Latest news with #taxpolicy
Yahoo
5 hours ago
- Business
- Yahoo
Here's How Much Retirees Would Save If Social Security Taxes Actually Get Eliminated
President Trump has often declared that seniors should not pay taxes on Social Security benefits. While it may just seem like another former campaign promise, the White House moved forward with some big tax policy changes. Getting rid of Social Security taxes sounds great for those who depend on these benefits, but how would this work in the big picture? Good To Know: Up Next: The One Big Beautiful Bill Act (OBBBA) added fuel to the speculation. However, even a wage-based blessing for retirees on fixed incomes — one of the country's biggest and most reliable voting groups — can come with implications. So how much would seniors benefit if Trump were to actually succeed in eliminating tax on Social Security benefits? Let's find out. How Trump's Bill Impacts Social Security After the approval by a Republican-led Congress, Trump signed a bill that includes a tax deduction for seniors but NOT the elimination of taxes on Social Security benefits. Instead of eliminating the tax, the bill introduced a temporary $6,000 tax deduction for seniors aged 65 and older. It will only be effective from 2026 through 2028, though, and has income-based eligibility limits. The bill is also an umbrella under which many components of Trump's overall tax plan can be found, such as the Senior Citizens Tax Elimination Act, as well as requiring retirees who exceed income thresholds to pay federal income tax on up to 85% of their Social Security benefits. However, it turns out that what appears to be a proposal to help the most vulnerable populations with their tax returns would actually benefit wealthy retirees the most. And, the cost in lost revenue could threaten the program's future and lead to reduced benefits for all. Find Out: It's also good to note that eliminating income tax on Social Security benefits could increase the federal deficit by up to $1.6 trillion over 10 years. If Trump's promise to end taxes on Social Security is passed altogether (again, to be clear, the OBBBA does not eliminate Social Security taxes), households earning between $32,000 and $60,000 annually would get an average tax cut of about $90. That means that less than 1% of the lowest-earning households (those making about $33,000 or less annually) would get a tax cut, 28% of middle-income households would get a tax cut, and roughly 20% of households earning more than $5 million a year would get a tax cut. According to the Tax Policy Center, 'The biggest winners would be those in the top 0.1% of income, who make nearly $5 million or more. They'd get an average tax cut of nearly $2,500 in 2025.' How Social Security Benefits Are Taxed About 68 million Americans collect Social Security benefits. As of 2025, the average monthly Social Security retirement benefit was estimated at around $1,999. Most recipients owe nothing to the IRS. According to the Social Security Administration (SSA), 'About 40% of people who get Social Security must pay federal income taxes on their benefits.' Kiplinger pointed out that the IRS taxes not just retirement benefits, but all payments pulled from the program's trusts, including disability and survivor benefits, although Supplemental Security Income (SSI) payments are exempt. Additionally, some states tax Social Security income too, but the president does not have the power to alter that. The federal government taxes or doesn't tax benefits based on the recipient's combined income, which includes their monthly Social Security checks. For single filers: Those earning between $25,000 and $34,000 in combined income can be taxed on up to 50% of their benefits. Those earning more than $34,000 can be taxed on up to 85% of their benefits. For couples filing jointly: Those earning between $32,000 and $44,000 can be taxed on up to 50% of their benefits. Those earning more than $44,000 can be taxed on up to 85% of their benefits. Final Take To GO: This Could Hurt More Than Help The bottom line is that the majority of recipients wouldn't get a tax break, and for most who would, the savings would be negligible. If Social Security taxes are eliminated, it's not likely you would see much of a difference in your tax return or your budget overall if you're a lower to average income earner. In other words, 60% of recipients who the IRS doesn't tax keep their entire payments because they don't have enough income to qualify for taxation. For them, Trump's plan wouldn't leave them with a single extra dollar. The rich, however, would reap the lion's share of the gains (as per usual, some might say). This is because Trump's plan to repeal Social Security taxes would lead to about 20% of the households earning more than $5 million a year getting a tax cut. While every dollar counts, $90 in savings pales in comparison to the projected cost of $1.6 trillion in lost revenue over the next decade, which would drive Social Security and Medicare hospital insurance into insolvency faster, resulting in sharply reduced benefits for tens of millions of recipients. Andrew Lisa contributed to the reporting for this article. More From GOBankingRates 3 Luxury SUVs That Will Have Massive Price Drops in Summer 2025 3 Reasons Retired Boomers Shouldn't Give Their Kids a Living Inheritance (And 2 Reasons They Should) Mark Cuban Says Trump's Executive Order To Lower Medication Costs Has a 'Real Shot' -- Here's Why This article originally appeared on Here's How Much Retirees Would Save If Social Security Taxes Actually Get Eliminated
