TCJA Extension Could Add $4 to $5 Trillion to Deficit – CRFB
“Most of the TCJA’s individual and estate tax provisions are scheduled to expire at the end of CY 2025. This includes lower tax rates, expansions of the child tax credit and standard deduction in place of the personal and dependent exemptions, near-repeal of the Alternative Minimum Tax (AMT), limitations on the state and local tax (SALT) deduction and other itemized deductions, a new deduction for pass-through income, and an increase in the estate tax exemption, among other provisions.
“If all these provisions were extended in full, they would reduce revenue by $3.9 trillion, or 1.1 percent of GDP, through FY 2035 relative to current law. By 2035, this would increase the national debt by 10.5 percent of GDP, with annual revenue loss approaching $500 billion per year.”
Congress will be forced to make major decisions on tax and spending policy next year which will have major consequences for people at differing income levels. It’s an opportunity to make the child tax credit, which now disproportionately benefits higher-income families, more helpful to those with low income. See: