With the passage of the Tax Cuts and Jobs Act (TCJA) last December, many Americans are wondering what will actually happen to their taxA tax is a mandatory payment or charge collected by local, state, and national governments from individuals or businesses to cover the costs of general government services, goods, and activities. liabilities when they file their taxes early next year. We’ve created a tax calculator that should help most Americans determine how the TCJA will affect taxpayers in scenarios similar to their own.
Previously, our earlier blog post on this subject detailed the effects of the TCJA on eight sample taxpayers. All eight sample taxpayers are included in the calculator as presets. However, to illustrate a taxpayer with an increased tax liability under TCJA, we have modified our assumptions for Soren and Linea. The full assumptions are included below this post.
Now, you can also create custom scenarios. Inputting custom scenarios is as simple as possible; a basic estimation can be run with just the taxpayer’s filing status and income.
Check out the tax calculator for yourself below.
The calculator in its current form includes most aspects of the federal individual income tax code except provisions related to business and self-employed income.
The Tax Foundation’s tax calculator is intended as an illustrative tool for the estimation of the TCJA’s impact on example taxpayers. It does not fully represent all potential tax scenarios and liabilities, and should not be used for tax preparation purposes. This calculator is for educational use only.
For more in-depth details and analysis of the Tax Cuts and Jobs Act as a whole, check out our report here.
Note: Soren and Linea now make $800,000 in income from one earner, and they live in a very high-tax state. They have three children, make $20,000 in charitable contributions each year, and contribute $18,000 in pre-tax 401(k) contributions. They pay $25,000 in property taxes and $80,000 in state and local income taxes. But they own their home outright and do not claim a mortgage interest deduction.