What tax bill does for individuals

For individuals, the tax bill passed by the House on Tuesday: Cuts the number of tax brackets Under current law there are 14 personal tax brackets topping out at 50 percent. Under the House bill there are four -- 15, 25, 35, and 38 percent. For married taxpayers, the 25 percent rate applies to taxable income over $22,500, the 35 percent rate to over $43,000, and the 38 percent rate to over $100,000. For single taxpayers, the 25 percent rate applies to taxable income over $12,500, the 35 percent rate to over $30,000, and the 38 percent rate to over $60,000. Boosts the personal exemption For non-itemizers the exemption would climb to $2,000 from the $1,080 now scheduled. Itemizers would effectively get a $1,500 per person exemption. Increases the standard deduction The deduction would be $4,800 for joint returns ($3,670 currently), $4,200 for heads of households ($2,480 currently), and $2,950 for single individuals ($2,480 currently). Retains many popular deductions Mortgage interest on first and second homes would remain fully deductible as would state and local tax payments. Non-itemizers could continue to deduct charitable contributions but only above $100. The child-care credit is retained. Eliminates some popular provisions The ability to income average, which offsets the tax effects of a sharp rise in income, would be eliminated. Also repealed is the two-earner deduction designed to lessen the so-called tax penalty on married couples who both are employed.

About these ads
Sponsored Content by LockerDome

We want to hear, did we miss an angle we should have covered? Should we come back to this topic? Or just give us a rating for this story. We want to hear from you.

Loading...

Loading...

Loading...

Save for later

Save
Cancel

Saved ( of items)

This item has been saved to read later from any device.
Access saved items through your user name at the top of the page.

View Saved Items

OK

Failed to save

You reached the limit of 20 saved items.
Please visit following link to manage you saved items.

View Saved Items

OK

Failed to save

You have already saved this item.

View Saved Items

OK