to Bloomberg,
"Current law: Applies a 20 percent rate as part of a parallel tax
system that limits tax benefits to prevent large-scale tax
avoidance. Companies must calculate their ordinary tax and AMT tax,
and pay whichever is higher. Proposed: Repealed" [Bloomberg,
12/15/17]
Legislation Bars Business Deductions For Costs Associated With
Sexual Harassment Settlements That Had A Non-Disclosure Agreement.
According to the New York Times, "The sexual misconduct allegations
against the former Fox News host Bill O'Reilly and the Hollywood
producer Harvey Weinstein --- and the confidential settlements
arising from those accusations --- have prompted a provision in the
final tax bill that aims to stem the use of nondisclosure
agreements. Senator Robert Menendez, a Democrat from New Jersey,
proposed the amendment last month. It says any settlement, payout or
lawyer's fees related to sexual harassment or sexual abuse could not
be deducted as a business expense if such payments were subject to a
nondisclosure agreement." [New York Times,
12/16/17]
Bill Allowed For Immediate Business Expensing From 2017 Though
2022. According to Bloomberg, "Current law: Businesses must take
depreciation, spreading the recognition of their equipment costs for
tax purposes over several years. Proposed: Businesses could fully
and immediately deduct the cost of certain equipment purchased after
Sept. 27, 2017 and before Jan. 1, 2023. After that, the percentage
of cost that could be immediately deducted would gradually phase
down." [Bloomberg,
12/15/17]
Legislation Opened Up Parts Of ANWR To Drilling. According to
Congressional Quarterly, "Passage of the bill, as amended, that
would revise the federal income tax system by lowering individual
and corporate tax rates, repealing various deductions through 2025,
specifically by eliminating the deduction for state and local income
taxes through 2025, increasing the deduction for pass-through
entities and raising the child tax credit through 2025. It would
also open parts of the Arctic National Wildlife Refuge to oil and
gas drilling." [Congressional Quarterly,
12/2/17]
Bill Would Repeal The Individual Mandate. According to the
Congressional Budget Office, "Repealing the Individual Mandate. The
bill's most significant effects on outlays would occur as a result
of the elimination, beginning in 2019, of the penalties associated
with the individual mandate. CBO and JCT estimate the following
effects of that provision:" [Congressional Budget Office,
11/26/17]
13 Million Fewer Americans Would Have Health Insurance As A Result
Of Repealing The Individual Mandate. According to the
Congressional Budget Office, "Repealing the Individual Mandate. The
bill's most significant effects on outlays would occur as a result
of the elimination, beginning in 2019, of the penalties associated
with the individual mandate. CBO and JCT estimate the following
effects of that provision: [...] The number of people with health
insurance would decrease by 4 million in 2019 and 13 million in
2027." [Congressional Budget Office,
11/26/17]
Premiums Would Increase By About 10 Percent. According to the
Congressional Budget Office, "Average premiums in the nongroup
market would increase by about 10 percent in most years of the
decade (with no changes in the ages of people purchasing insurance
accounted for) relative to CBO's baseline projections. In other
words, premiums in both 2019 and 2027 would be about 10 percent
higher than is projected in the baseline." [Congressional Budget
Office,
11/26/17]
Bill Lowers The Corporate Tax Rate From 35 Percent To 21
Percent. According to Congressional Quarterly, "It cuts the
corporate tax rate from 35% to 21%, allows businesses (excluding
public utilities and real estate-related businesses) to immediately
expense 100% of the cost of assets that are acquired and placed into
service by the business (up from 50% under current law), and repeals
the alternative minimum tax (AMT) for corporations." [Congressional
Quarterly, 12/18/17]
Bill Reduced Taxes For Pass-Through Companies Via A 20 Percent
Deduction. According to Vox, "Pass-through companies, like the
Trump Organization, which get a new deduction reducing their tax
burden. The House-Senate compromise bill allows people with
pass-through income to deduct a portion of that income from their
taxes; the deduction is for 20 percent of pass-through income, less
than the 23 percent under the Senate-passed bill." [Vox,
12/18/17]
Legislation Would Convert The U.S. International System To A
Territorial System Where Foreign Profits Are Not Subject To U.S.
