Tax credits

One of the tax credits that would end under the new proposals is the $30,000 tax credit for installing solar panels in your home. This credit is nonrefundable meaning you must owe that much tax to deduct. Typically, you have to spend $60,000 to get the full credit. Most working people do not have the $60,000 and only a small percentage of tax payers owe enough tax to earn the credit. A married couple would have to earn $200,000 gross to owe $30,000 in tax and that eliminates 86% of taxpayers. Another advantage of installing solar panels is that the excess power produced is sold back to the power company which means the company must increase rates on the others to cover the cost. This benefit helps the rich at the expense of the poor. The $7,500 tax credit on EV’s is another benefit for the rich. The average EV cost $55,000 which means they are out of the budget for poor people. About 90% of the 300,000 EV’s purchased took the tax credit. Even if a lower income person purchased an EV they would probably not earn enough income to get the credit. Another part of the bill makes able bodied single people no longer eligible for Obamacare unless they work at least 20 hours per week. Estimates are that 5 million fall into this category. The bill cuts the Supplemental Nutrition Assistance Program (SNAP), formerly known as food stamps by 30%. In 2024 the SNAP program cost the government $100 billion to provide and average cash benefit of $212 per month to 42 million participants. This will be reduced to $148 per month. Able bodies people are required to work 20 hours per week to qualify. The bill increases the child tax credit from $2,000 to $2,500. Removes taxes from TIPS and overtime. Adds $4,000 to the tax deduction for seniors making less than $75,000. Allows deduction of car loan interest but since most people owe very little tax this will help the rich much like the home interest deduction.