What you need to know about the proposed tax bills

House Ways and Means Committee member Rep. Carlos Curbelo (R-FL) prepares for a markup hearing of the proposed GOP tax reform legislation on Capitol Hill November 6, 2017 in Washington, DC.
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In the past month, there have been major developments in revising the national tax code. On Nov. 16, the House of Representatives passed their version of a tax bill. And this past weekend, on Saturday, Dec. 2, the Senate passed a version

Currently, these are two separate tax bills that are not yet law. Now that they have made their way through Congress, the House and the Senate need to work together to draft a version to send to President Trump.

The bills have some similarities, like reducing corporate tax rates and lowering individual income taxes. The corporate cut is meant to be permanent unlike family tax credits which would expire in 2025. Currently, the House's bill hopes the changes can be put in place by 2018, while the Senate's bill calls for the switch to happen in 2019. Committee analysis revealed that a 2019 implementation would keep more than $100 billion in the federal budget. 

Here are some of the components of the bills, how they are different, how they are the same and other elements included in the tax proposals. 

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What do these changes mean?

These tax proposals are an overhaul to the tax code that America hasn't seen in 31 years. But as, of right now, the potential impact can still only be estimated since neither bill has made it to President Trump's desk yet.

However, since both have passed through the Senate and the House, several non-partisan groups like the Congressional Budget Office and the Joint Committee on Taxation have released reports about what these changes could mean. 

There are a few concerns and criticisms of the bills. Here are some of them. 

The Congressional Budget Office released a report saying that the House's proposed changes in the tax bill would increase the national debt by more than $1.4 trillion over the next 10 years. 

The CBO also reported that because the individual mandate would be repealed, that 4 million people would lose health insurance in 2019, and by 2027, that number would reach 13 million. 

It has also been reported that while the middle class would initially get a tax break in 2018, that over time they will actually be a tax increase. The New York Times said that two-thirds of middle class taxpayers would be subject to a tax increase by 2027 and none of them would get a tax cut on personal income taxes. But, those are also estimates. 

The Institute on Taxation and Economic Policy looked at how the tax bill would affect people in Michigan. They found that the richest 1% of Michigan taxpayers would receive the largest tax cut by 2027, and the bottom 60% would be facing tax increases. 

The Johnson Amendment prohibits religious bodies, as well as other non profits, from any sort of partisan political involvement. The repeal of the amendment, a key measure in keeping church and state separate, would allow 501(c)(3) groups, including faith-based organizations to endorse political leaders and make campaign contributions.

The repeal could also give way to privatized donations. For example, if a donor provides an annual donation to a church that church could then donate that money to a political campaign. The donation would be not only be tax deductible for the donor, but also, the origin of that donation would be private. Churches are not required to report who their donations come from, which circumvents current campaign contribution laws. 

So now what? 

Fourteen members of the House of Representatives have been appointed to the conference committee that will work with a similar committee from the Senate to negotiate a final tax bill. 

One of the big debates between the House and the Senate is the decision to keep or scrap the corporate alternative minimum tax. Members of the House were surprised that the Senate kept it in their bill. But the Senate said they kept the corporate AMT because it would curb the increase in the national debt. 

In order for a bill to be put before President Trump, the Senate and House versions must be the same. Congress is going to have to work quickly, because the President previously said he wants a tax bill to sign before Christmas. 

Emma Nicolas contributed to this reporting. 

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