Taxes. According to CNN, "Change how U.S. multinationals are
taxed: Today U.S. companies owe Uncle Sam tax on all their profits,
regardless of where the income is earned. They're allowed to defer
paying U.S. tax on their foreign profits until they bring the money
home. Many argue that this 'worldwide' tax system puts American
businesses at a disadvantage. That's because most foreign
competitors come from countries with territorial tax systems,
meaning they don't owe tax to their own governments on income they
make offshore. The Senate bill proposes changes to move the U.S. to
a territorial system. It also includes a number of anti-abuse
provisions to prevent corporations with foreign profits from gaming
the system. And it would require companies to pay a one-time low tax
rate on their existing overseas profits -- 14.5% on cash assets and
7.5% on non-cash assets (e.g., equipment abroad in which profits
were invested), slightly higher than the 14% and 7% rates in the
House bill." [CNN,
12/2/17]
Bill Created A One-Time "Repatriation" Fee Of 15.5 Percent For
Companies That Earned Income Oversees That Is Still Being Held
There. According to Congressional Quarterly, "The agreement
encourages companies to 'repatriate' those stockpiled earnings back
into the United States by offering a much lower, one-time, 15.5% tax
on those foreign earnings held as cash or other liquid form (versus
14% in the House bill) and an 8% tax for any earnings that were
reinvested in illiquid assets). Under the measure, this repatriation
tax could be payable in escalating installments over eight years.
The measure includes special rules for S Corporations, REITs, and
for identifying the scope of earnings and profits subject to the
transition tax." [Congressional Quarterly,
12/18/17]
Bill Would Increase The Deficits By Nearly $1.5 Trillion And Over
$1 Trillion When Accounting Economic Growth. According to
Congressional Quarterly, "The Joint Committee on Taxation (JCT)
estimates that the agreement would increase deficits by $1.46
trillion over 10 years. In conducting macroeconomic analyses of the
House and Senate bills, JCT found that the House bill as passed
would generate economic growth that results in $428 billion of
additional revenues over 10 years while the Senate bill as reported
would generate $408 billion in additional revenues --- in both
cases still leaving deficits of over $1 trillion." [Congressional
Quarterly, 12/18/17]
Legislation Would, Because Of PayGo Rules Regarding The Bill's
Deficit Increase, Force Automatic Spending Cuts, Including $25
Billion In Medicare Next Year. According to Politico, "Republicans
are on the verge of a massive tax overhaul that would hand President
Donald Trump his first major legislative victory. But the $1.5
trillion tax package could trigger eye-popping cuts to a slew of
federal programs, including Medicare. Unless Congress acts swiftly
to stop it, as much as $150 billion per year would be cut from
initiatives ranging from farm subsidies to student loans to support
services for crime victims. Medicare alone could see cuts of $25
billion a year. And the specter of those cuts has thrust Congress
into a high-stakes game of political chicken." [Politico,
11/30/17]
Most Of The Bill's Tax Cuts For Individuals Are Temporary, But The
Corporate Ones Are Permanent. According to the Washington Post,
"The core of the plan is a massive and permanent cut to the
corporate tax rate, dropping it from 35 percent to 21 percent. The
bill also would cut individual tax rates for all income tax levels.
