UPDATE (4-26-18):: This post was regarding the tax bill and is no longer relevant except as a warning.
We are in the Crosshairs—Again!
Nearly 35 years after public employees were cheated out of their earned Social Security benefits, Congress seems to be after senior citizens again. The current tax proposals that are in process have a number of areas of jeopardy for seniors, including the elimination of income tax deductions which many of us rely on to lower our tax bills. Although the standard deduction would be doubled, many of us have traditional deductions which add up to more than the proposed $12,000.
If you don’t already have your Representative and your Senator on your email address and phone numbers lists, find them at house.gov and senate.gov and keep making noise. Tell them how these provisions will raise your income tax and how unfair that is! Here is the Capitol switchboard for an easy call to any member: 202 224 3121.
You might start with a message similar to the one below:
“As a retired public servant who has already lost $100,000 over the last ten years because of the Government Pension Offset, I am horrified to learn that I will lose even more money because of the proposed limitations on state and local taxes and the loss of the medical deduction.”
Fill in your own penalty and keep on repeating it! (If you practice what you will say before you dial, your speech can be stronger.)
Here are the current cuts, in one or both aimed directly at Seniors:
The medical deduction. In addition to what Medicare covers, long-term care insurance and medical insurance costs can easily go above the proposed deduction. Non-compensated dental bills add to this total.
State and local taxes. Those of us who are fortunate to be living in a home purchased many years ago are hit by increasing property tax bills, which might no longer be fully deductible. Those of us in states with income taxes, would lose that deduction, also.
The chained Consumer Price Index The bills propose a switch to the chained CPI which gives a cost-of-living increase to Social Security that doesn’t reflect the spending patterns of seniors and results in lower yearly increases for Social Security retirement payments–for those who actually get any payments.
Probable add-on effects of the tax bill include a cut to Medicaid (which pays for nursing-home care for many) and cuts to Medicare, itself.
Here are some details (from NCPSSM*) that will give you an idea of what is being worked on now.
Things the House and Senate will need to reconcile to pass the same tax bill:
– Individual tax rates: The House bill reduces the number of tax brackets to four. The Senate keeps seven.
– Child tax credit: The House bill increases the credit to $1,600. The Senate bill increases it to $2,000.
– Mortgage interest deduction: The House bill caps the deduction for home values up to $500,000 for new purchases. The Senate bill keeps it at $1 million.
– Medical expense deduction: Current tax law lets you deduct qualified medical expenses that cost more than 10% of adjusted gross income. The House bill repeals it. The Senate bill keeps it and actually expands it.
– Education deductions: The House bill repeals deductions for student loans and other education expenses, like teachers buying school supplies. The Senate bill keeps them.
– Corporate tax cut start date: Both bills cut the corporate rate from 35% to 20%. They differ on the start date.
– Estate tax: The House bill eventually repeals it. The Senate bill only expands how much can be exempt from it and then allows that to expire.
– Obamacare’s individual mandate: The House bill doesn’t touch it. The Senate bill repeals it. An estimated 13 million fewer Americans would have health insurance if it were repealed.
The Government Pension Offset and the Windfall Elimination Provision are Unfair, Unconscionable, and Un-American!
*The National Committee for the Preservation of Social Security and Medicare supports our campaign to abolish the GPO/WEP.