The Tax Policy Center analyzed the Tax Cuts and Jobs Act and calculated average tax savings in 2018 for everyone in the country by income segments. Carol Sumner, in her Dec. 25 letter to the Gazette-Times, referenced an Associated Press article that listed three of those segments: the lowest fifth, up to $25,000; the middle fifth, $49,000 to $86,000; and the top 1 percent, over $733,000.
John Brenan (Letters Jan 1) decided the Tax Policy Center was wrong and tried to produce his own version. He calculated 2018 taxes using the Tax Cuts and Jobs Act's tax rules and brackets for one individual each at $25,000, $83,000 and $733,000, the single status, and the standard deduction — even for the 1 percent person. He then calculated 2017 taxes using 2017 rules and tax brackets instead of 2018 taxes with the old rules and the 2018 tax brackets, standard deductions, and exemptions that would have existed under those rules. Using 2018 for both years is the correct comparison.
Not only was Mr. Brenan’s calculation of savings between tax codes wrong, he was comparing the savings of a single person to the average of everyone in the country in an income range. Both errors rendered his results and analysis invalid.
The complete Tax Policy Center analysis can be found on the center's website in the document “Distributional Analysis of the Conference Agreement for the Tax Cuts and Jobs Act,” Table 1.
Corvallis (Jan. 4)