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Is it just me or do all things working class have far lower cutoffs than all things investment class? People with working class retirement income and a little deferred savings in RMD get little from the BBB. I, for one, got nothing.
People with working class retirement income get the ability to deduct $1K worth of charitable deductions without itemizing (starting in 2026). Only matters if their income is greater than the standard deduction.
Since their tax brackets are lower than the those of the wealthy, this deduction is of less value to them than to high earners. IMHO a fairer break would have been to give a tax credit of, say, 50% of the amount contributed, up to a $500 credit (50% of $1K).
With an increased standard deduction and an extra $6K "senior deduction", people with working class retirement income get the ability to convert more of their IRA tax free. That is, they can generate more income from conversions while still staying under the (now increased) standard deduction amount. This in turn gives them more flexibility in future years as the amount they must take from their T-IRA (RMD) is reduced.
Their tax bracket (assuming they are subject to taxes) is locked in at 10% or 12%. Without this legislation, roughly speaking the 12% bracket would have reverted to 15%. https://smartasset.com/taxes/trump-tax-brackets
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https://www.aaii.com/journal/article/336923-what-the-one-big-beautiful-bill-act-means-for-your-taxes
https://www.aaii.com/images/journal/336923-table-1.png
https://www.aaii.com/images/journal/336923-table-2.png
Looking for a tax calculator that incorporates all of these changes... especially for a 65+ youngster.
Since their tax brackets are lower than the those of the wealthy, this deduction is of less value to them than to high earners. IMHO a fairer break would have been to give a tax credit of, say, 50% of the amount contributed, up to a $500 credit (50% of $1K).
With an increased standard deduction and an extra $6K "senior deduction", people with working class retirement income get the ability to convert more of their IRA tax free. That is, they can generate more income from conversions while still staying under the (now increased) standard deduction amount. This in turn gives them more flexibility in future years as the amount they must take from their T-IRA (RMD) is reduced.
Their tax bracket (assuming they are subject to taxes) is locked in at 10% or 12%. Without this legislation, roughly speaking the 12% bracket would have reverted to 15%.
https://smartasset.com/taxes/trump-tax-brackets
Chickenfeed. But slightly above zero. Perhaps.