Two parts of Trump’s 2017 tax law that are particularly expensive and beneficial to the richest individuals are the changes in income tax rates and brackets and the special deduction for “pass-through” business owners. Lawmakers should not extend these provisions for high-income households past the end of this year, when they are scheduled to expire.
Joe Hughes
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blog March 26, 2025 Two Ways a 2025 Federal Tax Bill Could Worsen Income and Racial Inequality
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media mention March 25, 2025 The American Independent: Trump’s IRS Cuts Will Make It Easier for Rich Americans to Avoid Paying What They Owe
Experts say staffing cuts at the Internal Revenue Service will make it easier for wealthy tax evaders to avoid paying what they owe to the U.S. Treasury each year. In… -
report March 3, 2025 High-Rent, Low-Wealth: Addressing the Racial Wealth Gap through a Federal Renter Credit
While the federal tax code has some policies focused on raising income of low earners, it contains fewer provisions designed specifically to address wealth inequality. A renter tax credit offers a simple, administratively practical means of reaching low-wealth populations through the federal tax code without requiring a comprehensive measurement of every household’s wealth.
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blog January 17, 2025 Congress Could — But Won’t — Pass a Tax Package That Pays for Itself
If Republican lawmakers were serious about deficit-neutral tax reform, they would focus on increasing taxes for the ultra-wealthy and large corporations. The absence of such proposals in their plan reveals their true priority: delivering enormous tax cuts to the wealthiest Americans while average working families receive crumbs.
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blog December 12, 2024 Defunding the IRS Would Cost Taxpayers
As Congress negotiates a bill for federal funding during the lame-duck session, lawmakers would be wise to remember that stripping funds from the IRS costs more than it saves. On the table in the appropriations bill is a $20 billion recission of funds to the nation’s tax administration. While this may look like a spending cut, it will increase deficits by $46 billion due to a drop in the agency’s capacity to enforce taxes on wealthy individuals owed under existing federal law.
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media mention November 21, 2024 Public News Service: Colorado Working Families Would Pay More Under Trump Tax Proposals
President-elect Donald Trump and Republicans in Congress have promised to pass a new tax bill, and a new report breaks down the expected winners and losers. Joe Hughes, senior policy analyst with the nonpartisan Institute on Taxation and Economic Policy, says based on Trump’s campaign proposals, the top one percent – those making more than $900,000 a year – will see their tax bill go down by more than $36,000, on average.
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blog October 10, 2024 Fifteen Companies Each Avoided More than $1 Billion in Taxes from a Single Trump Tax Cut
The deduction for Foreign-Derived Intangible Income (FDII), one of the tax cuts included in former President Trump’s signature 2017 tax law, provides a lower effective tax rate on income earned from intangible assets, such as patents, trademarks, and other forms of intellectual property. Since the law went into effect in 2018, 15 corporations have separately reported more than $1 billion in tax benefits. Alphabet (the parent company of Google) reported the most, at more than $11 billion in tax breaks from 2018 to 2023. Other beneficiaries include large tech firms such as Meta, Microsoft, Intel, and Qualcomm.
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report October 7, 2024 A Distributional Analysis of Donald Trump’s Tax Plan
Former President Donald Trump has proposed a wide variety of tax policy changes. Taken together, these proposals would, on average, lead to a tax cut for the richest 5 percent of Americans and a tax increase for all other income groups.
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media mention October 7, 2024 HuffPost: Group That Says Tariffs Are Taxes Touts Tariff-Pushing JD Vance Taking Its No-Tax Pledge
Americans for Tax Reform’s anti-tax pledge is well known in GOP circles. But what does it mean when punishing tariff hikes are on the table? Read more. -
media mention October 2, 2024 Business Insider: Trump’s Plan to Scrap Taxes on Tips and Overtime Could Reshape How Millions of Americans Get Paid
Joe Hughes, a senior analyst on federal tax policy at the Institute on Taxation and Economic Policy, told BI that “you would need a lot of safeguards in place to keep this from being just another avenue for tax avoidance.” He continued: “It’s at least applaudable that Trump says that he wants to help low-income workers. But I think that there are much better avenues to do that than exempting very specific types of income.”
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media mention August 26, 2024 The Lever: Will Harris Finally Kill Wall Street’s Infamous Tax Break?
s part of their new 2024 party platform, Democrats have promised to close a notorious tax loophole that has long allowed Wall Street billionaires to pay a far lower tax rate than most Americans. Likewise, Vice President Kamala Harris has reportedly signaled she supports ending this tax break, which could net billions in government revenue.
