A Massive Middle-Class Tax Cut May Not Be in Store
Every article I read just gets me more angry!
https://www.nytimes.com/2017/11/02/us/politics/middle-class-tax-cut-republican-bill.html?mabReward=ART_ACTM1&recid=0vpXebPK1UgDxULZr3WrNaIHZWk&recp=2&moduleDetail=recommendations-2&action=click&contentCollection=Reader%20Center®ion=Footer&module=WhatsNext&version=WhatsNext&contentID=WhatsNext&src=recg&pgtype=article
A ‘Massive’ Middle-Class Tax Cut May Not Be in Store
Jim Tankersley
8-9 minutes
The Republican tax plan would make it difficult for middle class people looking to buy starter houses in high-priced, economically vibrant areas such as Silicon Valley and New York. Jim Wilson/The New York Times
WASHINGTON — The House Republican tax bill is a clear windfall for corporate America and a roll of the dice for the middle-class families that President Trump promised would be the centerpiece of his economic agenda.
Early projections suggest the bill would cut taxes for an average middle-class family. But the typical cut could be relatively modest, compared with the benefits for businesses and high earners. More important, the myriad changes in the code would actually raise taxes on nearly 13 million tax filers who earn $100,000 a year or less, according to preliminary calculations using the open-source economic modeling software TaxBrain.
Those changes also include limits on, or the elimination of, what might be called tax breaks for middle-class aspirers. The bill would no longer allow Americans to deduct interest on student loans they took out to attend college. It would limit mortgage interest deductions to $500,000 on newly purchased homes, a provision that would hit middle-class teachers or office workers looking to buy starter houses in high-priced, economically vibrant areas such as New York City and Silicon Valley.
One of the bill’s biggest lifts to working families would vanish after five years — though Republicans would certainly push to extend it — and another would be diluted by the bill’s changes to how the tax code calculates inflation.
It is difficult to see those provisions as the unambiguous gift to American workers — the “major, major tax cut,” in the words of Mr. Trump — that Republicans promised. Instead, the bill effectively asks those workers to put their faith in a sort of bank-shot theory of income growth, where corporate tax cuts turn into profits that are passed on to workers in the form of higher wages.
If those benefits do not accrue, many workers could face higher taxes while companies keep their savings or pass them on to shareholders in the form of higher dividends..................................................
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