Zawya
a day ago
- Business
- Zawya
Liberia Secures Seat on United Nations (UN) Global Tax Committee
The Ministry of Foreign Affairs, in collaboration with the Liberia Revenue Authority (LRA), has announced Liberia's inclusion among the newly appointed members of the United Nations Committee of Experts on International Cooperation in Tax Matters. This milestone follows the decision of the UN Secretary-General to appoint 25 distinguished tax experts to the Committee, each serving a four-year term ending on June 30, 2029. Representing Liberia on this globally significant body is Mr. Darlingston Y. Talery, a highly respected tax policy specialist and former Commissioner for Domestic Tax at the LRA. Mr. Talery currently heads the Department of Domestic Resource Mobilization at ECOWAS Commission. Mr. Talery's appointment is a major step for Liberia, showcasing the country's growing prominence in global tax policy dialogue and reinforcing its commitment to transparent, fair, and effective tax governance. 'The inclusion of Liberia in this globally significant committee sends a clear message about the capacity, credibility, and growing influence of Liberia's public institutions,' said H.E. Sara Beysolow Nyanti, Minister of Foreign Affairs. 'This appointment not only recognizes the professional excellence of Mr. Talery but also positions Liberia as an active contributor to the global conversation on fair and inclusive tax systems.' Commissioner General of the Liberia Revenue Authority, James Dorbor Jallah, hailed the appointment as a proud achievement for the nation and the LRA: 'Mr. Talery's appointment is a proud moment for our institution. It is the result of years of investment in capacity-building and policy innovation. Liberia is ready to contribute meaningfully to international tax cooperation and bring home the benefits of fair global tax practices.' The appointment process followed a communication from the UN Secretary-General, dated November 20, 2024, inviting all 193 UN Member States to nominate qualified candidates. Of the 58 nominations received globally, 25 were appointed, including Liberia's Mr. Talery. According to the Ministry of Foreign Affairs, this appointment aligns with the administration's broader goal of increasing Liberian representation in foreign and international organizations. The Ministry is encouraging all Ministries, Agencies, and Commissions to collaborate in identifying and nominating qualified Liberians for such positions, following the example set by the LRA in Talery's nomination. The United Nations Economic and Social Council (ECOSOC), acting under its Resolution 2004/69 and the Addis Ababa Action Agenda of the Third International Conference on Financing for Development (endorsed by the UN General Assembly in Resolution 69/313), mandates the formation of this Committee to enhance international tax cooperation. The 25-member body comprises experts nominated by Member States and appointed by the Secretary-General in their personal capacities, ensuring diverse geographic representation and a wide range of tax system expertise. Liberia's inclusion marks a milestone for the Government, reflecting the strong partnership between the Ministry of Foreign Affairs and the LRA. The Government of Liberia considers this recognition as a validation of its efforts to position the country as a proactive voice in shaping global financial and tax policies. The Committee of Experts on International Cooperation in Tax Matters plays a critical role in advancing global tax transparency, combating illicit financial flows, supporting domestic resource mobilization, and improving the coherence of international tax rules. Liberia's representation will ensure that the perspectives and development challenges of African nations particularly those in fragile and post-conflict contexts are effectively represented in the Committee's deliberations. Liberia now joins a diverse group of countries represented on the Committee, including Nigeria, Kenya, Sierra Leone, Rwanda, France, India, China, Belgium, Brazil, and Australia, among others. With the support of Liberia's Mission to the United Nations and development partners, the Ministry of Foreign Affairs and the LRA reaffirm their commitment to advancing international tax cooperation, promoting equity in global financial systems, and securing Liberia's place as a leader in multilateral development processes. Distributed by APO Group on behalf of Ministry of Foreign Affairs of Liberia.
