Child care reforms
The Trump plan will achieve the following goals:
- Exclude the costs of child and elder care from tax.
In a world where almost two-thirds of mothers with children under age 6 are employed, the cost of child care is an unavoidable family expense. In business, other such expenditures are tax-deductible, but they are not for families. The Trump plan will exclude child care costs from the income tax from birth to age 13 and will include adoptive parents as well as foster parents who are legal guardians of the child. The exclusion (also known as an above-the-line deduction) will cover up to four children per family.
The exclusion would apply to a variety of different kinds of child care — institutional, private, nursery school, after-school care and enrichment activities. The deduction would be limited to the average cost of child care in the state of residence for the age of the child.
The benefit would be provided to families who use stay-at-home parents or grandparents as well as those who use paid caregivers.
Similarly, the Trump plan would allow an above-the-line deduction for elder care costs necessary to keep a family member working outside the home. It would apply to costs like home care or adult day care for elderly dependents when those expenses are needed to keeping family members in the workforce. The deduction would be limited to $5,000 per year.
To get benefits to lower-income taxpayers who can’t use the exclusion against the income tax because they have no income tax liability, the Trump plan would provide them a boost in the Earned Income Tax Credit (EITC). This boost would be half of the payroll taxes paid by the lower earning parent, and would be subject to an income limitation of $31,200.
For a parent making $15 per hour at a full-time job, the EITC boost in the Trump plan could mean as much as $1,200 extra per year
Allowing every family, whether they take the standard or itemized deduction, to deduct child care expenses from tax will help get the incentives right for women who opt to work outside the home. The current tax code discourages their work.
- Create child care savings accounts.
Families should have an option to set aside extra money to foster their child’s development. The Trump plan will provide Americans the option of opening dependent care savings accounts (DCSAs).
Annual contributions and earnings on the account will not be subject to tax. Immediate family members and employers also will be able to set aside funds in these accounts, which will be established for the benefit of specific individuals, including unborn children. Total contributions could not exceed $2,000 per year from all sources, but balances in a DCSA will roll over from year to year so that substantial amounts could be accumulated over time.
When established for a child, parents can use the accumulated funds to enroll their kids in a school of their choice or for other enrichment activities that prepare them for their future. Funds remaining in the account when the child reaches 18 can be used for higher education expenses. To encourage low-income families to establish DCSAs for their children, the government will provide a 50 percent match on parental contributions of up to $1,000 per year. That’s an extra $500 per child for families that qualify.
When established for an elderly dependent, the funds can be used for adult day care, in-home or long-term care services. The ability to set aside funds tax-free would be particularly helpful to women, low-income workers and minorities, who typically are primary care providers who reduce paid time worked in order to provide care. The ability to set aside funds for elder care is critical because taking time off from work to care for elderly family members reduces a woman’s financial readiness for retirement, and can increase a woman’s risk of living in poverty in old age.
- Create a dynamic market for family-based and community-based solutions.
Families will be given the power and information to choose who will provide care and where that care will be provided without fear of loss of government benefits. The marketplace will be free to develop alternatives that provide care where needed, and at the times when people who work irregular hours need care.
Current federal efforts to reduce child care costs, such as the pre-tax flexible spending accounts available to many workers, are biased toward center-based care. The lack of choice limits options for people who work irregular hours and those who live in rural communities where choices for center-based care are not available nearby.
- Incentivize employers to provide child care at the workplace.
The 2014 National Survey of Employers found that only 7 percent of employers offered child care at or near the worksite. The Trump plan will make the existing tax credit for employer-based child care facilities more effective, and will allow the same income tax exclusion allowed to individuals to businesses that contribute to an employees’ cost of child care.
Legislation enacted in 2001 included a bipartisan incentive for on-site child care. That law gave companies that provide appropriately-licensed on-site child care centers a tax credit of up to 25 percent of facility expenditures, plus 10 percent of resource and referral costs, up to a limit of $150,000 per calendar year; a portion of the credit is recaptured if the center is kept in service for less than 10 tax years. The Trump plan would increase the cap, shorten the recapture period, and devise ways for companies to pool resources in order to make the credit more attractive.
