#TrumptaxCuts The Trump tax cuts refer to the Tax Cuts and Jobs Act (TCJA), a congressional revenue act signed into law by President Donald Trump in December 2017. Here are some key aspects ¹:
Key Provisions
- *Individual Income Tax Cuts*: Reduced tax rates for individuals, with new brackets and rates, such as 10%, 12%, 22%, 24%, 32%, and 35%.
- *Standard Deduction Increase*: Doubled the standard deduction, simplifying tax filing for many.
- *Business Tax Cuts*: Lowered corporate tax rate and improved international tax system.
- *Estate Tax Exemption*: Doubled the estate tax exemption.
Impact
- *Economic Growth*: Studies show the TCJA led to an estimated 11% increase in corporate investment, but its effects on economic growth and median wages were modest.
- *Federal Debt*: Extending the expiring provisions is estimated to add $4.6 trillion in deficits over 10 years.
- *Tax Burden*: After-tax incomes increased disproportionately for the most affluent.
Expiration and Extension
- *Scheduled Expiration*: Many individual tax cuts expire in 2025, while business tax cuts expire in 2028.
- *Proposed Extension*: President Trump has called for permanent extension of the TCJA, with potential impact on long-run GDP and federal revenue ¹ ².