Three of the states that have the highest state and local tax burden are ‘swing’ states: Ohio, Pennsylvania and Virginia. There is no way that politicians in office are going to anger those voters.
@TatinG I beg to disagree. Senator Toomey is pushing the tax proposal big time here in Pennsylvania.
I dare say that we will pay more. I’m concerned about the loss of revenue - no doubt entitlements will eventually (soon) be reduced or eliminated to pay for the cuts. Most of what’s been released has been aimed at reductions for wealthy people and corporations.
The continued fallacy of trickle-down economics and economic growth coming from tax cuts…
I pay 10% in sales tax and my high property taxes pay for good schools amongst other things. I don’t live in a particularly wealthy city, but schools have always been a priority, hence the higher taxes.
Estate taxes, pass-through income, capital gains, not things my family has to deal with. Our income is mostly wages, and we both have professional jobs, so we’ve always paid more.
If I could pay $1,000 for a new car or a kitchen reno, I’d be gold.
Trying to gauge the described effects on last year’s taxes, I came up with an increase of about $4K. Too early to get much further, but I don’t think we will be in the group getting a tax break.
We’ve been wanting a kitchen renovation, happy to hear it’s not nearly as expensive as we thought. $1k we can handle.
In most states $1000 won’t cover the sales tax on a new car.
Okay, so I ran the (very!) speculative numbers, and it looks like our effective tax rate would be nearly 4(!) percentage points higher. (And this from someone in a state with no income or sales taxes!)
Allow me to simply say: Ouch.
$1000 won’t even get you one kitchen appliance.
From what I hear SALT elimination affects coastal states most. That I hope has an effect equalizing coasts and flyover states. It may encourage moving population and businesses to depressed area. If it was up to me, I would eliminate all deductions. I would like to see a study of who benefits most from desuctions.
Schedule A deductions mostly benefit upper middle to upper income people (who tend to have larger mortgages, pay more state/local/property tax). However, the AMT reduces or eliminates the benefit of some of them (including state/local/property tax) for many upper income people, while the schedule A deduction limit starts to become a limitation as income approaches the plutocrat level.
$1000 got me a Miele dishwasher. 
Google can be your friend on such matters (as long as you’re willing to then also check the sources you get to make sure you know which way they lean). It would lead you to sources like the center-left Tax Policy Center (whose “Briefing Book” has some of the basic answers to your question very well laid out), or the centrist Institute on Taxation and Economic Policy (look for their biennial “Who Pays” reports), or the libertarian Mercatus Institute, or the center-right Tax Foundation, and so on.
If the goal was purely to raise revenue, a flat tax would make the most sense. But the goal of the tax code is to influence behavior, help friends and hurt enemies. Which leaves us with the patchwork quilt mess called the tax code.
We are right around the median income on the national scale. I always think of us as lower middle class because we are far below the median income in our area.
I think the proposed changes might help us the a bit with the doubling of the standard deduction since we don’t usually itemize anyway.
The doubling will make up for the loss of the any state tax or property tax deduction but probably not by all that much. If we didn’t live in a state with high property taxes we would benefit a lot more.
If the child tax credit increases or expands we might benefit.
I heard that foreign income for businesses won’t be taxed. Oh that will help with jobs here 8-|
Flat tax rates would not by themselves stop the tax code from being used to influence behavior, help friends, and hurt enemies. Most of that (and most of the complexity in the tax code) is contained in how “taxable income” is defined.
If a US company has a Chinese subsidiary which is profitable, should the US tax the income of that Chinese subsidiary? Right now its only taxed if its repatriated to the US (simplest way is by paying dividends to its US parent but there are other ways that result in a deemed dividend/repatriation). Is the view that there should be US income tax on the foreign subsidiaries income even if its not repatriated to the US parent?
If we take that route, US company likely forms a new holding company (maybe in the Caymans) which has the US company and Chinese entity as brother-sister companies. At that point the Chinese entity’s income isn’t subject to US income tax because it does not have a US parent.
It may be that we are slowly accidentally moving in the direction of a flatter tax rate structure with fewer deductions by accident, as the number of taxpayers affected by the AMT increases. But then the gain of simplification is not gotten, since the regular tax deductions still need to be calculated, even if they are later thrown away when calculating the AMT.
Defining income impacts far fewer people than setting forth deductions. For the vast majority of people, income is simple. What’s deductible impacts a far greater number of people.
I don’t think there is much in the way of an accident in terms of what is happening with AMT. Its been understood for a while. Politicians just don’t want to do anything about it. Much like they phase out exemptions when they don’t have the guts to raise rates (because too many people focus on marginal rather than effective tax rates), more people being impacted by AMT isn’t a result of something the current group in office is doing.
We have tax brackets for earned income. Why don’t we have tax brackets for unearned income?