“… The bill
released late Friday would increase the standard deduction by $1,000 for individuals and $2,000 for married couples starting in tax year 2025, above and beyond the Trump tax cuts’ expansion of that basic level where income taxes don’t apply.
… Friday’s bill is incomplete and will likely be changed substantially before the committee vote. It is silent on some of the issues that are dividing Republicans, including the cap on the state and local tax deduction and the fate of clean-energy tax credits that Democrats created in 2022. It doesn’t include the tax-rate increase for the highest-earning Americans that Trump has been floating in recent days.
The changes to the standard deduction and child tax credit wouldn’t be permanent under the proposal, but they would have an immediate effect above and beyond maintaining the status quo. The boosts would make it easier for Republicans to show Americans some benefit from tax cuts before the 2026 midterm elections. The extra tax cuts could also counter some of the effects of Trump’s tariffs on consumers. …
Although the bill would make some tax cuts permanent, it schedules some to lapse in a few years, a move that lowers the headline cost but sets up expirations for a future Congress to address. For example, the extra standard deduction lasts only through 2028. So does the $2,500 child credit, which would drop to $2,000 in 2029 and then increase with inflation.“
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So there is the GOP solution to the political problem that extending current tax levels wouldn’t feel like a cut because they are an extension of existing tax brackets from the first Trump Administration— a temporary increase in the standard deduction and child tax credit to juice refunds (for those who use the standard deduction) ahead of the ‘26 midterms, expiring after the ‘28 Presidential election year.