How Will the New Bill Impact You?

Posted on August 3rd, 2025

I have been following this Big Beautiful Bill (hereafter BBB) closely for the last few weeks. No matter how many good things it contains the left will hate it. And they have been attacking it with phony math and lies non-stop, saying it would hurt middle income people the most. The bill is fantastic for the lower and middle class. The real heart of the bill is what it does for income taxes. Again, Democrats, as always, say it favors the rich over those with low incomes. Well, here is the first thing to know about that; About 45% of households pay no income tax. 97% of taxes are paid by the top 50% of earners. 3% by the bottom half. So the Dems can say whatever they want. Also, more people making under $100,000 voted for Trump over Kamala Harris.

There are no provisions which “give breaks to Trump’s buddies,” The brackets are the same. It becomes hard for the left to continue to stoke class warfare. They have to constantly manufacture victimhood for their constiuency. All of us get the benefits of government, from electricity, Sewer, water, National and local parks, sports stadiums, Emergency rooms, to traffic signs, Universities and freeways. People who attack the rich should be thanking them for covering the taxes they would have to pay for what is freely given to all of us.

Taxes Under BBB

It will mean an increase in take home pay for the middle and lower income classes. This savings will average $7,200 to $12,200 for the middle class. How will this be done? No tax on tips. Many of this class get paid to some extent by tips. Tips will now be tax free. 24% of households work overtime. There will be no tax on overtime.

No tax on Social Security for average Americans. The rich will continue to be taxed on SS. According to CBS news, According to an analysis by the White House's Council of Economic Advisers, the bill is expected to reduce the number of people who pay federal income taxes on their Social Security benefits. This analysis estimates that 88% of seniors who receive Social Security benefits – or 51.4 million people – will pay no tax on their payments due to the BBB. CBS News reports. It will exclude 2 million farmers and ranchers from the Death Tax (Estate tax.) It raises the standard deduction to $31,500! Cut that in half if you are single. The Standard Deduction was $12,000 when Trump took office in 2016. He doubled it intially to $24,000 and now it keeps growing with the cost of living. If you itemize, you do not get the $31,500 deduction. Common itemized deductions are charitable, some medical deductions, property tax and mortgage interest. It is hard for most couples to come up with deductions that exceed $31,500. The Democrats fought Trump when he tried to raise it the first time. This year they tried to stop the BBB which means we would have reverted back to a $16,700 standard deduction (which is the original $12,000 deduction in 2015 with cost of living adjustments.)

Now, here is the deception by the left: They say there is little tax savings from the new 31.5k deduction. That is simply nonsense. Why? Because if the Dems were in charge they would have let the Trump tax cuts expire and put working families back to a $16,700 standard deduction. It’s pretty simple. Take $31,500 off of your gross income vs. $16,700. That extra $14,800 deduction with a 22% tax bracket is $3,256 in your pocket. With the 12% bracket you save $1,500. The child tax credit will increase to $2,200 per child 0-17. That is a dollar for dollar reduction in taxes you owe. If you owe no taxes, you get it in cash. The difference between tax deductions and tax credits. Tax deductions reduce your total amount of taxable income. Tax credits pay you a dollar for dollar reduction in the tax you actually owe. If you owe $10,000 and have 3 kids in your household you now only owe $3,400. Let’s do a couple of examples:

• Family of 4 making $80,000 per year without overtime. Here are the deductions: $31,500 standard deduction leaves $48,500 taxable income. They put $6,000 into their 401ks which they can deduct. That leaves $42,500. Let’s see what they owe on that $42,500: As you can see, the first $23,850 of income they pay 10% or $2,308.50. That leaves them with $18,650 in the 12% bracket or 2,238. Total tax liability (amount they owe) = $5,038. They have 2 kids. Now let the tax credits reduce that. $2,200 tax credit x 2 kids that are worth $4,400 to pay their tax bill. $5038-$4,400 = $638.00 of income they owe taxes on. Or $77.40 total income tax owed. 
• Take the same family but they make $60,000 and owe no taxes. Normally tax credits could only be used to offset their tax bill. But…if you have no tax to pay, the Federal Government now sends them cash for the child tax credits or $4,400 extra cash in their pocket. They both owe virtually no income tax. Now let’s say the same family makes $100,000. That would be the additional earnings of $20,000 x 12%. or about $3,600 in income tax payable. The much maligned (for no reason) 1%. Okay, now lets look at a family who makes $787,000 per year. I use that number because that is the minimum you can make and still be in the 1%. Assuming the income of $787,000 is for the 2024 tax year and you are married filing jointly, here's how to calculate the federal income tax using the standard deduction:
• Standard Deduction: For the 2024 tax year, the standard deduction for married couples filing jointly is $29,200.
• Taxable Income: Subtract the standard deduction from your gross income: $787,000 - $29,200 = $757,800. This is your taxable income.
• Tax Bracket Calculation (based on 2024 brackets for Married Filing Jointly):
  10% bracket: $23,200 (first portion) = $2,320.
  12% bracket: $94,300 - $23,200 = $71,100 taxed at 12% = $8,532.
  22% bracket: $201,050 - $94,300 = $106,750 taxed at 22% = $23,485.
  24% bracket: $383,900 - $201,050 = $182,850 taxed at 24% = $43,884.
  32% bracket: $487,450 - $383,900 = $103,550 taxed at 32% = $33,136.
  35% bracket: $731,200 - $487,450 = $243,750 taxed at 35% = $85,312.50.
  37% bracket: $757,800 - $731,200 = $26,600 taxed at 37% = $9,842.
• Total Federal Income Tax: Sum the taxes from each bracket: $2,320 + $8,532 + $23,485 + $43,884 + $33,136 + $85,312.50 + $9,842 = $206,511.50 they owe.
• With an income of $2,000,000 and using the standard deduction for married filing jointly, the estimated federal income tax liability is approximately $652,541.88.

So, who isn’t paying their fair share? “ “Not paying their fair share,” is a line made up by some Democrat campaign staff member. Maybe. Or was it Bernie Sanders?