May I recommend http://taxplancalculator.com/ ? It takes in to account state taxes, which potentially can make a difference between a tax cut and a tax hike. It also shows you an estimate of your federal taxes under the current laws, so that you can ascertain its precision against last years returns.
Its author, Maxim Lott, is a journalist and has been tweaking the calculations over the past couple of weeks reflecting the latest changes in the bills. You may have seen his predictive markets analysis site [1] in the run up to 2016 US Presidential Election.
As a matter of disclosure, the author is a friend and I helped him debug a couple of small issues.
Doesn't have business income or capital gains, which is pretty important to have considering the contents of the GOP plan. The pass-through rates in the bills will have a big effect on small business owners.
Edit: The more I play with this, the more flaws I find. I work at a tax policy think tank and I've been involved with more than a few tax calculators, and this one isn't reliable. It fails basic tests, like applying the standard deduction if itemized deductions are less than that amount.
Second edit: Here's a tip. It's a lot easier to calculate marginal rates on income if you go through the brackets backward rather than forward. That way, you just check if income is >= the current bracket threshold. If yes, subtract threshold from income, add that multiplied by the rate to the running total of taxes owed, and move to the next bracket. Else, just move to the next bracket. Way easier than what you're doing.
Thanks for feedback. We will add the itemized v standard deduction minimizer soon. We thought we’d let user direct but I agree we should take the min and change that.
Re tax brackets, we are looking to add state tax soon so it is much easier not to hardcore the running totals. The computation time is insignificant but code is cleaner with our current method, IMO.
This doesn't include Pease, which makes quite a difference.
I don't believe the AMT exemptions you're using are correct (although they are widely reported). The bill updates the "original" AMT amounts from 2012, which need to be inflation adjusted.
I made these accurate graphs that include everything. They also compute your state taxes for you.
Thank you for feedback! Indeed we didn’t include Pease, and we will look to add that shortly.
Re AMT, When I read the bill my interpretation was that the new levels were the correct numbers for 2018 and increase from there. I’m certainly not a lawyer and relied on other ‘widely reported’ interpretations. Given how many reported things turned out to be at least moderately innacureatr when we did fact check them, it would not surprise me if you are right.
I really like your site and the graphs. The fixed property tax deduction seems like a limitation (I personally pay close to 2x your NY rate and have some friends who pay more) but it certainly does some things that we don’t, Pease included. Had I found your site a week ago we likely would have had to build our own!
We made our code available on GitHub so by all means feel free to contribute and improve it if you like!
It would be more useful if they made it clear what has been factored in here. As is mentioned elsewhere, the bills have to be reconciled, and there are significant variables remaining. The SALT deduction is still up in the air, as are the details around mortgage interest. For people in some states, these two details could swing things between saving thousands and paying thousands extra.
edit: should have included property tax, which is more of an issue than mortgage interest for existing homeowners.
Sorry about that. We need to add more info. The code is available on github. The latest info we could get our hands on. 10k cap on property tax deduction in both house and senate bill and no state income tax deduction in either. No change to mortgage deduction as current mortgages are grandfathered in under both plans.
It would be cool if the govt had to develop an open-source tax estimator whenever tax-change bills were introduced (or make modifications to some base tool). An iteration of a tax bill would be presented alongside the tax-estimator tool so that citizens and businesses could run real numbers through the hypothetical tax-changes.
Totally agree. And it could also show net impact to the deficit/surplus (yeah, right) across the whole population given the gov had all that data. Would be awesome.
Cannot speak to the soundness of the calculations, but there looks to be a ton of guesswork involved, and it does seem fairly simplified in light of the size of the bills being considered.
On a dollar impact basis, there wasn’t much guesswork at all. What there was was a bunch of disparate contradictory sources online so we had to plow through that, given that reading through and internalizing the legislation (both old and new) was quite the bear. A number of folks have already made suggestions on github which is great (and appreciated).
I wish we had documented every hard coded number with a source but we only started doing that at the very end of project when we were reconciling different sources. We plan on documenting everything going forward with a source.
As the tax plan has not yet been finalized, I'm not sure what the use of this calculator is. You don't really know what your new taxes will be yet. I would wait until it is reconciled and signed to worry about that. YMMV.