Yahoo
3 days ago
- Business
- Yahoo
Here's What Trump's New Tax Law Means for Your Deductions and Donations
The massive piece of legislation known as the 'One Big Beautiful Bill' comes with many changes to tax policy. While you may be aware Trump's 2017 tax cuts are extended, you may not know about the impact on deductions and donations. Read More: Learn More: Here are some things to know before you adjust your plans, according to some financial experts. Impact on Charitable Giving As noted by CNBC, the new deductions are designed to encourage everyday people to give more. The bill's deduction for those who don't itemize 'has the potential to re-motivate charitable giving among a significant number of households,' per the Akron Community Foundation. However, one of the important takeaways from the new law is that it has an exemption rule for the wealthy and limits for high earners. According to CNBC, the law could disincentivize charitable giving for high earners, as it limited deductions for those in the top tax bracket. 'Business and real estate deductions are dependent on the type of expenses,' said Schuyler M. Moore, partner at Greenberg Glusker. 'For donations, they are no longer deductible for the first amount up to 0.5% of the taxpayer's income.' 'Plus, those in the 37% bracket are now limited to a 35% deduction value cap, reducing the overall benefit of giving. Bottom line — the tax advantages are still there, but you'll need a more intentional, high-leverage strategy to access them,' said Christopher Stroup, founder and president of Silicon Beach Financial. Check Out: Impacts on Deductions According to Stroup, itemizing may no longer make sense in many cases. 'It makes the increased standard deduction permanent and introduces new below-the-line deductions, making itemizing less common,' Stroup said. The standard deduction under the new law is $15,750 for single filers and $31,500 for those filing jointly, per the Tax Foundation. 'The more generous standard deduction improves tax simplicity by reducing the number of taxpayers who benefit from itemizing over taking the standard deduction,' it said. Opportunity for Planning According to Stroup, this law rewards proactive planning. 'For high-income earners and charitably inclined households, tools like donor-advised funds, qualified charitable distributions and even revisiting gift and estate strategies — with the new $15 million exclusion — are essential,' Stroup said. 'With itemized deduction limits, adjusted gross income floors and phaseouts reshaping the landscape, a one-size-fits-all approach no longer works as coordination between your tax and financial plan is now critical.' Editor's note on political coverage: GOBankingRates is nonpartisan and strives to cover all aspects of the economy objectively and present balanced reports on politically focused finance stories. You can find more coverage of this topic on More From GOBankingRates 3 Luxury SUVs That Will Have Massive Price Drops in Summer 2025 These Cars May Seem Expensive, but They Rarely Need Repairs The 5 Car Brands Named the Least Reliable of 2025 This article originally appeared on Here's What Trump's New Tax Law Means for Your Deductions and Donations Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
3 days ago
- Business
- Yahoo
Here's What Trump's New Tax Law Means for Your Deductions and Donations
The massive piece of legislation known as the 'One Big Beautiful Bill' comes with many changes to tax policy. While you may be aware Trump's 2017 tax cuts are extended, you may not know about the impact on deductions and donations. Read More: Learn More: Here are some things to know before you adjust your plans, according to some financial experts. Impact on Charitable Giving As noted by CNBC, the new deductions are designed to encourage everyday people to give more. The bill's deduction for those who don't itemize 'has the potential to re-motivate charitable giving among a significant number of households,' per the Akron Community Foundation. However, one of the important takeaways from the new law is that it has an exemption rule for the wealthy and limits for high earners. According to CNBC, the law could disincentivize charitable giving for high earners, as it limited deductions for those in the top tax bracket. 'Business and real estate deductions are dependent on the type of expenses,' said Schuyler M. Moore, partner at Greenberg Glusker. 'For donations, they are no longer deductible for the first amount up to 0.5% of the taxpayer's income.' 'Plus, those in the 37% bracket are now limited to a 35% deduction value cap, reducing the overall benefit of giving. Bottom line — the tax advantages are still there, but you'll need a more intentional, high-leverage strategy to access them,' said Christopher Stroup, founder and president of Silicon Beach Financial. Check Out: Impacts on Deductions According to Stroup, itemizing may no longer make sense in many cases. 'It makes the increased standard deduction permanent and introduces new below-the-line deductions, making itemizing less common,' Stroup said. The standard deduction under the new law is $15,750 for single filers and $31,500 for those filing jointly, per the Tax Foundation. 