11 Ways President Trump's Tax Plan Could Affect Americans

[Theinquisition]

https://www.yahoo.com/news/11-ways-p...244.html?nhp=1

Seems like a mixed bag. I really don't like the idea of increasing gov't debt by that much and it could negatively affect our ability to borrow money.

at the same time, less taxes could mean more investment.

what say you MMOCOT


Donald Trump's tax plan, explained.

There are at least two schools of thought when it comes to Donald Trump's tax proposal. Some say the promised tax cuts would greatly stimulate the economy because people would have more money to spend and reinvest it into the country. Others say the lack of revenue would vastly accelerate the government's debt and lead to anxious business markets and spiking interest rates for houses, cars and loans. Here's a rundown on how the plan could affect Americans.

Lowest tax brackets get a break.

No income tax on your first $25,000 if you're single, $50,000 if you're married, $37,500 if you're the head of the household. This standard deduction applies to all earners, says Kyle Pomerleau, director of federal projects at the Tax Foundation, a tax policy research organization. That could be huge -- or "yuuuge!" as Trump may say -- for those in the lowest tax brackets. The so-called marriage penalty and alternative minimum tax would be eliminated.

Reduced taxes for the next tax brackets.

You'd pay 10 percent if you're single and making 25,000-$50,000, or married in the $50,000-100,000 range, or a head of household making $37,501-$75,000. The higher income brackets (up to $150,000 single, $300,000 for married and $225,000 for head of households) would pay a 20 percent rate, and those earning more would pay 25 percent. "Those in the top 20 percent would see an average tax cut of $25,000, about 10 percent of their income," says Roberton Williams, a Sol Price Fellow at the Urban-Brookings Tax Policy Center.

15 percent corporate tax for all businesses.

"We have the third-highest corporate tax rate in the world with only the countries of Chad and United Arab of Emirates with higher rates," says Scott Cody, CFS and partner at Latitude Financial Group in Denver. "The world average corporate tax rate is roughly 24 percent and we are at 39 percent. This could help bring more jobs back and corporate dollars that are sitting offshore back to the U.S." Without safeguards, however, this plan could encourage people to become corporate entities instead of employees, Williams says.

Raised income limits on investments.

Today an individual earning up to $37,450 and married couple earning $74,900 would not have to pay long-term capital gains tax on their investment gains and dividends, Cody says. "Whereas with Trump's plan those income limits are raised to $50,000 for an individual or $100,000 for a couple, respectively," he says. "It's more generous and a little clearer under the proposed plan. This certainly encourages those folks to make these types of investments."

Some exemptions and deductions would disappear.

The tax plan says that with lower tax brackets, "current exemptions and deductions will become unnecessary." Although it's not specified which deductions would be eliminated, the plan says those in the 10 percent bracket will keep most of their current deductions, those in the 20 percent bracket would retain more than half of their deductions, but more would be eliminated for the 25 percent bracket. Also, special interest or corporate loopholes could be closed, but the plan doesn't specify. Charitable giving and mortgage interest deductions would remain.

Big benefits to the upper 5 percent.

"This is mostly going to be a reduction in the taxes paid by the upper 5 percent, partially because (they) pay such a big part of the taxes now," says Ross Levine, the Willis H. Booth chair in banking and finance at UC Berkeley's Haas School of Business. This could lead to less tax dodging and more investment, Levine says. On the negative side, he says, since the top 5 percent of earners pay 60 percent of the income tax, dropping their rate 15 percent could cause an "enormous" tax deficit.

Quick increase of government debt.

By many estimates, revenue would fall at a fast pace, 60 percent in 10 years, Levine says. Meanwhile, the national debt increase would be $1 trillion per year and $9.5 trillion to $12 trillion in the next decade, according to Tax Policy Center and the Tax Foundation, respectively. The proposal would add $34.1 trillion to the national debt by 2036, the Tax Policy Center says. The current national debt is about $19 trillion.



Higher interest rates for borrowers.

Vastly higher debt would likely mean higher interest rates for consumers and businesses, Levine and Williams say. "If I were lending money to the U.S. and I saw the U.S. adopt a policy for (debt) to increase by over 60 percent in the next decade at a time when the country's demographics are also aging, it would make me quite nervous about lending money to the federal government and it would make me nervous about the future economic prosperity of the U.S.," Levine says.

Government programs could be at risk.

Since Trump says he'll work to keep Social Security, Medicare and Medicaid intact -- which is about two thirds of the budget -- and increase military spending -- about half of the remaining budget, "he's down to just the non-defense discretionary spending," Williams says, which isn't enough to cover the debt. The shortfall might mean cutting discretionary services, such the Postal Service, military, education and commerce, Pomerleau says. The goal is the economy will grow so much from the tax cuts that there won't be a deficit.

