Tax Provisions

The bill makes the 2017 Tax Cuts and Jobs Act permanent, preserving individual and corporate tax cuts (e.g., top individual rate at 37%, corporate rate at 21%). It introduces temporary deductions (2025-2028): no tax on tips or overtime, car loan interest deduction (up to $10,000), and a $4,000 deduction for seniors over 65. It also raises the state and local tax (SALT) deduction cap from $10,000 to $40,000, benefiting high earners in high-tax states. The Tax Foundation estimates these provisions will reduce federal revenue by $1.5 trillion over 10 years, disproportionately favoring the top 20% of earners (those making over $200,000). Critics argue it exacerbates income inequality, while supporters claim it boosts economic growth by putting more money in consumers’ pockets.