'The more generous standard deduction improves tax simplicity by reducing the number of taxpayers who benefit from itemizing over taking the standard deduction,' it said. Opportunity for Planning According to Stroup, this law rewards proactive planning. 'For high-income earners and charitably inclined households, tools like donor-advised funds, qualified charitable distributions and even revisiting gift and estate strategies — with the new $15 million exclusion — are essential,' Stroup said. 'With itemized deduction limits, adjusted gross income floors and phaseouts reshaping the landscape, a one-size-fits-all approach no longer works as coordination between your tax and financial plan is now critical.' Editor's note on political coverage: GOBankingRates is nonpartisan and strives to cover all aspects of the economy objectively and present balanced reports on politically focused finance stories. You can find more coverage of this topic on More From GOBankingRates 3 Luxury SUVs That Will Have Massive Price Drops in Summer 2025 Are You Rich or Middle Class? 8 Ways To Tell That Go Beyond Your Paycheck 10 Cars That Outlast the Average Vehicle This article originally appeared on Here's What Trump's New Tax Law Means for Your Deductions and Donations Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Daily Mail
6 days ago
- Business
- Daily Mail
Power plays, tax fights and lost voices: PVO reveals what the first week of new parliament tells us
Parliament returned this week not with a bang, but with a calculated rhythm. No drama in the numbers, no early leadership tension, and no surprise legislative ambushes. And yet beneath the calm surface, the first full sitting week of this new term - which only included two days of Question Time - revealed a lot. The government was keen to look measured but quietly ruthless, an opposition still licking its electoral wounds was slowly finding its voice, while the crossbenchers immediately discovered just how little leverage they now have, other than the Greens who hold the balance of power in the Senate in their own right. There was strategy at play on all sides: defensive, offensive and performative. And with tax policy fast becoming the next political battlefield during this parliamentary term, the tone may already have been set. What were Anthony Albanese 's priorities? Labor returned to Canberra laser-focused. Top of the list: pushing the HECS‑HELP cut to student debts through the parliament. Their signature pre-election promise - a 20 percent wipe-off for roughly 3 million Australians - was formally introduced in the House on Wednesday. But beyond policy, optics mattered too. Labor deliberately dialled down the triumphalism. The tone was 'steady hand', not swagger. Ministers fronted the media emphasising unity and focus, a calculated effort to sidestep hubris. Welcoming new MPs added another layer to the week. Ali France, Sarah Witty and others delivered first speeches: personal, grounded and in contrast to the Coalition's more familiar faces (those few who survived the electorate's cull). Labor also took the chance to underscore the Coalition's troubles on the floor of parliament. Their failure to back a modest income tax cut before the election got plenty of Question Time airplay. So too the divisions over net zero. And a depleted number of Liberal women in the opposition's party room took away from its first female leader strutting her stuff. The Nationals remain publicly split on 2050 emissions targets, with Barnaby Joyce and Michael McCormack pushing to scrap them entirely. It's hard not to think that at some point sooner or later there will be another challenge Nats leader David Littleproud will need to navigate. Then came trade. Australia lifted biosecurity restrictions on US beef imports, widely seen as a move to smooth tensions with Washington and hopefully negotiate down the Trump trade tariffs. Labor tried to claim the timing of the policy change was a coincidence, but the Coalition isn't buying that. It wants the decision reviewed, using the final Question Time to push its case that biosecurity standards have been sacrificed to the interests of trade. There was no policy switch on beer tax, as Labor went ahead with its election promise to freeze the excise for the next two years. Cheers! A nice win for the outgoing CEO of the Brewers Association, John Preston, who had long advocated for an end to the continual hikes which have given Australia some of the highest beer taxes in the world. With pressure on the government to ease the cost of living, it will be interesting to see if the industry can successfully lobby to make the freeze permanent. If the Coalition looked fractured and reactive, Labor appeared focused and composed. Less interested in gloating, more committed to governing, or at least projecting that impression. How did the new Opposition leader perform? Taking on what's often called the toughest job in politics, Sussan Ley managed her first full week with steadiness and restraint. It wasn't flashy, to be sure, but she avoided missteps. Ley anchored her messaging to one issue: Labor's plan to tax unrealised super gains. It was a deliberate pitch to older Australians and SMSF holders. Her lines in Question Time were clear and targeted. She even ventured briefly into housing, territory the government prefers to control. Ley didn't bite at the attempts to reignite the net zero wars. She stayed out of the mess, refusing to endorse or criticise