Families earning less than $25,000 a year would receive an average
tax cut of $60, while those earning more than $733,000 would see
an average cut of $51,000, according to the nonpartisan Tax Policy
Center. Many of the breaks for individuals are set to expire in the
coming years. Republicans set those expiration dates to comply with
Senate limits on how much their legislation could add to the
nation's deficit, and they say a future Congress will extend the
cuts or make them permanent." [Washington Post,
12/20/17]
Bill Did Not Repeal The 'Carried Interest' Loophole, Even Though
Then-Candidate Trump Campaigned On Doing So. According to Business
Insider, "President Donald Trump said during his campaign that he
would close a tax loophole for fund managers. 'The hedge fund guys
didn't build this country,' he told John Dickerson on CBS's 'Face
the Nation' in August 2015. 'These are guys that shift paper around
and they get lucky.' 'Half of them, look, they're energetic, they're
very smart, but a lot of them, it's like they're paper pushers. They
make a fortune, they pay no tax. It's ridiculous, OK?' But that
loophole --- the carried interest provision --- remains in the
Republicans' final version of the tax bill, which the House and
Senate are scheduled to vote on Tuesday." [Business Insider,
12/19/17]
Legislation Alters 529 Education Accounts To Allow Up To $10,000
For Private Primary Or Secondary Schools And Allows Certain
Withdrawals For Homeschool Expenses. According to Congressional
Quarterly, "The agreement modifies education- and disability-related
tax benefits with regard to section 529 education savings plans and
ABLE accounts, which are tax-advantaged savings accounts for
individuals with disabilities and their families[.] Specifically,
it allows section 529 savings plans to distribute up to a maximum of
$10,000 in expenses related to private elementary or secondary
school. It also modifies the definition of higher education expenses
to include certain expenses related to a homeschool."
[Congressional Quarterly,
12/18/17]
Bill Creates A 1.4 Percent Excise Tax On Certain Private College's
Endowment. According to Congressional Quarterly, "Similar to both
House and Senate bills, the measure imposes a 1.4% excise tax on the
net investment income of private colleges and universities that have
at least 500 tuition paying students and assets valued at the close
of the preceding tax year of at least $500,000 per full-time
student (versus $250,000 in the House). Assets calculated for that
determination would exclude those assets used directly in carrying
out the institution's educational purposes, but generally would
include the assets of any related organization controlled by the
educational institution or that is a supporting organization."
[Congressional Quarterly,
12/18/17]
Legislation Increased Taxes On Gold Star Families. According to
CNN, "Survivor benefits designated to children were previously taxed
at the parent's rate, but changes in the 2017 tax law, which
Republicans say were intended to simplify tax rules for child
income, led to the steep hikes for some Gold Star families. The
government instead began treating the Defense Department benefit as
if it were a trust or estate, meaning it could be taxed at rates as
high as 37%." [CNN,
5/2/19]
2017: Fitzpatrick Voted For The House GOP's 2017 Tax Reform Plan Which
Significantly Cut Taxes For The Rich And Corporations. In November
2017, Fitzpatrick voted for reconciliation legislation which
significantly altered the federal tax code. According to Congressional
Quarterly, "The bill substantially restructures the U.S. tax code to
simplify the code and reduce taxes on individuals, corporations and
small businesses. For individuals, it consolidates the current seven tax
brackets down to four and eliminates or restricts many tax credits and
deductions, including by eliminating the deduction for state and local
income taxes and limiting the deduction for property taxes to $10,000
and the interest deduction for a home mortgage to the first $500,000
worth of a loan. [...] On the business side, it reduces the corporate
tax from 35% to 20% and establishes a 'territorial' tax system that
would exempt most income derived overseas from U.S. corporate taxation.
It allows businesses to immediately expense 100% of the cost of assets
acquired and placed into service, and for small businesses it raises the
Section 179 expensing limit to $5 million for five years. It also
establishes a 25% rate for a portion of pass-through business income
that would otherwise have to be paid at the ordinary individual tax
level, and for small businesses where an individual would receive less
than $150,000 in pass-through income it taxes the first $75,000 of
that income at a 9% rate." The vote was on passage. The House passed the
bill by a vote of 227 to 205. President Trump later signed an amended
version of the bill into law. [House Vote 637,
11/16/17; Congressional
Quarterly, 11/15/17;
Congressional Actions, H.R.
