Sept. 28 (UPI) — A typical U.S. family with two children that makes $100,000 per year would see a tax savings of $1,000 under President Donald Trump’s proposed tax plan, White House economic adviser Gary Gohn told reporters Thursday.
Trump spoke about his proposed tax overhaul Wednesday in Indianapolis, saying he hoped to bring growth to the U.S. economy by simplifying the tax code and lowering taxes on businesses and some households.
He detailed some aspects of the proposed plan — three tax brackets instead of seven and a doubling of the standard deduction — but for some households, it’s still unclear exactly how the plan would personally impact them.
Cohn, speaking at the White House during the daily press briefing, offered more details for a family with two children making $100,000 per year.
“If we allow a family to keep another $1,000 of their income, what does that mean? They can renovate their kitchen, they can buy a new car, they can take a family vacation, they can increase their lifestyle,” he said.
Cohn said the estate tax — also known as the death tax — and the alternative minimum tax would be repealed immediately. He also dismissed the idea that by doubling the standard deduction, it could hurt the real estate market.
Critics said people may not purchase homes if they’re unable to make use of the mortgage deduction. With a higher standard deduction, more taxpayers will be less likely to itemize their deductions when filing their taxes and thus may be less likely to make sure of the mortgage deduction.
“People don’t buy homes because of the mortgage deduction,” Cohn said. “The No. 1 reason why people buy homes is they’re excited and optimistic about the economy.”
The mortgage deduction allows Americans to reduce their taxable income by the amount of money they spend on interest on their mortgage.
Though the Trump administration has focused on the tax plan as a reduction in taxes for the middle class, Cohn said “there’s an exception to every rule.”
He said he was sure at least one middle class family would not benefit from the plan.