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Happy New Year! I hope everybody had a nice relaxing holiday. This year is shaping up to be a busy year with the expiration of the tax cuts looming and many other issues to address. The Taxpayers Protection Alliance (TPA) is excited to work with the Department of Government Efficiency (DOGE) Commission and Congress to finally address spending. The Taxpayers Protection Alliance Foundation (TPAF) is ready to continue its work on the App Security Project, the Mission Creep project, and submitting more Freedom of Information Act requests. TPAF had a banner year in making FOIA requests, submitting more than 30 queries for information and obtaining valuable insights into the inner workings of government. These critical tidbits of information are invaluable in the fight to keep government small and accountable to taxpayers and consumers. TPAF will keep fighting the good fight in 2025 and utilize FOIA responses to keep bureaucracy honest.
Countdown to Tax Cut Expiration
Earlier this week, TPA launched a countdown clock to the expiration of many crucial provisions of the Tax Cuts and Jobs Act (TCJA) of 2017 that expire December 31 of this year. TCJA provided badly needed tax relief to Americans and played no small role in the prosperity enjoyed by Americans during the late 2010s. Congress has been negotiating a new tax package to extend, and improve upon, the TCJA, but thus far a final agreement has been elusive.
Here is a sampling of the important TCJA provisions that will sunset at year’s end:
1. Marginal Tax Rates: The TCJA lowered marginal rates over multiple tax brackets. It also tweaked the thresholds for many brackets. These changes resulted in most filers (across brackets) receiving tax relief. If they are not renewed, more than three fifths of filers will pay higher taxes in 2026.
2. Standard Deduction: The TCJA increased the standard deduction for filers. This made it easier for Americans to lower their tax bill. The expiration of these provisions would cost taxpayers money and complicate the process of filing taxes, which might cause more Americans to spend additional funds hiring external help during filing season.
3. Charitable Contributions Deduction Cap: Taxpayers who donate to charities can deduct their philanthropy at tax time. The TCJA raised the threshold for cash donations to public charities from 50 percent of adjusted gross income to 60 percent. This allowed taxpayers to receive benefits for higher levels of charitable giving.
4. SALT Cap: The TJCA capped the state and local tax (SALT) deduction at $10,000. If the law is not extended, that cap will vanish. SALT deductions seek to mitigate the effects of state-level governance decisions, which, for economic and constitutional reasons, should not be a concern of the federal government.
5. Itemized Deduction for Miscellaneous Expenses: The TCJA had removed filers’ ability to deduct miscellaneous expenses, such as unreimbursed employee expenses or tax preparation fees. The expiration of this provision would reintroduce a complex income-based formula that calculates the amount of miscellaneous expenses that can be deducted. The expiration of this provision would erase an important advancement in simplifying the tax code.
6. Overall Limitation on Itemized Deductions: Prior to the passing of the TCJA, itemized deductions were capped by a complex income-based formula. The TCJA removed this cap, allowing taxpayers to claim all the allowable deductions with no limit and simplifying the deduction scheme.
7. Removal of Payroll Tax Exclusions: The TCJA flattened and simplified payroll taxes by considering previously excluded benefits, such as moving or bicycle commuting reimbursement, as wage incomes. The expiration of this provision would allow these benefits to be considered non-taxable income for payroll tax calculations.
8. Alternative Minimum Tax (AMT): The AMT is a tax system (parallel to the tax code) which prevents taxpayers from eliminating their tax liabilities via deductions or credits. The TCJA had raised the exemption amounts for taxpayers filing under the AMT regime and introduced a scheme in which the exemptions would be phased out after filers crossed certain income levels. This provision was a welcome step to simplify the vastly complex AMT system and should not be allowed to expire.
9. Business 199A Deduction: The 199A deduction provides some necessary relief that prevents pass-through businesses incomes from being entirely taxed at individual income tax rates. By deducing a portion of the business’s income from consideration, the 199A set a more level playing field between pass-through businesses and traditional C corporations in terms of effective taxation.
10. Estate and Gift Tax Exclusion Threshold: The TCJA increased the threshold of assets which are not considered for estate and gift taxes to $10 million per decedent, adjustable to inflation (currently around $13.6 million). The increase is set to expire and be reduced to $5 million, which would then be subject to inflation adjustment.
The TCJA’s reforms spurred investment and innovation and kept money in the pockets of Americans, where it belongs. For the sake of everyday Americans, businesses, and the economy at large, it is crucial that Congress moves to enact smart tax reform with all speed. Allowing the TCJA to lapse would be a colossal error. In an ever more chaotic world, America’s global economic leadership depends on having sound tax policies that make it an attractive location for businesses and investment. The TCJA’s lowering of the corporate tax and its R&D tax credit are two examples of common-sense policies that drove American prosperity and competitiveness. Tax relief for the average American is also very important. The effects of inflation are still making themselves felt, and allowing taxpayers to keep more of their hard-earned income would go far to alleviate these effects. Congress should act — and the sooner the better — to cement the kind of tax policy that will boost American prosperity in the coming decades.
