Trump’s R&D Tax Hike Is Visible in 2 Weeks

Hey, remember when Donerd A “two hands required to sip water” and “man/woman/camera/towel” served as sufficient evidence for a man who was significantly challenged by a ramp was somehow more fit for the presidency than the old guy currently in office?

Great news! You don’t have to worry about Biden because Trump’s 2017 Tax fraud bill has now just become due! You see, this is the year where businesses’ R&D gets heavily punished as noted here (although if you were even paying attention this was also reported six years ago)

https://news.bloombergtax.com/tax-insights-and-commentary/the-r-d-tax-break-and-bipartisan-support-for-its-restoration

So most businesses oppose this Donald J Trump brand tax hike that punishes American research and development. Hmmm, it’s almost like he hates capitalism! (Let’s ask the tens of thousands farmers he bankrupted and put on the government dole.)

Why does Trump hate R&D? For starters, he has no policy positions or principles. All Dotard Herr Trump policies have been to make him look good tomorrow, he doesn’t care how he looks 5 years from now (see the insane R&D tax hikes).

Regardless, Trump clearly didn’t want American corps competitive in the near future, bc he found a way to support his red state tax cut by hiking R&D costs! Good for him!

Unfortunately, this kind of stupidity is really bad for America. But who cares, right?!? Orange man good! All others liars! Lolololol

Very interesting indeed!  

-zzzzzzzz

Trump did lots of good, but you won't hear it from the LIBS  that dominate this site ;

2017 tax cuts for business & individuals 

Decreased regulation 

Eradicated ISIS ( remember them?)

Secure southern border

No inflation to speak of (<2%).... and now? Hmmm

Economic growth 6% leaving office ... and now? Hmmm

Peace in the middle east w abraham accord ... isn't Ukraine on fire now ? 

And yet you guys still defend the worst president in history ( biden) 

@Rush51

 None of what you suggest could cycle through and show itself in the span of his presidency, this is so economically absurd I cannot believe you would try to pass this crap off.

2017 tax cuts were smoke and mirror tactics that took from some and gave to the upper income brackets, the simplification of the tax code and changing of the brackets hurt the middle class and benefitted the higher income levels, its trickle down nonsense and nothing more, my taxes went up and I am middle class, what EXACTLY went down for the middle and lower class?

Regulation is forced onto society when free markets and capitalism abuse the citizen, the government is forced into action due to complaints from the population and from corporate greed via PAC and lobby efforts to protect profits. The common person is not wealthy enough to engineer any regulation and corps are 100 years in front of underfunded government efforts, you act like regulation is some scheme to punish a corp when it is actually due to abuse and fraud given from corps.

ISIS is never gone, it will never be gone because to rid that area of ISIS or AQ or whatever name you want to give it you have to destroy the religious forces which cause it to exist, Trump did zero to change the religious male dominated structure of society and nothing has changed, nothing will. What did he change exactly? Is that area free of religious factions and fighting, are women free and are minorities and gays free to live life there? You are funny.

The border will never be secure even with a 100 foot wall costing 2 TRILLION to make and another 500B a year to maintain because what you want to KEEP out has more motivation to get IN than you do manpower and money to keep out, the border is not secure it was a political ploy to incite your group to vote and keep the party in power.

Inflation began to bubble when Trump was in office, it was germinated for fifteen years due to the FED, not from a politician, what did TRUMP do to guide inflation exactly? It took a supply chain disruption and Russia crimping oil/natural gas to pop the FED induced inflation bubble, the FED tried for 5-7 years to manufacture 2% and it didnt happen, yet it took two events to go from near ZERO inflation to double digits, where before the FED tried everything but raising rates and they could not FORCE even 2 percent. Why is that? Trump has no power in four years to alter inflation and if anything inflation is a trailing measure, it is a bubble that is visible and you can watch it develop until it is too late and until supply returns this inflation will persist.

What kind of economic growth will happen when the growth was funded by zero percent interest rates? Corps had risk free leveraged cash to use to ramp production and it cost literally nothing for doing so, even with lower margins it made sense. Now that free cash costs more than the lower margin revenues it produced so now supply on the marginal level is reduced because cost of capital is higher when the FED raised and keeps raising rates. What kind of growth do you expect when the cost of capital is higher? The real estate market is down because of mortgage rates, credit rates never went down but are high so how can you expect growth to be great when cost of capital is higher in such a short period AND supply chain is not functioning?

