UNDATED (WKRC) – Project 2025 has been kicked around quite a bit over the past few months, and it’s important to understand how the plan could affect you, starting with taxes.
Project 2025 is the 900-page guide for the next Republican president to overhaul many existing government programs, including the existing tax code.
The current tax system is broken into seven brackets based on income:
- 10% – $0 to $11,000
- 12% – $11,001 to $44,725
- 22% – $44,726 to $95,375
- 24% – $95,376 to $182,100
- 32% – $182,101 to $231,250
- 35% – $231,251 to $578,125
- 37% – $578,126 and up
Each percentage is the amount taken from taxable income.
With Project 2025, there would only be two tax brackets:
- 15% – up to $168,000
- 30% – over $168,000
It is notable that the 15% tax bracket is a tax increase for anyone who currently makes less than $44,725, and a decrease for anyone who makes between $44,726 and $168,000. Meanwhile, except for those making between $168,000 and $182,100, the 30% tax bracket is a decrease across the board for all who would apply. Additionally, Project 2025 wants to get rid of “most deductions, credits and exclusions.”
Project 2025’s defense for this is because the current tax code is too difficult to understand.
In an interview with CBS, Brendan Duke, senior director for economic policy at the Center for American Progress (left-leaning), said, “The federal income tax system is progressive, and people who make more money pay a higher marginal tax rate than people who make less money. Conservatives look at that, and they feel that that’s unfair to the wealthy to ask them to pay a greater share of their income in taxes than lower income families.”
Duke went on to say the tax code proposed by Project 2025 “is a dramatic reform of how we fund our government, where we ask the wealthy to pitch in more than lower income families. This shifts taxes from the wealthy to the middle class, full stop.”
Duke estimated that a family with two children and a household income of $100,000 would pay an additional $2,600 in federal income tax simply from losing the 10% and 12% tax brackets, and if the Child Tax Credit was to be eliminated that addition could jump to $6,600. On the other hand, he estimated that a identical family with a household income of $5 million would see a $325,000 tax cut.
Donald Trump has distanced himself from Project 2025, saying, “I know nothing about Project 2025. I have not seen it, have no idea who is in charge of it, and, unlike our very well received Republican Platform, had nothing to do with it.”
Other key points from Project 2025 include:
- Replacing individuals across the government with conservative leaning politicians
- Scaled down federal government
- Rejection of rights for transgender people
- Eliminating diversity, equity, and inclusion programs
- Removing sexual orientation and gender identity from being protected against discrimination
- Heavily emphasizing oil and natural gas over green energy
- Restricting topics taught in federally funded schools
- Redirects public school funding to private schools
- Banning TikTok
- Overhaul of the Department of Justice that is more “consistent with the President’s agenda”
- Pulling out of the World Health Organization and various United Nations agencies
Source: How Project 2025 might affect your taxes, for better or worse