Because breakdowns in employee child care networks of care cost U.S. businesses $4.4 billion annually as a consequence of avoidable employee absenteeism, both businesses and families will benefit from the increased availability of convenient, reliable care. Such facilities also could provide back-up or emergency care for employees with family-based or in-home care.
Further, allowing businesses the same exclusion from income for their contributions to their employees’ child care will give businesses the opportunity to provide a benefit that helps their employees remain in the workforce. This may be particularly attractive to small businesses that are unable to provide worksite care and take full advantage of the tax credit for on-site child care centers.
- Provide six weeks of maternity leave to new mothers.
The Trump plan will enhance Unemployment Insurance (UI) to include six weeks of paid leave for new mothers so that they can take time off of work after having a baby. This would triple the average two weeks of paid leave received by new mothers.
Providing a temporary unemployment benefit for eight weeks through the UI system would cost $2.5 billion annually at an average benefit of $300 per week. This cost could be offset through changes in the existing UI system, such as by reducing the $5.6 billion per year in improper payments or implementing the proposals included in the administration’s FY 2017 budget regarding program integrity. Providing the benefit through UI — paid for through program savings — will not be financially onerous to small businesses when compared with mandating paid leave.
An analysis of a similar program in California has shown that unmarried, nonwhite and non-college-educated mothers receive the most benefit.
- The Trump plan promotes economic freedom for women.
Many women stop paid work to provide care because other options are not readily available. This often limits their careers, and is fundamental to the wage disparities that women face. In 2014, single women without children made 94 cents on a man’s dollar, but married mothers with children younger than 18 made only 81 cents.
A one-size-fits-all solution ignores the reality of today’s modern family dynamics. It is essential to empower women who choose to work outside the home to do so, without penalty, while also supporting women who choose to work inside the home.
Here is how we can win the global competition for America:
- Tax reform.
- Simplify taxes for everyone and streamline deductions.
- Lower taxes for everyone, making raising a family more affordable for working families.
- Reduce dramatically the income tax.
- We will simplify the income tax from seven brackets to three.
- Exclude child care expenses from taxation.
- Limit taxation of business income to 15% for every business.
- Make our corporate tax globally competitive and the United States the most attractive place to invest in the world.
- End the death tax.
For every one percentage point of slower growth in a given year, that’s 1 million fewer jobs for American workers. Reducing taxes on our workers and businesses means that our workers can sell their products more cheaply here and around the world – meaning more factories, more hiring and higher wages.
- Regulatory reform.
- A temporary pause on new regulations and a review of previous regulations to see which need to be scrapped.
- Require each federal agency to prepare a list of all of the regulations they impose on American business, and rank them from most critical to health and safety to least critical. Least critical regulations will receive priority consideration for repeal.
- Hire experts who know how to create jobs.
- Targeted review for regulations that inhibit hiring. These include:
- The Environmental Protection Agency’s Clean Power Plan, which forces investment in renewable energy at the expense of coal and natural gas, raising electricity rates.
- The EPA’s Waters of the United States rule, which gives the EPA the ability to regulate the smallest streams on private land, limiting land use.
- The Department of Interior’s moratorium on coal mining permits, which put tens of thousands of coal miners out of work.
- Excessive regulation is costing our country up to $2 trillion a year, and we will end it.
- Trade reform.
- Appoint trade negotiators whose goals will be to narrow our trade deficit, increase domestic production and get a fair deal for our workers.
- Renegotiate NAFTA.
- Withdraw from the Trans-Pacific Partnership.
- Bring trade relief cases to the World Trade Organization.
- Label China a currency manipulator.
- Apply tariffs and duties to countries that cheat.
- Direct the Commerce Department to use all legal tools to respond to trade violations.
Our trade deficit in goods is almost $800 billion on an annual basis. The trade deficit subtracts from growth and costs the U.S. jobs.
- Energy reform.
- Rescind the Climate Action Plan and the Waters of the U.S. rule.
- Ask Trans Canada to renew its permit application for the Keystone Pipeline.
- Make land in the Outer Continental Shelf available to produce oil and natural gas.
- Cancel the Paris Climate Agreement (limit global warming to 2 degrees Celsius) and stop all payments of U.S. tax dollars to U.N. global warming programs.
- Lift restrictions on American energy.
