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The Senate version of President Donald Trump’s “One Big, Beautiful Bill” legislation includes a tax break that would benefit 90 percent of Americans, CNBC reported.
The Senate Finance Committee released the text for the tax and health care aspects of the Senate’s version of the bill that passed the House of Representatives last month.
The House version allows people who do not itemize their taxes to deduct $150 for individuals and $300 for joint filers like married couples. But the Senate version would allow $1,000 for single filers and $2,000 for joint filers.
Typically, people need to choose to itemize their taxes to receive the charitable contribution deduction. The rare exception came during the Covid-19 pandemic.
But 9 out of 10 Americans use the standard deduction, meaning the $2,000 tax break could come to most Americans.
“This could provide some tax savings for folks,” Erica York of the Tax Foundation, a conservative think tank, told CNBC. “That could be something unexpected if you’re not currently deducting charitable giving.”
The Senate is currently debating its version of the “One Big, Beautiful Bill,” as Trump requested Republicans to name it. In addition to the charitable deduction, Republicans hope to extend the 2017 tax cuts that Trump signed during his first tenure in the White House, boost up money for the military, military spending and oil production in the United States.
But Republicans remain split on a number of aspects of the bill, including its changes to Medicaid. Fiscal conservatives also say that the bill does not do enough to slash federal spending.
Earlier this week, the nonpartisan Congressional Budget Office released its dynamic estimate and it found that it would increase the deficit by $3.4 trillion.
Other Republicans want to keep the renewable energy tax credits that then-President Joe Biden put into place in the 2022 Inflation Reduction Act because many Republican states benefited from the law.
Republicans have only 53 seats in the Senate. To sidestep a filibuster, they plan to use a process called budget reconciliation, which allows them to pass legislation with a simple majority as long as it relates to federal spending and taxes.
Currently, the legislation is undergoing the “Byrd Bath,” wherein Senate Parliamentarian Elizabeth MacDonough, a career Senate employee, evaluates whether the legislation follows the rules of budget reconciliation and none of the parts of the bill are “merely incidental” to the budget.
