#TrumpTaxCuts The **Trump tax cuts**, formally known as the **Tax Cuts and Jobs Act (TCJA) of 2017**, were a major overhaul of the U.S. tax code signed into law by President Donald Trump. Here’s an overview of its key provisions, impacts, and current status:
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### **Key Provisions of the TCJA**
1. **Individual Tax Changes**:
- **Lowered Tax Rates**: Reduced individual income tax rates across most brackets (e.g., top rate dropped from 39.6% to 37%).
- **Increased Standard Deduction**: Nearly doubled the standard deduction (e.g., $12,000 to $24,000 for married couples).
- **SALT Deduction Cap**: Limited state and local tax (SALT) deductions to $10,000, affecting high-tax states like California and New York.
- **Child Tax Credit**: Increased from $1,000 to $2,000 per child.
- **Sunset Provision**: Most individual tax cuts expire after **2025** unless renewed by Congress.
2. **Corporate Tax Changes**:
- **Corporate Rate Cut**: Slashed the corporate tax rate from **35% to 21%** (permanent).
- **Territorial Tax System**: Ended the U.S. practice of taxing foreign profits of multinational corporations (shift to a territorial system).
- **Pass-Through Deduction**: Created a 20% deduction for income from pass-through businesses (e.g., LLCs, S-corporations).
3. **Estate Tax**:
- Doubled the estate tax exemption to **$11.2 million per individual** ($22.4 million for couples), adjusted annually for inflation.
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### **Economic Impacts**
- **Short-Term Growth**: The TCJA contributed to GDP growth (~3% in 2018) and boosted corporate profits. Unemployment fell to historic lows.
- **Stock Buybacks & Dividends**: Corporations used tax savings for record stock buybacks ($1 trillion in 2018) and shareholder dividends.
- **Wage Growth**: Modest wage increases occurred, though critics argue benefits skewed toward higher earners.
- **Deficit Increase**: The tax cuts reduced federal revenue, contributing to a **$1.9 trillion increase in the deficit** over 10 years (Congressional Budget Office estimate).
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### **Criticisms**
1. **Wealth Inequality