Benefits / Tax Cuts

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This is a collaborative knowledge base; feel free to propose edits/additions that you believe are important for others to know. Contributions will be reviewed and approved based on quality and accuracy.

How You Can Resist

  • Call your Senator and US Representative by dialing tel:844-6-RESIST and tell them to vote against proposed actions that cut taxes for the highest earners.
  • Find out when your Senators and US Representative are holding town halls and other Upcoming Events/Opportunities. Show up and tell them not to cut taxes for the highest earners.
  • Click here to find an organization looking for volunteers.

Food Stamps (SNAP)

Supplemental Nutrition Assistance Program helps people buy healthy food. The majority of recipients are children or elderly with many working. In a 2012 report, 45 percent of SNAP recipients were under 18 years of age and nearly 9 percent were age 60 or older. More than 40 percent of recipients lived in a household with earnings.[1] SNAP has been essential in preventing families from falling into poverty. In 2011, SNAP was shown to lift 4.7 million households out of poverty. Without the program, the child poverty rate would be almost 3 percentage points higher.[2] During economic downturns SNAP can respond to meet the increased need. As the first recession was hitting its stride, SNAP was able to efficiently expand and serve families hit the hardest by the recession after effects like job losses and foreclosures. And then as the economy improves, the program contracts accordingly. Poverty increased during the recession, but food insecurity remained flat due in large part to SNAP's role in helping keep food on the table for families that needed it most.[3] SNAP benefits the economy, and USDA research shows that for every $5 in new SNAP benefits, $9 of economic activity is generated. The food that families purchase with their benefits to meet their needs helps keep local businesses making money.[4]

The largest group that received SNAP benefits according to 2013 data was white. The breakdown according to the U.S. Department of Agriculture, was 40.2 percent of SNAP recipients are white, 25.7 percent are black, 10.3 percent are Hispanic, 2.1 percent are Asian and 1.2 percent are Native American.[5] Three quarters of the 22 million households that received SNAP benefits in 2014 included a child, an elderly person or someone with a disability.[6]

To find the usage of this program by Congressional district click here.

Trump/GOP agenda

  • Trump has shown that he will act against key protections for Americans like SNAP with comments that the program "shouldn't be needed often", and that "when half of food-stamp recipients have been on the dole for nearly a decade, something is clearly wrong, and some of if has to do with fraud."[7]
  • Cuts to SNAP would be immediately damaging. The House version of the Farm Bill would cause 2 million Americans to lose their benefits entirely, 210,000 children to lose access to free meals at school, and 850,000 households to see their benefits cut by an average of $90 per month.[8]

WIC/Food Deserts

The Special Supplemental Nutrition Program for Women, Infants and Children (WIC) provides Federal grants to States for supplemental foods, health care referrals, and nutrition education for low-income pregnant, breastfeeding, and non-breastfeeding postpartum women, and to infants and children up to age five who are found to be at nutritional risk.[9]

The program is voucher based, and has a list of foods that are high in nutrients such as protein, fiber, iron & calcium. WIC accepting locations often also accept SNAP, and are required to keep a certain number of foods that meet the WIC nutritional standards in stock. Participants will turn in a voucher that covers all or most of the cost on food items such as bread, eggs, milk, fruits & vegetables.

In addition to safeguarding the health and well being of low-income women, infants and children, WIC has provided opportunities for small businesses and corner stores to grow and sustain their businesses in food deserts, which are areas where fresh or healthy food options are rare, or altogether missing. Many of these small business owners are able to stay in business because they are able to provide local options for buying food, where few or no options are available.

The largest group that received WIC benefits according to 2012 data was white. A breakdown according to the U.S. Department of Agriculture in 2012 reports 58.2 percent of all WIC participants reported their race as White Only, 19.8 percent reported as Black or African American Only, 12.2 percent reported as American Indian or Alaska Native Only, and 3.9 percent of participants reported as either Asian Only or Native Hawaiian or Other Pacific Islander Only. Two or more races were reported for 5.1 percent of WIC participants. For ethnicity, 41.5 percent of participants reported as Hispanic/Latino.

