Restoring Internet Freedom is a Win for the Internet

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Posted by Katie McAuliffe on Tuesday, November 21st, 2017, 11:27 AM PERMALINK

Today the Federal Communications Commission released its "Restoring Internet Freedom Order." Undoing Title II restrictions is a win for all Americans.

The following statement can be attributed to Grover Norquist, President of Americans for Tax Reform:

The “Restoring Internet Freedom Order” released today by FCC Chairman Ajit Pai is a bold strike turning America away from the path we were on -- turning the internet into a cross between the  post office and the Department of Motor Vehicles.

Freedom, not top down control, is the best protector of a free and open internet worldwide.  

Today’s act reminds us that Chairman Ajit Pai’s confirmation to lead the Federal Communications Commission was second in importance only to Supreme Court Justice Neil Gorsuch's confirmation in protecting and expanding liberty.

Pai’s leadership in reining in FCC overreach on issues from media ownership to restoring internet freedom has been instrumental in undoing the harms of the Obama administration’s FCC and supporting continued American innovation.

I congratulate Chairman Pai and Commissioners O'Rielly and Carr for their vision and  leadership. 

The following statement can be attributed to Katie McAuliffe, Executive Director of Digital Liberty:

Chairman Ajit Pai has been instrumental in reforming the FCC to reflect the rapidly changing telecommunications industry. Governing 21st century technologies with 20th century regulations is not a strategy for keeping the United States as a worldwide leader in technological innovation. Chairman Pai and the FCC have made reforms necessary to keep the United States competitive in the global economy and to ensure that all Americans have access to the information they need.

Connecting unserved and underserved Americans has been a cornerstone of the FCC’s work under Chairman Pai, and by eliminating and reforming outdated rules, Chairman Pai and the FCC have helped create a regulatory environment that supports much-needed investment and will lead to improved connectivity for Americans nationwide.        

Chairman Pai and the FCC should be commended for making reforms that will foster American innovation and keep the United States at the forefront of the telecommunications sector.

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If Robert Reich Wants to Pay More Taxes, He Can Write a Check Right Now


Posted by John Kartch on Monday, November 20th, 2017, 7:30 PM PERMALINK

For many years Robert Reich has pushed for higher taxes. But if he wants to pay more in taxes, there is nothing stopping him. In fact, he can write a check, right now, payable to the U.S. Treasury.

As a service to Reich, we have pasted the relevant information below:

Gifts to the U.S. Government

How do I make a contribution to the U.S. government?

Citizens who wish to make a general donation to the U.S. government may send contributions to a specific account called "Gifts to the United States."

This account was established in 1843 to accept gifts, such as bequests, from individuals wishing to express their patriotism to the United States. Money deposited into this account is for general use by the federal government and can be available for budget needs.

These contributions are considered an unconditional gift to the government. Financial gifts can be made by check or money order payable to the United States Treasury and mailed to the address below.

Gifts to the United States
U.S. Department of the Treasury
Funds Management Branch
P.O. Box 1328
Parkersburg, WV 26106-1328

Any tax-related questions regarding these contributions should be directed to the Internal Revenue Service at (800) 829-1040.

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JCT Analysis of The Senate Tax Cuts and Jobs Act Includes Flawed Individual Mandate Assumptions


Posted by Alexander Hendrie on Monday, November 20th, 2017, 9:00 AM PERMALINK

The Joint Committee on Taxation last week released its distributional analysis of the updated Senate tax bill. Unlike previous analyses of the Tax Cuts and Jobs Act, this new JCT study shows a tax increase on Americans at certain income levels.

However, these findings are based on JCT's flawed methodology which overstates the impact that the Obamacare individual mandate has on compelling individuals to purchase insurance. The Senate tax bill does not increase taxes on Americans of any income level and is not repealing or modifying eligibility for the Obamacare tax credit.

In fact, a separate analysis of the Tax Cuts and Jobs Act that excludes the JCT's assumptions on the individual mandate shows strong tax reduction for Americans at every income level.

JCT Analysis of the Tax Cuts and Jobs Act With Repeal of The Mandate
Starting in calendar year 2021, the JCT analysis of the most recent version of the Senate’s Tax Cuts and Jobs Act shows a tax increase on those earning between $10,000 and $30,000. According to this analysis, individuals and families earning between $10,000 and $20,000 would see a tax increase of 5 percent, while those making between $20,000 and $30,000 would see a 13.3 percent increase in their federal tax liability.