Blogs:
Monday: Taxpayer Watchdog Slams Blocking of Nippon–U.S. Steel Deal
Tuesday: Taxpayer Watchdog Reacts to Meta’s New Content Moderation Policies
Wednesday: Taxpayer Group Slams IRS Over Reported Direct File Expansion
Thursday: What’s at Stake in the Tax Reform Debates: Taxpayer Watchdog Announces TCJA Countdown Clock
Friday: Taxpayer Watchdog Condemns Proposal Threatening Atlanta’s IG Independence
Media:
December 19, 2024: WBFF Fox45 (Baltimore, Md.) quoted me in their article, “Questions arise about Marilyn Mosby's new job and the ties to Maryland.”
December 19, 2024: WBFF Fox45 (Baltimore, Md.) quoted me for their story on GLOM Global.
December 20, 2024: WBFF Fox45 (Baltimore, Md.) quoted me in their article, “Baltimore's youth fund gave grants to board member’s non-profit.”
December 20, 2024: AOL ran TPA’s op-ed, “FOIA reveals hidden truths about IRS, FDA and WHO.”
December 20, 2024: The Baltimore Sun (Baltimore, Md.) quoted TPA in their article, “Baltimore’s youth fund gave grants to board member’s nonprofit.”
December 20, 2024: The Maryland Gazette (Annapolis, Md.) quoted TPA in their article, “Baltimore’s youth fund gave grants to board member’s nonprofit.”
December 20, 2024: The Black Chronicle (Oklahoma City, Okla.) ran TPA’s op-ed, “FOIA reveals hidden truths about IRS, FDA and WHO.”
December 21, 2024: The Baltimore Sun (Baltimore, Md.) quoted TPA in their article, “Youth fund gave grants to board member's nonprofit.”
December 21, 2024: USSA News mentioned TPA in their article, “Supreme Court must end the FDA’s vaping power-grab.”
December 21, 2024: The Blaze mentioned TPA in their article, “Supreme Court must end the FDA’s vaping power-grab.”
December 21, 2024: DNyuz mentioned TPA in their article, “Supreme Court must end the FDA’s vaping power-grab.”
December 21, 2024: The Conservative Angle mentioned TPA in their article, “Supreme Court must end the FDA’s vaping power-grab.”
December 22, 2024: WBFF Fox45 (Baltimore, Md.) quoted TPA for their story on Maryland’s budgetary problems.
December 23, 2024: WBFF Fox45 (Baltimore, Md.) interviewed me for their story on Pharmacy Benefit Managers.
December 23, 2024: WBFF Fox45 (Baltimore, Md.) quoted TPA for their story on Maryland’s budgetary problems.
December 23, 2024: American Family News quoted TPA on their article, “The president's 'weird fascination' persists.”
December 24, 2024: WBFF Fox45 (Baltimore, Md.) quoted me in their article, “State leaders debate who's responsible for Maryland's looming budget deficit.”
December 24, 2024: WBFF Fox45 (Baltimore, Md.) quoted TPA for their story on Governor Moore.
December 24, 2024: Antigo Daily Journal (Burlington, WI) ran TPA’s op-ed, “Tobacco report prioritizes stubborn ideology over public health.”
December 25, 2024: WBFF Fox45 (Baltimore, Md.) quoted TPA for their story on Governor Moore.
December 25, 2024: Newsbreak Original mentioned TPAF in their article, “Pritzker touts rising minimum wage as Illinois' unemployment rate has increased.”
December 26, 2024: WBFF Fox45 (Baltimore, Md.) quoted TPA for their story on Governor Moore.
December 29, 2024: The American Spectator ran TPA’s op-ed, “Republicans Should Reject European-Style Tech Policy.”
December 30, 2024: Money 105.5 (California) mentioned TPA in their article, “Conservative groups ask for corporate tax cut, end to capital gains inflation tax”
December 30, 2024: Iosco County News-Herald (East Tawas, Mich.) mentioned TPA in their article, “Conservative groups ask for corporate tax cut, end to capital gains inflation tax.”
December 30, 2024: Corydon Times Republican (Corydon, Iowa) mentioned TPA in their article, “Conservative groups ask for corporate tax cut, end to capital gains inflation tax.”
December 30, 2024: Selma Sun (Selma, Ala.) mentioned TPA in their article, “Conservative groups ask for corporate tax cut, end to capital gains inflation tax.”
December 30, 2024: Breeze (Harrisonburg, Va.) mentioned TPA in their article, “Conservative groups ask for corporate tax cut, end to capital gains inflation tax.”
December 30, 2024 Douglas Budget (Douglas, Wy.) mentioned TPA in their article, “Conservative groups ask for corporate tax cut, end to capital gains inflation tax.”
December 30, 2024: Wellsboro Gazette (Wellsboro, Pa.) mentioned TPA in their article, “Conservative groups ask for corporate tax cut, end to capital gains inflation tax.”
December 30, 2024: Inside Nova (Manassas, Va.) mentioned TPA in their article, “Conservative groups ask for corporate tax cut, end to capital gains inflation tax.”
