Would the GOP tax plan save you money or cost you money?

The US House passed its tax plan. The Senate is mulling over one of its own. But will either plan help a typical Wabash Valley family when it comes time to file taxes?

Posted: Nov 20, 2017 7:00 PM
Updated: Nov 20, 2017 7:04 PM

TERRE HAUTE, Ind. (WTHI) - The US House passed its tax plan. The Senate is mulling over one of its own. But will either plan help a typical Wabash Valley family when it comes time to file taxes?

We asked a tax preparer to find out. Mike Perkins is an Enrolled Agent with Larrison’s Tax Service in Terre Haute, Indiana.

In about six weeks, he’ll be cranking out tax returns. He says whatever bill Capitol Hill decides to pass, or not pass, will have a huge impact on local returns.

“A lot of people are adopting the wait and see attitude,” Perkins told me.

Perkins didn’t wait to see what the impact would be on a typical return. He worked out tax returns, both under the current code and the House plan, using five scenarios he usually sees. For example, one scenario was a family of four, married filing jointly, making less than $58,000 per year.

“Four out of five scenarios, people are going to pay more in taxes than they did filing last year,” Perkins said.

We asked Perkins what’s causing all of these higher taxes? He says the House bill increases the standard deduction, but it also reduces personal exemptions. It also only increases the child tax credit for kids 17 years of age and under.

Perkins doesn’t believe a tax bill will pass this calendar year, since Congress will only be in session just 12 more days. This means we will have at least another year of filing taxes under the current tax code.

“Outside of that, I just tell people not to worry too much until we have a final product.”

Click here to see the tax plan.

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