What a Trump presidency could mean for your tax obligations.

• Vice President Kamala Harris has been defeated by former President Donald Trump to win the White House, which could have a significant impact on taxpayers.
• Trump aims to completely implement the tax cuts introduced in 2017, including reduced tax rates, increased standard deductions, and enhanced child tax credits, among other measures.
• On the campaign trail, he proposed several new ideas, but most of them would need Congress's approval.

Vice President Kamala Harris has been defeated by former President Donald Trump to win the White House, which could have a significant impact on taxpayers, although the specifics are yet to be clarified by policy experts.

In 2017, Trump enacted the Tax Cuts and Jobs Act (TCJA), which will be a top priority for him in 2025. The law introduced significant changes, such as lower tax brackets, higher standard deductions, a more generous child tax credit, and larger estate and gift tax exemptions, among other provisions.

The Tax Foundation warns that if Congress does not act, individual tax breaks will expire after 2025, potentially raising taxes for over 60% of taxpayers. In contrast, Trump's proposal is to fully extend the expiring provisions of the TCJA.

Trump proposed several new ideas on the campaign trail, including eliminating taxes on tips, Social Security benefits for older adults, and overtime pay. He also suggested creating an auto loan interest deduction and imposing universal tariffs on imported goods.

During the campaign, Trump made numerous promises, but it's uncertain how many he will genuinely pursue, according to Howard Gleckman, a senior fellow at the Urban-Brookings Tax Policy Center.

Congressional approval is necessary for most of Trump's tax policy, and its success depends on the control of the Senate and House of Representatives and support within the Republican party.

If Democrats gain control of the House, it could lead to more gridlock in Congress, potentially hindering Trump's agenda, according to Gleckman.

The 'budget math' will be harder in 2025

The federal budget deficit is a growing concern, making tax negotiations challenging, as per Erica York, senior economist and research manager with the Tax Foundation's Center for Federal Tax Policy.

This year's budget math is more challenging due to higher interest rates and a larger baseline budget deficit, as she stated. The deficit reached $1.8 trillion in fiscal 2024.

The Tax Foundation estimates that if TCJA provisions are fully extended, federal revenue could decrease by $3.5 trillion to $4 trillion over the next decade, depending on the scoring model.