Growth in small business sector.

Tax breaks and access to funds would help small businesses, says Joseph Bucci, business, leadership and management department chairman at Regents University. After the financial crisis, small business loans have been hard to get. "You want businesses to expand, get new equipment, hire new people, people pay taxes," Bucci says. But critics say there's little evidence tax cuts lead to growth. "Take a look at the George W. Bush administration," Williams says. "They cut taxes substantially over the eight years and the economy didn't grow much at all."

Incentives to come back to America.

Companies holding cash overseas will have a one-time repatriation of a significantly discounted 10 percent tax rate, followed by an end to the deferral of taxes on corporate income earned abroad. "He's trying to say, you know, don't be afraid of bringing that money back into the country," Bucci says. "Because that will certainly help the economy and the investments in the U.S. And he's got to incentivize that a little bit." Critics say this wouldn't go far enough to cover the deficit and may prompt firms to seek more incentives.

[Endus]

Lowest tax brackets get a break.

No income tax on your first $25,000 if you're single, $50,000 if you're married, $37,500 if you're the head of the household. This standard deduction applies to all earners, says Kyle Pomerleau, director of federal projects at the Tax Foundation, a tax policy research organization. That could be huge -- or "yuuuge!" as Trump may say -- for those in the lowest tax brackets. The so-called marriage penalty and alternative minimum tax would be eliminated.

I feel this is oversimplified, in that it fails to really properly address the hardships by those who are poor. It's also cutting out a big chunk of revenue, and he hasn't really proposed cutbacks that would allow for that without consequence; he's advocated MORE spending.

15 percent corporate tax for all businesses.

"We have the third-highest corporate tax rate in the world with only the countries of Chad and United Arab of Emirates with higher rates," says Scott Cody, CFS and partner at Latitude Financial Group in Denver. "The world average corporate tax rate is roughly 24 percent and we are at 39 percent. This could help bring more jobs back and corporate dollars that are sitting offshore back to the U.S." Without safeguards, however, this plan could encourage people to become corporate entities instead of employees, Williams says.

This is simply not intelligent. Yes, the USA has a relatively high corporate tax rate, with so many exemptions that it's often not high at all. And if it WERE an issue, it certainly isn't depressing the American economy, which is huge and growing. The claims here fly in the face of basic facts, and relies on utterly baseless appeals to emotion, to play on the ignorance of voters for the benefit of corporate America.

Raised income limits on investments.

Today an individual earning up to $37,450 and married couple earning $74,900 would not have to pay long-term capital gains tax on their investment gains and dividends, Cody says. "Whereas with Trump's plan those income limits are raised to $50,000 for an individual or $100,000 for a couple, respectively," he says. "It's more generous and a little clearer under the proposed plan. This certainly encourages those folks to make these types of investments."

People at those income levels typically can't afford to invest much, if at all, in the first place. Not sure where the value is, here.

Some exemptions and deductions would disappear.

The tax plan says that with lower tax brackets, "current exemptions and deductions will become unnecessary." Although it's not specified which deductions would be eliminated, the plan says those in the 10 percent bracket will keep most of their current deductions, those in the 20 percent bracket would retain more than half of their deductions, but more would be eliminated for the 25 percent bracket. Also, special interest or corporate loopholes could be closed, but the plan doesn't specify. Charitable giving and mortgage interest deductions would remain.

No specifics? Then I won't credit this as doing much of anything, in practice. Explain WHAT deductions are to be eliminated, in detail, with justifications as to why, and which are to be kept, with the same. Otherwise, it's not a policy position. It's like saying "we'll reduce spending! Somehow! If we remember! Maybe!"

Big benefits to the upper 5 percent.

"This is mostly going to be a reduction in the taxes paid by the upper 5 percent, partially because (they) pay such a big part of the taxes now," says Ross Levine, the Willis H. Booth chair in banking and finance at UC Berkeley's Haas School of Business. This could lead to less tax dodging and more investment, Levine says. On the negative side, he says, since the top 5 percent of earners pay 60 percent of the income tax, dropping their rate 15 percent could cause an "enormous" tax deficit.

Completely backwards. Trickle-down economics does not, and has never worked. This is just a lie.

Quick increase of government debt.

By many estimates, revenue would fall at a fast pace, 60 percent in 10 years, Levine says. Meanwhile, the national debt increase would be $1 trillion per year and $9.5 trillion to $12 trillion in the next decade, according to Tax Policy Center and the Tax Foundation, respectively. The proposal would add $34.1 trillion to the national debt by 2036, the Tax Policy Center says. The current national debt is about $19 trillion.

So much for fiscal conservativism, I guess. The Democrats at least had the excuse that that was never a platform they held.