1]
Legislation Alters The Federal Individual Income Tax Structure
From Seven To Four Tax Rates, Including Increasing The Top Rate From
$500,000 To $1,000,000 For An Individual. According to
Congressional Quarterly, "Tax Rate Restructuring --- Reduces and
restructures federal income tax rates by consolidating the seven
current rates into four rates --- 12%, 25%, 35% and 39.6% --- which
would reduce rates for most taxpayers. Under the measure, the 12%
bracket would apply to taxable income up to $45,000 for individuals
and $90,000 for married couples; the 25% bracket to additional
income up to $200,000 for individuals and $260,000 for couples;
the 35% bracket to additional income up to $500,000 for individuals
and $1 million for couples; and the top 39.6% bracket to additional
income above those levels." [Congressional Quarterly,
11/15/17]
Legislation Alters The Mortgage Interest Deductions To Cap New
Debt Incurred After November 1st, 2017 At $500,000 And Eliminates
The Deduction For Second Homes And Equity Loans. According to
Congressional Quarterly, "Limits the amount of mortgage interest
that can be deducted to just that associated with the first
$500,000 of a home loan (down from $1 million), and eliminates the
deduction for interest on second homes and home equity loans
(interest associated with existing mortgages as of Nov. 1, 2017,
could still be deducted)." [Congressional Quarterly,
11/15/17]
Bill Eliminated The Deduction For State And Local Income Taxes And
Capped The Overall State And Local Tax Deduction At $10,000 For
Property Taxes. According to Congressional Quarterly, "State &
Local Deduction --- Eliminates deductions for state and local income
taxes and caps the deduction for state or local property taxes at
$10,000." [Congressional Quarterly,
11/15/17]
Legislation Eliminates The Personal Exemptions, But Doubles The
Standard Deduction. According to Congressional Quarterly, "The
bill significantly increases the standard deduction, nearly doubling
it to $12,200 for individual filers and $24,400 for joint filers
(the 2018 standard deduction is to be $6,500 for individuals and
$13,000 for joint filers). However, it eliminates the personal
exemptions that taxpayers may claim for themselves, their spouses
and for any dependents (which for 2018 is to be $4,150 per person).
The personal exemption, along with either the standard deduction or
itemized deductions, reduces a taxpayer's adjusted gross income in
determining taxable income. To temporarily replace the personal
exemption, the measure creates a new family credit (see below)."
[Congressional Quarterly,
11/15/17]
Legislation In Part Replaces The Personal Exemption By Creating A
$300 Credit For Parents And Non-Children Dependents -- But For Only
Five Years - And Increases The Child Tax Credit By $600.
According to Vox, "The child tax credit, currently $1,000, will
grow to $1,600, and a new $300 credit for parents and other
non-child dependents in the house (the $300 credit expires after
five years, presumably to save money)." [Vox,
11/16/17]
The Bill Repeals The AMT. According to the Washington Post, "The
mega-wealthy also would get to keep charitable deductions, a popular
way that lowers their tax bills, and they no longer would have to
pay the alternative minimum tax (AMT), a safeguard against excessive
tax dodging that's been in place since 1969." [Washington Post,
11/16/17]
The Measure Changes The Metric In Which Inflation Is Adjusted For
Tax Brackets To "Chained CPI", Which While More Accurate, Grows More
Slowly Than The Current Metric. According to Congressional
Quarterly, "The measure changes the manner in which tax brackets are
increased each year to account for inflation and thereby prevent
people from being pushed into higher tax rates as their income grows
without an actual increase in purchasing power. Specifically, the
bill switches to so-called 'chained CPI,' which many economists say
represents a more accurate estimate of inflation because it factors
in consumer substitution of cheaper products. Chained CPI is usually
lower than the current inflationary index used (the CPI-U; the
Consumer Price Index for All Urban Consumers), which means that tax
brackets would not rise as rapidly and more taxpayers may end up in
higher tax rates. Under the measure, new tax brackets each year
would be set by using chained CPI and then rounding down to the next
lowest multiple of $100." [Congressional Quarterly,
11/15/17]
Legislation Repeals The Medical Expenses Deduction. According to
Vox, "A variety of other, much smaller deductions, like the medical
expense deduction and the property casualty loss deductions, are
repealed." [Vox,
11/16/17]
Legislation Repealed The Deduction For Alimony Paid. According
to CNBC, "The Tax Cuts and Jobs Act, unveiled on Thursday, includes
a provision to kill the deduction that taxpayers get for making such
payments to an ex-spouse. Although it's just one of the many tax
breaks eliminated under the legislation, experts say it will end up
most hurting the person receiving the money. [...] The new tax
legislation essentially would shift much of the taxation from the
recipient to the alimony payer. 'Due to the disparity in tax rates
that exist in these cases, this would have a negative effect on the
payee. That's the bottom line,' said Malcolm Taub, co-chair of
Davidoff Hutcher & Citron's Divorce & Family Law Group in New York.
