#TrumpTaxCuts

President Trump's proposed tax cuts for 2025 aim to extend key provisions from the 2017 Tax Cuts and Jobs Act (TCJA) while introducing new measures. Here's what you need to know:

*Key Provisions:*

- *Extension of TCJA Provisions*: Make current lower tax rates permanent, retaining the top rate of 37% and increasing the standard deduction to $15,000 for single filers and $30,000 for married couples filing jointly.

- *New Tax Proposals*:

- *Eliminate Taxes on Social Security Benefits*: Remove federal taxes on Social Security income, providing financial relief for retirees.

- *Tax Exemptions*: Exempt tipped income and overtime pay from taxes, potentially increasing take-home pay for workers in industries like hospitality.

- *Reduce Corporate Tax Rate*: Lower the corporate tax rate from 21% to 20%, with a 15% rate for US manufacturers to encourage domestic production and job growth.

*Potential Impacts:*

- *Middle-Class Families*: Continued savings through extended TCJA provisions, with potential tax increases avoided (e.g., a family of four earning $80,610 could avoid a $1,695 tax hike).

- *High-Income Earners*: Benefit from extended lower tax rates and deductions, with additional financial advantages from eliminating taxes on Social Security benefits.

- *Businesses*: Gain from reduced corporate tax rates and potential reinstatement of deductions like the Domestic Production Activities Deduction, encouraging investment and growth.

*Challenges and Considerations:*

- *Federal Deficit Impact*: Extending tax cuts could increase the deficit by over $3.7 trillion in the next decade, potentially leading to long-term economic challenges.

- *Congressional Approval*: Trump's proposals require congressional approval, which may be challenging given the need to balance tax cuts with revenue generation or spending cuts.¹ ²