Energy costs the average American households $5,000 per year. As a percentage of income, the cost is greater for lower-income families. An America First Energy Plan will bring down residential and transportation energy costs, leaving more money for American families as they pay less each month on power bills and gasoline for cars. This also will make electricity more affordable for U.S. manufacturers.
- Other reforms, to be rolled out in the near future.
- Obamacare repeal and replacement.
- Infrastructure: 28 percent of our roads are in substandard condition and 24 percent of bridges are structurally deficient or worse. Trump’s plan will provide the growth to boost our infrastructure,
- Child care is the single greatest expense for most American families — even exceeding the cost of housing in much of the country. Trump will allow families to exclude child care costs from income.
Pay for the wall
The provision of the Patriot Act, Section 326 – the “know your customer” provision, compelling financial institutions to demand identity documents before opening accounts or conducting financial transactions – is a fundamental element of this action. It’s an easy decision for Mexico: make a one-time payment of $5 billion to $10 billion to ensure that $24 billion continues to flow into their country year after year. There are several ways to compel Mexico to pay for the wall, including:
- On day one promulgate a “proposed rule” (regulation) to redefine applicable financial institutions to include money transfer companies like Western Union, and redefine “account” to include wire transfers. Also include in the proposed rule a requirement that no alien may wire money outside of the United States unless the alien first provides a document establishing his lawful presence in the United States.
- On day two Mexico will immediately protest. They receive about $24 billion a year in remittances from Mexican nationals working in the United States. The majority of that amount comes from illegal aliens. It serves as de facto welfare for poor families in Mexico. There is no significant social safety net provided by the state in Mexico.
- On day three tell Mexico that if the Mexican government will contribute the funds needed to the United States to pay for the wall, the Trump administration will not promulgate the final rule, and the regulation will not go into effect.
- Trade tariffs, or enforcement of existing trade rules: There is no doubt that Mexico is engaging in unfair subsidy behavior that has eliminated thousands of U.S. jobs, and which we are obligated to respond to; the impact of any tariffs on the price imports will be more than offset by the economic and income gains of increased production in the United States, in addition to revenue from any tariffs themselves. Mexico needs access to our markets much more than the reverse, so we have all the leverage and will win the negotiation.
- Cancelling visas: Immigration is a privilege, not a right. Mexico is dependent on the United States as a release valve for its own poverty – our approvals of hundreds of thousands of visas to their nationals every year is one of our greatest leverage points. We also have leverage through business and tourist visas for important people in the Mexican economy. Keep in mind, the United States has already taken in four times more migrants than any other country on planet Earth, producing lower wages and higher unemployment for our own citizens and recent migrants.
- Visa fees: Even a small increase in visa fees would pay for the wall. This includes fees on border crossing cards, of which more than 1 million are issued a year. The border-crossing card is one of the greatest sources of illegal immigration into the United States, via overstays. Mexico also is the largest recipient of U.S. green cards, which confer a path to U.S. citizenship. Again, we have the leverage so Mexico will back down.
- Mexican gangs, drug traffickers and cartels have freely exploited our open borders and committed vast numbers of crimes inside the United States. The United States has borne the daily cost of this criminal activity, including the cost of trials and incarcerations. Not to mention the even greater human cost. We have the moral high ground here, and all the leverage.
Here are the three core principles of immigration reform:
Make Mexico pay for the wall. The cost of building a permanent border wall pales in comparison to what American taxpayers spend every year on the fallout of illegal immigration on their communities, schools and unemployment offices.
Mexico must pay for the wall and, until they do, the United States will, among other things, impound all remittance payments derived from illegal wages; increase fees on all temporary visas issued to Mexican CEOs and diplomats (and if necessary cancel them); increase fees on all border crossing cards – of which we issue about 1 million to Mexican nationals each year (a major source of visa overstays); increase fees on all NAFTA worker visas from Mexico (another major source of overstays); and increase fees at ports of entry to the United States from Mexico (tariffs and foreign aid cuts are also options).