As was the case in other versions of the Tax Cuts and Jobs Act, every other income category sees strong tax reduction (figure 1 - click to expand).


The Senate's Tax Cuts and Jobs Act reduces taxes across the board, so these findings are based solely on the assumption that repeal of the individual mandate tax penalty will mean millions of Americans choose not to purchase costly, Obamacare health insurance. Under this assumption, millions will also no longer recieve subsidies to purchase Obamacare, including the advanced refundable tax credit.

As a result, JCT is assuming that individuals will choose to increase their own taxes by choosing to not purchase insurance and not receive the refundable tax credit.

It is important to note that the Obamacare tax credit is not being repealed or limited in any way. As noted by Senator Pat Toomey (R-PA), no one is losing eligibility from health insurance programs and no one is losing subsidies or tax credits for these programs.

JCT Analysis of the Tax Cuts and Jobs Act Without Repeal of the Individual Mandate 
Case in point, the JCT analysis of the Senate tax bill without the repeal of the individual mandate shows strong tax relief for Americans of all income levels. In 2021, JCT projects those earning between $10,000 and $20,000 see a five percent tax cut, while those earning between $20,000 and $30,000 see an 11.2 percent tax cut (figure 2 - click to expand).

Absent JCT’s flawed analysis of the individual mandate, the biggest winners of the Tax Cuts and Jobs Act are those making between $20,000 per year and $50,000 per year, with each of these income categories receiving an average tax cuts of at least eight percent.


This is not the first time that the individual mandate’s effectiveness has been overstated by government models. The Congressional Budget Office has repeatedly overstated the number of Americans that would purchase Obamacare, because it the model gave too much weight to the power that the the mandate had in compelling individuals to purchase insurance.

As a result, the agency predicted that 25 million people would be enrolled on Obamacare exchanges. In reality, only 12 million individuals enrolled on exchanges.

 

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A Collins "YES" Vote for Tax Reform Bill Will Help Middle Class Maine Households

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Posted by John Kartch on Sunday, November 19th, 2017, 8:22 PM PERMALINK

The Senate's Tax Cuts and Jobs Act will finally repeal the Obamacare individual mandate tax. Repeal of this Obamacare tax will be of great help to middle-class Maine households. Americans for Tax Reform urges Sen. Susan Collins to vote YES.

According to official IRS data, middle-class Maine households will benefit greatly from a Collins YES vote. 

  • If Sen. Susan Collins votes YES on the Tax Cuts and Jobs Act 34,030 Maine households will no longer be stuck paying Obamacare’s individual mandate tax
  • In 2015, these Maine households had to pay the IRS $15,490,000 for choosing not to purchase Obamacare, an average tax penalty of $455 per household
  • 79% of Maine households paying this tax make less than $50,000 per year
  • If Sen. Collins votes NO, Mainers will be forced to pay Obamacare’s individual mandate tax simply for choosing not to purchase Obamacare.

 

Contact Senator Collins' office and urge her to vote YES on the Tax Cuts and Jobs Act.

 

413 Dirksen Senate Office Building 
Washington, DC 20510
Phone: (202) 224-2523

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A Johnson “YES” Vote for Tax Reform Bill Will Help Middle Class Wisconsin Households

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Posted by John Kartch on Thursday, November 16th, 2017, 1:26 PM PERMALINK


The Senate’s Tax Cuts and Jobs Act will finally repeal the Obamacare individual mandate tax. Repeal of this Obamacare tax will be of great help to middle class Wisconsin households. Americans for Tax Reform urges Sen. Ron Johnson to vote YES.

According to official IRS data Middle class Wisconsin households will benefit greatly from a Johnson YES vote:

  • If Sen. Ron Johnson votes YES on the Tax Cuts and Jobs Act 105,040 Wisconsin households will no longer be stuck paying Obamacare’s individual mandate tax
  • In 2015, these Wisconsin households had to pay the IRS $42,073,000 for choosing not to purchase Obamacare, an average tax penalty of $401 per household
  • 82% of Wisconsin households paying this tax make less than $50,000 per year
  • If Sen. Johnson votes NO, Wisconsinites will be forced to pay Obamacare’s individual mandate tax simply for choosing not to purchase Obamacare.
     