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blog August 16, 2024 Here’s a Tip: Keep the Taxation of Tips As-Is
The no tax on tips idea isn’t a new one, but it’s always been abandoned because it’s practically impossible to do without creating new avenues for tax avoidance. Despite its embrace by the candidates from both major parties, this policy idea would do little to help the roughly 4 million people who work in tipped occupations while creating a host of problems.
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media mention August 12, 2024 The Washington Examiner: The Coming Multifront Battle Over the Corporate Tax Rate
Next year is likely to see the biggest battle over the taxation of corporations in nearly a decade, a multifront engagement that will pit free marketers and big business against Democrats and populists. The corporate tax rate is set to be a point of negotiation in a historic “fiscal cliff” scheduled for next year, when the individual portions of the Trump tax cuts expire.
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media mention July 19, 2024 USA Today: America’s Billionaires Are Worth a Record $6T. Where Does That Leave the Rest of Us?
America’s billionaires are now collectively worth a record $6 trillion. Their wealth has more than doubled since the passage of the landmark Tax Cuts and Jobs Act in 2017. Is… -
ITEP Work in Action April 12, 2024 Audio: ITEP’s Joe Hughes on the Need for a Well-Funded IRS
ITEP Federal Policy Analyst Joe Hughes appeared on the Oregon Center for Public Policy’s “Policy for the People” podcast, discussing IRS funding and Direct File. -
blog March 28, 2024 Congress Should Enhance – Not Diminish – IRS Capability this Tax Season
While funding cuts to the IRS may have been necessary as a political matter to avoid harmful agency shutdowns, they are severely misguided as a policy matter. By all serious accounts, cuts to IRS funding increase the deficit due to uncollected taxes – mostly from big businesses and the very wealthy.
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blog February 16, 2024 IRS Commissioner, New GAO Report Highlight Importance of Proper IRS Funding
A new GAO report and Commissioner Werfel’s testimony highlight the value and necessity of a well-funded and functioning IRS. Most families and businesses do their best to pay taxes accurately and on time. The nation benefits from a modern revenue agency that can make this process as easy and simple as possible and identify complex tax schemes that deprive the country of revenues.
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brief February 2, 2024 House SALT Proposal is Expensive, Unneeded, and Poorly Designed
The SALT Marriage Penalty Elimination Act passed by the House Rules Committee on February 1 is costly, decreasing tax revenue by about $8 billion in 2023.
It also mostly only helps taxpayers who are already well off. -
brief February 2, 2024 Impacts of the Tax Relief for American Families and Workers Act
The Tax Relief for American Families and Workers Act passed by the House of Representatives on January 31 is a compromise between lawmakers who want to address child poverty and… -
media mention January 31, 2024 The Hill: Tax Deal Likely Much More Expensive than Official Estimate, Experts Warn
“The $600B figure … is consistent with earlier estimates of the 10-year costs of these provisions if made permanent,” Joe Hughes, a policy analyst with Institute on Taxation and Economic Policy, told The Hill.
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media mention January 29, 2024 Fatherly: What the New Child Tax Credit Would — and Wouldn’t — Do for Families
Various efforts have been made to revive the 2021 tax credit, which was wildly popular and is considered the “gold standard,” to CTC advocates, according to Joe Hughes, a Federal Policy Analyst at the Institute on Taxation and Economic Policy, a non-profit, non-partisan tax policy organization. It’s also popular across party lines: A poll from Zero to Three and Morning Consult found that 85% of respondents want Congress to reinstate the 2021 CTC — 94% of Democrats and 77% of Republicans. But no effort in that direction has yet been successful.
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blog January 26, 2024 Three Things to Know This Tax Filing Season
The IRS Direct File pilot is currently open to eligible taxpayers here. Millions of American families have now received their W-2s for 2023, signaling the start to a new tax… -
media mention January 20, 2024 The Hill: House Panel Advances Tax Deal with Resounding Bipartisan Vote
A deal to reduce taxes for businesses and increase the child tax credit (CTC) made it out of the House Ways and Means Committee with broad bipartisan support Friday. Read… -
brief January 16, 2024 Proposed Tax Deal Would Help Millions of Kids with Child Tax Credit Expansion While Extending Damaging Corporate Tax Breaks
On January 16, Congressional tax writers officially announced the details of a tax policy agreement. The deal includes expansions of the Child Tax Credit (CTC) to improve access for low-… -
media mention December 14, 2023 Money: What Would Happen If The IRS Was Abolished?
What would happen if the U.S. actually did eliminate the IRS? When I posed this question to Joe Hughes, federal policy analyst at the Institute on Taxation and Economic Policy, he…