Higher interest rates for borrowers.

Vastly higher debt would likely mean higher interest rates for consumers and businesses, Levine and Williams say. "If I were lending money to the U.S. and I saw the U.S. adopt a policy for (debt) to increase by over 60 percent in the next decade at a time when the country's demographics are also aging, it would make me quite nervous about lending money to the federal government and it would make me nervous about the future economic prosperity of the U.S.," Levine says.

So attacking the lower-income folks, directly, since they're the ones who borrow the most. Works directly against the earlier tax changes. And shifts the revenue from the government to the banks. The only people happy about this are bankers.

Government programs could be at risk.

Since Trump says he'll work to keep Social Security, Medicare and Medicaid intact -- which is about two thirds of the budget -- and increase military spending -- about half of the remaining budget, "he's down to just the non-defense discretionary spending," Williams says, which isn't enough to cover the debt. The shortfall might mean cutting discretionary services, such the Postal Service, military, education and commerce, Pomerleau says. The goal is the economy will grow so much from the tax cuts that there won't be a deficit.

Yeah, who needs those programs when we could buy more tanks the Army doesn't need? This makes literally no sense. Particularly with the revenue changes.

Growth in small business sector.

Tax breaks and access to funds would help small businesses, says Joseph Bucci, business, leadership and management department chairman at Regents University. After the financial crisis, small business loans have been hard to get. "You want businesses to expand, get new equipment, hire new people, people pay taxes," Bucci says. But critics say there's little evidence tax cuts lead to growth. "Take a look at the George W. Bush administration," Williams says. "They cut taxes substantially over the eight years and the economy didn't grow much at all."

Higher interest rates directly attack this, so this is highly unlikely. He's reduced access to funding, with his above strategies.

Incentives to come back to America.

Companies holding cash overseas will have a one-time repatriation of a significantly discounted 10 percent tax rate, followed by an end to the deferral of taxes on corporate income earned abroad. "He's trying to say, you know, don't be afraid of bringing that money back into the country," Bucci says. "Because that will certainly help the economy and the investments in the U.S. And he's got to incentivize that a little bit." Critics say this wouldn't go far enough to cover the deficit and may prompt firms to seek more incentives.

If they're a global company, they have no reason to want to take advantage of this. If they aren't, they have no capacity to. Who's this supposed to benefit?

[Garnier Fructis]

Since Trump says he'll work to keep Social Security, Medicare and Medicaid intact -- which is about two thirds of the budget -- and increase military spending -- about half of the remaining budget, "he's down to just the non-defense discretionary spending," Williams says, which isn't enough to cover the debt. The shortfall might mean cutting discretionary services, such the Postal Service, military, education and commerce, Pomerleau says. The goal is the economy will grow so much from the tax cuts that there won't be a deficit.

By many estimates, revenue would fall at a fast pace, 60 percent in 10 years, Levine says. Meanwhile, the national debt increase would be $1 trillion per year and $9.5 trillion to $12 trillion in the next decade, according to Tax Policy Center and the Tax Foundation, respectively. The proposal would add $34.1 trillion to the national debt by 2036, the Tax Policy Center says. The current national debt is about $19 trillion.

And don't forget how he wants to reduce the national debt as well.

My thoughts? My thoughts are that Trump is checking all the right boxes. Tax cuts? Check. Military spending increase? Check. Keep social security and medicare? Check. Reduce debt? Check. How is he going to do all of this at once? He can't: it's apparently all based on the hope that trickle down voodoo economics works. I have enough faith in Congress left that they won't go for this.

But that doesn't matter. You get votes by saying what people want to hear, and he's saying a whole bunch of what people want to hear. Clinton could really fumble here by not taking the opportunity to rip this apart during presidential debates.

[Kapadons]

How could anyone with even a rudimentary understanding of budgets see how this would work? You can't operate in a yearly deficit with a sizable amount of debt, increase spending and lower revenue and hope to do anything but compound the issue. The only way to lower the deficit/debt (if you actually want to) is to cut spending while increasing revenue ie taxes. To increase taxes you can either raise rates, or create growth of your tax base.

Instead of lowering taxes, he should seek to simplify the tax code. Set lower rates and cut out nearly all of deductions. For nearly anyone. Also, if you wanna increase revenue, stop giving tax exempts status to any jackass organization that asks for it. And for shits sake, start taxing the some 350k churches in America. Talk about "not paying their fair share "

[kail]

Where did Trump learn to keep a budget? Or simple math? Lower the government's income while increase spending? Why increase military spending?

[Mormolyce]

Trump wants to lower the corporate tax rate?

Gee I wonder why.

[ati87]

People are given Trump to much shit honestly.