Defend the laws and Constitution of the United States. No one is above the law. The following steps will return to the American people the safety of their laws, which politicians have stolen from them:
- Triple the number of ICE officers.As the president of the ICE Officers’ Council explained in Congressional testimony: “Only approximately 5,000 officers and agents within ICE perform the lion’s share of ICE’s immigration mission … Compare that to the Los Angeles Police Department at approximately 10,000 officers. Approximately 5,000 officers in ICE cover 50 states, Puerto Rico and Guam, and we are attempting to enforce immigration law against 11 million illegal aliens already in the interior of the United States. Since 9-11, the U.S. Border Patrol has tripled in size, while ICE’s immigration enforcement arm, Enforcement and Removal Operations (ERO), has remained at relatively the same size.” This will be funded by accepting the recommendation of the Inspector General for Tax Administration and eliminating tax credit payments to illegal immigrants.
- Nationwide e-verify.This simple measure will protect jobs for unemployed Americans.
- Mandatory return of all criminal aliens.All criminal aliens must be returned to their home countries, a process which can be aided by canceling any visas to foreign countries that will not accept their own criminals, and making it a separate and additional crime to commit an offense while here illegally.
- Detention, not catch-and-release.Illegal aliens apprehended crossing the border must be detained until they are sent home.
- Defund sanctuary cities.Cut off federal grants to any city which refuses to cooperate with federal law enforcement.
- Enhanced penalties for overstaying a visa.Millions of people come to the United States on temporary visas but refuse to leave, without consequence. This is a threat to national security. Individuals who refuse to leave at the time their visa expires should be subject to criminal penalties; this will help give local jurisdictions the power to hold visa overstays until federal authorities arrive. Completion of a visa tracking system – required by law but blocked by lobbyists – will be necessary as well.
- Cooperate with local gang task forces.ICE officers should accompany local police departments conducting raids of violent street gangs like MS-13 and the 18th Street Gang, which have terrorized the country. All illegal aliens in gangs should be apprehended and deported.
- End birthright citizenship.This remains the biggest magnet for illegal immigration. By a 2-1 ratio, voters say it’s the wrong policy.
Put American workers first. Nearly 40% of black teenagers and nearly 30% of Hispanic teenagers are unemployed. For black Americans without high school diplomas, more than 70% were employed in 1960, compared to less than 40% in 2000.
The influx of foreign workers holds down salaries, keeps unemployment high, and makes it difficult for poor and working class Americans – including immigrants themselves and their children – to earn a middle class wage. Nearly half of all immigrants and their US-born children currently live in or near poverty, including more than 60 percent of Hispanic immigrants. Every year, we voluntarily admit another 2 million new immigrants, guest workers, refugees, and dependents, growing our historic record population of 42 million immigrants. We need to control the admission of new low-earning workers in order to: help wages grow, get teenagers back to work, aid minorities’ rise into the middle class, help schools and communities falling behind, and to ensure our immigrant members of the national family become part of the American dream.
Increase the prevailing wage for H-1Bs. Up to two-thirds of entry-level hiring for IT jobs is accomplished through the H-1B program. More than half of H-1B visas are issued for the program’s lowest allowable wage level, and more than 80 percent for its bottom two. Raising the prevailing wage paid to H-1Bs will force companies to give these entry-level jobs to the domestic pool of unemployed native and immigrant workers in the U.S., instead of flying in cheaper workers from overseas.
Require companies to hire American workers first. Too many visas, like the H-1B, have no such requirement. In 2015, with 92 million Americans outside the workforce and incomes collapsing, we need companies to hire from the domestic pool of unemployed.
End welfare abuse. Applicants for entry to the United States should be required to certify that they can pay for their own housing, health care and other needs before coming to the U.S.
Offer jobs programs for inner city youth. The J-1 visa jobs program for foreign youth will be terminated and replaced with a resume bank for inner city youth provided to all corporate subscribers to the J-1 visa program.
Improve the refugee program for American children. Increase standards for the admission of refugees and asylum-seekers to crack down on abuses. Use the monies saved on refugee programs to help place American children without parents in safer homes and communities, and to improve community safety in high crime neighborhoods in the United States.
Reform immigration. Before any new green cards are issued to foreign workers abroad, there will be a pause where employers will have to hire from the domestic pool of unemployed immigrant and native workers.
Health care reform
Any reform effort must begin with Congress. Our elected representatives in the House and Senate must:
- Repeal Obamacare. Our elected representatives must eliminate the individual mandate. No person should be required to buy insurance unless he or she wants to.
- Modify laws that inhibit the sale of health insurance across state lines. As long as the plan purchased complies with state requirements, any vendor ought to be able to offer insurance in any state. By allowing full competition in this market, insurance costs will go down and consumer satisfaction will go up.
