Month/Year of Graduation

12-2018

Degree Name

Bachelor of Science (B.S.)

Department

Accountancy

First Advisor

Ms. Jillian Poyzer

Abstract

On December 22, 2017, President Trump signed into law the Tax Cuts and Jobs Act (TCJA), the most expansive change to the Internal Revenue Code (IRC) since 1986. What was the purpose of overhauling the IRC? President Trump identified four main goals: (1) tax relief for the middle-class, (2) simplification of the tax code, (3) American economic growth, and (4) no additional debt added to the government’s deficit. Speaker Ryan also identified similar goals. Now that the TCJA has been in place for over six months, an analysis of the new law in respect to both the President’s and Speaker’s goals is conducted. Were the stated goals met? First, for some taxpayers, the TCJA seems to provide substantial tax benefits, however, other households may not feel as significant an impact. Second, although the new law might simplify tax filing for some taxpayers, it does not simplify the tax preparation process for others. Third, while the TCJA is projected to be beneficial for the economy in the short-term, because the new law is deficit-financed, the TCJA will likely have a minimal impact on the economy. Lastly, the new law is not deficit neutral. The TCJA is projected to increase the federal deficit by over $1 trillion. Overall, the TCJA introduced substantial changes to the IRC. However, in regard to President Trump’s and Speaker Ryan’s goals, it is difficult to determine if the TCJA was a success or failure. The best answer that can be given at this time is: it depends.

Download

Included in

Accounting Commons

Share

COinS