Because the ex-spouse receiving the alimony typically is in a lower
tax bracket, the amount of tax paid by the recipients --- the
majority of which are women --- on the spousal support is less. And
it's something that courts, attorneys and divorce planners take into
consideration when divvying up assets." [CNBC,
11/3/17]
Legislation Counts Tuition Waivers As Income, Thereby
Significantly Increasing The Tax Burden For Certain Graduate
Students. According to CNBC, "The House Republican tax plan
includes a $1.5 trillion corporate tax cut and a giant tax hike on
graduate students. Tamar Oostrom, who is currently earning her Ph.D.
in economics at MIT, has been crunching the numbers to determine how
the current House Republican bill would affect the taxes paid by
graduate students. [...] Grad students like Oostrom often afford
advanced degrees by earning a tuition waiver. In these instances,
graduate students will work for the university by teaching classes
and/or conducting research in exchange for free tuition. According
to the American Council on Education, roughly 145,000 graduate
students receive this kind of tuition reduction. Some programs
provide graduate students with a modest stipend for food and
housing. For instance, Ryan Hill, a fourth-year Ph.D. student at
MIT, receives a $30,000 living stipend and a tuition waiver
allowing him to forego paying $50,000 in tuition. He currently pays
taxes on his $30,000 stipend, but under the proposed House tax
bill, his tuition waiver would also be taxed --- meaning he would be
taxed as if he was earning $80,000 a year." [CNBC,
11/16/17]
Legislation Modifies Numerous Education Tax Credits By Folding
Them All Into A Reformed American Opportunity Tax Credit.
According to Congressional Quarterly, "It consolidates certain
education tax credits, folding the Hope Scholarship Credit and the
Lifetime Learning Credit into the American Opportunity Tax Credit
(AOTC), which would be modified to be available for a fifth year of
post-secondary education at half the rate as the first four years,
with up to $500 of the credit being refundable. The AOTC would
continue to provide a 100% tax credit for the first $2,000 of
certain higher education expenses, such as tuition, fees, and course
materials, and a 25% tax credit for the next $2,000 of such
expenses." [Congressional Quarterly,
11/15/17]
Legislation Allowed Unborn Children To Have Education Savings
Accounts Set Up In Their Name. According to the Wall Street
Journal, "Abortion rights and antiabortion activists joined the tax
bill lobbying fray late Thursday, as a provision allowing adults to
set up a college savings account for a 'child in utero' caught the
attention of bill readers." [Wall Street Journal,
11/2/17]
Legislation Repeals The Tax Deduction For Student Loan Interest.
According to the Washington Post, "At the moment, low and middle
income Americans can deduct up to $2,500 a year in student loan
interest. That benefit would go away in 2018." [Washington Post,
11/16/17]
Bill Repeals The Tax Break Where Teachers Can Deduct $250 Of
Non-Reimbursed Classroom Expenses. According to Politico, "On the
secondary school side, the House GOP plan scraps a tax break that
allowed teachers to deduct up to $250 in out-of-pocket expenses for
the classroom." [Politico,
11/2/17]
Legislation Alters The Moving Expense Tax Break To Only Allow It
For Active Duty Military. According to Congressional Quarterly,
"For moving expenses, it allows a deduction only for members of the
active-duty military." [Congressional Quarterly,
11/15/17]
Bill Repeals The Tax Credit For Plug-In Electric Cars. According
to the Congressional Quarterly, "The measure retains the credit for
child adoption expenses, but it repeals a number of other credits,
including the credit associated with mortgage credit certificates,
the credit for plug-in motor vehicles, and a credit for certain
individuals who are over the age of 65 or who have retired on
disability." [Congressional Quarterly,
11/15/17]
Bill Would Phase In A Complete Estate Tax Repeal. According to
Congressional Quarterly, "It also repeals the estate tax starting in
2025, and until that time doubles from $5.6 million to $11.2
million (adjusted annually for inflation) the amount per spouse that
is exempted from the estate tax. The gift tax rate would be reduced
to 35%." [Congressional Quarterly,
11/15/17]
Legislation Reduces The Corporate Tax Rate From 35 Percent To 20
Percent. According to Congressional Quarterly, "It cuts the
corporate tax rate from 35% to 20%, except for personal services
firms organized as C corporations, which would pay a 25% rate."
