The sweeping tax bill that passed the House with only Republican votes on Thursday will cut what Uncle Sam collects in taxes by $1.5 trillion over the coming decade. But while some taxpayers come out as clear winners, others are losers, even within income groups.
For those making $50,000 to $75,000 in 2023, for example, the Joint Committee on Taxation said 36% would get a tax break of $500 or more and another 19% would get a break of $100-$500. But 19% would pay about the same as they do now, 11% would pay $100-$500 more, and 15% would pay an extra $500 or more.
Here's a look at some of the impacts:
Heirs and heiresses: The bill raises from $5.5 million to $10 million the exemption in the estate tax next year, so estates worth less than that would not be taxed. The tax is repealed entirely in six years. This change amounts to 10% of the lost revenue, or $151 billion over the coming decade.
Corporations: The top tax rate would drop from 35% to 20% on Jan. 1. New equipment could be written off immediately, rather than amortized over several years. And companies could continue to deduct state and local taxes.
Retirement savers: The House had considered cutting the tax benefits of saving in 401(k) and IRA accounts, but decided against it.
Retailers: A tax plan House Republicans campaigned on last year called for a "border adjustment tax" on imported goods, but retailers funded an effective campaign portraying it as a price increase on consumer goods and kept it out of the final bill.
Shareholders: The bill's supporters believe corporations will use tax relief to buy equipment and expand, but economists also say much of the bonus will be paid out as dividends that enrich stockholders, including pension funds. Wall Street apparently expects this windfall — stock prices dropped last week after news broke that the Senate would postpone the corporate cut by one year.
Low- and moderate-income taxpayers with children and no deductions: They avoid any losses from the bill's elimination of deductions and credits, and would benefit from the increase in the standard deduction from $12,700 this year to $24,400 next year. An increase in the child tax credit from $1,000 to $1,600, and a new credit of $300 each for a taxpayer, spouse and non-child dependent — like a parent — would offset the elimination of personal exemptions, which this year are worth $4,050 each.
The sick: The bill eliminates a deduction for medical and dental expenses that exceed 7.5% of their incomes. In 2015, there were 8.8 million taxpayers who deducted $87 million.
Disaster or fire victims: The deduction for losses from fire, flood or disaster that exceed 10% would be eliminated, except for losses covered by Hurricanes Harvey, Irma and Maria that were covered by a separate law passed this year.
Vacation communities: The bill eliminates the deduction for mortgage interest on second homes. That would make it more expensive to own such a home.
Residents of high-tax regions: Wealthy states such as New Jersey, New York and California as well as pockets of suburbs around the country could find that the loss of deductions eliminate any benefit from lower tax rates. The bill eliminates the deduction for state income taxes, caps the property tax deduction at $10,000, and on new mortgages, only allows a deduction for interest on the first $500,000 borrowed.
College students: Student loan interest would no longer be deductible. And many universities offer free tuition and a stipend to graduate students who work as teachers or researchers. Currently, only the stipend is taxable, but the would make the tuition a taxable benefit too.
Future generations: The $1.5 trillion reduction in revenues will cause some economic growth, but no study has yet shown it would pay for itself. That means it would most likely add to the deficit — which was $666 billion last year — unless the government makes major spending cuts, which have not been proposed.