{"id":103157,"date":"2025-03-14T11:30:00","date_gmt":"2025-03-14T15:30:00","guid":{"rendered":"https:\/\/en.econostrum.info\/?p=103157"},"modified":"2025-03-14T10:34:13","modified_gmt":"2025-03-14T14:34:13","slug":"how-donald-trump-tax-plan-could-change-paycheck","status":"publish","type":"post","link":"https:\/\/en.econostrum.info\/how-donald-trump-tax-plan-could-change-paycheck\/","title":{"rendered":"How Donald Trump\u2019s Tax Plan Could Change Your Paycheck"},"content":{"rendered":"\n

Former President Donald Trump has proposed eliminating federal income taxes for individuals earning less than $150,000 per year, a policy that could lead to substantial changes in the finances of millions of Americans. According to Newsweek<\/a>, this proposal would mean a significant boost in take-home pay for a large portion of the workforce. <\/p>\n\n\n\n

If implemented, the plan could reshape household budgets, spending habits, and overall economic dynamics, sparking debates about its feasibility, potential benefits, and broader implications for the U.S. economy.<\/p>\n\n\n\n

Who Would Benefit From the Tax Plan?<\/h2>\n\n\n\n

The vast majority of American workers would see an increase in their after-tax income under this proposal. According to U.S. Census Bureau data, approximately 93% of Americans aged 15 and older earn less than $150,000<\/strong> annually, meaning they would qualify for zero federal income tax<\/a>. <\/p>\n\n\n\n

However, workers would still be responsible for other deductions, including state and local income taxes, which vary by location, as well as Social Security and Medicare taxes, which are deducted separately. <\/p>\n\n\n\n

Additionally, other paycheck deductions, such as retirement contributions and health insurance, would continue to impact take-home pay.<\/p>\n\n\n\n

How Much Would Take-Home Pay Increase?<\/h2>\n\n\n\n

The impact of Trump’s tax cut depends on income levels, with higher earners in this bracket seeing the largest dollar-value savings, while lower earners would experience a smaller reduction in taxes as a percentage of their income.<\/p>\n\n\n\n

For instance, a worker earning $149,000<\/strong> per year could save approximately $25,300 annually, which translates to a 17%<\/strong> increase in take-home pay. In contrast, a worker earning $49,000 per year would save around $3,896 annually, representing an 8% increase. <\/p>\n\n\n\n

For context, the average annual salary in the U.S. is $63,795, with roughly 9% of this income currently deducted for federal taxes. If this tax were eliminated, a worker in Brooklyn, New York, earning this amount would see a noticeable increase in their paycheck.<\/p>\n\n\n\n

What Stays the Same ?<\/h2>\n\n\n\n

Even if federal income taxes were eliminated, other deductions would still apply. Employees would still pay :<\/p>\n\n\n\n