Contact Senator Johnson’s office and urge him to vote YES on the Tax Cuts and Jobs Act. 

328 Hart Senate Office Building
Washington, DC 20510
Phone: (202) 224-5323

Photo Credit: Gage Skidmore


Senators Should Support the Tax Cuts and Jobs Act

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Posted by Alexander Hendrie on Wednesday, November 15th, 2017, 5:37 PM PERMALINK

The Senate’s Tax Cuts and Jobs Act is a pro-growth, pro-family proposal that will reduce taxes on Americans at every income level and dramatically simplify the 70,000+ page tax code. It will also provide a much-needed overhaul to the outdated tax code so that businesses large and small will again be able to compete against foreign competitors and create jobs across the country.

The Senate Finance Committee this week is moving through a comprehensive regular order process that has included years of Committee hearings and Member input. Following the completion of this process later this week, the Senate should swiftly take up and pass the Tax Cuts and Jobs Act.

The Tax Cuts and Jobs Act will Reduce Taxes for Americans of Every Income Level

The Tax Cuts and Jobs Act provides tax reduction for Americans of every income level. The Senate bill doubles the standard deduction to $12,000, or $24,000 for a family. About 70% of filers – or 105 million individuals and families currently take the standard deduction, and these families would see strong tax reduction.

The plan also reduces almost every tax bracket, resulting in tax cuts across the board. Under this plan, a family of four earning $73,000 would see a tax reduction of 40% or $1,500 per year.

 The Middle Class would be the biggest winners under the Senate tax bill. Under this plan, those earning between $50,000 and $70,000 would receive a tax deduction of 7.1% in 2019, and earners making between $20,000 and $30,000 would see their taxes fall by 10.4%.

The Tax Cuts and Jobs Act is Pro-Family

The Senate tax bill doubles the child tax credit to $2,000 per child. Expanding the child tax credit will help millions of Americans across every state. According to the most recent IRS data, more than 22 million Americans used the child tax credit in 2015. These families will see strong tax reduction, and will also see simplification from the consolidation of other pro-family tax preferences into the expanded child tax credit.

The Tax Cuts and Jobs Act Dramatically Simplifies the Tax Code

Today, the tax code is absurdly complex. Since 1985 the tax code has doubled, and it has increased six fold since 1955. Today, the code totals 2.4 million words. This complexity costs Americans millions of hours and billions of dollars in lost productivity.

According to the Tax Foundation, Americans will spend more than 8.9 million hours complying with the tax code, costing $409 billion. 2.6 billion hours will be spent complying with individual income taxes, costing $98 billion each year. Similarly, the National Taxpayers Union Foundation estimates that taxpayers spend 1.8 billion hours on 1040 forms a year, costing $262 billion every year.

The many reforms in the Senate tax bill, including the doubling of the standard deduction and the repeal of many deductions and credits will drastically simplify the code and reduce the compliance burden on American families.

The Tax Cuts and Jobs Act Reduces Taxes on Businesses Large and Small

The Senate tax bill proposes a globally competitive 20 percent corporate rate that will allow American businesses to compete against foreign competitors. The U.S. currently has the highest marginal corporate income tax rate in the developed. At 35 percent (plus an average state rate of 4 percent), the U.S. corporate rate is nearly 15 points higher than the typical developed country which has a rate around 25 percent. Since 2000, 32 of the 35 developed countries have reduced their corporate rates. Only the U.S. and Chile have higher corporate tax rates.

The Tax Cuts and Jobs Act also proposes drastic tax reduction for businesses organized as pass-through entities (LLCs, sole-properties, partnerships etc.) The bill creates a 17.4 percent deduction on pass-through income resulting in tax relief for millions of small businesses across the country.

The Tax Cuts and Jobs Act Repeals the Individual Mandate

The Senate’s Tax Cuts and Jobs Act repeals Obamacare’s individual mandate, resulting in strong tax relief for millions of middle class families. The annual tax is currently $695 for an individual, and $2,085 for a family of four, or 2.5% of your household income, whichever is higher.

