Every dependent. This is a negative change because

Every year, Congress changes the way we collect and manage taxes. This year, taxpayers may be confronted with more changes that could potentially affect them either positively or negatively. Specifically, the following five tax reforms are undergoing major changes and are intriguing.         Primarily, the increase of the standard deduction has changed. The standard deduction is now double the amount of what it was before for single and married people. According to TurboTax, for single taxpayer’s numbers went from $6,350 to $12,000. Those with a married status had an increase from $12,700 to $24,000. At the first glance, a conclusion can be drawn that this is suitable being that fewer people will choose to itemize. However, this is not the case.            Also, Congress completely eliminated personal exemption and dependent exemption. Due to this, one cannot receive any exemptions for oneself or their dependent. This is a negative change because taxpayers normally benefit from this exemption. Before, they had both the standard deduction and personal exemption making them reduce their tax bill. Even though Congress doubled the standard deduction and eliminated the personal exemption as well as the dependent exemption, this will not benefit every taxpayer. It will only advantage the high-income taxpayer; those in the higher tax brackets. For those in the lower tax bracket, it would be difficult to receive any refund. For example, for a single taxpayer with the standard deduction of $6350, personal exemption and a claimed dependent of $4050, their total deduction would amount to more than Congress’ set amount of $12,000. Generally, families with low income tend to have more qualifying dependents such as children, permitting them to claim more than $12,000 in deductions. In a sense, mostly the rich will profit from these two tax reforms work while the less wealthy suffer a loss.          Another evolved tax reform is health care. Formerly, having health care year-round was an enforced policy. Individuals without a year-round health care plan were penalized while filing taxes. That is no longer the case. There will be no punishment for not having a health care plan. Furthermore, it will be possible to deduct medical expenses when they are more than 7.5% of your taxable income. Prior to this change, expenses had to be more than 10% of your taxable income. Once more, this is not a positive change for taxpayers because coming from Africa where hospital bills are much more lower though, the hospital here are way more sophisticated but the bills are astronomical the need to be some kind of penalty for people to have health care. The government needs to force people to have healthcare insurance because it helps them be covered whenever something unexpected happens. Again this will benefit just the rich those that have the extra money to be insured but, will hurt the low-income families. Since there is no penalty low families’ income will not enroll in any health insurance and in the long run will suffer when unexpected illness come knocking.          Child tax credit is the deduction you can take for having a child. It reduces your tax liability dollar for dollar. It is $1000 and would be doubled to $2000 so now families with children will be capable to take $2000 per child. For the married couple, there was a phase out at  $110,000 now it is at $400,000 according to TurboTax that means couples in the high brackets can still claim child tax credit. Once more this is a positive change but it benefits more taxpayers in the higher tax brackets those taxpayers don’t really need it but they have access to it.         Lastly, alimony will no longer be deductible if it is passed as law. Alimony is an amount of money paid by the richer parent to the poor parent and as of now it is deductible. It is not to be confused with child support. If passed as law the alimony will be taxable to the payer at his income bracket and since the payer is generally the richer parent they will pay a high tax on the alimony while the receiver so the lower income parent will pay a lower tax on the alimony. I predict alimony will no longer be paid if it doesn’t benefit from the tax-free status anymore. That will not hurt the high-income parent but, will hurt the low-income parent because they are the ones living on alimony thus, this is a negative change.       From the moment a new POTUS was elected, several changes were made in Congress. Tax rules were heavily changed overall. Although there are some positive changes made, they are more channeled to the wealthier people making the rich people richer and leaving the lower income people even poorer. This is causing yet again an increase in the gap between rich and poor. All these changes are contributing factors to the overall negative impact of these tax reforms.Cite work The final version of the tax plan. “Alimony Payers Lose Tax Deduction under GOP Bill.” CNNMoney, Cable News Network, money.cnn.com/2017/12/15/pf/taxes/alimony-tax-bill/index.html?iid=EL. Tax, TurboTax – Taxes Income. “2017 Tax Reform Legislation: What You Should Know.” TurboTax Tax Tips & Videos, turbotax.intuit.com/tax-tips/irs-tax-return/2017-tax-reform-legislation-what-you-should-know/L96aFuPhc. Floyd, David. “Trump’s Tax Reform Plan.” Investopedia, 12 Jan. 2018, www.investopedia.com/news/trumps-tax-reform-what-can-be-done/. 


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