Tax Calculator: How the TCJA’s Expiration Will Affect You
Unless Congress acts, Americans are in for a tax hike in 2026.
3 min readUnless Congress acts, Americans are in for a tax hike in 2026.
3 min readAt the end of 2025, the individual tax provisions in the Tax Cuts and Jobs Act (TCJA) expire all at once. Without congressional action, most taxpayers will see a notable tax increase relative to current policy in 2026.
4 min readPolicymakers should have two priorities in the upcoming economic policy debates: a larger economy and fiscal responsibility. Principled, pro-growth tax policy can help accomplish both.
21 min readLawmakers should see 2025 as an opportunity to consider more fundamental tax reforms. While the TCJA addressed some of the deficiencies of the tax code, it by no means addressed them all.
8 min readGiven that U.S. debt is roughly the size of our annual economic output, policymakers will face many tough fiscal choices in the coming years. The good news is there are policies that both support a larger economy and avoid adding to the debt.
6 min readWhile federal tax collections—especially corporate taxes—have reached historically high levels, these gains have not kept pace with escalating spending, particularly on debt interest, leading to a substantial and concerning budget deficit in FY24.
6 min readThe TCJA improved the U.S. tax code, but the meandering voyage of its passing and the compromises made to get it into law show the challenges of the legislative process.
6 min readThe Tax Cuts and Jobs Act’s changes to family tax policy serve as a reminder to avoid looking at tax reform provisions in a vacuum.
5 min readThe Tax Cuts and Jobs Act (TCJA) significantly lowered the effective tax rates on business income, but the impact was not the same for C corporations and pass-through businesses.
6 min readAs lawmakers consider which policies to prioritize in the upcoming tax policy debates, better cost recovery for all investment should be top of mind.
7 min readPro-growth tax reform that does not add to the deficit will require tough choices, but whether to raise the corporate tax rate is not one of them. If lawmakers want to craft fiscally responsible and pro-growth tax reform, a higher corporate tax rate simply does not fit into the puzzle.
3 min readThe 2017 Tax Cuts and Jobs Act (TCJA) was the largest corporate tax reform in a generation, lowering the corporate tax rate from 35 percent to 21 percent, temporarily allowing full expensing for short-lived assets (referred to as bonus depreciation), and overhauling the international tax code.
6 min readAs members of Congress prepare to address the expiration of the TCJA, they should appreciate how revenues have evolved since 2017.
4 min readWhile the approaches differ, they share a reliance on similar linkages: new capital investment drives productivity growth, which grows the economy and raises wages for workers.
37 min readThe Tax Cuts and Jobs Act of 2017 (TCJA) reformed the U.S. system for taxing international corporate income. Understanding the impact of TCJA’s international provisions thus far can help lawmakers consider how to approach international tax policy in the coming years.
30 min readTaxing university endowments has gained popularity recently, partly in response to the Biden administration’s forgiveness of student loan debt. Some view it as a means of holding universities accountable for the product they’re selling. Others view it as a tool to tamp down tuition rates or punish ideological opponents. But do these arguments hold water and is an endowment tax sound policy?
7 min readThe IRS recently released the new inflation adjusted 2023 tax brackets and rates. Explore updated credits, deductions, and exemptions, including the standard deduction & personal exemption, Alternative Minimum Tax (AMT), Earned Income Tax Credit (EITC), Child Tax Credit (CTC), capital gains brackets, qualified business income deduction (199A), and the annual exclusion for gifts.
4 min readFrom the Tax Cuts and Jobs Act in 2017 to the Inflation Reduction Act, signed into law just this summer, lawmakers across the political spectrum are often tempted to implement temporary tax reforms. Garrett Watson joins Jesse to discuss the pros and cons of writing tax laws that have an end date and why we find ourselves having a debate at the end of each year about so many temporary provisions.
The phaseout of 100 percent bonus depreciation, scheduled to take place after the end of 2022, will increase the after-tax cost of investment in the U.S. Permanently extending it would increase long-run economic output by 0.4 percent and increase employment by 73,000 FTE jobs.
20 min readPolicymakers should continue to focus on longer term impacts rather than emphasizing the short-term stimulus effects of tax cuts.
3 min readReviewing reported income helps to understand the composition of the federal government’s revenue base and how Americans earn their taxable income. The individual income tax, the federal government’s largest source of revenue, is largely a tax on labor.
10 min readAcademic research indicates foreign direct investment (FDI) is highly responsive to the corporate effective tax rate (ETRs); that is, the tax rate after accounting for all deduction and credits available to corporations.
3 min readOverall, the data shows outbound FDI shifted from low-tax to other jurisdictions, while inbound FDI remained largely unchanged.
3 min readCongress should prioritize evaluation of recent international tax trends and the model rules and adjust U.S. rules in a way that supports investment and innovation and moves towards simplicity.
25 min readAlthough the dispersion of our supply chains throughout the world has been scrutinized in recent years, both inbound and outbound foreign direct investment are critical to sustaining supply chain resiliency and reducing economic risks for both firms and investors.
5 min readThe United States needs to grow its way out of inflation and set the economy up for continued growth—the tax code provides tools for policymakers to do just that.
3 min readThe CBO projections show policymakers’ top priority over the next five years will need to be cleaning up our country’s fiscal situation while maintaining a pro-growth and competitive tax code.
5 min readStarting this year, firms must amortize their research and development (R&D) expenses over five years rather than immediately deduct them from taxable income, a policy change designed to raise federal tax revenue in the short term.
5 min readEfforts to improve the taxpayer experience should focus on the IRS’s operations and include structural improvements to the tax code.
4 min readTotal tax collections are currently running 25 percent higher than last year, and if that pattern holds, total federal tax collections will reach over $5 trillion in FY 2022—a new all-time high.
3 min readBy reducing the tax code’s current barriers to investment and saving and simplifying its complex rules, lawmakers would greatly enhance the ability of Americans to pursue new ideas, create more opportunities, and build financial security for themselves and their families.
40 min readConsumer prices rose by 7 percent in 2021, the highest annual rate of inflation since 1982. Where did this inflation come from and what might its impacts be? Tax and fiscal policy offer important clues.
5 min readAs 2021 comes to a close, countries are moving toward harmonizing tax rules for multinationals, but stalled talks on the Build Back Better Act in the United States means new uncertainties for a global agreement and for taxpayers.
5 min read