Posted by Tina
Citizens in high tax states like California, New York and New Jersey will take a hit if Congress includes one portion of Trumps tax plan in their final law. Trumps tax plan eliminated the state and local tax deduction (another reason to leave this state). But there are significant rate cuts that should work well to bring our economy’s growth to at least 3%.
Instead of seven brackets the new tax law would have only three (four if you include those who pay zero) The top rate for individual taxes would be lowered to 35% from the current 39.6% rate. The rates for the remaining two brackets would be 25% and 10%. The standard deduction for all individuals would doubl and, with the exception of mortgage interest and charitable contributions, all other deductions would be eliminated.
The corporate tax rate would fall from the current punishing rate of 35% to 15%. Business income from so called mom and pop businesses would also be taxed at the 15% rate.
The estate tax and the alternative minimum tax would be repealed.
The border tax that was on the table was left out of this proposal. Several other important possible changes were also left out of Trump’s plan:
whether companies could immediately write off capital expenses; what happens to personal exemptions; where to set the one-time tax rate on U.S. companies’ stockpiled foreign earnings; how a break for child care would be structured; and where the tax brackets for individuals would be set.
Wrangling room for negotiations in the Congress no doubt. All in all its a decent place to start. It would certainly bring a lot of relief to the good citizens of our nation. Some would find more money in their pockets, others would finally have room to expand their businesses, and other would finally get a chance to move out of Dad’s basement and see what it’s like to be a taxpaying working stiff.
America needs this tax cut. We also need cuts in government spending. The Trump administration is working on that too.
When a Junior in high school, one teacher had our class fill out a 1040 tax form. We were given a set list of wages and deductions and told to enter them in the proper places, do the math, and calculate our taxes based on the 1040 instructions.
After all the papers were turned in, the teacher informed us that NOBODY in the class got the amount due correct! And this wasn’t a dumb class as they are nowadays.
The purpose of the exercise was to demonstrate the complicated tax reporting system we have and how easy it is to get it WRONG. And this happened during the ’60’s! (Oops, I’m dating myself!) It’s only gotten worse since then.
These days you can get a computer program to help you file your taxes, but it’s still a pain in the tush. America has suffered under a pile of tax paperwork and NEEDS a tax cut. It also needs a SIMPLIFIED tax reporting system.
And in the Who Pays Taxes File – those that receive any goofernment benefits should be required to pay taxes on those benefits! The folks getting Social Security have to do so, but those on unemployment, welfare, or food stamps do not.
J, I was also a 60’s high-schooler. In the (I believe) late 90’s, I remember reading a bunch of collegiate academics’ paper concluding that a Liberal Arts Bachelor’s degree of the 90’s was equivalent to a high school diploma of the 60’s. It would explain a lot.
Check this out. How many BA degree holders could pass this today?
I mentioned in another comment earlier, I learned today that Civics hasn’t been taught in our schools since the 1970s. I’m a 1966 hs grad, so was in similar classes as you guys.
8th Grade Examination from late 1800’s:
“Received this from Jason today, a pledge brother of mine and one of the only card-carrying Mensa members I’ve ever known up close. I’m sure he scored well, but I’m not promising anything on my end, especially now that I have to understand what “syllabication” and “diacritical marks” are. Pull out a slate and some chalk and see how you do!:
*****
Remember when our grandparents, great-grandparents, and such stated that they only had an 8th grade education? Well, check this out. – – –
This is the eighth-grade final exam from 1895 in Salina, KS, USA. It was taken from the original document on file at the Smokey Valley Genealogical Society and Library in Salina, KS, and reprinted by the Salina Journal. Students were given 5 hours to complete the test.
8th GRADE FINAL EXAM
Continue to test.
http://thinklab.typepad.com/think_lab/2006/03/8th_grade_exami.html
America needs this tax cut.
Well, it appears that not all of America is going to get a tax cut.
The brackets have been announced but not the incomes those brackets apply to.
If one assumes they are the same as what Trump originally proposed a fair number of people are in for a nasty tax increase, especially those who will no longer be able to deduct state income tax. Some people could be in for a bigly tax increase which would be a yuge surprise as Trump would say.
For instance, the 35% tax bracket would start at 112,000. Today 112,00 is in the 28% bracket. So with state income tax no longer being deductible many will have more income taxed at a higher rate than under Obammy and the Demonrats. Thanks, Trumpy!
Assuming that worse case scenario you’re right, Joe, it could mean higher taxes for some people…not sure about “many” people.
The brackets are yet to be defined; this is just a proposal…a place to begin negotiations. We’ll have to wait and see how it’s fleshed out.
The amount of money lost to “many” in the middle and lower classes under O and the Democrats is immeasurable.
Big government spending punishes and that’s the real problem.
If we don’t get this economy rolling at greater that that awful low 2% or less generations of kids will not have a chance to grow into full adulthood and realize their dreams. They will remain dependent, poor, and needy forever. Even many with college degrees. At some point there will be no one left to tax. What then?