According to IRS data compiled by the office of Senator Steve Daines, 6.6 million households paid the individual mandate in 2015. 79 percent of those households have a yearly income of less than $50,000, while 37 percent of those households have a yearly income of less than $25,000.

The Tax Cuts and Jobs Act Will Create Higher Wages and More Jobs

Over the past decade, the economy has struggled at just two percent GDP growth as the country has experienced the worst recovery in the modern era. The Congressional Budget Office projects that under current policies, two percent growth will continue into the next decade. Because of this lackluster recovery, families have lost an average of $8,600 in annual income, according to Joint Economic Committee.

The Tax Cuts and Jobs Act will reverse this alarming trend, result in higher wages and new or better jobs for Americans across the country. According to a recent White House study, a 20 percent corporate tax rate would increase average household income by at least $4,000 a year.

The Tax Foundation estimates that the bill will grow the overall economy by 3.7% in the long term. The tax reductions will grow wages by 2.9% over the long term, delivering much needed relief to Americans blighted by wage stagnation over the past eight years. In the long run, the plan increases after-tax income of all taxpayers by 4.4% and will create approximately 1 million jobs.

The Tax Cuts and Jobs Act Moves toward a Globally Competitive Territorial System of Taxation

The tax reform plan replaces the outdated worldwide system of taxation with a territorial system of taxation. Currently, the U.S. tax code subjects American businesses to two layers of taxation – once when the income is earned overseas, and again when it is brought back to the U.S. to be reinvested in jobs and wages.

This creates a disadvantage for American companies, especially as the U.S. is one of six countries in the developed world that still uses a worldwide system of taxation. Today, 95 percent of consumers live outside the U.S. and a total of 41 million jobs are tied to business operations overseas, so this outdated system results in lost jobs and lower wages.

The Tax Cuts and Jobs Act Will Encourage More Investment in the U.S.

The Senate tax bill implements immediate, 100 percent full business expensing for the next five years, and expands Section 179 small business expensing. This will encourage businesses to make more investment in the U.S. economy and will dramatically simplify the tax code.

Under current law, businesses must deduct, or “depreciate” the cost of new investments over multiple years depending on the asset they purchase, as dictated by arbitrary IRS rules. Moving to full expensing ends this distortion and treats all investment equally.

According to research by the Tax Foundation, implementing full business expensing increases GDP by five percent after a decade and increases wages by 4 percent, creating more than one million jobs.

Photo Credit: Jim Grey


Senate Tax Reform Bill Provides Massive Middle Class Tax Relief


Posted by John Kartch on Wednesday, November 15th, 2017, 2:24 PM PERMALINK

Take Action: Stop Obamacare Taxes Now

79% of Households Hit With Obamacare Mandate Tax Make Less Than $50,000

The Senate’s Tax Cuts and Jobs Act repeals Obamacare’s individual mandate tax penalty. Repeal of the Obamacare individual mandate tax penalty gives further tax relief to middle class families. Repeal also ensures that the Senate’s Tax Cuts And Jobs Act allows permanent tax reduction for families and businesses in the form of a permanent, 20 percent corporate rate and a $2,000 child tax credit.

Official IRS data for tax year 2015 compiled by the office of Sen. Steve Daines (R-Mont.) indicates that low income Americans shoulder the burden of this tax:

  • In tax year 2015 -- 6,665,480 households paid a total of $3,079,255,000 in individual mandate tax penalties
     
  • 79% have a yearly income of less than $50,000
     
  • 37% have a yearly income of less than $25,000 


Please visit the website of Sen. Daines to get a handy PDF of the state-by-state Obamacare IRS tax data.

See state examples below:

ALASKA

  • If Sen. Lisa Murkowski votes YES on the Tax Cuts and Jobs Act 19,970 Alaska households will no longer be stuck paying Obamacare’s individual mandate tax.
  • In 2015, these households had to pay the IRS $12,836,000 for choosing not to purchase Obamacare, an average tax of $644 per household
  • 64% of Alaska households paying this tax make less than $50,000 per year.
  • If Sen. Murkowski votes NO, Alaskans will be forced to pay Obamacare’s individual mandate tax simply for choosing not to purchase Obamacare.

