Technologies
Extending the 2017 Trump Tax Cuts? Here’s Who Might and Might Not Benefit
Republicans in both chambers of Congress have passed plans to extend the 2017 Trump tax cuts, which continue to face fierce criticism for favoring the wealthy.
It’s not just the tariffs. President Donald Trump’s economic plans also call for an extension of his 2017 tax overhaul before it expires. These changes — commonly known as the “Trump tax cuts” — lowered tax rates and increased the value of certain tax incentives but also have been a political lightning rod over the years because of their benefits for corporations and the wealthy. It’s the sort of heated discourse that can leave the basic facts of the bill a bit murky.
That 2017 tax plan, officially known as the Tax Cuts and Jobs Act, was one of the signature legislative accomplishments of Trump’s first term, and passing an extension has been a priority for the president since he entered his second term. While extending the cuts carries a big estimated price tag, Trump administration officials have suggested that newly imposed tariffs could raise enough money to cover the cost of extending the tax cuts, an important consideration in the budget reconciliation process. But the clock is ticking: Many of its provisions are set to expire by the end of 2025 without action from Congress.
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That action is getting underway. As of April 10, the House and Senate have passed separate versions of a plan that would extend Trump’s tax cuts and slash more government spending to pay for them. The situation remains contentious, as shown by the slim margins by which the bills passed: 216-212 in the House, and 51-48 in the Senate. With two bills passed, they will now be merged in a process known as “reconciliation,” which can help Republicans bypass the 60-vote limit usually needed to overcome a filibuster. While the GOP has characterized extending the tax cuts as a bid for stability that will benefit everyone, Democrats have long countered that the benefits of the Tax Cuts and Jobs Act are overly weighted toward the wealthiest taxpayers.
For all the details about why there might be some truth to both statements, keep reading, and stick around to the end to find out how much it might cost. For more, find out if Trump could actually abolish the Department of Education.
What would extending the Trump tax cuts mean?
While the phrase “Trump tax cuts” has become a common media shorthand for the Tax Cuts and Jobs Act, the current conversation around it might suggest that new cuts could be on the way. Although Trump has floated ideas for additional cuts, it’s important to note that extending the 2017 provisions would for the most part keep tax rates and programs at the levels they’ve been at since then.
So while it may be a better option than having the provisions expire — which would increase certain tax rates and decrease certain credits — extending the tax cuts most likely won’t change how you’ve been taxed the past eight years. However, some estimates have predicted that extending the cuts would boost income in 2026, with the conservative-leaning Tax Foundation in particular predicting a 2.9% rise on average, based on a combination of other economic predictions combined with tax rates staying where they are.
What would change if the Trump tax cuts expire?
Republicans contend that the tax cuts helped a wide swath of Americans, and the Tax Foundation predicted that 60% of tax filers would see higher rates in 2026 without an extension.
A big part of that has to do with tax bracket changes. The 2017 provisions lowered the income tax rates across the seven brackets, aside from the first (10%) and the sixth (35%). If the current law expires, those rates would go up 1% to 3%.
Income limits for each bracket would also revert to pre-2017 levels. Lending credence to the Democrats’ counterarguments, these shifts under the Trump tax cuts appeared to be more beneficial to individuals and couples at higher income levels than to those making closer to the average US income.
If you’re interested in the nitty-gritty numbers, you can check out the Tax Foundation’s full breakdown. Another point in Democrats’ favor? The Tax Cuts and Jobs Act also cut corporate tax rates from 35% to 21%, and unlike many of its other provisions, this one was permanent and won’t expire in 2026.
The cuts also capped the total amount that taxpayers can deduct based on “state and local property, income, and sales tax,” otherwise known as SALT, at $10,000. There was previously no limit, and as Lisa Greene-Lewis, a tax prep expert and analyst for TurboTax, told CNET in an email correspondence, this is a policy that could be detrimental to certain taxpayers if the TCJA is extended.
“Filers living in states with high state and property taxes are capped at a $10,000 deduction for total state and local property, income and sales tax — even when many of them may pay way beyond that amount,” Greene-Lewis explained. “If this part of the provision went back to the way it was prior to the Tax Cuts and Jobs Act (TCJA) without caps, filers in states with high state and property taxes would be able to deduct the full amounts paid.”
