The Republican tax-overhaul plan will send about 10% of a net $1.5 trillion tax cut directly to middle-income households, according to an analysis released late Monday by Congress’s Joint Committee on Taxation.
Households that earn $20,000 to $100,000 a year in wages, dividends and benefits will get $144 billion in tax cuts in all over a decade, with most of those cuts coming in the early years of the decade and then petering out or reversing as tax cuts expire, according to the analysis. Those households account for about half of all U.S. tax filers, with nearly a quarter making more and a quarter making less.
America’s most affluent households, those earning $500,000 or more a year, representing 6% of households, would get $171 billion in tax cuts over a decade, or about 12% of the overall tax cut.
In all, U.S. households would get $768 billion in direct tax cuts from the plan, which is headed toward approval in the House on Tuesday and the Senate on Tuesday or Wednesday. That includes income earned by pass-through businesses such as partnerships and S-corporations that pay taxes on individual returns. It doesn’t include the benefits of estate-tax reductions. Much of the rest would go to businesses in the form of corporate tax cuts, according to the JCT analysis.
An expanded version of this report appears at WSJ.com.
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