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 Also repealed is the two-earner deduction designed to lessen the so-called tax penalty on married couples who both are employed.