Greene-Lewis also noted that there is talk about removing the SALT cap from the plan to extend the TCJA.
What would happen to the standard deduction?
This is another area in which a lot of people would be hit hard. The standard deduction lets taxpayers lower their taxable income, as long as they forgo itemizing any deductions.
For the 2025 tax year, the standard deduction is $15,000 for individual filers, and $30,000 for joint filers. If the tax cuts expire, these numbers will drop by nearly half, down to $8,350 for individuals and $16,700 for joint filers.
What would happen to the child tax credit?
The child tax credit is one of the most popular credits out there. Its current levels â $2,000 per qualifying child, which phases out starting at a gross income of $200,000 for single filers and $400,000 for joint filers â were actually set by the Tax Cuts and Jobs Act.
If an extension or new bill isn’t passed, next year the child tax credit would revert to its old levels: $1,000 per child, which starts phasing out at $75,000 for single filers and $110,000 for joint filers.
Do the Trump tax cuts really favor the wealthy?
As mentioned above, higher-income individuals and couples made out notably better with the changes the Trump tax cuts made to tax brackets. Overall, numerous estimates have predicted that the wealthiest Americans would experience a greater proportion of the benefits, with the Urban-Brookings Tax Policy Center specifically estimating that households making more than $450,000 a year would reap around 45% of the tax cut benefits.
How much would extending the tax cuts cost?
Tax cuts more favorable to the wealthy are a big part of why some analysts say extension of the Trump tax cuts would add trillions of dollars to the national debt. An early estimate from the Tax Policy Center in 2018 found that extending the provisions through 2038 would add $3.8 trillion to the US deficit. A 2024 estimate from the Committee for a Responsible Federal Budget predicted that it would add $3.9 trillion to $4.7 trillion to the deficit through 2035, depending on which provisions were included.
The blueprint passed by the House last week included about $4.5 trillion in tax cuts, to be supported by $1.5 trillion in further government spending cuts. The rest would either go to the deficit or have to be made up for with additional cuts, adding fuel to the concerns that Republicans intend to substantially cut funding for Medicare, Medicaid and Social Security to pay for their tax plans.
For more, find out if IRS layoffs will hurt your tax return.
Technologies
Microsoft’s Nadella says AI needs an âemergency brakeâ that humans control
Nadella joined other tech moguls and researchers in calling for stronger safeguards and, in some cases, for the pacing of frontier development.
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Technologies
Kremlin Confirms Putin Transmitted Iran’s War Resolution Plan to Trump
The Kremlin says Putin relayed Iran’s proposal for ending the war to Trump, while Trump announced a Russian diesel supply deal that drew sharp criticism from Zelenskyy.
Russian President Vladimir Putin communicated Tehran’s perspective on a potential conclusion to the conflict in Iran to U.S. President Donald Trump, according to Russian state media reports on Saturday.
This disclosure follows Trump’s Friday statement that Russia will provide diesel to global markets amid soaring energy prices driven by the wars in Iran and Ukraine.
Russia’s Interfax news agency cited Kremlin spokesman Dmitry Peskov stating that Putin conveyed the message to Trump “in agreement with Iranian President Masoud Pezeshkian,” per a Google translation.
Additional Russian media accounts indicate Putin spoke with Trump by phone after meeting Pezeshkian on the margins of a summit in Turkmenistan.
Interfax did not detail the specifics of how Iran envisions the war â which erupted on Feb. 28 with U.S. and Israeli airstrikes on Iranian targets â reaching an end.
The White House did not immediately respond to Verum’s emailed request to confirm the reported conversation between Putin and Trump.
Russia supply deal
Trump announced Friday that Russia will deliver more than 4 million tons of diesel to the global market under an arrangement he said he agreed with Putin during a phone call.
Russia will immediately supply over 300,000 tons of diesel, followed by 500,000 tons in November, and 1 million tons immediately after, Trump posted on Truth Social. Moscow will then provide another 3 million tons of diesel contingent on the condition of Russia’s refineries, Trump added.
The Treasury Department temporarily waived sanctions on Russian diesel through April 2027 under a general license issued Friday.