His plans are almost exactly like any other Republican plan if you think about it, be consistent and give call them out on their BS as well.

Lowest tax brackets get a break.

They all say this, it's usually a little reduction in taxes while the upper bracket get a massive tax break

Reduced taxes for the next tax brackets.

See....

15 percent corporate tax for all businesses.

Lower corp taxes and remove loopholes.... thats the normal BS argument but non dares to mention which loophole and non talks about the low effective tax rate the US has now

Raised income limits on investments.

Most people don't have capital gains or dividends, because they can't afford to.

Some exemptions and deductions would disappear.

See above, the vague promise again while with every other bloody Republican plan t was proven that it was a fantasy tale .

Big benefits to the upper 5 percent.

Voodoo economics, it goes against the basic economics of supply and demand

Plus I hate this fucking argument

This could lead to less tax dodging and more investment,

Go and hire more IRS agents and you will see less tax dodging, it's been proven that they make up for any increase in budget.

Incentives to come back to America.

The IRS can and will tax any US citizen outside the US, treat companies (if they are ''people) the same. And how did the last tax holiday work out he?

[Macaquerie]

Where did Trump learn to keep a budget? Or simple math? Lower the government's income while increase spending? Why increase military spending?

I do find it curious that we reserve all of our big dick diplomacy solely to punish impoverished third world countries, and have never once thought about using the same kind of coercion against these offshore tax havens.

[Orbitus]

I do find it curious that we reserve all of our big dick diplomacy solely to punish impoverished third world countries, and have never once thought about using the same kind of coercion against these offshore tax havens.

Because those offshore tax havens are most likely used by all of the politicians like Trump and Clinton.

[Mayhem]

snip

That´s a joke, right?

[kail]

That´s a joke, right?

Straight from the official site.

https://www.donaldjtrump.com/positions/tax-reform

[zorkuus]

People are given Trump to much shit honestly.

His plans are almost exactly like any other Republican plan if you think about it, be consistent and give call them out on their BS as well.

He's the only one running.

[Mayhem]

Straight from the official site.

https://www.donaldjtrump.com/positions/tax-reform

Ha Hahahahahaa. So the CIA world factbook says the US debt to gdp ratio is 105% and Trump hopes this "plan" is going to help with that? Hmm i have my doubts.

[stabetha]

Straight from the official site.

https://www.donaldjtrump.com/positions/tax-reform

except if you read that it's vastly different then whats in the OP

- - - Updated - - -

Reducing or eliminating deductions and loopholes available to the very rich, starting by steepening the curve of the Personal Exemption Phaseout and the Pease Limitation on itemized deductions. The Trump plan also phases out the tax exemption on life insurance interest for high-income earners, ends the current tax treatment of carried interest for speculative partnerships that do not grow businesses or create jobs and are not risking their own capital, and reduces or eliminates other loopholes for the very rich and special interests. These reductions and eliminations will not harm the economy or hurt the middle class. Because the Trump plan introduces a new business income rate within the personal income tax code, they will not harm small businesses either.

Corporations will no longer be allowed to defer taxes on income earned abroad,

We will also phase in a reasonable cap on the deductibility of business interest expenses.

yeah big brakes for the evil 1%

[LilSaihah]

So which countries can this tax plan be directly compared to? Where's he getting these ideas from? I'd look for myself but I'm a bit busy just now.

[ati87]

He's the only one running.

Past republican tax plans are exactly the same

Look up any republican plan (when they run for president of when they talk about taxes) since Bush and you will see that it's similar.

[zorkuus]

Past republican tax plans are exactly the same

Look up any republican plan (when they run for president of when they talk about taxes) since Bush and you will see that it's similar.

You're assuming I(we) haven't lambasted other republicans. You assume too much.
He's the talk of the town now, why shouldn't the focus of criticism be on him?

[kail]

except if you read that it's vastly different then whats in the OP

It effectively summarizes Trump's plan in the first half, and includes predicted results in the second half. I doubt Trump will openly state his plan will increase national dept. That's his #4 goal on the site.

4. Doesn’t add to our debt and deficit, which are already too large.

yeah big brakes for the evil 1%

Flat business tax to 15% alone feels like a tax break for them. We rank very high on corporate tax, hence the incentive for loop holes. Unless his plan will raise taxes on business done abroad, this will do nothing to bring jobs to the country. The 15% will be paid, and globalized business will continue as usual.

[Mayhem]

Lower all taxes. Defund government to make it collapse until the free market can take over, instead of having nanny-government and SJWs telling everyone what they can or can't do with their lives.

Your forum title fits.

[Bushtuckrman]

The mental gymnastics on some of these replies is worthy of the olympics. Come home Bern outs we will welcome you, even the God Emperor is offering his glorious olive branch... just bend the knee