Honestly, after thinking about it a few minutes more, I think this is actually a great political stunt - it sounds like you’re doing something to help people afford to buy stuff. But there are so many limitations on it that it doesn’t actually cost that much money. (On top of the things listed earlier, I assume that you’d have to itemize to get it.) That very real concern–that it’s just too expensive to live the life people want to live–was a major issue in the election. And now you get to point to this and say, “I’m helping you buy a car”. And it doesn’t actually affect the budget because in reality virtually no one will benefit. Win win.
Will the average person who is actually swayed by the announcement of this policy understand that they receive no tangible benefit? No, they’ll just enter their numbers in turbotax, take the standard deduction, and move on with their life knowing that their best friend DJT helped them afford the new Ford Raptor in their driveway.
Now that you pointed out the other hoops, I agree. It is a great “headline” legislation that FOX can trot out people are getting a $10k deductible on auto loan interest*! and people will just believe it, not knowing how to calculate the numbers on the backend to understand.
I wonder if this will be a thing at all, and how much (reduced tipping culture) it would take for this to be a net loser for workers in those industries.
The vast majority of my income is from tips, and I expect this will hurt me to the tune of several thousand dollars a year. Both in people tipping less and in fucking up the tax compliance agreement currently in place that is way better than the new rules will be. My rough calculations looking at my 2024 income and taxes are that if I made the same amount of money I’d be taxed on 40% MORE income with the new rules than I was under my current arrangement.
That’s interesting, you have details on how the agreement in place has you better off? (Don’t worry about it if it’s stupidly complicated to explain, just curious about how industry-specific it is etc.)
I’m torn on how widespread the whole phenomenon of tipping less will be. I could definitely see the cohort of people that begrudgingly tip severs like exactly 15% to the penny “because they have to” cutting it down to 10% or something. Gonna definitely be some “how do I personally benefit from this” going on.
My poker room, and many others, have what’s called the Gaming Industry Tax Compliance Agreement (GITCA). Basically we agree to have our tips taxed on a flat hourly rate whether you make more than that rate or not, and then we don’t need to report cash tips. So I get taxed on my hourly ($5.73/hr), and my tournament tokes (variable week to week), plus the GITCA rate per hour worked. It works out very well for good dealers. If the new change makes it so the first $25k in cash tips are tax free, but all tournament tokes and all tips above the $25k threshold are taxed in full it will bump my federal taxable income up by ~40%. Basically I’m currently getting a good bit more than $25k that is legally not taxed. So yea, I’m not too happy about this and it was hard to not call people fucking morons when they were congratulating me at the table yesterday for the payraise thanks to President Trump.
Do we know who put the gambling provision into the bill last minute? My hot take is it was done by someone to make Democratic incumbents in a swing-y state with swing-y districts like Nevada more vulnerable come election time.
Funny, I was told by any number of dipshits that we had to preserve the filibuster to prevent exactly this kind of thing from happening when the Rs got in power. Ah! Well. Nevertheless.
