Federal tax reform passage and its impact on your income, health - Cleveland 19 News Cleveland, OH

Federal tax reform passage and its impact on your income, healthcare

Cities in Cuyahoga County and their relative tax rates: yellow is 12 percent, green is 22 percent and pink is 24 percent. (Source: WOIO) Cities in Cuyahoga County and their relative tax rates: yellow is 12 percent, green is 22 percent and pink is 24 percent. (Source: WOIO)
Based on average individual wage data from the Bureau of Labor Statistics. Yellow is 12 percent and green is 22 percent, on average. (Source: WOIO) Based on average individual wage data from the Bureau of Labor Statistics. Yellow is 12 percent and green is 22 percent, on average. (Source: WOIO)
CLEVELAND, OH (WOIO) -

Since the Tax Cuts and Jobs act is expected to go in front of the U.S. House of Representatives on Tuesday, Cleveland 19 took a look at the final version of the bill agreed upon by the House and the Senate.

The two houses had passed different versions of the tax bill, which meant they had to come together and hammer out the differences between the two bills.

As a result of that reconciliation process, the new tax bill will have seven tax brackets. The original House bill had four, and the Senate version had seven.

Currently, the tax brackets are 10, 15, 25, 28, 33, 35 and 39.6 percent.

In the new tax bill, the brackets would change slightly.

For a married couple making under $19,500, taxes would be 10 percent; the next bracket, those making up to $77,400, would be 12 percent; the third bracket, up to $165,000, would incur taxes of 22 percent.

Couples earning up to $315,000 would be taxed at a rate of 24 percent; couples earning up to $400,000 would be taxed at a rate of 32 percent.

Those making up to $600,000 would be taxed 35 percent, and the top bracket -- couples making more than $600,000 -- would be taxed at a rate of 37 percent.

The standard deduction will almost double, affecting the number of people who itemize their deductions on their taxes. The standard deduction is currently $6,350 for an individual, and would go up to $12,000. For married couples, the current deduction is $12,700 and would go up to $24,000.

Personal exemptions are eliminated in this current version of the bill.

Another big change is that the final bill will have a clause eliminating the mandate that people need to buy health insurance or be penalized. This was not in the original House bill, it was in the original Senate bill and will be included in the bill that will go up for a vote. 

According to the nonpartisan Congressional Budget Office, eliminating the mandate would save the federal government more than $300 billion over ten years, but would also mean a likely increase in premiums and about 13 million more people uninsured by 2027. 

The House is expected to vote on the bill Tuesday, and the Senate is expected to vote on the bill Wednesday. 

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