[Congressional Quarterly,
11/15/17]
Bill Moves The International Tax System To Something Known As
"Territorial" Where Foreign Profits Are Not Subject To The Corporate
Income Tax. According to Congressional Quarterly, "The bill
replaces the current system of taxing U.S. corporations on the
foreign-source earnings of their foreign subsidiaries with a
dividend-exemption system --- which would exempt from U.S. taxation
100% of the foreign-source portion of dividends paid by a foreign
company to a U.S. corporation, if the U.S. company owns 10% or more
of the foreign entity. Under the measure, U.S. corporations could
not claim any foreign tax credit or deduction for its foreign tax
liability with respect to exempted dividends, and no deductions for
expenses allocable to an exempt dividend would be taken into account
for purposes of determining the U.S. corporation's foreign-source
income." [Congressional Quarterly,
11/15/17]
Legislation Would Allow For Immediate Business Expensing For Five
Years. According to Congressional Quarterly, "It allows businesses
(excluding public utilities and real estate-related businesses) for
five years to immediately expense 100% of the cost of assets that
are acquired and placed into service by the business, and also
repeals the ability of a business to use stockpiled alternative
minimum tax (AMT) credits in the place of depreciation."
[Congressional Quarterly,
11/15/17]
The Bill Significantly Altered Taxation For So-Called
"Pass-Through" Businesses By Lowering The Rate To 25 Percent;
Certain Professional Firms Would Not Be Subject To The New Lower
Rate. According to Congressional Quarterly, "'Pass-through'
Businesses --- Modifies the treatment of pass-through business
income, which is generally not subject to tax at the business level
but is taxed at the individual level when it is distributed to
owners in the form of profits, wages, or capital gains. It
establishes a new top 25% rate on such pass-through business income,
but generally allows just 30% of a business's net income to be
taxed at that rate, with the remainder being taxed at the
individual's ordinary income rate. Services firms such as lawyers,
accountants and physicians generally could not take advantage of
this rate, except to the extent they have capital investments."
[Congressional Quarterly,
11/15/17]
Legislation Modified, But Does Not Eliminate, The Carried Interest
Loophole. According to Congressional Quarterly, "Carried
Interest --- The bill modifies the so-called 'carried interest
rule,' which allows private equity and hedge fund managers to be
taxed on certain income at the lower capital gains rate rather than
at the individual tax rate for ordinary income. Specifically, it
requires that for preferential capital gains treatment the asset
must be held for at least three years, instead of only one."
[Congressional Quarterly,
11/15/17]
Legislation Repealed The Corporate AMT. According to
Congressional Quarterly, "The bill also repeals the corporate
alternative minimum tax (AMT), as well as the ability of a business
to use stockpiled AMT credits in the place of depreciation."
[Congressional Quarterly,
11/15/17]
Bill Repeals Numerous Energy Tax Credits, Including The Per-Barrel
Credit For Crude Oil And Certain Clean Energy Tax Credits.
