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Yahoo
a day ago
- Business
- Yahoo
I Asked ChatGPT How Trump's Tax Cuts Could Impact My Family Budget — Here's the Breakdown
President Donald Trump's One Big Beautiful Bill Act, which he signed on July 4, will impact millions of households, from their student loan repayments to their access to Medicaid and other social safety net programs. I, however, was most concerned with how the legislation's sweeping changes to U.S. tax law might impact my obligations to the IRS. Since my tax attorney charges by the quarter-hour for phone calls, I went with the next-best thing — ChatGPT. I asked the AI platform how Trump's tax cuts could impact my family budget. Here's what it told me. Find Out: Read Next: Many Households — Including Mine — Will Save Money The AI platform began with a bulleted list of benefits that will help many families lower their tax bill. It relied on sources such as the Bipartisan Policy Center and the Tax Policy Center to generate the section, which it titled, 'What You'll Likely Save.' This is its word-for-word synopsis of the potential savings for my family and others. Extended 2017 TCJA benefits — no major tax increases that were scheduled to take effect in 2026. Higher standard deduction — receives a $2,000 extra (married) or $1,000 (single) until 2028 on top of inflation adjustment. (CTC) — boosted to $2,500 per child through 2028, then reverts to $2,000. New tax benefits — exemption from federal tax on tips and overtime income (under $160K), a $40K state-and-local-tax (SALT) cap and a one-time $1K 'Trump account' per child. Learn More: Have a Little, Get a Little; Have a Lot, Get a Lot Next, my unofficial AI accountant used a Tax Policy Center analysis and a CBS News report to surmise that most families would see at least some benefit, with an average household tax bill reduction of $2,900 in 2026. However, it generated the following bulleted list, cited here verbatim, which showed that the 'haves' stand to gain more than the 'have-nots.' Bottom quintile households (≤ $35K income): ~$150 saved (~0.8% of income) Top quintile (≥ $217K income): ~$12,540 saved (~2.5%). Middle-income families fall in between, likely saving several hundred to a few thousand dollars annually. Taxes Aren't the Only Thing That Impact Family Budgets The platform then outlined how what it called the 'offsetting effects' of the tax cuts could shake up my family's — or anyone's — finances. This, too, is in ChatGPT's own words. Cuts to Medicaid, food stamps (SNAP) — billions in savings, but may reduce public benefits your family relies on. Reduced social safety nets — tougher work requirements; lower-income families could see net income decline despite tax cuts. Growing deficit — adds $3-$5 trillion to federal debt over 10 years, increasing future borrowing costs and potential for inflation/higher interest rates. Which Provisions Impact Which Families the Most? It included the following table to break down how different aspects of the legislation will impact different income groups. Income Level Estimated Annual Savings Key New Provisions Watch-Outs Low Income ~$150 Child Tax Credit, tip/overtime exemption Less SNAP/Medicaid Middle Income (~$50K-$100K) $500-$1,500 Standard SALT deduction bump, CTC, SALT cap Social cuts, inflation High Income (>$200K) $5K-$12K+ All above, plus SALT/ deduction benefits Future tax, interest pressure Make Your Situation as Big and Beautiful as Possible It concluded with a numbered list titled 'How To Maximize Benefits,' which outlined steps that my family and others can take to get the most out of the new changes. Use enhanced standard deduction — reduces taxable income directly. Claim full child tax credit if eligible — $2,500 per child. Take advantage of tip/overtime deductions — especially if you receive a lot of tips or extra hours. Monitor public benefits changes — if your household receives Medicaid or SNAP, check whether new work requirements or eligibility changes impact your budget. More From GOBankingRates Mark Cuban Warns of 'Red Rural Recession' -- 4 States That Could Get Hit Hard 10 Genius Things Warren Buffett Says To Do With Your Money 6 Big Shakeups Coming to Social Security in 2025 This article originally appeared on I Asked ChatGPT How Trump's Tax Cuts Could Impact My Family Budget — Here's the Breakdown
Yahoo
23-07-2025
- Business
- Yahoo
Here's exactly how much you'll save on your 2026 taxes, by income bracket: Trump's One Big Beautiful Bill benefits
