Federal Tax Cuts to be Major Issue in 2018 Midterm Elections

Federal Tax Cuts to be Major Issue in 2018 Midterm Elections

SPRINGFIELD (IRN) — Candidates in races for congressional districts across Illinois and the rest of the nation will likely be talking about federal tax reform, but one thing that’s undeniable is how much money will stay in the pockets of taxpayers.

The Heritage Foundation broke down how much each individual and household would save in taxes due to the rate cuts and a doubling of the standard deduction from last winter’s tax reform. In Illinois, the conservative policy group estimates that an average household that files jointly with two kids would save $2,381 and single filers would get to keep $1,265 on average.

Adam Michel, a policy analyst with Heritage, said the foundation estimates that it will be much more over the next decade.

“Folks can expect to save more than $20,000 in additional take-home pay and it’s close to double that for a family of four,” Michel said.

He said the tax cuts have given the entire nation a shot in the arm that has raised wages and, for the first time, there are more job openings than people looking for them.

“They invest more in jobs, in higher wages and economic activities,” he said.

Democrats say the job growth is a holdover from Obama’s time in office, that businesses are using tax savings to buy back stocks rather than boost wages, and that the tax cuts primarily help the rich.

The cuts are set to expire in 2025. A number of Republicans want to make the tax cuts permanent while Democrats say they’ll try to roll back parts of the tax cuts because they mostly just benefit the very wealthy.

“My fear is that we’re not going to wait until they expire, but they’ll actually be repealed before then,” Michel said.

Critics of last winter’s tax reform say Illinoisans took a hit for thousands of dollars on average when the amount of state and local taxes they were able to deduct on their federal taxes was capped at $10,000. The average Illinoisan who itemized deductions had more than $12,000 in state and local tax deductions on their federal returns in 2015.