Baldwin Introduces Bill to Provide Permanent Tax Relief for Middle Class Americans

WASHINGTON, D.C. - U.S. Senator Tammy Baldwin (D-WI) announced she joined her colleagues in introducing the Working Americans' Tax Cut Act, legislation to provide much-needed tax relief for millions of working Americans who are struggling to afford the cost of living as wages remain stagnant and costs skyrocket.

"Wisconsinites are working harder than ever with less and less to show for it. And Donald Trump is only making it worse. Trump gave tax breaks to the wealthiest Americans, while middle class families are living paycheck to paycheck and struggling to afford groceries or health care," said Senator Baldwin. "Our tax system is rigged to benefit the ultra-rich, and we need to change that. Our bill will cut working families' taxes, make their paychecks go further, and give Wisconsinites well-deserved breathing room."

The Working Americans' Tax Cut Act provides broad, permanent tax cuts to nearly 130 million working Americans. It eliminates federal income taxes for Americans who make under the median cost of living, about $46,000, and provides a significant tax break to individuals making between $46,000 to $80,500 with proportionally higher rates for heads of households and married couples. The legislation is fully paid for and avoids raising the national debt by having the wealthiest pay their fair share through a tiered surtax on income above a million dollars.

• The median cost of living for a single adult with no children in the United States is estimated to be $46,000 a year. Individuals who earn less than that?will not pay federal income taxes.

• For individuals with income ranging from $46,000 to $80,500, the legislation provides a significant tax break to also combat cost of living expenses. It phases out this cost-of-living exemption at 175% of the median cost of living for a single adult with no children. As a result, a person making between $46,000 and $80,500 a year would have a lower tax rate using this exemption than they do under the current tax system. To illustrate, a single person who makes $50,000 would typically receive a tax cut of approximately $2,800.

• The bill includes a larger exemption for heads of households, 140% of the single exemption or $64,400; and for married couples filing jointly, 200% of the single exemption or $92,000.

A broad range of organizations has endorsed this legislation: AFL-CIO, American Federation of Teachers (AFT), Americans for Tax Fairness, Community Change Action, Demos, Get Out the Vote PAC, Indivisible, Institute for Policy Studies, MoveOn, National Education Association (NEA), NETWORK Lobby for Catholic Social Justice, Oxfam US, Patriotic Millionaires, People's Action, Public Citizen, Social Security Works, Strong Economy for All Coalition, SURJ, Take on Wall Street, and United for a Fair Economy.

In the Senate, this legislation is led by Chris Van Hollen (D-MD), Mark Kelly (D-AZ), Kirsten Gillibrand (D-NY), Cory Booker (D-NJ), and Andy Kim (D-NJ) and cosponsored by Senators Dick Durbin (D-IL), Bernie Sanders (I-VT), Jeff Merkley (D-OR), Chris Coons (D-DE), Richard Blumenthal (D-CT), Brian Schatz (D-HI), Mazie Hirono (D-HI), Martin Heinrich (D-NM), Angus King (I-ME), Ed Markey (D-MA), Peter Welch (D-VT), Adam Schiff (D-CA), and Lisa Blunt Rochester (D-DE).

Click here to read the bill text and click here for a backgrounder.

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