Peace in the middle east, who says this? That area is seconds away from WWIII at every moment no matter who is in office, Trump was not a peace maker of any kind, he was a cheese burger and twitter dope who was more concerned about his image than anything you falsely credit him for.

Raiders22;

During the legislative debates that occurred prior to the bill’s passage, opponents of the legislation—especially congressional Democrats—argued that TCJA would disproportionately benefit wealthy households and businesses, at the expense of lower- and middle-income American families.

For example, Rep. Nancy Pelosi, who now serves as the speaker of the House, said on November 6, 2017, “Despite Republicans’ empty promises to cut taxes for middle class working families, it’s clear that the GOP tax plan for the wealthiest is rich indeed.”[3]

“House Republicans’ tax bill would increase taxes for 12 percent of Americans next year, according to a new report from the nonpartisan Tax Policy Center,” Pelosi added.

“The truth is already catching up with the GOP’s snake oil pitch,” Pelosi concluded. “Instead of pushing a deficit-exploding handout to corporations and the wealthy that increases taxes on millions of hard-working families, Republicans must join Democrats to work on bipartisan tax reform that puts the middle class first.”

More than four years after Pelosi’s dire statements, analysts now have the evidence needed to evaluate whether the TCJA truly was, as Pelosi suggested, nothing more than a “snake oil pitch.” The results are definitive and striking.

According to data from the U.S. Internal Revenue Service comparing outcomes from 2017 to 2018—the first year the tax reform law went into effect—the Tax Cuts and Jobs Act reduced average effective income tax rates for filers in every one of the IRS’s income brackets, with the largest benefits going to lower- and middle-income households. 

Continued.....

BELIEVE WHO YOU WANT, MY MIDDLE CLASS TAXES WENT DOWN AND MY SPENDING ABILITY WAS NEVER HIGHER 2+ YEARS AGO.

@UNIMAN

 This is possible if you are not someone who had deductions, for people who had deductions that got removed it has not been a tax cut at all but some who were standard deduction only filers have benefitted. 

I never saw a rationale on why certain deductions got wiped off and some did not, why this even happened in the first place it seems like a total shell game and a way to force middle class brackets higher and act as if it is better which it is not in my case.

@wallstreetcappers

 Wall, do you care to understand how much the standard tax deduction was increased under Trump,  or even how the Child Tax Credit was increased under Trump.... didn't think so.   That was the 2017 tax cuts....  go Google it...   and wow,  what a mean man Trump was, for lowering individual tax rates, in addition to what I just said above.   Jeezus, what kind of president would allow hard working Americans to keep more of what they earn. Lol. 

Jeezus, Wall.  C`mon.  You know as well as I do that the ability of tax filers in  high tax blue states couldn't deduct everything.   Hell,  I live in a high tax blue state and applaud what Trump accomplished.   

** Why should other tax filers subsidize the generous federal tax deductions you were getting in the first place ??  Perhaps your  "state" is to blame.   Don't blame the federal government 

If folks were to research on their own and take the politics out of it I think they would see how so many of these are actually way more beneficial to the upper income classes.  I realize folks just want to hear what reinforces what they choose to believe.  

But if you are sincerely interested, there are plenty of independent studies that disprove the myth that taxes on lower and/or middle income folks were raised.

I understand that people do not do their own research and do not want to read a lot of ‘cut-and-paste’ stuff, especially when it does NOT reinforce their political agenda.

But I will try — and believe me, this is really condensed and not at all comprehensive.

So, almost by definition, if someone is claiming they paid more taxes due to less deductions and credits — they CANNOT claim to be lower or middle income class.  For, example:

New York

2-person family middle-class income range: $48,674 to $145,296

3-person family middle-class income range: $57,889 to $172,802

4-person family middle-class income range: $70,331 to $209,944

California

2-person family middle-class income range: $52,681 to $157,258

3-person family middle-class income range: $57,796 to $172,524

4-person family middle-class income range: $66,091 to $197,288

Arizona

2-person family middle-class income range: $44,015 to $131,388

3-person family middle-class income range: $47,098 to $140,592

4-person family middle-class income range: $55,092 to $164,454

Idaho

2-person family middle-class income range: $41,527 to $123,960

3-person family middle-class income range: $45,395 to $135,508

4-person family middle-class income range: $53,479 to $159,640

Tennessee

2-person family middle-class income range: $40,158 to $119,874

3-person family middle-class income range: $45,967 to $137,216

4-person family middle-class income range: $54,118 to $161,546

In 2018 the top 1% ended up paying $16 billion more in federal individual income taxes than they did in 2017, while 99% paid a total of $80 billion less.