 

MAINE

  • If Sen. Susan Collins votes YES on the Tax Cuts and Jobs Act 34,030 Maine households will no longer be stuck paying Obamacare’s individual mandate tax.
  • In 2015, these households had to pay the IRS $15,490,000 for choosing not to purchase Obamacare, an average tax of $455 per household.
  • 79% of Maine households paying this tax make less than $50,000 per year.
  • If Sen. Collins votes NO, Mainers will be forced to pay Obamacare’s individual mandate tax simply for choosing not to purchase Obamacare.

 

ARIZONA

  • If Sen. John McCain votes YES on the Tax Cuts and Jobs Act 153,700 Arizona households will no longer be stuck paying Obamacare’s individual mandate tax.
  • In 2015, these households had to pay the IRS $69,770,000 for choosing not to purchase Obamacare, an average tax of $454 per household.
  • 82% of Arizona households paying this tax make less than $50,000 per year.
  • If Sen. McCain votes NO, Arizonans will be forced to pay Obamacare’s individual mandate tax simply for choosing not to purchase Obamacare.

 

INDIANA

  • If Sen. Joe Donnelly votes YES on the Tax Cuts and Jobs Act 138,170 Indiana households will no longer be stuck paying Obamacare’s individual mandate tax.
  • In 2015, these households had to pay the IRS $59,463,000 for choosing not to purchase Obamacare, an average tax of $430 per household.
  • 81% of Indiana households paying this tax make less than $50,000 per year.
  • If Sen. Donnelly votes NO, Indianans will be forced to pay Obamacare’s individual mandate tax simply for choosing not to purchase Obamacare.

 

MISSOURI

  • If Sen. Claire McCaskill votes YES on the Tax Cuts and Jobs Act 116,580 Missouri households will no longer be stuck paying Obamacare’s individual mandate tax.
  • In 2015, these households had to pay the IRS $50,016,000 for choosing not to purchase Obamacare, an average tax of $429 per household.
  • 81% of Missouri households paying this tax make less than $50,000 per year.
  • If Sen. McCaskill votes NO, Missourians will be forced to pay Obamacare’s individual mandate tax simply for choosing not to purchase Obamacare.

 

MONTANA        

  • If Sen. Jon Tester votes YES on the Tax Cuts and Jobs Act 29,450 Montana households will no longer be stuck paying Obamacare’s individual mandate tax.
  • In 2015, these households had to pay the IRS $14,341,000 for choosing not to purchase Obamacare, an average tax of $487 per household.
  • 75% of Montana households paying this tax make less than $50,000 per year.
  • If Sen. Tester votes NO, Montanans will be forced to pay Obamacare’s individual mandate tax simply for choosing not to purchase Obamacare.

 

NORTH DAKOTA

  • If Sen. Heidi Heitkamp votes YES on the Tax Cuts and Jobs Act 17,170 North Dakota households will no longer be stuck paying Obamacare’s individual mandate tax.
  • In 2015, these households had to pay the IRS $7,826,000 for choosing not to purchase Obamacare, an average tax of $456 per household.
  • 77% of North Dakota households paying this tax make less than $50,000 per year.
  • If Sen. Heitkamp votes NO, North Dakotans will be forced to pay Obamacare’s individual mandate tax simply for choosing not to purchase Obamacare.

 

WEST VIRGINIA

  • If Sen. Joe Manchin votes YES on the Tax Cuts and Jobs Act 34,360 households will no longer be stuck paying Obamacare’s individual mandate tax.
  • In 2015, these households had to pay the IRS $14,680,000 for choosing not to purchase Obamacare, an average tax of $427 per household.
  • 81% of West Virginia households paying this tax make less than $50,000 per year.
  • If Sen. Manchin votes NO, West Virginians will be forced to pay Obamacare’s individual mandate tax simply for choosing not to purchase Obamacare.

 

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20 Conservative Groups Support the Senate’s Tax Cuts and Jobs Act

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Posted by Alex Hendrie on Monday, November 13th, 2017, 7:00 PM PERMALINK

A coalition of 20 conservative groups led by Americans for Tax Reform today wrote to Chairman Orrin Hatch and the members of the Senate Finance Committee supporting the Chairman’s mark of the Tax Cuts and Jobs Act.

