The current 2018 numbers come from "IRS Announces 2018 Tax Brackets, Standard Deduction Amounts, And More," Kelly Phillips Erb, Forbes, October 19, 2017. The GOP Tax Bill numbers are from "What's in the Final Republican Tax Bill," Wilson Andrews and Alicia Parlapiano, New York Times, December 17, 2017, p. 21 and "What’s in the Tax Bill, and How It Will Affect You," Ron Lieber and Tara Siegel Bernard, New York Times, updated December 17, 2017.
Selfishly, my typical example is a married couple filing a joint return with no dependents.
| Comparison of Federal Income Tax Details | |||
|---|---|---|---|
| Married Filing Joint | Current 2018 | GOP 2018 | Change |
| Standard Deduction | $13,000 | $24,000 | +85% |
| Deduction >65 years | $1,300 | $1,300 | No change |
| Personal Exemption | $8,300 | $0 | Eliminated |
| Total | $22,600 | $25,300 | +12% |
| Number of brackets | 7 | 7 | No change |
| Married filing jointly | 10% for $0-$19,050 15% for $19,051-$77,400 25% for $77,401-$156,150 28% for $156,151-$237,950 33% for $237,951-$424,950 35% for $424,950-$480,050 39.6% for $480,051 + | 10% for $0-$19,050 12% for $19,051-$77,400 22% for $77,401-$165,000 24% for $165,001-$315,000 32% for $315,001-$400,000 35% for $400,001-$600,000 37% for $600,001 + | Rates: -0% to -4% Upper limits: -6% to +32% |
Again, selfishly, I am not overwhelmed by my temporary 12% total deduction/exemption increase or my 3% tax rate cut, both set to expire after seven years because the Republicans don't have 60 votes. Someone making $624,000 would have an overall tax cut of 11% from the rate reductions and bracket changes, almost four times mine. And then the corporate tax cut is 14% and permanent. This doesn't even look at the new loopholes for pass-through income. I will be much more unhappy when the Republicans start dismantling Medicare and Social Security next year.
There is nothing here to show that the bill won't increase taxes for the middle class in order to cut taxes for wealthy political donors. Trump's description of this as "a massive tax cut for the everyday working American families" tells me that, like the GOP health plan, he doesn't understand what the tax bill actually does.
This is the latest forecast of changes in after-tax income by the New York Times and the Tax Policy Center, including required spending cuts for deficit reduction:
My own theory is that Congress will never, ever simplify taxes, if only because the members will never give up creating tax incentives, even for a single conservative college in Michigan. Incentives are much safer politically than voting to raise taxes or provide direct public subsidies.
The Republican tax bill does not pass the postcard test.
It leaves nearly every large tax break in place. It creates as many new preferences for special interests as it gets rid of. It will keep corporate accountants busy for years to come. And no taxpayer will ever see the postcard-size tax return that President Trump laid a kiss on in November as Republican leaders launched their tax overhaul effort.
This was not the grand simplification of the code that Republicans promised when they set out to eliminate tax breaks and cut the number of tax brackets as they lowered rates.
As their bill tore through Congress, their ambitions fell to the powerful forces of lobbying and the status quo. Killed tax breaks returned to life. New ones sprung up beside them. A plan for three individual tax brackets became five, and finally eight.
Trade groups, such as the one for real estate agents, were able to preserve many benefits targeted for elimination. The groups whose breaks were actually killed formed an eclectic, if less powerful, bunch: bicycle commuters, gamblers, workers whose companies give them free food.
What emerged on Friday, in the final product agreed to by Republican members of a House-Senate conference committee, was a bill that layers new tax complexities upon businesses large and small, and which delivers a larger share of benefits to corporations and the rich than to the middle class.
— "File Your Taxes on a Postcard? A G.O.P. Promise Marked Undeliverable," Jim Tankersley, New York Times, December 16, 2017
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