SENATE OK’S TAX OVERHAUL, HOUSE TO VOTE AGAIN
Trumppromised ‘ massive’ cut for ‘ everyday’ families, but many in Illinois likely to lose underGOPplan
LYNN SWEET ANALYSIS: Bill not good for many in Illinois
WASHINGTON— When it comes to federal tax policy— and what is equitable— the disconnect between congressional Republicans and Democrats is so vast, it’s hard to see how it can it can be bridged, with the Illinois delegation fitting into this national picture. Consider:
No Democrats in the House and Senate support the “Tax Cuts and Jobs Act.”
All Illinois Democrats in Congress— the 11 in the House and Dick Durbin and Tammy Duckworth in the Senate— are against this legislation. All seven Illinois House Republicans are for the measure President Donald Trump will eagerly sign into law this week.
Republicans are pushing through Congress a sweeping tax cut bill with business America the clear winner. Corporate rates drop from 35 percent to 21 percent with other breaks for business in the legislation.
How individuals fare depend on a lot of factors. Overall, this is not a good deal formany Illinois households, especially in the Chicago area.
The shave in rates, and doubling of the standard deduction, and an increase in the child tax credit and some other new breaks may not counterbalance the new $ 10,000 cap on deductions for state and local taxes. At present, all income and property taxes are deductible.
Illinois residents in the northern part of the state— with higher real estate taxes and with enough going on financially to file itemized returns — may not all come out ahead.
“What I do understand out of the gate is that [ the tax bill] is unfairly balanced to those at the top,” said Rep. Brad Schneider, D- Ill. He represents the north suburban 10th Congressional District. Some “83 percent of the benefits goes to the top 1 percent.”
The GOP measure is “going to hurt a lot of Illinoisans. In the 10th District alone, 140,000 people use the state and local tax deduction and are going to be impacted negatively by this tax bill,” Schneider said.
Rep. Rodney Davis, R- Ill., whose 13th Congressional District takes in exurban and rural central and southwest Illinois, said threequarters of the people in his district don’t file an itemized return— and that will go up under this GOP tax bill.
“Ninety to 95 percent ofmy constituents won’t have to itemize anymore,” Davis said.
Still, “I think the impact of the tax bill depends on where you live, what youmake and what your individual tax situation is.” Well put, Rep. Davis. Rep. Raja Krishnamoorthi, D- Ill., whose 8th Congressional District takes in the north and northwest suburbs, said the $ 10,000 cap “is a killer for the suburbs of Chicago. . . . I don’t know they will come out ahead.”
Rep. John Shimkus, R- Ill., who represents the 15th Congressional District in southern Illinois, asked about the state and local tax deduction cap, said, “Maybe Illinois should cut their taxes.”
That was Shimkus taking a shot at the Illinois Democrats in Springfield who raised state income taxes this year.
Said Rep. Robin Kelly, D- Ill., whose 2nd Congressional District includes part of South Side Chicago and the southern suburbs, “I just cannot understand whymy colleagues on the other side think this is good.”
That’s because what is not going to happen— a “massive” tax cut for everybody. Let’s define everybody. Everybody means everybody. Trump promised — as recently as Dec. 13—“a massive tax cut for the everyday, working American families who are the backbone and the heartbeat of our country.”
On the upside: If you are a salaried worker, look formore in your paycheck starting in February. That’s because there will be less money withheld for taxes because the rates are lower.
But that could be just a sugar high. Be financially savvy.
Whether your total federal taxes for tax year 2018 are lower won’t be known until you file your return in April 2019.
Or put in political terms— past the 2018 mid- term elections. But in time for Trump’s bid for a second term.