[The letter can be found here]

As the letter says, the Tax Cuts and Jobs Act simplifies the code, reduces taxes for families and businesses, and grows the economy. While there is still more work to be done, the Act is an excellent start, and the signers are ready to work with the Committee to pass comprehensive tax reform before the end of the year.

The full letter can be found here and is below:

Dear Chairman Hatch and Members of the Senate Finance Committee:

We write in support of the Chairman’s mark of the Tax Cuts and Jobs Act. The release of this legislation marks an important step in passing comprehensive tax reform before the end of the year. We urge your committee to swiftly approve this bill and send it to the full Senate for consideration.

Just like the House bill, your proposal is pro-growth and pro-family. This legislation simplifies the code, reduces taxes for families and businesses, and grows the economy, leading to higher wages and new or better jobs.

Importantly, more work needs to be done, such as ensuring full repeal of the death tax. As you move through the committee process this week, it is imperative that this unfair tax is repealed.

Congress has a rare opportunity this year to reform the broken federal tax code. We stand ready to work with you as the Senate Finance Committee continues moving through regular order starting with mark-up of the legislation this week.

Sincerely,

Grover Norquist
President, Americans for Tax Reform

Pete Sepp
President, National Taxpayers Union

Christine Harbin
Vice President of External Affairs, Americans for Prosperity

James L. Martin
Founder & Chairman, 60 Plus Association

Lisa B. Nelson
Chief Executive Office, ALEC Action

Phil Kerpen
President, American Commitment

Andrew Quinlan
President, Center for Freedom and Prosperity

Olivia Grady
Senior Fellow, Center for Worker Freedom

Dan Caldwell
Executive Director, Concerned Veterans for America

Matthew Kandrach
President, Consumer Action for A Strong Economy (CASE)

Thomas Schatz
President, Council for Citizens Against Government Waste

Katie McAuliffe
Executive Director, Digital Liberty

Nathan Nascimento
Vice President of Policy, Freedom Partners Chamber of Commerce

Jason Pye
Vice President of Legislative Affairs, FreedomWorks

Carrie Sheffield

Executive Director, Generation Opportunity

Mario H. Lopez
President, Hispanic Leadership Fund

Heather R. Higgins
President & CEO, Independent Women’s Voice

Daniel Garza
President, The LIBRE Initiative

Lorenzo Montanari
Executive Director, Property Rights Alliance

David Williams
President, Taxpayers Protection Alliance

Photo Credit: Pixabay


ATR Feedback on the Chairman’s Mark of the Tax Cuts and Jobs Act


Posted by Alex Hendrie on Monday, November 13th, 2017, 7:00 PM PERMALINK

[Full PDF Document Can be Found Here]

Americans for Tax Reform today provided feedback applauding Senate Finance Committee Chairman Orrin Hatch’s mark of the Tax Cuts and Jobs Act.

The Tax Cuts and Jobs Act is pro-family and pro-growth.

The legislation gives tax cuts for Americans of all income levels and simplifies the code. The largest benefit goes to the middle class, according to the Joint Committee on Taxation.

The Act helps Americans by doubling the standard deduction, expanding the Child Tax Credit, and fully repealing the Alternative Minimum Tax. The Act also simplifies the code by repealing distortionary deductions and credits, like the State and Local tax deduction.

On the business side, the Act makes America more competitive in the world, resulting in more jobs and stronger economic growth: another win for Americans of all income levels, most particularly those currently without a job.

The Act reduces the current 35% marginal corporate tax rate, the highest in the developed world, to 20% and replaces the worldwide taxation system with a territorial system. It further implements 100 percent expensing of new investments for five years, and it maintains the existing deductions for advertising. In addition, section 1031 for like-kind exchanges is also maintained, and there is a reasonable deduction for interest expenses.

Americans for Tax Reform, however, does urge the Committee to fully repeal the Death Tax, grandfather in the elimination of the deduction of deferred employee compensation, and extend the minimum hold period for access to long-term capital gains to three years. These changes would create even more jobs and economic growth.

While more work needs to be done, Americans for Tax Reform applauds the Senate Finance Committee on its work and supports the Tax Cuts and Jobs Act.

