A month ago, the GOP-controlled House of Representatives passed the second phase of the tax cuts following the December 2017-passed Tax Cuts and Jobs Act. The main piece of the three-bill package is a measure that would extend and make permanent the individual tax cuts implemented almost a year ago. Under current law, the individual cuts are set to expire after 2025. Though these significant tax cuts would balloon the deficit even more, it would continue to put more money into the pockets of hard working Americans. I used to care about the debt and the deficit. But no one else seems to care, so I have given up trying to sound the alarm.
The bill now sits in the Senate and its fate depends on the outcome of Tuesday’s elections.Economists appear to be in agreement that the extended tax cuts would provide a modest boost to the economy in the short-term, but the benefits would be tilted toward wealthier Americans, AKA job creators, employers, and investors
According to the Tax Policy Center, the individual tax cut past 2025 would slash taxes for American households by $1,600 on average starting in 2026. Lower-income households making up to $28,600 would receive an average tax cut of $100, a 0.5 percent boost to after-tax income. The middle class ($54,800 to $95,000), however, would benefit from an average cut of $980, a 1.3 percent boost to incomes. The top 1 percent of income earners, who make much more money than the rest of us and pay a disproportionate amount of taxes already, would get an average cut of more than $40,000, a 2 percent increase to incomes. The new cuts would benefit a vast majority of households. Two-thirds of Americans would receive a tax cut while roughly 9 percent would see their tax burden increase due to the elimination of a few tax credits. The remaining quarter of households would see a minimal change of $100 or less after taxes.
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