What does the Senate tax plan mean for you?

The massive tax overhaul passed by the Senate early Saturday morning will if enacted into law impact millions of Americans in different ways.

By and large, the most costly provision continues to be reducing the corporate tax rate to 20 percent. The Joint Committee on Taxation (JCT) gives that a $1.4 trillion price tag. Republican claims the measure would pay for itself were also debunked this week by the JCT. Their analysis estimated the bill would grow the economy by .8 percent over a decade, still adding $1 trillion to the deficit.

When it comes to individual income taxes, the Senate measure also makes broad cuts across income levels. However, most of the individual income tax provisions will sunset after 2025 unless Congress acts. The bill also includes a change to inflation adjustments that would raise taxes slightly compared to what they would have been under current law.

By 2027, every income group under $75,000 is expected to see tax increases according to the Joint Committee on Taxation.

The corporate rate cut, from 35 percent to 20 percent, will be permanent.

The Senate bill is not the final word.

The Senate and House versions of tax reform have big differences including the treatment of the health insurance mandate penalties, as well as the number of tax brackets. The two will need to be reconciled before they get to President Trump’s desk.

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