Ways Your Taxes Might Go Up Under the GOP's Plan

President Donald Trump called his tax reform blueprint a'middle class miracle on Wednesday

President Donald Trump called his tax reform blueprint a'middle class miracle on Wednesday

Taxpayers in the top 1 percent of incomes - above $730,000 - would receive about 50 percent of the total tax benefit from the tax overhaul, with their after-tax income forecast to increase an average of 8.5 percent, the group said. Using the details available, the Tax Policy Center concluded that almost a third of taxpayers with incomes between $50,000 and $150,000 would see their taxes go up, as would a majority of those making between $150,000 and $300,000.

"Taxpayers in the bottom 95 percent of the income distribution would see average after-tax incomes increase between 0.5 and 1.2 percent", the TPC's report said.

At the same time as the plan increases the standard deduction, it eliminates the personal exemption, which now cuts the taxable income of a household by $4,050 each for every taxpayer and dependent in it.

Not everyone benefits. In 2018, 12 percent of taxpayers would see their taxes increase by an average of $1,800. Nor is it clear how Trump officials are weighing the benefits of the lower corporate taxes - which would primarily help investors. Republicans are hoping to move forward with tax reforms to benefit Americans since they haven't been able to repeal and replace Obamacare.

The $6 trillion plan would simplify the tax system and cut the corporate tax rate from 35 to 20 percent while recommending a surcharge on the wealthy.

That includes some 10 percent of low-income households - more than a quarter of the middle class.

That statement requires this fact check: Quarterly growth hit or exceeded 3% eight times under President Barack Obama, most recently in the first quarter of 2015, when GDP grew at an annualized rate of 3.2%.

As a result, people who more recently purchased their houses pay disproportionately higher property taxes than long-term homeowners - and would be hurt more by Trump's plan to do away with deductions for property taxes. As an example, the state and local tax deduction allowed California residents to reduce their federally taxable income by $101 billion in 2014, the most recent year for which complete data is available.

The tax plan would increase the deficit by $2.4 trillion over the first decade, the center found.

But Treasury Secretary Steve Mnuchin told NBC's "Meet the Press" that Trump's goal is to boost jobs and lower the tax burden for the middle class.

The biggest untruth is that the tax cut will pay for the $5.5 trillion it could add to the deficit over 10 years by sparking dramatic economic growth.

It is up to President Donald Trump and Congress to seize this opportunity to modernize the tax code. It also creates three individual tax brackets with rates of 12 percent, 25 percent and 35 percent.

Trump also insisted that the GOP's tax reform plan would not help the country's wealthiest taxpayers, including himself - even though he still has not released his tax returns and can therefore not prove this claim. So, it's fair to say that this could mean a big tax hike to many people in these states. He is discovering, though the learning curve seems to be a little steep, that he can't do that with the most cantankerous bunch of human beings on the planet, the Republican-controlled U.S. Congress. But even those proposed changes were left vague - and wouldn't remotely pay the full cost of the tax cut. Certainly, the time is ripe for a simpler form to use and for middle-class tax relief.

Trump and congressional Republicans unveiled the broad outlines of the tax plan earlier this week.

The White House and congressional leaders want to enact a sweeping rewrite of the tax code with tax cuts for businesses and a far less complicated tax structure.

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