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WestVirginiaRebel

Will Truckers Get a Tax Cut? Only if the Child Tax Credit Rises Significantly

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President Trump pitched his tax overhaul plans to truckers on Wednesday evening, though many of the men and women behind the wheels of U.S. trucks may see little or no direct benefit.

The reason: many truck drivers do not earn enough income to owe federal income taxes. For others, the benefits will largely depend on what happens to tax credits for children.

The tax framework released by the Trump administration last week nearly doubles the standard exemption from $12,700 for a married couple to $24,000. But it also would eliminate the personal exemption of $4,050 per person, which for a family of four amounts to $16,200. So for a married couple with two children, their basic deductions under current law would be $28,900. Which means that the Trump plan actually lowers the basic deductions available for middle-class families.

In other words, under the Trump plan more of a family’s income would be subject to income tax than under current law. So even if their rates fall, they could still wind up paying more in taxes.

There’s very little in the framework, moreover, that would directly benefit most truckers. According to the Labor Department, the median annual income of a trucker is around $40,000. A married couple with two children with $40,000 would have no income liability at all under current law. In fact, they would be entitled to an earned income tax credit refund of around $2,000.

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The tax cut that's not really there?

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