- Allow individuals to fully deduct health insurance premium payments from their tax returns. Businesses are allowed to take these deductions, so why wouldn’t Congress allow individuals the same exemptions? As we allow the free market to provide insurance coverage opportunities to companies and individuals, we must also make sure that no one slips through the cracks simply because they cannot afford insurance. We must review basic options for Medicaid and work with states to ensure that those who want health care coverage can have it.
- Allow individuals to use Health Savings Accounts (HSAs). Contributions into HSAs should be tax-free and should be allowed to accumulate. These accounts would become part of the estate of the individual and could be passed on to heirs without fear of any death penalty. These plans should be particularly attractive to young people who are healthy and can afford high-deductible insurance plans. These funds can be used by any member of a family without penalty.
- Require price transparency from all health care providers, especially doctors and health care organizations like clinics and hospitals. Individuals should be able to shop to find the best prices for procedures, exams or any other medical-related procedure.
- Block-grant Medicaid to the states. Nearly every state already offers benefits beyond what is required in the current Medicaid structure. The state governments know their people best and can manage the administration of Medicaid far better without federal overhead.
- Remove barriers to entry into free markets for drug providers that offer safe, reliable and cheaper products. Though the pharmaceutical industry is in the private sector, drug companies provide a public service. Allowing consumers access to imported, safe and dependable drugs from overseas will bring more options to consumers.
Providing health care to illegal immigrants costs us some $11 billion annually. If we were to simply enforce the current immigration laws and restrict the unbridled granting of visas to this country, we could relieve health care cost pressures on state and local governments.
To reduce the number of individuals needing access to programs like Medicaid and the Children’s Health Insurance Program, we will need to install programs that grow the economy and bring capital and jobs back to America. The best social program has always been a job – and taking care of our economy will go a long way toward reducing our dependence on public health programs.
Finally, we need to reform our mental health programs and institutions in this country. Families, without the ability to get the information needed to help those who are ailing, are too often not given the tools to help their loved ones. There are promising reforms being developed in Congress that should receive bi-partisan support.
U.S.-China trade reform
Details of Trump’s U.S.-China trade plan:
- Declare China a currency manipulator.
Economists estimate the Chinese yuan is undervalued by anywhere from 15% to 40%. This gives Chinese exporters a huge advantage while imposing the equivalent of a heavy tariff on U.S. exports to China. This has resulted in chronic U.S. trade deficits, a severe weakening of the U.S. manufacturing base and the loss of tens of millions of American jobs.
In a system of truly free trade and floating exchange rates like a Trump administration would support, America’s massive trade deficit with China would not persist. On day one of the Trump administration, the U.S. Treasury Department will designate China as a currency manipulator. This will begin a process that imposes countervailing duties on artificially cheap Chinese products. The U.S. Treasury’s designation of China as a currency manipulator will force China to the negotiating table and open the door to a fair – and far better – trading relationship.
- End China’s intellectual property violations.
China’s ongoing theft of intellectual property may be the greatest transfer of wealth in history. This theft costs the U.S. more than $300 billion and millions of jobs each year. We will enforce stronger protections against Chinese hackers and counterfeit goods. Our responses to Chinese theft will be swift, robust and unequivocal.
The Chinese government also forces American companies like Boeing, GE and Intel to transfer proprietary technologies to Chinese competitors as a condition of entry into the Chinese market. We will adopt a zero tolerance policy on intellectual property theft and forced technology transfer.
- Eliminate China’s illegal export subsidies and other unfair advantages.
Chinese manufacturers and other exporters receive numerous illegal export subsidies from the Chinese government. These include – in direct contradiction to WTO rules – free or nearly free rent, utilities, raw materials and many other services. China’s state-run banks routinely extend loans to these enterprises at below market rates or without the expectation they will be repaid. China even offers them illegal tax breaks or rebates as well as cash bonuses to stimulate exports.
The U.S. trade representative recently filed yet another complaint with the WTO accusing China of cheating on our trade agreements by subsidizing its exports. The Trump administration will not wait for an international body to tell us what we already know. To gain negotiating leverage, we will pursue the WTO case and aggressively highlight and expose these subsidies.
