“The Working Families Tax Cuts delivered an unprecedented increase in tax refunds, boosting the money going back into the pockets of workers and families by 11%, with an average tax refund of over $3,400.”
By Ways and Means Committee Chairman Jason Smith (MO-08)
Washington Examiner
April 15 of this year, Tax Day, marks the end of the most historic tax refund season in American history, thanks to the Working Families Tax Cuts passed by Republicans in Congress and signed into law by President Donald Trump.
The Working Families Tax Cuts delivered an unprecedented increase in tax refunds, boosting the money going back into the pockets of workers and families by 11%, with an average tax refund of over $3,400.
When Republicans in Congress set out to deliver tax relief, we put working families, farmers, and small businesses at the top of the agenda. The House Ways and Means Committee traveled to 30 states and held 120 events to hear from working parents, families, farmers, and small business owners. We got out of Washington, D.C., to talk to people who do not have fancy lobbyists representing them. We traveled to a lumber mill in Petersburg, West Virginia; a horse barn in Yukon, Oklahoma; an airplane parts manufacturer in Peachtree City, Georgia; and a rebounding Rust Belt neighborhood in Erie, Pennsylvania.
The Americans we heard from told us they quickly needed relief from the 21% spike in the cost of living under former President Joe Biden, caused by his $10 trillion spending spree in the first two years of his administration. We heard loud and clear that working families appreciated the tax relief provided by the 2017 tax cuts, but that more was needed to keep up with the price spike they are experiencing.
That’s why Republicans not only made the tax relief from the 2017 Trump tax cuts permanent but also delivered on the president’s promises to give more help to the men and women who make this country work: no tax on tips, no tax on overtime, no tax on Social Security, and no tax on auto-loan interest. Nearly half of all tax filers this tax season claimed at least one of these key provisions — including over 6 million Americans claiming no tax on tips, over 25 million claiming no tax on overtime, over 30 million taxpayers claiming the Social Security deduction, and over 1 million claiming no tax on auto-loan interest. Each of these policies helped working-class families keep more of their hard-earned money and contributed to the record refunds Americans received this tax season.
While I was traveling in my district, I heard the story of a waitress who received a $10,000 refund because of the combined no tax on tips and the expanded child tax credit, along with other provisions in the Working Families Tax Cuts. During hearings the Ways and Means Committee held outside Washington, we heard from a Nevada retiree about how no tax on Social-Security is going to help her afford necessities after having had to dip into her savings to make ends meet during the Biden inflation crisis.
A California cattle rancher spoke about how the permanent death tax exemption gives his family certainty to plan for future generations. Countless Americans have similar stories this tax season: larger refunds and lower taxes thanks to the Republican-enacted tax relief. Tipped workers will receive an average tax cut of $1,300. Hourly workers will receive an average of $1,400 in tax cuts from no tax on overtime. Married couples on Social Security now have a $12,000 deduction on their Social Security benefits. Republicans delivered all this in combination with a permanent boost to the standard deduction by $1,500 for a family of four to $31,500 — giving an estimated $205 billion in new tax relief to the 90% of Americans who claim it.
Parents have struggled for a long time to afford the things their children need. That’s why we stopped the child tax credit from being slashed in half and permanently increased it to $2,200 per child, while guaranteeing it increases with inflation each year so it never loses its value. A larger child and dependent care credit means low-income working parents will be able to afford child care better, and a strengthened paid family and medical leave credit offers more workers the flexibility and financial security to care for a sick loved one. Americans looking to start or grow their family through adoption have increased access to an adoption tax credit, with $5,000 of that credit now refundable. In the years to come, families will have more choices when it comes to finding the right fit for their children’s education through the new education choice tax credits and expanded 529 education savings accounts that now cover K-12 education and trade schools.
Even the youngest Americans benefit from the Working Families Tax Cuts. New Trump Accounts, including a $1,000 government contribution for newborns, will provide for a child’s future and give more Americans a stake in our country’s economic prosperity. These accounts will grow through contributions from their parents, employers, and community partners, as well as stronger economic growth. It does not matter if a child grows up on a city block or a country road; they will receive a transformational investment that changes lives for an entire generation. When they reach adulthood, these funds could help cover the costs of education, starting a family, buying a home, and more.
Thanks to Republican-enacted tax relief, a family of four with two children earning up to $73,000 has no federal income tax liability. They owed Uncle Sam zero on Tax Day. Those tax savings will help working-class families, including waitresses, welders, linemen, and nurses, buy the school supplies they need, put food on their tables, and put clothes on their backs. This tax season, when families got their refund, taxpayers saw the promise of Republican tax cuts come to life.