Food-deserts.jpg

For more information on program requirements and how to determine eligibility, please follow the link.

Trump/GOP agenda

  • The Trump administration's new budget plans to reduce the budget of WIC by $200 million.[10]

Unemployment Benefits

The Department of Labor's Unemployment Insurance (UI) programs provide unemployment benefits to eligible workers who become unemployed through no fault of their own, and meet certain other eligibility requirements, most of which will vary from state to state.[11]

Unemployment benefits largely focus on providing for immediate financial needs for people who are currently out of work but are able and available to work, with the intention of looking for and securing employment while receiving unemployment. In addition to supplementing income, unemployment benefits can also include job training and readiness programs. Most programs for collecting unemployment require participants to enroll in and attend re-employment seminars.

Unemployment benefits through the Department of Labor's Unemployment Insurance programs are not available for individuals who are out of work due to injury, or disability, although there are other programs to support these people. Unemployment benefits require certification for continued eligibility on a weekly, or bi-weekly follow up. This means that your state agency that you have filed with to receive these benefits requires you to share information on any job applications, job offers, or job refusals. Recipients may also be required to register with a state Employment Service, so that they can get assistance in finding a job in a timely manner [12].

The unemployment rate in your Congressional district can be found by clicking here and selecting workers.

Trump/GOP agenda

The White House fully intends to implement a law that would allow states to drug test any applicant for unemployment benefits. The previous restriction only tested applicants who do jobs that require drug testing.[13] However, in instances around the United States drug testing Unemployment Insurance applications has repeatedly shown to be a failure at best and a waste of resources at worst. In Tennessee, only one person in the 800 who applied tested positive. In Florida, during the four months the state tested for drug use, only 2.6% of applicants tested positive, which is well under the state-wide illegal drug use rate of 8%. The Florida law wasted taxpayer money and was eventually ruled unconstitutional.[14]

Trump/GOP Tax Reform Proposal

On April 26th, 2017, the White House released a one-page document outlining the Trump administration's new proposed tax plan. Thus far, no legislation has been introduced to implement it. Treasury Secretary Steven Mnuchin and director of the administration’s National Economic Council Gary D. Cohn presented the plan to reporters.

The U.S. Federal Bureau Budget Deficit is the difference between what the government takes in from taxes and other profits, and the amount of money it spends.

While the tax plan did not give many details, there are several key changes the administration proposed that would increase the deficit, or excess spent. [15] Experts argue that this new plan only proposes tax cuts, with no plan to make up for them. This may reduce economic growth instead of increase economic growth, which was an administration promise.[ http://www.crfb.org/blogs/fiscal-factcheck-how-much-will-trumps-tax-plan-cost]

Expanding child care benefits

The Trump administration’s latest tax proposal may include tax credits for childcare. How much this would increase the deficit is unknown.[16]

In 2016, the administration had considered adding other child-care benefits, such as:

  • Child-care savings account based on income rates. Experts argue that these savings accounts would benefit the wealthy more than low-income families. For example, the top wealthiest income bracket gets taxed 39.6% of their income. That means for every $1,000 deposited in the account, they would save $396 in tax. But a family in the bottom tax bracket taxed at a 10% rate would save just $100 on the same $1,000 deposit. Wealthy families already benefit from being able to afford child care that low income families do not.[17]
  • Child-care spending rebate. This means a partial refund for low-income parents. The Trump campaign described it as “half of the payroll taxes paid by the lower earning parent, and would be subject to an income limitation of $31,200.”[ https://assets.donaldjtrump.com/Childcare_Reform.pdf] For low-income married couples, both spouses would have to work. By contrast, a wealthy couple with even only one working spouse would still be able to afford more care to begin with and benefit from other tax breaks.[18]

The previous proposal and current proposal did not say how much of a tax reduction families would get for stay-at-home parents. It also did not say whether the reduction would change depending on the age of the child, or how each state average would be measured.[19]

