It's Tax Day and the last year that Americans will have to struggle with outdated, complex tax forms. The Tax Cuts and Jobs Act has delivered historic tax reform for businesses and individuals, but it's done more than that.
Not only has Congress cut tax rates for individuals and corporations, but other reforms will allow families to keep more of what they earn.
For example, a single parent with one child earning $41,000 per year will see a tax cut of more than $1,300. Their tax bill will also fall from about $1,792.50, to just $488 –a reduction in their tax bill of nearly 73 percent compared to current law.
In a USA Today op-ed, President Trumps points to the jobs created since he's been in office, noting:
"We have already created 3 million jobs since the election — including more than 290,000 new jobs in manufacturing and more than 75,000 in mining and logging jobs."
Not only is the unemployment at a sustained low level, but demographics are also experiencing historic lows as well. Black and Hispanic unemployment, for example, saw tremendous declines and continue to remain low.
Not only is this about now earning a paycheck, but expanding opportunity to groups that have struggled to gain a foothold in the labor force.
New Benefits for Workers
Millions of American workers can point to bonuses, higher starting salaries, raises, and new benefits as companies reinvest in their workers.
Kroger is the latest company to announce new employee benefits thanks to savings from the tax reform bill. The company announced that it plans to invest about $130 million more per year on expanded employee benefits.
This includes expanding their education benefit available to part-time staff from $1,5000 to $3,500 and allowing the benefit to be applied more training certificates, online degrees and other continuing education opportunities that weren't covered before; adding an education-assistance benefit worth up to $21,000 for any employee with more than six months on the job; increasing retirement matching; and expanding employee discounts as well as funds for employees affected by natural disasters.
Thanks to tax reform, this is the last year that Americans will face penalties for not carrying health care coverage because of the Affordable Care Act (aka Obamacare). Those penalties disproportionately affected low- and middle-class families with 80 percent of the penalties hitting families earning less than $50,000 per year.
Easier Tax Filing
Next year, tax filing should also get a lot easier. Because the standard deduction was expanded, an estimated 31 million filers will use it rather than itemizing. The simplified the tax code is projected to save taxpayers $14 billion in compliance costs next year.