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Tuesday, Sep. 2, 2025

Will the bottom 20% of American income earners pay more in taxes under Trump’s big bill?

Noe Goldhaber / Wisconsin Watch, Wisconsin Watch
no

Americans who earn less than $18,000 are estimated to see a slight federal tax cut under President Donald Trump’s big bill, but the net effect of the bill is likely to lead to a loss in household resources.

The average federal tax change from current levels for the bottom 20% of American earners is a reduction of $150 by 2026 and a reduction of $160 by 2030, according to estimates from the nonpartisan Tax Policy Center. In contrast, the average income earner will receive a $2,860 cut while the top 1% of earners will see a $75,410 cut on average. 

Lower income earners already pay little in taxes. Reductions in Medicaid and SNAP benefits are likely to affect lower income earners disproportionately, resulting in a projected net decline of 2.9% in their household resources.

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