In the December 21st issue of local Florida newspaper The Villages Daily Sun, founder and president of AMAC, Dan Weber, was interviewed by journalist David R. Corder. Weber spoke in detail about the GOP tax plan and how it will affect seniors, focusing on how this pro-growth legislation will ease the tax burden faced by mature Americans.
Read below for an excerpt of the article:
What’s the No. 1 benefit of the new law to your members?
The No. 1 benefit is the immediate lowering of the tax rates in 2018. So, a single person earning from $9,525 to $38,700 and a married couple earning from $19,050 to $77,400 would see their tax bracket decrease by 3 percent to 12 percent. Pretty much everybody is going to get a tax break, with the average person saving about $2,000 a year in taxes. That should go into effect around February, with companies automatically withholding less in worker taxes because of the new standard rates.
Any changes in the standard deduction?
It increased the standard deduction from $6,350 to $12,000 for a single person and from $12,750 to $24,000 for married persons beginning with returns filed in 2019. So, they’re almost doubling the deduction. And the more you deduct, the less you pay in taxes.
What’s one change that affects the demographic of your membership?
Seniors who have worked hard all their lives and built up an estate will get a break, too. That’s a tremendous break. Most people will no longer pay an estate tax; only about one-quarter of 1 percent of the total U.S. population will be paying the new estate tax.
What else do you like about the new law?
We’re keeping and expanding the medical expense deduction. It expands the deduction in 2017 and 2018 for medical expenses that exceed 7.5 percent of adjusted gross income, with it increasing to 10 percent in 2019.
What would you have liked to have seen in the new law that wasn’t in it?
Our purpose is to protect seniors. So, we are proposing a law that would remove the tax on Social Security income that in 2018 will affect about 40 percent of the people who are subject to an income tax. Right now, about 40 percent of older people are paying a tax on their Social Security even though we’ve already paid a tax on it before. If your income is now over $34,000, you’re going to get taxed on part of your Social Security. We’re trying to raise that to $50,000 or eliminate it entirely.