Simpson Praises Historic Tax Relief for American Families
Congressman Mike Simpson praised the passage today of H.R. 1, the Tax Cuts and Jobs Act in the House of Representatives. H.R. 1 is the first comprehensive tax reform legislation to pass the House since 1986.
“Since coming to Congress, I’ve talked to farmers, ranchers and businesses throughout Idaho and I consistently hear about the burden that our overly complex, outdated, and unfair tax code puts on families and small businesses,” said Simpson. “The bill that we voted on today has been years in the making, with the Better Way Blueprint’s release in June of 2016. Tax reform has been a key promise that Republicans made to our constituents when we gained control of the House, Senate, and White House, and I am proud to say that promise was fulfilled today.”
H.R. 1 will lower tax rates on individuals and businesses of all sizes. It will nearly double the standard deduction, so the first $12,000 earned by an individual and $24,000 earned by a married couple is completely tax-free. Other important provisions in H.R. 1 include:
• Expands the Child Tax Credit from $1,000 to $2,000 for single filers and married couples to help parents with the cost of raising children. The tax credit is fully refundable up to $1,400 and begins to phase-out for families making more than $400,000.
• Improves savings vehicles for education by allowing families to use 529 accounts to save for elementary, secondary and higher education.
• Preserves the mortgage interest deduction – providing tax relief to current and aspiring homeowners.
• Eliminates Obamacare’s individual mandate penalty tax – providing families with much-needed relief and flexibility to buy the health care that’s right for them, if they so choose.
• Continues to allow people to write off the cost of state and local taxes – up to $10,000. Gives individuals and families the ability to deduct property taxes and income – or sales – taxes to best fit their unique circumstances.
• Preserves the Adoption Tax Credit so parents can continue to receive additional tax relief as they open their hearts and homes to an adopted child.
• Provides support for graduate students by continuing to exempt the value of reduced tuition from taxes.
• Continues the deduction for charitable contributions so people can continue to donate to their local church, charity, or community organization.
• Provides relief for Americans with expensive medical bills by expanding the medical expense deduction for 2017 and 2018 for medical expenses exceeding 7.5 percent of adjusted gross income, and rising to 10 percent beginning in 2019.
• Provides immediate relief from the Death Tax by doubling the amount of the current exemption to reduce uncertainty and costs for many family-owned farms and businesses when they pass down their life’s work to the next generation.
“The United States has one of the highest corporate tax rates in the world, so taking that rate down to 21% is going to benefit our entire economy,” said Simpson. “We need to stop incentivizing companies from leaving America to go create jobs elsewhere. Not only will they stay and create more jobs, but the wages for American workers will be higher and our businesses will be more competitive on a global stage.”
Some of the provisions that will benefit American Job creators include:
• Delivers significant tax relief to Main Street job creators by offering a first-ever 20 percent tax deduction that applies to the first $315,000 of joint income earned by all businesses organized as S corporations, partnerships, LLCs, and sole proprietorships.
• Establishing strong safeguards so that wage income does not receive the lower marginal effective tax rates on business income – helping to ensure that Main Street tax relief goes to the local job creators it was designed to help most.
• Prevents American jobs, headquarters, and research from moving overseas by eliminating incentives that now reward companies for shifting jobs, profits, and manufacturing plants abroad.
• Allows businesses to immediately write off the full cost of new equipment to improve operations and enhance the skills of their workers – unleashing growth of jobs, productivity, and paychecks.
• Preserving the Research & Development Tax Credit that encourages our businesses and workers to develop cutting-edge “Made in America” products and services.
• Retaining the tax-preferred status of private-activity bonds that are used to finance valuable infrastructure projects.
• Eliminates the Corporate Alternative Minimum Tax, thereby lowering taxes and eliminating confusion and uncertainty so American job creators can focus on growing their business and hiring more workers, rather than on burdensome paperwork.
For greater American energy security and economic growth, the Tax Cuts and Jobs Act:
• Establishes an environmentally responsible oil and gas program in the non-wilderness 1002 Area of the Arctic National Wildlife Refuge (ANWR). Congress specifically set aside the 1.57-million acre 1002 Area for potential future development. Two lease sales will be held over the next decade and surface development will be limited to 2,000 federal acres – just one ten-thousandth of all of ANWR.
• Significantly boosts American energy production. Responsible development in the 1002 Area will raise tens of billions of dollars for deficit reduction in the decades to come, while creating thousands of new jobs, reducing our dependence on foreign oil, and helping to keep energy affordable for American families and businesses.
• Provides a temporary increase in offshore revenue sharing for the Gulf Coast in 2020 and 2021, allowing those states to invest in priorities such as coastal restoration and hurricane protection.
“The focus of this plan has always been to help middle class families by creating a simple and fairer tax system,” said Simpson. “While every family’s circumstance is unique, projections show that this plan would reduce the tax burden of a typical family of four earning $73,000 per year by more than $2,000. A single parent with one child earning $41,000 per year would see a tax cut of more than $1,300. And married small business owners with income of $100,000 per year would get a 24% reduction in their tax bill. I encourage people to see what this bill means to you, by using a simple tax calculator, available here or here. Simply put, this legislation will create economic growth in the United States by unleashing American small businesses and unburdening middle class families so they can make better financial decisions with their own money.”
H.R. 1 passed by a vote of 227-203. The Senate will vote on the bill later today.