Key Vote: ATR Urges Senate Passage of the Tax Cuts and Jobs Act


Posted by Alexander Hendrie on Monday, November 27th, 2017, 10:00 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 the motion to proceed to the bill and a YES vote on final passage.

Later this week, the U.S. Senate will vote on comprehensive tax reform legislation, known as the "Tax Cuts and Jobs Act." All Senators should vote YES on this important legislation.

By voting YES on the Tax Cuts and Jobs Act, Senators have a rare opportunity to reform the broken tax code and offer relief to families and businesses across the country.

This legislation dramatically reduces taxes for American families and businesses at every income level, simplifies the overly complex tax code, and reforms the taxation of businesses so that the economy can grow, leading to higher wages and new or better jobs.

Individual Provisions:

-Reduces taxes across the board:

                  -Current law: 10%, 15%, 25%, 28%, 33%, 35%, 39.6%

                -Senate bill: 10%, 12.5%, 22%, 24%, 32%, 35%, 38.5%

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

-Under this plan, the middle class are among the biggest winners. A family of four earning $73,000 will see a tax cut of $2,200 – nearly 60 percent.

-Increases the child tax credit from $1,000 to $2,000. The child tax credit is currently used by 22 million Americans.

-Repeals the Obamacare individual mandate. 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. 6.6 million Americans paid this tax in 2015.

-79 percent of those paying the individual mandate make less than $50,000.

-37 percent of those paying the individual mandate make less than $25,000.

-Reduces taxes for pass-through businesses that file through the individual tax code (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.

-Under this plan, a small business earning $100,000 per year will see tax reduction of nearly $3,000 or 25 percent. 

-Simplifies the tax code – The bill repeals personal exemptions, repeals the state and local tax deduction, and repeals other itemized deductions with the exception of the home mortgage interest deduction and charitable giving deduction.

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

-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 2019 - 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 also increased to $1 million.

-Implements a partial cap on deductibility of net interest expense - The cap will be applied when a corporation’s net interest exceeds 30 percent of adjusted taxable income (income calculated without regard to interest expense, interest income, and net operating losses).

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

-Introduces a one-time repatriation rate of 10 percent for cash and 5 percent for non-cash, payable over eight years. This allows an estimated $2.6 trillion in after-tax income to come back to the U.S. to be reinvested in the economy. 

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