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Congressman Paul Mitchell

Representing the 10th District of Michigan

Mitchell Introduces the Tax Cuts and Jobs Middle Class Enhancement Act

March 21, 2018
Press Release

WASHINGTON – Today, Rep. Paul Mitchell (MI-10) introduced The Tax Cuts and Jobs Middle Class Enhancement Act, which makes bonuses stemming from the Tax Cuts and Jobs Act tax free, makes individual tax cuts permanent, increases the standard deduction and more.

 

“The passage of the Tax Cuts and Jobs Act was historic. It kept more money in the pockets of the middle class — folks like those in Michigan’s 10th District. We have already seen millions of Americans positively impacted by tax cuts, bonuses, and more. My bill takes those wins and makes them even better; going one step further to help the middle class,” said Mitchell. “The Tax Cuts and Jobs Middle Class Enhancement Act allows Americans to keep even more of their hard-earned money and makes the individual tax cuts permanent. Last year’s tax cuts were already a big win for Americans, and my bill furthers its successes.”

 

Summary:

Tax Free Bonuses:

  • Current law treats bonuses as income for the purpose of taxation. This bill would make bonuses given between December 22, 2017 and December 31, 2018 tax free. There would be a cap of $5000 on this provision; any bonus over that amount would be taxed as it normally would be.

Individual Provisions Permanent:

  • Current law has the individual provisions of the Tax Cuts and Jobs Act (H.R. 1) set to expire at the end of 2025. This bill would make all the individual provisions permanent.

Increased Standard Deductions:

  • Current law has standard deductions of $12k for individuals and $24k for couples. This bill would increase the standard deduction for individuals by $1,000 (up to $13k) and for couples by $2,000 (up to $26k).

Medical Expense Deduction Enhancement Permanence

  • Current law expanded the medical expense deduction for 2017 and 2018 to cover medical expenses exceeding 7.5 percent of adjusted gross income, and rising to 10 percent beginning in 2019. This bill makes the lower income threshold of 7.5 percent of AGI permanent.

Child Tax Credit Full Refundability:

  • Under current law, the first $1,400 of the Child Tax Credit for each child is refundable. This bill would make the CTC fully refundable (up to $2,000 per child, depending on higher income phase-outs.)

 

To read the text of the Tax Cuts and Jobs Middle Class Enhancement Act, please click here.

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