The proportion of taxes paid by the highest 1% of income earners went from around 37% in 2017 to 40% in 2018. 

Fake facts mislead voters and generate bad policy. In this case the middle class will end up getting hit with more taxes, because that’s where the real money is.

By the way, you read that right. About 1.6 million, or one percent of all taxpayers, bore 40 percent of the income tax burden due to the federal government.

So, as a result of the TCJA, high earners paid more taxes to the government, while everyone else paid less. They also paid a larger percentage of all taxes, while everyone else paid a smaller percentage.

But what about the middle class specifically? While there is no accepted definition for the “middle class,” median family income in 2018 was $63,179, so let’s look at taxpayers making between $50,000 and $100,000.

In 2018, there were about 35 million taxpayers in this bracket, an increase of roughly one million over 2017 (a growing middle class). In total, they owed $31 billion less in 2018 than in 2017. In other words, the middle class got nearly half of the $64 billion decline in taxes owed under the TCJA.

As for their share of the tax burden, it also declined. While they accounted for 22 percent of total income (roughly the same as in 2017), their share of income taxes was 13 percent (over a percentage point less than in 2017).

Let’s look at taxpayers making under $25,000. The number of taxpayers in this bracket was 52 million in 2018, a drop of 2.3 million taxpayers from 2017. In total, their tax liability declined 16 percent or $4 billion, from $25 billion in 2017 to $21 billion in 2018.

Their share of the tax burden also declined. Those taxpayers accounted for 4 percent of total income (roughly the same as in 2017) but their share of taxes was one percent (slightly less than in 2017).

So here are the results of the Trump tax cuts:

--The income tax burden for high earners increased $16 billion to 40 percent of the total owed.

--The income tax burden for middle class earners decreased by $31 billion to 13 percent of the total owed.

--The income tax burden for low wage workers decreased by $4 billion to 1 percent of the total owed.

Doesn’t sound much like a tax cut for the wealthy.

So why does Biden keep saying what he says? To quote Ronald Reagan: “It isn’t so much that liberals are ignorant. It’s just that they know so many things that aren’t so.”

As for middle- and lower-wage earners, the number of tax returns claiming the standard deduction increased in 2018 by 29 percent to 134 million. Because the TCJA increased this deduction, the amount those taxpayers deducted increased $1.4 billion or 156 percent from $900 million to $2.3 billion.

In reality, thanks to the TCJA, working and middle-class Americans were earning more and keeping more of what they earned following the Trump tax cuts. That meant bigger paychecks and an easier time meeting household expenses.

As a group, high earners were paying more and bore a greater percentage of the income tax burden.

Biden can claim otherwise but that won’t make it so.

This is really not as complicated as folks try to make it.

Income brackets:

The TCJA changed the tax brackets and the income thresholds for brackets. For example, if you are now in the 12% tax bracket, before you would have been in the 15% tax bracket. If you are now in the 22% tax bracket, you would have been in the 25% tax bracket. If you are now in the 24% tax bracket, you would have been in either the 28% or 25% tax bracket, depending on your income.

Nothing but good here so far

The act nearly doubled the standard deduction and eliminated or limited many itemized deductions. The effect of the tax reform was that many people who used to itemize on Schedule A took the standard deduction instead. 

This is a good way to try to simplify the tax code.  Doubling the standard deduction was good in that it encouraged people to use this instead of itemizing; bad, if you are someone that itemized and used any kind of deductions and credits you could get.  A different debate would be whether that is personally good longterm or not (if you are doing this you are more than likely making bad fiscal choices for your longterm financial stability.

Personal Exemptions

The new law suspended personal and dependent exemptions between 2018 and 2025. Though an exemption is not technically a deduction, it functions the same way by allowing you to reduce your taxable income by the amount of the exemption. In this case, say the exemption was $4,050 for yourself and for each dependent you claim. Now, it is zero. Keep in mind, though, that even though you can't claim a personal or dependent exemption, you may be eligible for other tax benefits.

Same point here as above.  The question is whether or not the simplification offset the exemptions enough, etc.

