Tax Overhaul 2.0: 2017 Cuts Made Permanent, Impacting Everyone from Homeowners to High-Earners

The "TCJA Permanency Act" is exactly what it sounds like: a move to lock in the 2017 Tax Cuts and Jobs Act (TCJA) for good. Instead of expiring in 2025, the changes made back then to individual income taxes, business taxes, and a bunch of deductions would become permanent. This bill touches a lot of areas, so buckle up.

Making the 2017 Tax Cuts Stick

The core of this bill is making the 2017 tax changes permanent. This means the individual income tax rates and brackets we've been using since then? Here to stay. The (nearly doubled) standard deduction? Permanent. The boosted Child Tax Credit? You guessed it – permanent. (Sec. 122). The bill also makes the increased estate and gift tax exemption permanent, which mainly benefits the wealthiest among us (Sec. 151).

Real-World Rollout: Winners and Losers

Let's break down who might pop the champagne and who might be reaching for the antacids:

• Higher-Income Folks: They're likely coming out ahead, with those lower tax rates locked in. Think of a tech entrepreneur in Silicon Valley or a successful doctor – their tax burden stays lighter, long-term.
• Corporations: Another win. The bill solidifies any corporate tax changes from the 2017 law, which generally means lower taxes for businesses.
• Families with Kids: The increased Child Tax Credit ($2,000 per qualifying child, up from $1,000 before 2017) is a definite plus. A family with two kids in a middle-class neighborhood? That's real money back in their pockets. (Sec. 122).
• Homeowners (and Aspiring Homeowners): This is a mixed bag. The bill keeps the limit on deducting state and local taxes (SALT) at $10,000 (Sec. 142). If you're in a high-tax state like New York or California, that could still sting. Also, the deduction for interest on new mortgages is capped for loans over $750,000 (Sec. 143). It also limits the mortgage interest deduction to acquisition indebtedness, meaning it can only be used to buy build or improve a home, no more home equity loan deductions (Sec. 143).
• Renters: The SALT deduction cap will also impact renters as landlords who pay property taxes may increase the rent to offset the cap.
• Anyone Who Itemized Before: If you used to deduct a ton of stuff beyond the standard deduction, this could be a negative. The bill eliminates a bunch of miscellaneous itemized deductions (Sec. 145).

The Fine Print – and Potential Problems

There are a few other key changes worth noting:

• 529 Savings Plans Expansion: These accounts, usually for college, can now be used for K-12 expenses, including homeschooling (Sec. 132). This could be a big deal for some families, but there's also potential for, shall we say, creative accounting on what counts as a "qualified educational expense."
• ABLE Accounts: The bill makes it easier to contribute to ABLE accounts, which help people with disabilities save money (Sec. 124, 125).
• Student Loan Discharge: For those dealing with student loans discharged before 2025 due to death or disability, that discharged amount won't be counted as income (Sec. 131). After that, the old rule is back, it will be counted as income, and it will be taxable.

The Big Picture

This bill is essentially cementing a tax system that largely favors higher earners and corporations. While the increased standard deduction and Child Tax Credit provide some relief to middle- and lower-income families, the overall structure is tilted towards those already doing well. It's a bet that these tax cuts will stimulate the economy, but it also raises questions about long-term fairness and the national debt. The challenge, as always, will be in the details – how these changes are implemented, and whether the promised benefits actually trickle down to everyone else.