According to Congressional Quarterly, "The bill makes a number of
modifications to tax credits provided for the production of energy,
including repeal of the inflation adjustment for the renewable
electricity production tax credit for qualified projects placed in
service after Nov. 2, 2017, with the credit amount reverting to 1.5
cents per kilowatt hour (from 2.3 cents in 2016), and harmonization
of the expiration dates, phase-out schedules and application of the
30% investment tax credit as applied to solar, fuel cell, and small
wind energy. That investment tax credit would not be available for
properties beginning construction after 2021." [Congressional
Quarterly, 11/15/17]
Bill Repeals Tax Exemption For Private Actively Bonds. According
to Congressional Quarterly, "Interest paid on certain private
activity bonds (PABs), which are issued by state and local
governments to finance activities of, or loans to, private parties,
is exempt from federal tax. The bill repeals the tax exemption for
newly issued PABs; the committee says it wants to ensure that the
federal government does not subsidize the borrowing costs of private
businesses to the detriment of other business that cannot avail
themselves of PABs." [Congressional Quarterly,
11/15/17]
Bill Repeals Tax Deduction For Interest On State And Local Bonds
On Professional Sports Stadiums. According to Congressional
Quarterly, "State and Local Bonds --- Subjects to federal taxation
the interest paid from any new private activity bonds (PABs) issued
in the future by state and local governments to finance the
activities of, or loans to, private parties, and it also repeals the
federal tax exemption on advance refunding bonds. It also subjects
to federal taxation the interest paid on state and local bonds
issued to build professional sports stadiums." [Congressional
Quarterly, 11/15/17]
Legislation Taxes Certain Large College Endowments. According to
Congressional Quarterly, "The measure imposes a 1.4% excise tax on
the net investment income of private colleges and universities that
have at least 500 students and assets valued at the close of the
preceding tax year of at least $250,000 per full-time student.
Assets calculated for that determination would exclude those assets
used directly in carrying out the institution's educational
purposes." [Congressional Quarterly,
11/15/17]
Bill Would Repeal The So-Called "Johnson Amendment", Which
Prevents Non-Profits From Endorsing Political Candidates.
According to USA Today, "A provision in the tax bill to allow
churches to be more directly engaged in politics could cost the U.S.
government hundreds of millions of dollars, congressional experts
say, because some political donors would shift their money to
tax-exempt charities. The House Ways and Means Committee approved a
sweeping overhaul of the tax code Thursday, including a provision to
do away with the 'Johnson Amendment,' a 1954 provision that forbids
non-profit charities --- called 501(c)(3)s --- from endorsing
political candidates." [USA Today,
11/10/17]
Republican Supporters Claim That The Bill Will Increase Economic
Growth And Increase After-Tax Income For The Average Middle-Class
Family By $4,000. According to Congressional Quarterly,
"Supporters of the bill, primarily Republicans, say it will provide
relief from a broken tax code, a slow-growing economy, stagnant
wages, and from jobs fleeing overseas. They say the legislation
charts a new course for the country and is expected to create one
million new jobs, increase annual after-tax income for middle-income
households by an average of $4,000 and grow the U.S. economy by
more than 3.5% each year. Workers will finally be able to get the
raise they deserve, more families will have help to buy a home,
raise children, pay for college, and plan for their future, while
businesses of all sizes will be able to create jobs, increase
paychecks, and invest in the United States." [Congressional
Quarterly, 11/15/17]
Legislation Will Add $1.5 Trillion To The National Debt.
According to the Committee for a Responsible Federal Budget, "The
House of Representatives passed a tax cut package today that will
add $1.5 trillion or more to the national debt. The following is a
statement from Maya MacGuineas, president of the Committee for a
Responsible Federal Budget: The House approved debt-financed tax
cuts based on predictions of magical economic growth that defy
history and all credible analyses. Tax reform should grow the
economy and not add to the debt. Unfortunately, lawmakers are
assuming faster economic growth will pay for that debt increase when
there is no evidence it will cover more than a fraction of the tax
bill's costs." [CRFB,
11/16/17]
Legislation's Changes To Education Policy "Would Increase The Cost
Of College By $71 Billion Over A Decade." According to the
Washington Post, "Government analysis shows House tax bill would
increase the cost of college by $71 billion over a decade. The
repeal and revision of higher-education tax benefits in the bill
passed Thursday by the House would cost students and families more
than $71 billion over the next decade, according to an official
analysis by Congress's Joint Committee on Taxation." [Washington
Post,
11/16/17]
President "Trump And His Family Could Save More Than $1 Billion
Under House Tax Bill." According to NBC News, "Trump and his
family could save more than $1 billion under House tax bill [...]
