Friday, November 10, 2017

The most horrifying provisions hidden in the House Republican tax plan

  Last week, House Republicans released their tax plan, finally providing long-awaited details on what they really mean when they promise “tax reform.” While they billed it as a middle-class tax cut, the new legislation is filled with gifts for wealthy corporations and the richest Americans. Meanwhile, middle-class and working families would at best get scraps—and in many cases, see their taxes increase.

  Many of the most extreme tax increases come in the form of eliminated tax credits or deductions buried deep in the text of the bill—and ignored by lawmakers and the media. With tax increases affecting groups ranging from seniors and people with disabilities, to families facing costly medical bills, to immigrant children, to people with student loans—to name just a few—the bill is a virtual laundry list of tax increases on populations who are often struggling to make ends meet.

  Here are eight of the most horrifying provisions buried in the tax plan.

1. It raises taxes for people with student loans

  Americans now owe more than $1.4 trillion in student loan debt—nearly double all credit card debt. The average monthly payment is up to $351 (or more than $4,200 a year) for borrowers between the ages of 20 and 30—a large chunk of income for young Americans.

  Thankfully, under current law, borrowers can deduct up to $2,500 of the interest on these loans per year, which helped more than 12 million Americans in 2015. But the House tax plan eliminates that deduction. If the plan passes, the average borrower will see their taxes go up by $275 each year just on student loan interest. And a borrower who pays the full $2,500 in interest would see their taxes go up even more—by a whopping $625.

2. It raises taxes on people facing high medical expenses

  Under current law, people are able to deduct medical expenses that exceed 10 percent of their income for the year. This benefits thousands of people facing serious illnesses or with long-term care needs—and gives them some financial relief in the face of high medical bills.

  But the House Republican plan eliminates that deduction, too. This will hit people with disabilities as well as elderly nursing home residents particularly hard, as they often pay tens of thousands of dollars in out-of-pocket costs for long-term care. Much like their earlier plan to repeal the Affordable Care Act, the change is also aimed directly at states that supported Donald Trump in the 2016 election, where residents are more likely to be uninsured and have higher medical costs.

3. It ends a tax credit that helps parents adopt

  For thousands of adoptive parents, adoption is only possible because of the adoption tax credit, which helps parents recoup up to $13,000 of the cost of adoption. House Republicans would eliminate the adoption tax credit, making it harder for countless would-be parents to have children. There are more than 100,000 children in U.S. foster care today (not to mention millions more orphaned or abandoned), and eliminating the credit would make it significantly harder for them to find a permanent home.

4. It makes disability accessibility more expensive for small businesses

  Under current law, small businesses can claim a tax credit to offset 50 percent of the cost of accessibility for people with disabilities for expenses between $250 and $10,250. But the House GOP tax bill would eliminate that tax credit, effectively raising taxes on small businesses trying to make sure their doors are open to people with disabilities. This comes as legislation currently pending in the House—misleadingly titled the “ADA Education and Reform Act of 2017”—would gut the very part of the Americans with Disabilities Act that requires public places to ensure accessibility for people with disabilities.

5. It eliminates a tax credit that spurs investment in poor communities

  Trump has repeatedly promised to save and bring back jobs in communities left behind. But the House Republican tax bill would eliminate a tax credit that encourages businesses to invest in hard-hit rural and urban areas. Investors who qualify for the New Markets Tax Credit get a tax credit to partially offset their investments in distressed communities where the poverty rate is 20 percent or higher. The vast majority of the tax credit’s funding has benefited communities with unemployment rates more than 1.5 times the national average and/or poverty rates of at least 30 percent.

6. It allows churches to be manipulated for political purposes

  Under current law, 501(c)3 nonprofit organizations—including churches—are prohibited from endorsing or opposing political candidates. Trump has long made known his desire to repeal this policy, known as the Johnson Amendment—as far back as the early 2000s, as well as throughout his presidential campaign—claiming it violates churches’ First Amendment rights. And hidden in the House GOP tax bill is a provision that would make good on Trump’s promise, despite the fact that nearly 80 percent of Americans say they do not support political endorsements in church. As a letter from more than 4,000 faith leaders opposing this change states: “Faith leaders are called to speak truth to power, and we cannot do so if we are merely cogs in partisan political machines.”

7. It takes away critical income from immigrant families with kids

  While House Republicans are busy patting themselves on the back for including modest enhancements to the Child Tax Credit (CTC) in their tax bill, they have changed the credit so that many immigrant families with citizen children will not be able to receive it. The bill would require all filers to provide a Social Security number, instead of an Individual Tax Identification Number, which immigrant workers with qualifying citizen children can currently use to claim the credit. According to the nonpartisan Institute on Taxation and Economic Policy, more than 5.1 million children of immigrant parents would lose access to the CTC under this provision.

8. It gives fetuses legal status as people

  Buried in House Republicans’ tax bill is their latest effort to advance the GOP’s anti-choice agenda. Specifically, they use a provision in the bill that would allow parents to buy 529 college savings plans for unborn children as a smoke screen to, yet again, try to give fetuses legal status as people. The provision goes out of its way to define unborn child as a “child in utero … a member of the species homo sapiens, at any stage of development, who is carried in the womb.” This comes on the heels of Trump’s Department of Health and Human Services’ strategic plan draft released last month, which bent over backwards to define life as beginning at conception.

  About the authors: Rebecca Vallas is the Managing Director for the Poverty to Prosperity Program at the Center for American Progress.  She is also the host of Off-Kilter podcast powered by CAP Action. Jeremy Slevin is the Associate Director of Advocacy for the Poverty to Prosperity Program at the Center for American Progress.

  This article was published by

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