Earlier this month, the House passed the Tax Cuts & Jobs Act. The tax bill reforms the tax code to help hardworking, middle-income Americans keep more of their hard-earned money.
Here are the new individual income tax rates set by the proposal passed by the House:
| Tax Brackets | Individual | Couple |
| 12% | $0 – $44,999 | $0 – $89,999 |
| 25% | $45,000 – $199,999 | $90,000 – $259,999 |
| 35% | $200,000 – $499,999 | $260,000 – $499,999 |
| 39.6% | $500,000 + | $500,000 + |
Here’s an example of how this would impact a family in our district earning $50,000 who take the standard deduction under the current tax structure and under the current plan is as follows:
| Current Tax Bracket | New Tax Bracket |
| $50,000 – $12,700 = $37,300 of taxable income | $50,000 $24,000 = $26,000 of taxable income |
| $37,000 x .15 = $5,595 of taxes owed | $26,000 x .12 = $3,120 of taxes owed |
Because this plan cuts the tax rate and doubles the standard deduction, this family in our district earning $50,000 will see a $2,475 decrease in taxes.
For a second example, a single and newly-hired teacher straight out of college in Citrus County with a starting salary of $34,197 according to the Citrus County School Board, the tax calculation for the teacher is as follows:
| Current Tax Bracket | New Tax Bracket |
| $34,197 – $6,350 = $27,847 of taxable income | $34,197 – $12,000 = $22,197 of taxable income |
| $27,847 x .15 = $4,177.05 of taxes owed | $22,197 x .12 = $2663.28 of taxes owed |
Under this plan, single and newly-hired teacher in Citrus County will see a $1573 decrease in taxes.
In addition to doubling the standard deduction and streamlining the individual rate brackets, the bill maintains and even increases some key tax credit and deductions that help families and individuals.
This tax plan ensures that the average, middle-income American worker gets to keep more of their hard-earned money. It’s time to help that fresh-out-of-college student and new employee pay the bills, meet the monthly rent, and put a little more away for personal savings. This plan helps the newly-wed family and the new parents to purchase their first home, get a bigger and safer family car, and make it easier to put more away for college. And it helps those nearing retirement to finally finish off paying debt and invest more into their retirement.
Congressman Daniel Webster represents The Villages in the U.S. House of Representatives.
