Apr 13 2018
Editor's Note: The Joint Economic Committee is counting down the days until Tax Day (April 17th) by showing how the Tax Cuts and Jobs Act will make life easier next year. Check out the Tuesday, Wednesday, and Thursday editions.
April 13, 2018
Countdown to Tax Day
Five Ways the TAX CUTS AND JOBS ACT (TCJA) Will Make Tax Day Less Taxing Next Year
#2: Fairer Taxes
TCJA lowered taxes across the board but shifted a larger share of the tax burden to millionaires. While the individual tax relief remains in effect, millionaires will pay a larger share of federal taxes than they would without TCJA. The Joint Committee on Taxation (JCT) estimates that in 2019, taxpayers with incomes over $1 million will pay 19.8 percent of all federal taxes, compared to 19.3 percent without TCJA. Conversely, under TCJA taxpayers with less than $50,000 in income will see their share of the federal tax burden fall from 4.4 percent to 4.1 percent.
Middle-income taxpayers get the largest percentage tax cut under TCJA. JCT estimates that in 2019 TCJA will result in an average tax cut for all taxpayers of 8 percent, but the largest percentage reductions will be enjoyed by taxpayers with incomes between $20,000 and $50,000. Those who earn over $1 million will have a below-average percentage tax cut of 5.9 percent.