December 30, 2024: Atlantic News Telegraph (Atlantic, Iowa) mentioned TPA in their article, “Conservative groups ask for corporate tax cut, end to capital gains inflation tax.”
December 30, 2024: Saipan Tribune (Northern Mariana Islands) mentioned TPA in their article, “Conservative groups ask for corporate tax cut, end to capital gains inflation tax.”
December 30, 2024: Albia Newspapers (Albia, Iowa) mentioned TPA in their article, “Conservative groups ask for corporate tax cut, end to capital gains inflation tax.”
December 30, 2024: The Daily Gazette (Schenectady, N.Y.) mentioned TPA in their article, “Conservative groups ask for corporate tax cut, end to capital gains inflation tax.”
December 30, 2024: Sierra County Sentinel (Truth or Consequences, N.M.) mentioned TPA in their article, “Conservative groups ask for corporate tax cut, end to capital gains inflation tax.”
December 30, 2024: AOL mentioned TPA in their article, “Conservative groups ask for corporate tax cut, end to capital gains inflation tax.”
December 30, 2024: Washington Examiner (Washington, D.C.) mentioned TPA in their article, “Conservative groups ask for corporate tax cut, end to capital gains inflation tax.”
December 31, 2024: The Crescent-News (Defiance, Ohio) ran TPA’s op-ed, “FOIA reveals hidden truths about IRS, FDA and WHO.”
December 31, 2024: Circleville Herald (Circleville, Ohio) ran TPA’s op-ed, “FOIA reveals hidden truths about IRS, FDA and WHO.”
January 2, 2025: WBFF Fox45 (Baltimore, Md.) quoted TPA in their article, “Maryland lawmakers passed a bill that would help cut the deficit. Why isn't it being used?.”
January 2, 2025: WMAL Westwood One (Washington, DC) quoted TPA for their story on Maryland and Virginia’s budgets.
January 2, 2025: I appeared WBOB Radio (Jacksonville, Fa.) to talk about healthcare.
January 2, 2025: WJLA (Arlington, VA) quoted me in their article, “Maryland lawmakers passed a bill that would help cut the deficit. Why isn't it being used?.”
January 2, 2025: ZNWS (Washington, DC) quoted me for their story on Maryland’s budget gap.
January 2, 2025: WSET (Lynchburg, Va.) quoted me in their article, “Fairfax Co. leaders forecast a nearly $300 million budget shortfall for Fiscal Year 2026.”
January 2, 2025: WBFF Fox45 (Baltimore, Md.) interviewed me for their story on Maryland’s fiscal challenges going into the new year.
January 2, 2025: WBFF Fox45 (Baltimore, Md.) quoted me in their article, “Maryland lawmakers passed a bill that would help cut the deficit. Why isn't it being used?.”
January 2, 2025: WMAL Westwood One (Washington, DC) interviewed me for their segment on Maryland and Virginia’s budget gaps.
January 2, 2025: WBOB Salem Radio (Jacksonville, FL) interviewed me for their segment on taxes in the new year.
January 2, 2025: WJLA (Arlington, VA) quoted me in their article, “Maryland lawmakers passed a bill that would help cut the deficit. Why isn't it being used?.”
January 2, 2025: WSET (Lynchburg, VA) quoted me in their article, “Fairfax Co. leaders forecast a nearly $300 million budget shortfall for Fiscal Year 2026.”
January 2, 2025: WBFF Fox45 (Baltimore, Md.) interviewed me for their story on Maryland’s structural deficit and Baltimore City’s deadline on their federal relief money.
January 2, 2025: MSN United States quoted me in their article, “Maryland lawmakers passed a bill that would help cut the deficit. Why isn't it being used?.”
January 2, 2025: Baltimore Sun (Baltimore, Md.) quoted me in their article, “Maryland lawmakers passed a bill that would help cut the deficit. Why isn’t it being used?.”
January 2, 2025: WBFF Fox45 (Baltimore, Md.) interviewed me for their story on Baltimore’s lack of transparency with their spending.
January 4, 2025: WMAL Westwood One (Washington, D.C.) interviewed me for their segment on Fairfax County’s fiscal management of tax dollars.
January 8, 2025: The American Spectator ran TPA’s op-ed, “US Postal Service Needs Some Competition.”
January 9, 2025: RealClear Markets ran TPA’s op-ed, “Simple Solution for Tax Chaos w/National Benefits.”
January 9, 2025: I appeared on 55WKRC NBC (Cincinnati, Ohio) to talk about Cincinnati’s spending of tax dollars and the 2025 policy agenda for Congress and President Trump.
January 9, 2025: WBFF Fox45 (Baltimore, Md.) interviewed me for their story on a Baltimore tourism nonprofit asking for $4 million in federal funds to attract more visitors to Baltimore.
January 10, 2025: Bozeman Daily Chronicle (Bozeman, MT) published TPA's op-ed, "Gallatin County risks credit rating to support struggling fiber project."
Have a great weekend!
Best,
David Williams
President
Taxpayers Protection Alliance
1101 14th Street, NW
Suite 500
Washington, D.C. xxxxxx
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