the move, thus avoiding inflaming an already unstable internal debate. That said, it's likely this issue will explode within the Coalition sooner rather than later. Away from the chamber, Ley focused on authenticity. Her 60 Minutes appearance on the Sunday before the sitting week commenced - speaking about the death of her mother and her reasons for taking the job - struck the right tone: restrained and sincere. It didn't prevent the first Newspoll of her leadership revealing that the opposition starts this term further down in the polls than the poor election showing in May. Commentary on Ley's performance in her first parliamentary sitting week was mixed. Some accused her of lacking ideological edge. Others noted her improved recognition and clearer messaging. Her approval ratings remain low but she has time to turn that around. Behind the scenes, Ley began rebuilding with internal reviews, outreach to business and community groups, and a reshaped shadow team. It's too soon to judge, but she made it through her first test without slipping. She even met with former long term Liberal deputy leader Julie Bishop during the sitting week, no doubt receiving some tips on how to navigate the male-dominated shadow cabinet she leads. Does anyone remember the crossbench? The crossbench went to the 2025 election with high hopes. A hung parliament was on the cards, and the independents and Teals saw themselves as likely policy shapers and kingmakers. But Labor's outright majority removed that possibility in an instant. In the lower house, the crossbench is now politically irrelevant. Their speeches will still be heartfelt, and they'll get a sizeable share of questions given how small the opposition party room now is. But without leverage anything they do is largely symbolic. The Senate, however, is a different story, but only for the Greens. With eleven seats, they hold the balance of power and have made clear they intend to use it. Most of what's passed so far hasn't been contentious, but that won't last. Greens Senator Mehreen Faruqi ensured the crossbench wasn't entirely invisible. During the Governor-General's address, she stood mid-speech and unfurled a sign reading: 'Gaza is starving… Sanction Israel.' It drew formal censure and headlines, but no policy traction. Still, it was a reminder that the Greens won't fade quietly despite their poor performance in lower house electorates. The rest of the crossbench? Watching from the sidelines, for at least the next three years. That includes ACT Senator David Pocock who made such a splash in his first term. The team of four One Nation senators led by Pauline Hanson also has little power, but their enlarged party room is a lead indicator that they will be in the running to share the balance of power after the next election. What debates will we hear more about in the coming weeks? The biggest issue emerging from this week is the looming political fight over taxing unrealised gains in superannuation. The government's Division 296 proposal (a 15 percent tax on earnings for super balances over $3 million, including on gains not yet realised) has become the central line of Coalition attack. Ley and her deputy and shadow treasurer Ted O'Brien are already framing it as a broader tax threat. 'Will Labor now tax unrealised gains on everything?' was the line floated in Parliament, designed to create unease among all Australians, not just the rich few with huge super balances. Labor maintains that the tax hits only 0.5 percent of people and will raise over $40 billion in the next decade. But there's disquiet, even internally. Some Labor MPs reportedly 'hate' the idea of taxing paper profits, even if they accept the budget imperative. Whatever way you cut it, the policy is badly designed, even if the goal of restricting super tax concessions for the wealthy has some merit. The industry pushback is already intense, precisely because the design is so poor. SMSF groups warn they'll bear the brunt of what's coming. Hostplus wants indexation to avoid younger savers being caught by the tax in the future. Then there's the politics. Anthony Albanese joked in Question Time: 'The time to run a scare campaign is just before an election, not after one.' A wry line, but from a man who well knows how effective a scare campaign can be. Chalmers is framing the debate in class terms: 'This side of the House is cutting taxes for 14 million Australians. That side is going to the wall for 0.5 percent.' That may resonate, but it won't silence critics, and it gives away the Treasurer's penchant for class warfare, which might cripple his efforts to embrace serious tax reform. If indeed he is even serious about that looming debate. The August tax summit will keep the issue of super in the headlines at the same time as broadening the discussion. Whether it resolves anything is another matter. The noise around Division 296 will therefore carry into August, but it won't be the only game in town. What this week showed (quietly but clearly) is how each player plans to operate in the new political reality. Labor in control and careful not to overreach. The opposition disciplined, for now at least, despite Joyce and McCormack's best efforts. The crossbench adjusting to irrelevance. The curtain has only just gone up, but the tone of the new parliamentary term is already taking shape.