Changing the Tax Brackets

As of 2017, we have seven tax brackets that tax people, married couples, or households differently based on how much money they make.[20] The new tax plan is proposing to have three tax brackets instead of seven: 10%, 25%, 35%. The Trump administration has not outlined how where each bracket's income cut-off begins or ends, which makes it difficult to see how it will affect the middle class.[21] This would be a tax cut for the wealthiest tax bracket by 5%, and may increase the deficit by almost $1.5 trillion.[22][23] [24]

Doubling Standard Deductions

Depending on if you are single ($6,350), married ($12,700), or head of household ($9350), you can deduct from your taxable income.[25] The Trump administration has proposed doubling the amount, which may benefit the middle class. However, since people can elect to pay less taxes, this may increase the deficit by almost $1.5 trillion.[26] [27]

Tax Cuts for the Wealthy

Repealing the AMT

The AMT (alternative minimum tax) is an additional tax used to tax items that are not covered by the regular income tax. It is meant to make sure the very wealthy do not avoid paying taxes on "add-ons" that are not included in their income.[28]. In 2005, Trump had to pay an additional $31 million because of this law. The Trump administration would like to remove this requirement, benefitting the wealthy it currently affects and possibly raising the deficit by almost $.4 trillion.[29] [30]

Lowering Capital Gains Tax

In this new plan, the Trump Administration has proposed removing the 3.8% tax on investment income. This 3.8% is in addition to a 20% investment tax, and helps fund the Affordable Care Act. Removing would lower the rate, and is meant to make more people want to invest. This would increase the deficit by almost $0.2 trillion.[31] [32]

Removing the inheritance tax

The tax plan proposes repealing the inheritance tax, which taxes estates. The U.S. has the fourth highest inheritance tax in the world.[33] The Trump administration has said this is mostly a burden on farms and small business, but many argue that this will mostly benefit the very wealthy who own expensive estates.[34] This would increase the deficit by almost $0.2 trillion.[35][36]

Tax Cuts for Businesses

The Trump administration plans to reduce the corporate tax from 35% to 15%. It is estimated this would increase the deficit by $3.7 trillion.[37] [38] The plan also includes a special one-time tax with, with no specific rate. This is meant to encourage corporations to bring back money made overseas.[39]

Tax Increases for Homeowners and People Giving to Charity

The plan proposes getting rid of tax deductions (expenses that won’t be taxed) for mortgage interest and money given to charities. State and local taxes would no longer be deductible. This negatively affects people who live in high-tax states, such as New York. High-tax states usually have higher populations in urban areas.[40] This would reduce the deficit by $2.0 trillion.[41][42]

Social Security (OASDI) and SSI

Supplemental Security Income (SSI)

Supplemental Security Income (SSI) is a federal program that provides supplemented income to help aged, blind, and disabled individuals who have little to no money of their own to pay for basic living needs, like clothing, shelter and food. SSI is not the same as Social Security—although recipients of SSI may also be eligible to receive Social Security. There is more information available on SSI on the Disability Rights page.

Social Security (OASDI)

Social Security (also known as OASDI) is a federally funded program meant to supplement the loss of income for people who have retired. Eligibility for Social Security is determined by how long someone has had a job in the United States that offers Social Security benefits. People work to obtain credits from the time they turn 21 until they turn 62, become disabled, or die—whichever comes first—to reach the amount of credits necessary to provide for their quality of life upon retirement.[43] Social Security payments are monthly, and a recipient can begin obtaining these benefits at the age of retirement, which is currently 65. Due to the federal hiring freeze Trump ordered at the beginning of his time in office, some recipients of Social Security have experienced delays in receiving their Social Security checks. Since many Social Security recipients depend on this income to support themselves, these delays are harmful.

Congressional District Breakdowns

Breakdowns of use of these programs by Congressional District can be found here.

Vulnerabilities in Their Strategy

  • On average, states with Republican leadership are more dependent on the federal government for funds than are Democratic states.[44]

Source