Where do you live?

Choose a filing scenario

How much do you earn?

Minus pre-tax income like 401ks.

Max of $250,000.

How much do you itemize?

$0 if you take the standard deduction.

Max of 42% of income.

$100 tax cut in 2018

Income$100k
Current itemized42%

You itemized but will likely switch to the standard deduction.

Tax change
$6,000+ cut
Increase

$100 tax cut in 2018

Income$100k
Current itemized42%

You itemized but will likely switch to the standard deduction.


Larger itemized deduction (share of income)
Smaller itemized deduction (share of income)
Income (wages, salaries, tips)

The House and Senate are expected to pass the final version of the tax bill this week, and most Americans are expected to see an immediate tax cut in 2018.

[GOP tax bill headed for passage in House and Senate]

But how much of a cut? Individual tax situations are, of course, different. But for most people, the answer will boil down to four factors: How much you earn, your filing status (including children), where you live and whether - and how much — you itemize deductions. Explore above to see a simple estimate of your tax cut or hike.

Many of these cuts are not permanent. The GOP bill sunsets the individual income taxes changes at the end of 2025, while keeping corporate tax cuts in place. And it would adjust how inflation is calculated in the tax code, which would cause many taxpayers getting a cut now to get a hike after 2025.

Methodology matters a lot for tax estimates, and this analysis – which is based on hypothetical taxpayers – may overestimate the tax cut you get. The results are correct for the simple tax scenarios we’re laying out, but most Americans have some factor that complicates their tax situation and can result in lower overall tax burdens, leading to smaller changes when tax law is amended.

Analyses that use data from real taxpayers as their starting point – like the calculator put together by the New York Times – produce lower estimates. Other calculators like the one put together by the Wall Street Journal produce similar results to ours. For example, a household in D.C. filing jointly with two kids under 17, earning a total of $150,000 and itemizing $20,000 gets a tax cut of $3,796 in our analysis. Roughly equivalent inputs to the New York Times calculator produces an estimated range of a $1,020 to $3,280 cut, while the Wall Street Journal calculator – which is based on the less generous House bill – produces a cut of $3,230.

Many other caveats apply (see more detailed methodology below). We’re only looking at income from salaries, wages and tips. Taxpayers who earn business income but pay taxes on it through the individual tax code may benefit from major changes to the “pass through” tax rates, which is not accounted for above. We’re only focusing on changes to the major, most common deductions, not accounting for the removal of certain miscellaneous deductions like unreimbursed business expenses over 2% of AGI (similar deductions are still available for small business expenses). If your overall deduction relies heavily on these miscellaneous deductions, this calculator is likely overestimating how much you’ll be able to itemize under the new bill.

And the corners of the chart above are territory that very few taxpayers fall into. Here’s what the distribution actually looks like, according to sample data from the Census’ Current Population Survey.

Distribution of CPS sample taxpayers, by income and size of itemized deduction

60%

of income

Area on chart

40%

20%

0%

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Income (wages, salary, tips)

More

taxpayers

Fewer

taxpayers

Distribution of CPS sample taxpayers,

by income and size of itemized deduction

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taxpayers

Fewer

taxpayers

60%

Area on chart

40%

20%

0%

0k

100k

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Income (wages, salary, tips)

Distribution of CPS sample taxpayers,

by income and size of itemized deduction

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taxpayers

Fewer

taxpayers

60%

Area on chart

40%

20%

0%

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Income (wages, salary, tips)

Earlier versions of the bill provided less tax breaks overall to middle class taxpayers. Nevertheless, there are a couple of groups that could still get hit with an increase.

New York City, filing singly

Larger itemized

deduction

Smaller

deduction

0k income

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New York City, filing singly

Larger itemized

deduction

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deduction

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New York City, filing singly

Larger itemized

deduction

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deduction

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Some high-income filers in states with high taxes will see a hike in 2018. These taxpayers can currently deduct a large amount from their federal taxes for state/local income (SALT), as well as any property taxes. Under the new bill, they would be able to deduct up to $10,000 in SALT and property taxes combined. Previous versions of the bill eliminated state/local income tax deductions altogether.

Blue states generally have higher state income taxes, making this hike more politically feasible for Republicans. Especially because red states with high rates – Iowa, Montana and Idaho for example – don’t have as many high-income individuals as places like New York City.

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Florida, single filer

Smaller

deduction

0k income

100k

200k

Florida, single filer

Smaller itemized

deduction

0k income

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Florida, single filer

Smaller itemized

deduction

0k income

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Our analysis shows a second group getting a hike: low-to-middle income taxpayers that currently take very large deductions of any kind. Filers in this group won’t benefit from the increased standard deduction, and they will get hurt by the removal of personal and dependent exemptions.

These taxpayers are rare but maybe not as rare as you think. In 2015, only 19 percent of filers earning between $25,000 and $50,000 itemized, but those that did took an average deduction of $16,154. A D.C. single filer who itemized that much, earning $40,000, will likely see a tax increase.

Deductions generally rise with income, but spending can get decoupled from earnings for all sorts of reasons. Elderly taxpayers, who can be on moderate fixed incomes, may use savings on medical expenses, which are partially deductible. And a married couple where one partner gets laid off may dip into savings to make mortgage interest or real estate tax payments, both deductible.

Texas, married two children

Larger itemized

deduction

Smaller

deduction

0k income

100k

200k

Texas, married two children

Larger itemized

deduction

Smaller

deduction

0k income

50k

100k

150k

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250k

Texas, married two children

Larger itemized

deduction

Smaller

deduction

0k income

50k

100k

150k

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250k

But these are still edge cases. The majority of Americans will be getting a tax cut in 2018 under the new bill. Couples with children will especially benefit, especially if they live in places with low state taxes.

But again, this is just 2018. With the sunsetting of individual cuts, taxes are expected to rise for many in the next decade. Republicans argue this is a non-issue. The sunsetting of the individual cuts is a strategic move to hit budget targets that allow them to pass the bill with a simple majority in the Senate. In the future, they expect to pass new legislation to make the cuts permanent, as President Obama made many of the Bush tax cuts permanent in 2010.

But that depends on a number of factors: whether the cuts are effective for the economy, whether they end up being popular and whether Republicans maintain control of Congress. If the tax changes stay as written, millions more Americans will see their taxes rise within the next decade.

How we calculated this

This analysis used Tax Calculator v. 0.14.1, along with author calculations, to estimate taxes owed under current law and the reconciliation plan for 116,688 hypothetical taxpayers, one for each square (in 52 states and cities). The open source Tax-Calculator project was started by the Open Source Policy Center at the American Enterprise Institute. Thanks to Martin Holmer, Matt Jensen and Cody Kallen for their assistance.

“Children” in the analysis assumes children under the age of 17, qualifying for both the Earned Income Credit and Child Tax Credit. State income taxes for each taxpayer were estimated from data from the Tax Foundation. State sales taxes were estimated using the IRS’s optional state sales tax tables. Whichever was higher was used in the SALT estimate. With the exception of New York City, local taxes were not considered. Property taxes were estimated by fitting real property deductions against income in a sample dataset from the CPS – our estimate is that taxes increased by log(income) * 1625 - $15,933 (but no less than zero).

Our analysis does not consider pass through income, nor does it consider the effects of changes to the mortgage deduction. But for 2018, that change would only apply to homeowners taking a new mortgage of between $700,000 and $1,000,000, a relatively small population.

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