- The Trump plan will strengthen our negotiating position.
As the world’s most important economy and consumer of goods, America must always negotiate trade agreements from strength. Branding China as a currency manipulator and exposing their unfair trade practices is not enough. To further strengthen our negotiating leverage, the Trump plan will:
- Lower the corporate tax rate to 15% to unleash American ingenuity here at home and make us more globally competitive. This tax cut puts our rate 10 percentage points below China and 20 points below our current rate.
- Attack our debt and deficit by vigorously eliminating waste, fraud and abuse in the federal government, ending redundant government programs, and growing the economy to increase tax revenues. Closing the deficit and reducing our debt will mean China cannot blackmail us with our own Treasury bonds.
- Strengthen the U.S. military and deploy it appropriately in the East and South China seas. These actions will discourage Chinese adventurism that imperils American interests in Asia.
Veterans Administration reforms
The Trump plan will:
- Give veterans the freedom to choose and force the VA to compete for their dollars. Under a Trump Administration, all veterans eligible for VA health care can bring their veteran’s ID card to any doctor or care facility that accepts Medicare to get the care they need immediately.
- Treat the whole veteran. We must recognize that today’s veterans have very different needs than those of the Greatest Generation.
- Increase funding for post-traumatic stress disorder (PTSD), traumatic brain injury and suicide prevention services to address our veterans’ invisible wounds. Service members are five times more likely to develop depression than civilians. They are almost 15 times more likely to develop PTSD than civilians. This funding will help provide more and better counseling and care. More funding also will support research on best practices and state-of-the-art treatments to keep our veterans alive, healthy and whole.
- Increase funding for job training and placement services (including incentives for companies hiring veterans), educational support and business loans.
- Better support our women veterans. The fact that many VA hospitals don’t permanently staff OB/GYN doctors shows a lack of respect for the growing number female veterans. In addition, women veterans can always choose a different OB/GYN in their community using their veteran’s ID card.
- Fire incompetent VA executives. New leadership will focus the VA staff on delivering timely, top quality care and other services.
- End waste, fraud and abuse at the VA. The days of $6.3 million for statues and fountains at VA facilities and $300,000 for a manager to move 140 miles are over.
- Modernize the VA. The VA has been promising to modernize for years without real results. The Trump plan will make it happen by accelerating and expanding investments in state-of-the-art technology to deliver best-in-class care quickly and effectively.
- Empower caregivers to ensure our veterans receive quality care quickly. Caregivers should be able to streamline treatment plans across departments and utilize telehealth tools to better serve their patients.
- Hire more veterans to care for veterans.The more veterans we have working at the VA, the better the VA will be. They understand the unique challenges facing their community. To increase the number of veterans hired by the VA, this plan will add five points to the qualifying scores of veterans applying for VA jobs.
- Embed satellite VA clinics in rural and other underserved areas. This will ensure veterans have easy access to care and local hospitals, and care facilities can handle the influx of patients without backlogs while tapping the specialized knowledge of VA health specialists.
The Trump plan will revise and update both the individual and corporate tax codes.
Individual income tax
The Trump plan will collapse the current seven tax brackets to three. The rates and break points are as shown below. The tax brackets are similar to those in the House GOP tax blueprint.
Brackets and rates for married-joint filers:
(Brackets for single filers are half of these amounts)
Taxable income: Rate
Less than $75,000 12%
More than $75,000 but less than $225,000 25%
More than $225,000 33%
The Trump plan will retain the capital gains rate structure (maximum rate of 20 percent) with tax brackets shown above. Carried interest will be taxed as ordinary income.
The 3.8 percent Obamacare tax on investment income will be repealed, as will the alternative minimum tax.
The Trump plan will increase the standard deduction for joint filers to $30,000, from $12,600, and the standard deduction for single filers will be $15,000. The personal exemptions will be eliminated as will the head-of-household filing status.
In addition, the Trump plan will cap itemized deductions at $200,000 for married-joint filers or $100,000 for single filers.
The Trump plan will repeal the death tax, but capital gains held until death will be subject to tax, with the first $10 million tax-free as under current law to exempt small businesses and family farms. To prevent abuse, contributions of appreciated assets into a private charity established by the decedent or the decedent’s relatives will be disallowed.