[Full PDF Document Can be Found Here]

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KEY VOTE: ATR Urges Passage of H.R. 1, the Tax Cuts and Jobs Act


Posted by Alexander Hendrie on Monday, November 13th, 2017, 8:00 AM PERMALINK

The Tax Cuts and Jobs Act lives up to its name. The legislation cuts taxes on Americans of all income levels and will grow the economy, leading to new and better jobs and more take-home pay.

ATR urges a YES vote on H.R. 1

Later this week, the House of Representatives will vote on H.R. 1, the Tax Cuts and Jobs Act. All members of Congress should vote YES on this important legislation.

“House passage of the Tax Cuts and Jobs Act is an important step toward enacting a pro-growth tax reform package that reduces taxes for Americans at all income levels and fulfills the promises of the tax reform framework put forward by the GOP leadership this summer,” Said Grover Norquist, President of Americans for Tax Reform. “The tax reform bill’s biggest winner will be the person who couldn’t find a job during eight years of stagnation under Obama.”

By voting YES on the Tax Cuts and Jobs Act members of Congress have a rare opportunity to reform the broken tax code and offer relief to taxpayers across the country.

This legislation contains numerous provisions that simplify the tax code, give tax cuts to families and businesses, and grow the economy leading to higher wages and new or better jobs.

Individual Provisions:

Consolidates the seven tax brackets into four (12%, 25%, 35%, and 39.6%) - Under this reform, the existing 10 percent bracket goes to zero. The 15 percent bracket goes to 12 percent.

-The 12 percent bracket applies to income up to $45,000 ($90,000 for married couples). This does not include the standard deduction of $12,000 or $24,000.

-The 25 percent bracket applies to income between $45,001 and $200,000 ($90,001 and $260,000 for married couples).

-The 35 percent bracket applies to income between $200,001 and 500,000 ($260,001 and $1 million for married couples).

-The 39.6 percent bracket applies to income above $500,000 ($1 million for married couples).

-Doubles the standard deduction (The first $12,000 for individuals and $24,000 for families will not be taxed). 

-Increases the child tax credit from $1,000 to $1,600 per dependent under 17 with an additional $300 credit per parent. The child tax credit is currently used by 22 million Americans.

-Simplifies the tax code – The bill repeals personal exemptions, repeals the state and local tax deduction for income and sales taxes and caps the SALT deduction for property taxes at $10,000. The home mortgage interest is grandfathered in and preserved for new homes up to $500,000. All other itemized deductions with the exception of charitable giving are repealed.

-Repeals the alternative minimum tax – This tax is currently paid by 4.5 million individuals and families.

-Repeals the death tax effective 2025 - In years 2018 to 2024, the exemption is doubled to $10 million ($20 million for a couple) and indexed to inflation. The generation skipping transfer tax is also repealed while the gift tax is lowered from 40 percent to 35 percent. Step-up in basis is preserved.

-Preserves retirement tax savings accounts such as 401(k)s and Individual Retirement Accounts.  

Business Provisions:

-Permanently reduces the corporate income tax rate to 20 percent effective immediately - The current 35 percent federal rate is the highest in the developed world. Reducing this rate to 20 percent will allow American businesses to compete against foreign competitors and will allow the U.S. economy to grow. According to an analysis by the Council of Economic Advisers, a 20 percent corporate rate would increase average household income by between $4,000 and $9,000.

-Enacts 100 percent, full business expensing for five years - Section 179 small business expensing is increased from $500,000 to $5 million, and the phaseout is increased from $2 million to $10 million.

-Reduces the business tax rate on pass-through entities from 44.6 percent to 25 percent - This new rate would be applied based on one of two formulas designed to prevent wage income from being mischaracterized as business income.

 -Implements a partial cap on deductibility of net interest expense for corporations - The cap will be applied when a corporation’s net interest exceeds 30 percent of earnings before interest, tax, depreciation and amortization (EBITDA).

-Implements a modern, territorial system of taxation so that American businesses operating overseas can compete.

-Introduces a one-time repatriation rate of 14 percent for cash and 7 percent for non-cash, payable over eight years. This allows $2.6 trillion in after-tax income to come back to the U.S. to be reinvested in the economy. Ideally, the repatriation rate should be single digit rates. However, this reform will still allow trillions to come back into the U.S. economy. 

 

 

 

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