President Trump signed his “one great beautiful act” (OBBA) into law, and Americans will see major changes to their finances. The final bill includes the Senior Prize, which helps to compensate for social security taxes, tax benefits for the service industry, and higher children’s tax credit, but will also perform in 2017. The Law on Trump Tax Reduction and Workplaces (TCJA) will reduce the financing of Medicaid and Medicare – according to the center of American progress.
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Although the draft law was stated as a way to offer financial assistance to Americans, it does not provide much help. “This thing is usually the smoke and mirrors of higher middle -class families (which is $ 117,000 to $ 150,000),” said Andrew Lokenaut, a financial expert with Fluent in Finance. “You don’t go into a hammer but you also win.”
According to tax and financial experts, this is what a short tax law really means for a higher secondary class.
The standard deduction increases to $ 15,000 for individual documents, which increases by $ 400 and $ 30,000 for married couples, which is an increase in $ 800 for IRS.
“This is a big achievement in this income group that does not calculate deductions,” said Peter Diamond, a federal level of licensed tax, accounting, real estate and structure and a certified bank expert.
“Most of the higher middle-class taxpayers do not exceed the limits of the explicit, especially with the still salt (state and local tax) to the top. Increased standard deduction gives them a higher automatic write-off by reducing taxable income and simplifying the feed,” he explained.
However, according to Lokenaut, this change can cost more taxpayers. “If you are in that $ 120,000-150,000 in the income zone, especially due to the mortgage, losing personal exceptions and salt boundaries, it means that you probably pay more than you do until 2018,” he added.
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Children’s tax credit was a large speaking point for Trump and Vice President Vance. Credit increased from $ 2,000 for a child to $ 2220, starting from 2026, for CNBC. Parents are required to earn $ 200,000 a year or less or in cases of $ 400,000.
“This means that many families with a range of $ 117,000 to $ 150,000, which have previously been gradually removed from this credit, are now qualified again,” Diamond said. “For a family with two children, this is up to $ 4,000 tax credit, which directly reduces the dollar tax account.”
But the new amendments are not as good as Lokenaut said.