If you want to influence the outcome of what is in the tax bill, then finding the thing in it that you don't like the most (and preferably it is in only in one of the bills) and advocating for that to be removed or changed is probably the most useful. Academia was up in arms about losing its special tax break on tuitions (only in House bill), got a bunch of press, and it looks like that might be left out in reconciliation.
Even though the bills are not finalized I think people would like to have an idea of what changes they may be facing, and it also benefits people who like to get informed before debating the issue with others.
Stupid question: in all of those calculators, I never know if I should include my personal income or household income (including my spouse). Is it an obvious thing that everyone knows? as it's never in the (?) tooltip... in any calculator I found online (I'm an expat, so perhaps I just don't get the obvious)
If you file jointly as a married couple, you would include both. But if your spouse is a not a US taxpayer, then you'e likely not filing jointly. In that case, only your income would apply.
But take any of these with a huge grain of salt, because expats have very different rules to play by, including some generous exemptions.
This has an intuitive interface and computes quickly. With 2 competing bills in the House and Senate that haven't yet been reconciled and formalized, a calculator like this is never going to be perfect, but at least we can begin to see the implications these proposals could have on our tax liability.
Maybe I'm just daft, but this tool is a bit confusing at first because I didn't realize it wasn't comparing the difference between itemizing now and taking the standard deduction under the new plan (and there isn't a way to do that without manually crunching the numbers). Or better said, it doesn't pick your best deduction under each plan like you would if you were actually filing taxes.
I think this calculator is counting "State/Local Income Taxes" as a credit instead of a deduction. Input a salary of $60,000 and a $6300 deduction into "State/Local Income Taxes".
$6300 was the single filer standard deduction amount from 2016. It shows different outputs when toggling between itemized and standard deduction.
The Senate and House plans do different things with these deductions (house eliminates, senate curtails) and it's not at all clear what will come out of conference.
I recently started working on something similar: http://politisee.com, with a little different goal. Rather than calculate the net result for a single person, Politisee for a single person, Politisee tries to summarize and compare plans, and shed light on how they perform broadly to society (i.e. at all income levels). However I do plan to add the personal side too. For now I'll be linking to yours.
One of the challenges of the broad approach is getting everything into an apples-to-apples comparison. I'm definitely going to be taking some inspiration from your work.
The personal exemption is incorrect. It doesn't add the children into the total (https://www.irs.gov/pub/irs-pdf/f1040.pdf), but you can enter it by hand. Also, Student Loan Interest is an above the line deduction (line 33 on 1040), i.e. you can deduct it regardless of whether or not you itemize.
[+] [-] aleyan|8 years ago|reply
Its author, Maxim Lott, is a journalist and has been tweaking the calculations over the past couple of weeks reflecting the latest changes in the bills. You may have seen his predictive markets analysis site [1] in the run up to 2016 US Presidential Election.
As a matter of disclosure, the author is a friend and I helped him debug a couple of small issues.
[1] https://www.electionbettingodds.com/
[+] [-] doughj3|8 years ago|reply
[+] [-] dahdum|8 years ago|reply
"No impact from end of state and local deductions"
Same at $30k, $300k, and $1M. I don't think it's accounting for SALT at all.
[+] [-] ahh|8 years ago|reply
Wildly incorrectly. I live in WA and it overestimates my sales tax deduction by a factor of ten.
[+] [-] pianom4n|8 years ago|reply
It also doesn't include the Senate's AMT change at all.
It doesn't seem to include PEP or Pease.
[+] [-] tvanantwerp|8 years ago|reply
Edit: The more I play with this, the more flaws I find. I work at a tax policy think tank and I've been involved with more than a few tax calculators, and this one isn't reliable. It fails basic tests, like applying the standard deduction if itemized deductions are less than that amount.
Second edit: Here's a tip. It's a lot easier to calculate marginal rates on income if you go through the brackets backward rather than forward. That way, you just check if income is >= the current bracket threshold. If yes, subtract threshold from income, add that multiplied by the rate to the running total of taxes owed, and move to the next bracket. Else, just move to the next bracket. Way easier than what you're doing.
