It’s no secret. Filing your taxes is complicated. That’s why the vast majority of Americans have to rely on accountants or software to help them get the job done every April—services that can be both costly and time-consuming. It’s 2017, and people are walking around with computers in our pockets. Surely we can make taxes a little bit easier, as well.
Yesterday, Grover Norquist, president of Americans for Tax Reform, and Speaker Paul Ryan sat down to answer your questions on Facebook and explain, in detail, how Americans will benefit from a simplified tax code. Here are the top 5 takeaways:
1. Imagine a postcard-sized tax return.
For 9 out of 10 Americans, you will soon be able to do your taxes yourself, in a matter of minutes, on a form the size of a postcard. That means less stress. Less hassle. Less frustration. And also more convenience (and money) come tax season.
2. Your standard deduction will double.
Tax deductions allow you to subtract certain expenses from your taxable income, reducing your overall tax bill. In 2017, individuals can claim a $6,300 deduction, and married couples filing jointly can claim a $12,600 deduction. We’re roughly doubling that. Single filers will receive $12,000 in tax relief, and married taxpayers filing jointly will receive $24,000, right off the bat. No more hassle in saving receipts or counting miles. Your taxes are about to get a whole lot easier.
3. Low-income families get tax relief.
We have seven different tax brackets right now. By simplifying the tax code, we’ll structure it so more low-income Americans get a tax cut, while simultaneously closing unfair loopholes. Americans who are currently in the 15% bracket will move down to a 12% bracket, and those who are currently in the 10% bracket will have more of their income move to the 0% bracket. Yes, you read that right. By doubling the standard deduction, many more low-income families will pay 0% in federal income tax. Zilch. Nada. Zip.
4. Middle-class deductions will remain.
You will still be able to enjoy tax relief by deducting charitable contributions and mortgage interest from your final federal tax bill. The child tax credit will also increase along with the creation of a non-refundable credit for non-child dependents to help defray the cost of care.
5. We’re going to get this done this year.
Speaker Ryan, along with leaders from the House, the Senate, and the White House, is working to make this framework for tax reform a reality very soon. To quote the Speaker directly: “We want to get this done this year, so we start next year with a new tax system.”