Now that President Donald Trump's so-called 'big, beautiful bill' is the law, you're probably wondering how much you'll save on your taxes when you file next year. The Tax Policy Center (TPC), a nonpartisan think tank staffed by the Urban Institute and the Brookings Institution, has crunched the numbers. Here's a rundown. Southwest Airlines' open seating is ending: Here's what the new 8-group boarding process will look like Here's exactly how much you'll save on your 2026 taxes, by income bracket: Trump's One Big Beautiful Bill benefits The Trump administration is pushing to open new coal mines that will likely never turn a profit What does the new tax bill do? Trump's One Big Beautiful Bill Act (OBBBA) offers Americans a number of tax benefits by extending the 2017 Tax Cuts and Jobs Act (TCJA), making many of the changes permanent, plus adding some new short- and long-term tax rules. Those changes include certain business and international tax rules, and revenue-raising provisions—including the repeal of various energy tax incentives, according to the TPC. What is the average 2026 tax savings from Trump's 'Big, Beautiful Bill'? An analysis from the TPC shows the new law would reduce taxes for Americans by about $2,900 on average in 2026, with some 85% of households receiving a tax cut in 2026. That figure will drop to just 70% in 2030, after some provisions are phased out. But notably, almost 60% of the tax benefits would go to those in the top quintile, or one-fifth of earners, with incomes of $217,000 or more. It's fair to say that higher-income Americans are more likely to see larger tax benefits than lower-income Americans. Overall, about 4% of households would see their taxes go up in 2026; that percentage would increase to about 10% in 2030. How much will each income bracket save on their 2026 taxes? According to the data compiled by the Tax Policy Center, here's how much the average 2026 tax savings will be for each of the five quintiles of income, as well as the top 1% and 0.1%: Bottom 20% ($0 to $34,600 income range):Second quintile ($34,601 to $66,800):Third quintile ($66,801 to $119,200):Fourth quintile ($119,201 to $217,100):Top 20% ($217,101 and higher):Top 1% ($1,149,000 and higher):Top 0.1% ($5,184,900 and higher):What are some specific tax benefits included in the new bill? There are a number of new tax write-offs and credits, including: the 'No Tax on Tips' provision (which allows eligible tipped workers to deduct a portion of their income from tips on their federal income taxes), a car loan deduction, a deduction for charitable donations, and a child credit. This post originally appeared at to get the Fast Company newsletter: Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
Fast Company
21-07-2025
- Business
- Fast Company
Here's exactly how much you'll save on your 2026 taxes, by income bracket: Trump Big Beautiful Bill benefits
Now that President Donald Trump's so-called Big Beautiful Bill is the law, you're probably wondering how much you'll save on your taxes when you file next year. The Tax Policy Center (TPC), a nonpartisan think tank staffed by the Urban Institute and the Brookings Institution, has crunched the numbers. Here's a rundown. What does the new tax bill do? Trump's One Big Beautiful Bill Act (OBBBA), offers Americans a number of tax benefits by extending the 2017 Tax Cuts and Jobs Act (TCJA), making many of the changes permanent, plus adding some new short- and long-term tax rules. Those changes include certain business and international tax rules, and revenue raising provisions—including the repeal of various energy tax incentives, according to the TPC. What is the average 2026 tax savings from Trump's Big Beautiful Bill? An analysis from the Tax Policy Center shows the new law would reduce taxes for Americans by about $2,900 on average in 2026, with some 85% of households receiving a tax cut in 2026. That figure will drop to just 70% in 2030, after some provisions are phased out. But notably, almost 60% of the tax benefits would go to those in the top quintile, or one-fifth of earners, with incomes of $217,000 or more. It's fair to say higher-income Americans are more likely to see larger tax benefits than lower-income taxpayers. Overall, about 4% of households would see their taxes go up in 2026; that percentage would increase to about 10% in 2030. How much will each income bracket save on their 2026 taxes? According to the data compiled by the Tax Policy Center, here's how much the average 2026 tax savings will be for each of the five quintiles of income, as well as the top 1% and 0.1%: Bottom 20% ($0-$34,600 income range): $150 Second quintile ($34,601-$66,800): $750 Third quintile ($66,801-$119,200): $1,780 Fourth quintile ($119,201-$217,100): $3,460 Top 20% ($217,101 and above): $12,540 Top 1% ($1,149,000 and above): $75,410 Top 0.1% ($5,184,900 and above): $286,440 What are some specific tax benefits included in the new bill? There are a number of new tax write-offs and credits, including: the ' No Tax on Tips ' provision (which allows eligible tipped workers to deduct a portion of their income from tips on their federal income taxes), a car loan deduction, one for charitable donations, and a child credit.
