Your taxes could drop by $4,334 under a Donald Trump presidency
With the first presidential debate slated for Monday, Sept. 26, Republican presidential contender Donald Trump's policies are under the lens. Although Hillary Clinton leads Trump in the latest polls released by NBC News, the business mogul known has shrunk the Democratic's lead since her post-convention high.
With the presidential election in just under two months, and with the Trump-Clinton rivalry coming to a head in the first debate, get a snapshot of Trump's policies — and how he'll affect your wallet from the Oval Office.
Donald Trump on Taxes
Trump has said the rich are not among his biggest fans. "The people that like me best are poor people and middle-income people," he said on "Breitbart News Sunday." No doubt the presidential candidate's plan to fold the current seven tax brackets into three look to drop the effective tax rate on middle-income Americans.
The current tax rate for married-joint filers making between $18,551 and $75,300 is 15 percent. Under Trump's proposed individual income tax reform plan, married-joint filers making under $75,000 will pay an income tax rate of 12 percent, according to the latest information on Trump's website.
Meanwhile, Trump plans to increase the standard deduction for joint filers to $30,000, up from $12,600. For single filers, the standard deduction would be $15,000.
The U.S. Census Bureau reported the median household income in 2015 was $55,775. Assuming this median income for someone filing married-jointly, Trump's tax plan would save them an estimated $4,334, or 34 percent, compared to current law, according to a calculator from the Tax Foundation.
Although how much you pay in taxes under Trump is liable to change depending on how his tax plan changes in his presidency, the Republican candidate has been consistent in his promise to lower taxes for middle-class Americans.
In a speech delivered at the Detroit Economic Club in August 2016, Trump said, "I am proposing an across-the-board income tax reduction especially for middle-income Americans. This will lead to millions of new and really good-paying jobs. The rich will pay their fair share, but no one will pay so much that it destroys jobs or undermines our ability as a nation to compete."
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Donald Trump on Minimum Wage
Minimum wage has been a hot-button issue with many protesters advocating for a $15 minimum wage nationwide. Clinton herself proposes a $12 federal minimum wage and supports cities and states looking to pay more than that amount.
While economists are split on that issue, Trump said in a July 2016 interview on "The O'Reilly Factor" that he would like states to determine the minimum wage, saying, "Let the states make the determination, because if you take New York, it's very expensive to live in New York, and they need more than $7, $8, $9 [per hour]."
Pressed to give a concrete number on the federal minimum wage, Trump said he would "raise it somewhat," to $10.
By keeping the minimum wage low, Trump could boost jobs in the U.S. by luring back big businesses that have moved production overseas to keep down costs. In a "Meet the Press" interview with Chuck Todd in August 2015, Trump said he will bring back so many jobs to the U.S. in his presidency that "we won't even have to be talking about the minimum wage."Donald Trump on Trade Reform
Trump vows to lower the corporate tax rate to 15 percent, "10 percentage points below China and 20 points below our current burdensome rate," according to Trump's website. But Trump also aims to target American businesses that have moved overseas to lower costs.
In his campaign announcement, for example, Trump said he would charge Ford a 35 percent tax to bring in trucks and parts from a plant in Mexico. Although it's unclear whether he plans to follow through on the tax, Trump has promised to be hard on businesses that have moved jobs overseas.
When it comes to trade, China has consistently been the focus of Trump's campaign. Even as far as a 2011 interview with the Wall Street Journal, the presidential candidate called for tariffs on Chinese products. On his website, Trump says he would put an end to China's intellectual property violations and declare the country a currency manipulator.
On a broader level, Trump wants to renegotiate trade with China and renegotiate the North American Free Trade Agreement, which is between the U.S., Mexico and Canada.
On NAFTA, Trump said in a speech in Monessen, Pa., that, "I'm going to tell our NAFTA partners that I intend to immediately renegotiate the terms of that agreement to get a better deal for our workers. ... If they do not agree to a renegotiation, then I will submit notice under Article 2205 of the NAFTA agreement that America intends to withdraw from the deal.
Donald Trump on Healthcare
Trump says on his website that if he is elected president, he will ask Congress to repeal the Affordable Care Act. He promises to follow free market principles and to work with Congress to broaden healthcare access, lower costs and improve quality.
Trump's position on the ACA is not unpopular. The Republican house voted 56 times to repeal or undermine the ACA without success, so any replacement program will likely be strongly supported.
Donald Trump on Social Security
Trump said he was opposed to cutting back on Social Security. In an April 2015 interview with Fox News, Trump said, "They're attacking Social Security — the Republicans — they're attacking Medicare, Medicaid, but they're not saying how to make the country rich again." Later, Trump said he would make the country "so rich you don't have to do those things.
Without changes to the current Social Security system, the Treasury Department will need to redeem bonds between 2020 and 2033 and borrow from elsewhere in order to cover Social Security costs, unless there is a sufficient federal budget surplus, according to The Motley Fool.
Although Trump does not want to cut into Social Security, he will need to follow through on his promise of making America rich in order to avoid issues with the program in the future. If he fails, about 59 million Americans on Social Security might be faced with cut benefits.
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Donald Trump on Immigration
Trump has blamed illegal workers for some of America's economic woes, and he's taken a hard stance on immigration, declaring that all 11 million undocumented immigrants "have to go," according to an August 2015 interview on NBC's "Meet the Press."
The presidential candidate also wants to end birthright citizenship, according to his website, meaning American-born children to illegal immigrants would also be deported. Trump also wants to triple the number of agents patrolling the Southern border and build a wall separating the two countries — a price he wants Mexico to pay.
Ending birthright citizenship would require an amendment to the Constitution, which will be an uphill battle for President Trump. Enforcing deportation of illegal immigrants, meanwhile, could cost billions, according to the American Action Forum, a conservative group.
Donald Trump on Student Loans
Trump has been vocal about his position on student loans. In short, Trump promises to create jobs to help Americans pay off student loan debt. In a July 2015 interview with The Hill, Trump said student loans are "probably one of the only things the government shouldn't make money off." He went on to add, "I think it's terrible that one of the only profit centers we have is student loans."
Trump's position on student loans is certainly a popular one. Student loan debt hit $1.26 trillion in the U.S., according to the Federal Reserve Bank of New York. Because Trump has not provided specifics on how he'll tackle student loans, it's hard to tell how his presidency will affect millennials.
However, as the average graduate of the class of 2015 took on $35,000 in student loan debt, any move by Trump to make repayment easier could help boost spending in the general economy — and mitigate fears that student loan debt is leading to fewer millennials buying property.
Donald Trump on Interest Rates
On Bloomberg's "With All Due Respect," Trump said that though he's "always loved" low interest rates as a developer, he worries that they can be "creating a bubble and the bubble could explode."
In September 2016, when asked about a potential rate hike by the Federal Reserve, Trump said, "They're keeping the rates down so that everything else doesn't go down. We have a very false economy."
Safe to say, Trump would look to raise interest rates — and he and the Feds are aligned on that point. The Fed is poised to increase rates in 2016 unless the economy takes a turn for the worse. Higher interest rates can reduce consumer borrowing and spending, and dissuade businesses from making big purchases requiring loans.