The Tax Cuts and Jobs Act (TCJA) of 2017 included numerous provisions scheduled to expire at the end of 2025. Absent congressional action, these expirations will result in significant changes to the tax landscape, impacting various income brackets and business structures. Understanding the distributional effects of these changes necessitates a careful examination of how different segments of the population are affected by the current law’s sunsetting provisions.
The implications of allowing the TCJA provisions to expire are substantial. Historically, tax policy adjustments have served as tools for economic stimulus, revenue generation, or addressing income inequality. The impending expiration presents both challenges and opportunities for policymakers to re-evaluate the tax code’s effectiveness and fairness, considering its potential impact on economic growth, investment, and household finances.
