Table of contentsThe power of taxesTypes of taxesPrevious president's tax plansSome numbersThis article focuses on what taxes are, where the first started income tax, where we are today and how where we are today affects our agricultural community. Many presidents before Trump signed tax cut laws in hopes of providing tax relief to one class or another. As tax cut bills are signed into law, they favor Americans stimulating the economy and may even encourage Americans to save, invest and work to earn more money. Say no to plagiarism. Get a custom essay on “Why Violent Video Games Should Not Be Banned”? Get the original essay In December 2017, President Donald J. Trump signed the Tax Cuts and Jobs Act (TCJA) . This document was intended to help middle-class taxpayers. This document made significant changes to income tax deductions and tax rates as well as many other changes to the provisions. This document makes it much easier for average households to avoid having to itemize their deductions. This document is also expected to boost the economy in the near future. President Trump is taking matters into his own hands to ensure Americans are taxed fairly and constitutionally. The Power of Taxes Taxes have been a burden and a blessing to families for generations. A burden because no one wants to pay money out of their salary every week, half of which you still wonder what it's for. A blessing because we would not have adequate road networks, plowed streets, Medicare/Medicaid systems, social security, etc. Having all of this has helped almost every American in the United States, whether they realize it now or not. In December 2017, President Trump signed the largest tax overhaul since 1986. It created simplicity in that the taxpayer will no longer have to itemize their deductions, but it will take more time to complete their tax forms. “This will increase health care premiums and reduce health insurance coverage. This will affect activities in many sectors, including state and local government spending, charities, and housing. » In 1862, as the Civil War raged, the United States Congress introduced the first-ever form of income tax. People who made between six hundred and ten thousand dollars were taxed on average around three percent and those who made more than ten thousand dollars were subject to a higher tax, and so on. In 1913, the Sixth Amendment was created because the tax system was now permanent. Stated in the United States Constitution, “The Congress shall have power to lay and collect taxes upon income from any source, without apportionment among the several States, and without regard to any census or enumeration (Constitution ). » Collections from American citizens in 1918 amounted to over a million dollars. In 1920, they exceeded five billion. This made taxation the primary revenue of the United States government. Types of Taxes Consumption Tax A consumption tax is a tax based on your money spent, not your money earned. It is also associated with sales taxes that differ by state. Sales taxes are used to generate revenue and may be imposed on certain products. Such as gasoline, alcohol, clothing and food. Progressive tax A progressive tax isone that increases with the amount of money earned by the individual. In the United States, the system is set up so that the upper classes pay more than the middle class, etc. (Smart Asset). One of the benefits of the progressive tax is that it leaves more money in the pockets of low-income workers, which will most likely stimulate the economy and spend more. Regressive Tax A regressive tax is different from progressive tax in which the rates are lower for the wealthy. or they are flat. Flat taxes are described because they are the same amount that everyone has to pay, but depending on your income level you will of course pay different amounts. Proportional taxA proportional tax means that all income levels will pay the same proportion of taxes. As explained, proportional taxes are the same as regressive taxes. These two types of taxes are the same in sales taxes at the state level, but not at the federal level. During the 2012 presidential campaign, the 9-9-9 plan made a lot of noise. This included a 9 percent business transaction tax, a 9 percent income tax, and a 9 percent federal sales tax. Property taxes are paid on land, real estate, and commercial real estate. Most people don't own their own home because living in a rental property is cheaper due to all the taxes that come with owning your own home. Inheritance and Inheritance Taxes Inheritance taxes are determined by the net worth of the deceased. This tax comes with the privilege of passing on your assets to your heirs. There are federal estate taxes, but inheritance taxes are only legal in a few states. Payroll Taxes Payroll taxes arise when you receive a paycheck and your state taxes you on the money you earn. There are also other factors that factor into payroll taxes, you can opt for a 401K or health care plan. There are also federal taxes, Social Security, and Medicare. These are the most common taxes for anyone working on books in the United States. These are the taxes you could potentially get back when you file your taxes. Income Tax Income taxes are self-explanatory. The government taxes you on the money you earn. This type of tax is marginal, so everyone pays something different depending on what tax bracket you're in. Trump changed these tax brackets as I will explain later. The previous president's tax plansBetween 2001 and 2018, tax cuts continue to significantly reduce federal revenues and lower taxes and benefit American households. Under the Bush era, most of these measures consisted of tax cuts granted to the wealthy and wealthy classes. While the Obama era saw cuts to the lower and middle classes. It is estimated that by the end of 2025, tax cuts will reach $10.6 trillion, with more than two-thirds going to the richest five percent. Below I've shown an important tax law that was signed into law between 2001 and 2017 for each president. The Economic Growth and Tax Relief Reconciliation Act of 2001 was signed by President George W. Bush and was one of the largest U.S. tax cuts. “This law introduced a new low-income tax rate of 10%, increased the child tax credit, adjusted tax brackets for married couples and reduced the 4 rateshighest tax rates”. Helping families make ends meet and achieve higher returns or simply lower contributions. The American Opportunity Tax Credit, signed into law in 2009 under President Obama, allowed families and students to obtain a tax credit of up to ten thousand dollars over four years of their college career. This allowed students or parents of students to claim their college expenses and have a chance to get some of that money back. Usually in my case the student's parents receive this money because the student may not be earning enough money and will need to be claimed on behalf of the parents. Even if the student paid these expenses, the parents will get this money back. This tax credit law saved thousands of families. Signed in December 2017, President Trump adopted the document that made significant changes to the income tax. Although these changes are temporary and will end in 2025, they will return to pre-TCJA status. “These changes include a nearly doubled standard deduction, new limitations on itemized deductions, reduced income tax rates, and reforms to several other provisions. In total, these changes simplify the personal income tax by eliminating the need for millions of households to itemize their deductions. The Tax Cuts and Jobs Act reduced tax levels on each tax bracket shown in Table 1. These levels are set for inflation as well. The income tax constitutes the largest revenue of the United States government. Reducing government revenue is positive in the hope that it will stimulate the economy, create more jobs and the money will flow. The TCJA is ready to do it. Until 2025, because the TCJA is temporary. Previously, before the TCJA, the child tax credit was a $1,000 deduction per child under the age of seventeen. This tax was phased out when common income reached over $110,000 and $75,000 for singles. Currently, with the TCJA in full swing, the child deduction is now $2,000 under the age of seventeen. Also the joint income is now less than 400k and the single fill is less than 200k to be able to claim your children which in my opinion is considerably high. Unlike before TCJA, these deductibles are now only offered to children who have a Social Security number. , which is a good thing because there have been cases where "parents" have claimed that their children do not need a higher tax refund. There is also now a $500 credit for any other dependents the filer may claim. Which makes this more beneficial to taxpayers because since the threshold for claiming your children is seventeen, some children live in their parents' home for a period of time after finishing college and the average age for Graduating is twenty-one years old. This is also beneficial for the taxpayer as they can claim any other adults in the household who they provide financial support to. For example, their parents who come to live with them at an advanced age. The Tax Cuts and Jobs Act nearly doubles the standard deduction by changing the previous deduction from 13,000 to 24,000 for filing jointly and from 6,500 to 12,000 for single filers. This was done intentionally to reduce the number of taxpayers itemizing their deductions. The TCJA limits each household in each state to just $10,000 in itemized deductions each year. There.”