Child Tax Credit

The TCJA doubled the child tax credit(CTC) from $1,000 to $2,000 for those who qualify, including parents with higher incomes than in the past. That limit was increased again for the 2021 tax year to $3,000 for children ages six through 17 and $3,600 for children under the age of five. These reverted back to the original amount of $2,000 for 2022 and 2023. Income thresholds are $200,000 for single parents and $400,000 for those married filing jointly, whereafter the credit is reduced.

Remember, this is a tax credit so this comes directly off the total taxes you owe. In addition, a new $500 tax credit is available for dependents aged 17 and older.

Obviously, a good thing for middle to lower income classes.

Higher Standard Deduction

The TCJA raised the standard deduction for taxpayers. Single filers can claim a standard deduction of $12,950 in 2022 and $13,850 in 2023. For married couples filing jointly, the deduction is $25,900 in 2022 and $27,700 in 2023.

Regardless of your age, you may discover that the new standard deduction is larger than the combined total of your itemized deductions, even if you deduct mortgage interest.

Nothing not to like here.

Commuter Tax Benefits

In the past, your employer could reimburse you up to $20 a month or $240 annually for bicycle commuting expenses on a tax-free basis. In addition, your employer could take a deduction for offering the benefit. The TCJA suspended that benefit for both bike commuters and their employers. It also removed employer deductions for parking, transit, and carpooling.

Employees continue to receive tax-free benefits for parking, transit, and carpooling from their employers. The exclusion amounts are $280 per month for 2022 and $300 in 2023.

Moving Expenses Deduction

Costs associated with relocating for a new job used to be deductible on Form 1040 as an above-the-line deduction, which you could subtract from your gross income to calculate your Adjusted Gross Income(AGI). Unfortunately, this no longer applies. In fact, the distance you move doesn't even matter. Moving expenses are simply not deductible.

Another way to simplify and should not have affected too many of the lower, or even middle class, folks.  The richer really are the ones that take advantage of this the best.  Good to see it go away.  You never saw enough middle or lower class folks change jobs and move to a much better financial state to further their longterm stability.

Alimony Deduction

In the past, the person making alimony payments received an above-the-line deduction, and the person receiving the alimony counted the money as taxable income. As of 2019, the paying spouse no longer receives a deduction and the receiving spouse no longer declares the payments as taxable income for any divorce that occurred after Dec. 31, 2018. Payments initiated before 2019 are not affected. Child support payments are also nondeductible by the paying spouse and tax-free to the recipient.

I am okay with this.  Helps to simplify it.  No matter your thoughts on the fairness (or unfairness) of alimony for one party, this might encourage more fairness to the party that might be perceived as ‘punished’ more.

Gift an IRA

One suggested tactic for the paying spouse involves giving the receiving spouse a lump-sum Individual Retirement Account(IRA). This effectively provides the paying spouse with a deduction because they are giving away money they would have had to pay taxes on eventually.

The receiving spouse would be responsible for taxes upon withdrawal (including a 10% penalty if money is withdrawn before age 59½) but would have the benefit of tax-free growth until withdrawing funds. The transfer of the IRA account is tax-free.

Obviously, this would not be ideal if the receiving spouse needs money right away.

A scam to me, should be done away with.

Medical Expenses Deduction

The deduction for medical expenses remains.

No problem here — this is fine.

Foreign Property Taxes

The TCJA eliminates the deduction for foreign taxes paid on real estate. Previously, you could deduct foreign property taxes on Schedule A just as you can in the United States, either for a regular residence or a second home.

To me, this should never have existed.

Qualified Housing Expense

Foreign property taxes may now be considered a deductible qualified housing expense on Form 2555…

I would do away with this one as well.

Mortgage Interest Deduction

In the past, you could deduct interest on mortgage debt of up to $1 million ($500,000 for married taxpayers filing separately). This still applies to any loan originated on or before Dec. 16, 2017. But if you originated a new mortgage after that date, the new limit of $750,000 applies ($375,000 if married and filing separately).

Does not affect lower or middle income folks.  I do not like it anyway and would do away with it.  This, in a way almost, ‘incentivizes’ people to buy homes they really cannot afford.  Or at least, should not buy because it sacrifices their long term financial stability.

HELOC Interest Deduction

HELOC Interest

Mortgage Insurance Deduction

I feel the same about these.

Casualty, Theft Deduction

The comprehensive Schedule A deduction for casualty and theft losses went away following the passage of the TCJA. In the past, you could deduct losses related to a disaster or theft to the extent that those losses were not covered by insurance or disaster relief.

