Tax Cuts and Jobs Act of 2017

rdf:langString Tax Cuts and Jobs Act of 2017

rdf:langString Tax Cuts and Jobs Act

rdf:langString H.R. 1

rdf:langString Kevin Brady

rdf:langString House of Representatives

rdf:langString Senate

rdf:langString House of Representatives

rdf:langString An Act to provide for reconciliation pursuant to titles II and V of the concurrent resolution on the budget for fiscal year 2018

rdf:langString "Overall, the combined effect of the change in net federal revenue and spending is to decrease deficits allocated to lower-income tax filing units and to increase deficits allocated to higher-income tax filing units.--Congressional Budget Office"

rdf:langString The Act to provide for reconciliation pursuant to titles II and V of the concurrent resolution on the budget for fiscal year 2018, Pub.L. 115–97 (text) (PDF), is a congressional revenue act of the United States originally introduced in Congress as the Tax Cuts and Jobs Act (TCJA), that amended the Internal Revenue Code of 1986. Major elements of the changes include reducing tax rates for businesses and individuals, increasing the standard deduction and family tax credits, eliminating personal exemptions and making it less beneficial to itemize deductions, limiting deductions for state and local income taxes and property taxes, further limiting the mortgage interest deduction, reducing the alternative minimum tax for individuals and eliminating it for corporations, doubling the estate tax exemption, and cancelling the penalty enforcing individual mandate of the Affordable Care Act (ACA). The Act is based on tax reform advocated by congressional Republicans and the Trump administration. The nonpartisan Congressional Budget Office (CBO) reported that under the Act individuals and pass-through entities like partnerships and S corporations would receive about $1.125 trillion in net benefits (i.e. net tax cuts offset by reduced healthcare subsidies) over 10 years, while corporations would receive around $320 billion in benefits. The CBO estimated that implementing the Act would add an estimated $2.289 trillion to the national debt over ten years, or about $1.891 trillion after taking into account macroeconomic feedback effects, in addition to the $9.8 trillion increase forecast under the current policy baseline and existing $20 trillion national debt. Many tax cut provisions, especially income tax cuts, will expire in 2025, and starting in 2021 will increase over time; by 2027 this would affect an estimated 65% of the population and in that same year the law's provisions are set to be fully enacted, but the corporate tax cuts are permanent. The Senate was able to pass the bill with only 51 votes, without the need to defeat a filibuster, under the budget reconciliation process. The House passed the penultimate version of the bill on December 19, 2017. The Senate passed the final bill, 51–48, on December 20, 2017. On the same day, a re-vote was held in the House for procedural reasons; the bill passed, 224–201. The bill was signed into law by President Donald Trump on December 22, 2017. Most of the changes introduced by the bill went into effect on January 1, 2018, and did not affect 2017 taxes. Supporters argued that the law would increase GDP growth, increase levels of business investment, increase wage and salary income for households, that the tax cuts would pay for themselves, and that the law would simplify tax codes. Opponents argued that the law would result in adverse impacts, including a higher budget deficit, higher trade deficit, greater income inequality, and lower healthcare coverage and higher healthcare costs, and a disproportionate impact on certain states and professions. Critics also argued that advocates misrepresented the law. Some of the reforms enacted by the Republicans have become controversial within key states, particularly the $10,000 cap on state and local tax deductibility, and were challenged in federal court before being upheld. According to an aggregation of polls from Real Clear Politics, 34% of Americans were in favor of the new plan, 39% not in favor, and 28% unsure. According to a 2017 report by Tax Policy Center, taxes would be reduced by about $1,600 on average in 2018 and 2025. The top 20% of Americans by income were projected to receive roughly 65% of the tax savings. In the two years since the Act was passed, it has failed to pay for itself through increased economic growth, according to Maya MacGuineas, president of the Committee for a Responsible Federal Budget. According to Bloomberg, the Act has simplified the tax code for some, but not others, lowered corporate debt, led investment to temporarily increase before then declining, and brought money back from overseas, but did not bring back business activity.

rdf:langString TCJA

rdf:langString An Act to provide for reconciliation pursuant to titles II and V of the concurrent resolution on the budget for fiscal year 2018.