In fact, Trump and his heirs potentially could save more than $1
billion overall under the GOP tax proposal that the House of
Representatives passed Thursday, with most of that amount coming
from a repeal of the estate tax, according to an analysis NBC News
commissioned of Trump's one known 2005 tax return and his estimated
net worth. Trump would save more than $20 million himself,
according to the analysis of how the legislation affects his 2005
tax return, and his heirs could potentially save $1.1 billion based
on his reported wealth." [NBC News,
11/16/17]
Bill Retained A Tax Break For Golf Course Owners When They Pledge
To Not Develop Certain Land. According to the Washington Post,
"The Republican tax plan could also benefit Trump by protecting
exemptions that help his business. The House bill would still allow
golf course owners to claim deductions if they commit to never
building on the land, a write-off that Sen. Jeff Flake (R-Ariz.)
included in his report this year on 'outlandish loopholes.'"
[Washington Post,
11/10/17]
Moving To A Territorial International Tax System Would Encourage
Outsourcing. According to William Gale of the Tax Policy Center,
"The plan would also move the U.S. toward a territorial tax system,
under which U.S. companies would pay no U.S. taxes on their foreign
income. That would encourage them to ship jobs, capital, and profits
overseas." [Brookings Institution,
10/20/17]
Legislation Would Raise Taxes On 36 Million Middle Class
Americans. By 2027 According to the Tax Policy Center via the
Center for American Progress, "In fact, the Tax Policy Center found
that 36 million middle-class and working families nationally would
experience a tax increase under the House tax plan by 2027."
[Center for American Progress,
11/15/17]
By 2027, The Top 1 Percent Would Get 50 Percent Of The Total
Benefit. According to the Tax Policy Center, "In 2027, the overall
average tax cut would be smaller than in 2018, reducing taxes by
about $860 on average, or 0.9 percent of after-tax income (table
2). Taxpayers in the bottom two quintiles of the income distribution
(those with income less than about $55,000) would see little change
in their taxes, with average tax decreases of $50 or less.
Taxpayers in the middle of the income distribution would see a net
tax cut on average and see their after-tax incomes increase 0.5
percent. Taxpayers in the top 1 percent would receive nearly 50
percent of the total benefit; their after-tax income would increase
2.6 percent on average." [Tax Policy Center,
11/13/17]
Some Republicans Claimed That Donor Pressure Was The Reason For
The Bill. According to the Associated Press via the Washington
Post, "House Republicans cited donor pressure as they rolled over
Democratic objections Tuesday and pushed forward with contentious
legislation to overhaul the nation's tax code. 'My donors are
basically saying get it done or don't ever call me again,'
Republican Rep. Chris Collins of New York told reporters. [...]
Indeed, the political backdrop was inescapable as Republicans sought
final action by year's end on the bill that's strongly supported by
President Donald Trump as he and Congress' GOP majorities search for
a legislative win they can take to voters next year." [Associated
Press via the Washington Post,
11/7/17]
Bill Includes Numerous Loopholes For Wall Street. According to
Bloomberg, "Lawmakers who sped a bill through the U.S. House last
week may have handed a few more goodies to Wall Street's wealthiest
than they realize. Investors in billion-dollar hedge funds might be
able to take advantage of a new, lower tax rate touted as a break
for small businesses. Private equity fund managers might be able to
sidestep a new tax on their earnings. And a combination of proposed
changes might allow the children and grandchildren of the very
wealthy to avoid income taxes in perpetuity." [Bloomberg,
11/21/17]
Bill Includes Permanent Tax Cuts For Corporations, But Not For
Individuals. According to the Washington Post, The essential
gamble of Republican plans to overhaul the tax code is now becoming
clear: Big businesses get a large, permanent tax cut, while American
families receive only temporary tax relief that expires as soon as
2023 in the House bill and 2026 in the Senate bill. In the House
bill, the tax increase would mostly hit moderate and middle-income
families because a credit designed to help them expires after five
years. But in the Senate plan, released late Tuesday, virtually all
Americans would face higher tax rates because the individual income
rate cuts go away entirely in 2026. The tax cuts for corporations do
not expire." [Washington Post,
11/15/17]