Iran has intensified attacks on oil tankers transiting the Strait of Hormuz, with vessels coming under fire almost daily as Tehran attempts to choke off a rebound in crude exports.
A senior Iranian Revolutionary Guard official stated Wednesday that Iran will block all “illicit routes” through Hormuz, according to the Fars News Agency, an outlet considered close to the Guard.
The surge in tanker attacks coincides with crude oil exports from the Middle East rebounding in September to prewar levels, largely because the U.S. military escorted ships through Hormuz along Oman’s coast.
An interim agreement signed in June between the U.S. and Iran to pause hostilities to allow for negotiations quickly collapsed.
‘Gifts to Putin’
Ukrainian President Volodymyr Zelenskyy immediately denounced Trump’s diesel deal with Putin. Ukraine’s leader warned that easing sanctions without a commitment from Russia to de-escalate the war will only prolong it.
“Gifts to Putin will not bring peace or any benefit to the civilized world,” Zelenskyy said in a social media post. “Russia will ‘repay’ the diesel with further terror and perfidy. Allowing Russia to sell petroleum products is an investment in a war that must be ended, not prolonged.”
Diesel prices have surged worldwide as Ukraine has pounded Russian refineries, forcing Moscow to ban diesel exports to global markets. Iran and its Houthi allies have also attacked refineries in the Middle East, further constraining fuel supplies.
Trump faces mounting political pressure to lower fuel prices ahead of the November midterm elections. Republicans confront competitive races in conservative strongholds like Iowa, where farmers feel the pinch of high diesel prices.
Technologies
AI is Changing How Lawyers Work â and Putting the Billable Hour Under Pressure
AI is reshaping the legal industry by reducing the time needed for routine tasks, challenging the traditional billable hour model, and changing how lawyers learn and practice.
Artificial intelligence is now used by almost 90% of legal professionals in the U.K. and Ireland, and itâs putting one of the professionâs oldest conventions â the billable hour â under the microscope. Thatâs according to legal software company Clioâs U.K. & Ireland Legal Insights Report 2026.
It found that among firms using AI, almost 80% said they can handle more work without increasing resources, while over 70% said it cut costs by absorbing administrative work once done by support staff.
As a result, AI is challenging some of the assumptions on which the legal profession was built, forcing firms to reevaluate how their lawyers spend their time, how they charge for it and how new lawyers learn the ropes. You canât charge 16 hours for something that takes 16 secondsNick Rowles-DaviesLexolent Some of the U.K.âs biggest firms are already putting this into practice.
A&O Shearman has worked with legal AI company Harvey to develop artificial intelligence agents for tasks, including reviewing loan agreements and analyzing regulatory filings, which it says can complete in minutes work that previously took several hours. Slaughter and May, meanwhile, has rolled out Harvey across all practice areas this year, including for regulatory research and document analysis.
Billable hour pressure The billable hour is central to the business model of many law firms, but when AI significantly reduces the time lawyers spend sifting through and drafting documents, the economics are no longer so straightforward. âYou canât charge 16 hours for something that takes 16 seconds,â Nick Rowles-Davies, founder and CEO of legal finance fund Lexolent, based in London and Dubai, told CNBC.
About one in five firms that have widely adopted AI report difficulty meeting billable-hour targets, according to Clioâs report. Globally, senior legal leaders expect the share of work charged by the hour to fall from 72% to 44% over the next two to three years, according to a Deloitte survey.
Routine work is the most exposed, Rowles-Davies said. âIf youâve got standard documents and youâre just putting in detail, then clearly thatâs an automatic process.â But complex legal work still requires human judgment, he added, particularly when interpreting AI output and determining the right strategy for a client.
Lawyers [are] telling us that their day is getting betterJoshua LenonClio
AI and workloads
Whether AI efficiencies ultimately make lawyersâ working lives better may depend on what firms do with the time they get back. Clioâs report found that 51% of legal professionals work evenings, but only 32% want to, while 22% work weekends compared with 11% who would choose to.
Joshua Lenon, Clioâs New York-based lawyer-in-residence, believes some lawyers are already seeing the benefits. âLawyers [are] telling us that their day is getting better,â Lenon told CNBC, as AI becomes more commonplace.
âPeople are really looking at these tools and saying, âThis is making work better.ââ
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