You purposefully left out that the standard deduction will be doubled. That is the sort of thing the MSM does.
“You purposefully left out that the standard deduction will be doubled. That is the sort of thing the MSM does.”
I also left out the fact that the personal exemption will be eliminated, along with severe limits on the 401k exemption.
Let’s call it a wash.
You purposefully left out that the personal exemption is being done away with. So for a married couple with one kid, that $12,500 increase in the standard deduction is offset by the loss of $12150 in personal exemptions so the net is an increase of only $350. Remove the deduction for state and local income taxes and reduce the 401K deduction and taxable income goes up.
You purposefully left out the true math on that too didn't you.
“You purposefully left out that the standard deduction will be doubled. That is the sort of thing the MSM does.”
I was thinking the same thing. Why was this not in the story?
What about people who have already payed for their house? Under the current system they get no mortgage deduction at all. They most likely don’t Itemize at all. That means they don’t itemize sales taxes as well. By doubling the standard deduction these people will actually get some relief.
I have always been so frustrated by a system that rewards people for going into debt and punishes people who save and pay for everything outright. And this system does that in so many ways.
For many people that makes these deductions moot and the process of doing taxes simpler. As a parent of several kids I am a bit put off by the loss of exemptions for my kids, but they are talking about increasing the tax credit so it may be a wash.
One problem people have with tax and other economic discussions though is the dynamic nature. Take away deductions (and credits) but cut tax rates and things balance out a bit. I really don't mind paying more dollars at the end of the year if the economy is growing such that I am earning many more dollars in the year and improve my standard of living. What really matters are what opportunities open up to earn money and what we can do with what we earn. That gets lost in all the rhetoric and how the politicians and media play us as fools.
Simplify the tax code, take away all the exemptions and credits and make it so any private citizen can do his taxes for himself in one evening. That would put a lot of accountants and tax lawyers out of business, but free up a lot of capital to put even more people to work doing and making the things we really want.