Obiwan Kenobe told the Storm Troopers, “these aren’t the droids you’re looking for!” Then he went on his merry way. So too, Jedi Master Donald J. Trump waved his hand and told the American public, “everybody is getting a tax cut, especially the middle class.” He too is on his merry way, but no matter how you slice it many middle class taxpayers will not only fail to share in a tax cut, but will actually see a significant tax increase.
He’s certainly not the first U.S. President to employ Jedi mind tricks. “Read my lips!” But without even taking office yet, he’s already backtracking big time. The chart below highlights the tax bracket changes proposed by the president-elect:
As you can see, the greatest benefit will be to single taxpayers making more than $415,050 or more who used to be in the 40% bracket, but will now find themselves paying only 33%. Meanwhile, the majority of middle class taxpayers will remain at the 25% level. The lower-middle class taxpayer will see a 3% tax cut, but the upper-middle class taxpayer will see a 5% increase. “Those are the tax breaks you’re looking for!”
So in quick summary, the middle class will see little change, except for the upper-middle class which will see a 5% increase. The upper-lower class will see a 3% savings, while the lower-lower class will see a 2% increase. The upper class will see savings between 2% and 7% across the board. Putting this to numbers – a single taxpayer who makes $415,050 per year will now pay $29,053.5 less per year in taxes. A single person making $9,000 per year will now pay an additional $180 in taxes annually. But of course, “that’s not the math you’re looking for!”