[+] [-] carrben12|8 years ago|reply
Re tax brackets, we are looking to add state tax soon so it is much easier not to hardcore the running totals. The computation time is insignificant but code is cleaner with our current method, IMO.
[+] [-] Redoubts|8 years ago|reply
Yeah, this is the difference between the calculator showing a $2K tax hike for me, and a $2K cut.
[+] [-] woolvalley|8 years ago|reply
[+] [-] pianom4n|8 years ago|reply
I don't believe the AMT exemptions you're using are correct (although they are widely reported). The bill updates the "original" AMT amounts from 2012, which need to be inflation adjusted.
I made these accurate graphs that include everything. They also compute your state taxes for you.
Senate: https://jsfiddle.net/4ec6eLz5/ House: https://jsfiddle.net/bsjryfLo/
[+] [-] carrben12|8 years ago|reply
Re AMT, When I read the bill my interpretation was that the new levels were the correct numbers for 2018 and increase from there. I’m certainly not a lawyer and relied on other ‘widely reported’ interpretations. Given how many reported things turned out to be at least moderately innacureatr when we did fact check them, it would not surprise me if you are right.
I really like your site and the graphs. The fixed property tax deduction seems like a limitation (I personally pay close to 2x your NY rate and have some friends who pay more) but it certainly does some things that we don’t, Pease included. Had I found your site a week ago we likely would have had to build our own!
We made our code available on GitHub so by all means feel free to contribute and improve it if you like!
[+] [-] gnicholas|8 years ago|reply
edit: should have included property tax, which is more of an issue than mortgage interest for existing homeowners.
[+] [-] carrben12|8 years ago|reply
[+] [-] mbil|8 years ago|reply
[+] [-] carrben12|8 years ago|reply
[+] [-] beager|8 years ago|reply
https://github.com/nick264/gop-tax-plan-calculator/blob/mast...
Cannot speak to the soundness of the calculations, but there looks to be a ton of guesswork involved, and it does seem fairly simplified in light of the size of the bills being considered.
[+] [-] carrben12|8 years ago|reply
I wish we had documented every hard coded number with a source but we only started doing that at the very end of project when we were reconciling different sources. We plan on documenting everything going forward with a source.
[+] [-] unknown|8 years ago|reply
[deleted]
[+] [-] njarboe|8 years ago|reply
If you want to influence the outcome of what is in the tax bill, then finding the thing in it that you don't like the most (and preferably it is in only in one of the bills) and advocating for that to be removed or changed is probably the most useful. Academia was up in arms about losing its special tax break on tuitions (only in House bill), got a bunch of press, and it looks like that might be left out in reconciliation.
[+] [-] dwg|8 years ago|reply
[+] [-] scroot|8 years ago|reply
[+] [-] carrben12|8 years ago|reply
[+] [-] eranation|8 years ago|reply
[+] [-] gnicholas|8 years ago|reply
But take any of these with a huge grain of salt, because expats have very different rules to play by, including some generous exemptions.
[+] [-] hartator|8 years ago|reply
[+] [-] DownWithTaxes|8 years ago|reply
[+] [-] RyanShook|8 years ago|reply
[+] [-] brnd4n|8 years ago|reply
[+] [-] drstewart|8 years ago|reply
[+] [-] brockwhittaker|8 years ago|reply
[+] [-] chrisp_dc|8 years ago|reply
$6300 was the single filer standard deduction amount from 2016. It shows different outputs when toggling between itemized and standard deduction.
[+] [-] intopieces|8 years ago|reply
[+] [-] zrail|8 years ago|reply
[+] [-] dwg|8 years ago|reply
I recently started working on something similar: http://politisee.com, with a little different goal. Rather than calculate the net result for a single person, Politisee for a single person, Politisee tries to summarize and compare plans, and shed light on how they perform broadly to society (i.e. at all income levels). However I do plan to add the personal side too. For now I'll be linking to yours.
One of the challenges of the broad approach is getting everything into an apples-to-apples comparison. I'm definitely going to be taking some inspiration from your work.
[+] [-] rcollyer|8 years ago|reply
[+] [-] matthjensen|8 years ago|reply
[+] [-] maerF0x0|8 years ago|reply
[+] [-] loeg|8 years ago|reply