Yahoo
18-07-2025
- Business
- Yahoo
Here's your potential tax cut in 2026 from the One Big Beautiful Bill Act
Millions of taxpayers could see a lower tax bill next year due to the so-called "big, beautiful bill" that was signed into law on July 4 by President Trump, with a recent analysis finding that every income group will see some savings. On average, taxpayers will save about $2,900 per household in 2026, according to the analysis from the Tax Policy Center, a nonpartisan think tank focused on taxes. But higher-income Americans are more likely to see a bigger relative boost than lower-income households, their analysis found. The new law extends the tax cuts in President Trump's 2017 Tax Cuts and Jobs Act, with many of those provisions otherwise slated to expire at year-end. But the legislation also adds a bevy of new tax breaks, ranging from eliminating taxes on overtime and tips to lifting the state and local taxes deduction from $10,000 to $40,000. About $6 of every $10 in tax breaks will go to the top 20% of households, or people who earn incomes of about $217,000 or more, the Tax Policy Center analysis found. "Average tax cuts are generally larger as a percentage of after-tax income for higher income households than for lower income households," it noted. !function(){"use strict"; 0!== e= t in r,i=0;r=e[i];i++)if( d= For instance, the typical household in the bottom quintile — those earning up to $34,600 per year — will save an average of about $150 in tax payments next year, or 0.8% of their income. But those in the top quintile, or who earn $217,101 or more, will save an average of $12,540 next year, or 2.5% of their incomes, the analysis found. To be sure, an individual's tax savings next year will depend on a number of variables, such as their number of children, which allows people to claim the Child Tax Credit, or whether they can tap one of the new tax breaks, such as the elimination of taxes on some tipped income. Wall Street Journal reports Trump sent "bawdy" birthday letter to Epstein, Trump threatens to sue 7.3 magnitude earthquake hits southern Alaska Medical expert on Trump's chronic venous insufficiency diagnosis Sign in to access your portfolio
CBS News
18-07-2025
- Business
- CBS News
Here's your potential tax cut in 2026 from the One Big Beautiful Bill Act
Millions of taxpayers could see a lower tax bill next year due to the so-called "big, beautiful bill" that was signed into law on July 4 by President Trump, with a recent analysis finding that every income group will see some savings. On average, taxpayers will save about $2,900 per household in 2026, according to the analysis from the Tax Policy Center, a nonpartisan think tank focused on taxes. But higher-income Americans are more likely to see a bigger relative boost than lower-income households, their analysis found. The new law extends the tax cuts in President Trump's 2017 Tax Cuts and Jobs Act, with many of those provisions otherwise slated to expire at year-end. But the legislation also adds a bevy of new tax breaks, ranging from eliminating taxes on overtime and tips to lifting the state and local taxes deduction from $10,000 to $40,000. About $6 of every $10 in tax breaks will go to the top 20% of households, or people who earn incomes of about $217,000 or more, the Tax Policy Center analysis found. "Average tax cuts are generally larger as a percentage of after-tax income for higher income households than for lower income households," it noted. For instance, the typical household in the bottom quintile — those earning up to $34,600 per year — will save an average of about $150 in tax payments next year, or 0.8% of their income. But those in the top quintile, or who earn $217,101 or more, will save an average of $12,540 next year, or 2.5% of their incomes, the analysis found. To be sure, an individual's tax savings next year will depend on a number of variables, such as their number of children, which allows people to claim the Child Tax Credit, or whether they can tap one of the new tax breaks, such as the elimination of taxes on some tipped income.