The deduction is still available if you live in a federally designated disaster zone. 

I do not like this.  This is another example of folks ‘incentivized’ to not get enough insurance or to continue to live in ‘disaster-prone’ areas.  Not fair to someone to have to ‘pay’ for someone that chooses to live in a hurricane-prone area — while they are not reimbursed under the same conditions if they experience a bad localized storm that affects just their house AND is not declared a federal disaster, etc.

Miscellaneous Itemized Deductions

Miscellaneous Schedule A itemized deductions subject to a 2% of AGI threshold went away in 2018.

Unreimbursed Job Expenses.

Investment Expenses.

Tax Preparation Fees.

Hobby Expenses.

I am not for these — most are scams and do not affect lower or middle income folks.

Now this is where a lot of people seem to take issue:

SALT Taxes Deduction

The Schedule A deduction for state and local taxes(SALT) used to be unlimited. These include income taxes (or general sales taxes), real estate, and personal property taxes. With the passage of the TCJA, the SALT deduction is now limited to $10,000 ($5,000 if married and filing separately).

This can be a real problem for people in states with high income or property taxes, such as New York and California.

I think this explains this somewhat:

SALT DEDUCTIONS ARE REGRESSIVE

Representative Josh Gottheimer (D-NJ) – one of the repeal’s staunchest proponents – remarked that reinstating previous SALT deductions would be a boon for “struggling families.” 

Yet the deductions disproportionately benefit the wealthy. Under a full repeal, the top 1 percent of households would receive an average tax cut of at least $35,000— compared to a paltry $37 for their middle class counterparts. 

This phenomenon is a function of our tax code structure. Most taxpayers opt for the standard deduction when filing their taxes. Only 25 percent of households with an income between $40,000-$50,000 elect to itemize deductions— compared to 90 percent of those with an income exceeding $200,000. 

Typically wealth and deduction eligibility are linked. For example, an individual can deduct mortgage interest as an expense, but not rent. One can also deduct some capital gains losses, but not lost wages. Deductions derive their value from the top tax bracket applicable to a taxpayer. For instance, a $1,000 deduction is worth $370 for a household in the 37 percent bracket, but is only worth $220 for those in the 22 percent bracket. Unlike tax credits or public assistance programs, tax deductions are inherently structured in a manner that disproportionately helps the wealthy. 

Prior to the $10,000 cap, New Yorkers claimed an average SALT deduction of $23,804. Extrapolating beyond this data point indicates that state and local governments would cede significant revenue to the coffers of the wealthy if the cap is nixed. At a time when states have witnessed their largest revenue declines in at least 25 years, diverting any revenue to the wealthy does not make economic sense. 

The 400 richest Americans pay a lower tax rate than any other income group. Additionally, 69 percent of voters support raising taxes on the rich and corporations. Given this context, it does not make either policy or political sense to champion tax deductions that overwhelmingly benefit the wealthy. 

Furthermore, the notion of “double taxation” regarding the SALT cap is absurd. This assertion presupposes that state and local governments do not uniquely or predominantly offer a host of services like public transportation, public schools, parks and recreation, public works, police, fire, and EMS services. 

The claim “double taxation” might operate well in the realm of alternative facts, but not in our reality where there is a distinct separation of powers between different levels of government. 

As a party that purports to fight for the working-class, Democrats must unequivocally reject any upward redistribution of wealth. 

I just think people need to do their own research and see if what the Democrats and the Media are saying is true.

If you feel your taxes are not correct or you NEED deductions and credits -- then you simply need to reevaluate your financial well-being.

Most people refuse to live within their means -- this includes wealthier folks.  These are the folks that are really bellyaching about their taxes -- with reason.

But, even Democrats, say they want to raise taxes on the rich and increase their tax-burden.

As the studies show -- this did that.

So, if folks REALLY had an increase in their taxes they are NOT lower or middle class.  

This

Raiders.. seriously.  We could've stopped w my posts, but I'm sure we've engaged in some serious information overload w some folks.  Lol. 

@Rush51

 Of course you are correct.

But do you think lazy folk will ever look it up for themselves?

How do you complain about something AND NOT even understand it?

How can you say you do NOT know why certain deductions were done away with and others were not?  

Look it up!  Research and learn.

It is just frustrating to see, seemingly intelligent, folks not do this.  

But you are correct -- I will move on. 

And this.