Extending Temporary TCJA Provisions: A Windfall for the Wealthy with an Enormous Price Tagnews release
Contact: Jon Whiten ([email protected])
The push by Congressional Republicans to make permanent a series of tax laws that expire at the end of 2025 would cost nearly $300 billion in the first year and deliver the bulk of the tax benefits to the wealthiest Americans, according to a new analysis released today by the Institute on Taxation and Economic Policy.
The report features both national and state-by-state breakdowns of how the “TCJA Permanency Act” – which would make permanent the provisions of the Tax Cuts and Jobs Act of 2017 that would otherwise expire at the end of 2025 – would impact people across the income scale in 2026.
- The bill would cost $288.5 billion in 2026 alone.
- The poorest fifth of Americans (annual income under $26,900) would receive just 1 percent of the tax cut dollars while the richest fifth of Americans (annual income over $149,800) would receive nearly two-thirds.
- The richest 5 percent of Americans would receive more tax breaks ($112.6 billion) than the entire bottom 80 percent ($104.6).
- The poorest fifth of Americans could expect an average tax cut of $100 while the richest 1 percent could expect an average tax cut of nearly $26,000. The average tax cut for the richest 1 percent would be 25 times that of the middle 20 percent and more than 250 times that of the bottom 20 percent of Americans.
- When combined with the portions of TCJA that are already permanent, the tax changes are even more tilted to the richest Americans.
“It is difficult to understand how lawmakers would make permanent these tax cuts even for the richest taxpayers while also insisting that ordinary Americans must make sacrifices to address budget deficits and debt,” said Steve Wamhoff, report co-author and ITEP Federal Policy Director.
To read the full report and download the data, click here.