All but the wealthiest Americans will be able to take an above-the-line deduction for children under age 13 that will be capped at the state average for the age of the child, and for elder care for a dependent. The exclusion will not be available to taxpayers with total income of more than $500,000 married-joint/$250,000 single.
The child care exclusion would be provided to families who use stay-at-home parents or grandparents as well as those who use paid caregivers, and would be limited to four children per taxpayer. The elder care exclusion would be capped at $5,000 per year. The cap would increase each year at the rate of inflation.
The Trump plan would offer spending rebates for child care expenses to certain low-income taxpayers through the Earned Income Tax Credit (EITC). The rebate would be equal to 7.65 percent of remaining eligible child care expenses, subject to a cap of half of the payroll taxes paid by the taxpayer (based on the lower-earning parent in a two-earner household).
This rebate would be available to married-joint filers earning $62,400 ($31,200 for single taxpayers) or less. Limitations on costs eligible for exclusion and the number of beneficiaries would be the same as for the basic exclusion. The ceiling would increase with inflation each year.
All taxpayers would be able to establish Dependent Care Savings Accounts (DCSAs) for the benefit of specific individuals, including unborn children. Total annual contributions to a DCSA are limited to $2,000 per year from all sources, which include the account owner (parent in the case of a minor or the person establishing elder care account), immediate family members of the account owner, and the employer of the account owner. When established for children, the funds remaining in the account when the child reaches 18 can be used for education expenses, but additional contributions could not be made.
To encourage low-income families to establish DCSAs for their children, the government will provide a 50 percent match on parental contributions of up to $1,000 per year. When parents fill out their taxes, they can check a box to directly deposit any portion of their EITC into their Dependent Care Savings Account. All deposits and earnings thereon will be free from taxation, and unused balances can roll over from year to year.
The Trump plan will lower the business tax rate from 35 percent to 15 percent, and eliminate the corporate alternative minimum tax. This rate is available to all businesses, both big and small, that that want to retain the profits within the business.
It will provide a deemed repatriation of corporate profits held offshore at a one-time tax rate of 10 percent.
It eliminates most corporate tax expenditures, except for the research and development credit.
Firms engaged in manufacturing in the U.S. may elect to expense capital investment and lose the deductibility of corporate interest expense. An election once made can be revoked only within the first three years of election; if revoked, returns for prior years would need to be amended to show revised status.
The annual cap for the business tax credit for on-site child care authorized by Sec. 205 of the Economic Growth and Tax Relief Reconciliation Act of 2001 would be increased to $500,000 per year (up from $150,000), and the recapture period would be reduced to five years (down from 10 years).
Businesses that pay a portion of an employee’s child care expenses can exclude those contributions from income. Employees who are recipients of direct employer subsidies would not be able to exclude those costs from the individual income tax, and the costs of direct subsidies to employees could not be used as a cost eligible for the credit.
Second Amendment rights
It’s been said that the Second Amendment is America’s first freedom. That’s because the right to keep and bear arms protects all our other rights. We are the only country in the world that has a Second Amendment. Protecting that freedom is imperative. Here’s how we will do that:
Enforce the laws on the books.
Several years ago there was a tremendous program in Richmond, Va., called Project Exile. It said that if a violent felon uses a gun to commit a crime, he will be prosecuted in federal court and sent to prison for five years – no parole or early release. Murders committed with guns in Richmond decreased by more than 60% when Project Exile was in place – in the first two years of the program alone, 350 armed felons were taken off the street.
Here’s another important way to fight crime: Empower law-abiding gun owners to defend themselves. That’s why I’m a gun owner, that’s why I have a concealed carry permit, and that’s why tens of millions of Americans have concealed carry permits as well.
Fix our broken mental health system.
We need to expand treatment programs, because most people with mental health problems aren’t violent, they just need help. But for those who are violent, a danger to themselves or others, we need to get them off the street.
Defend the rights of law-abiding gun owners.
Gun and magazine bans are a total failure. That’s been proven every time it’s been tried. Law-abiding people should be allowed to own the firearm of their choice.
There has been a national background check system in place since 1998. Every time a person buys a gun from a federally licensed gun dealer – which is the overwhelming majority of all gun purchases – they go through a federal background check. Study after study has shown that very few criminals try to pass a background check – they get their guns from friends/family members or by stealing them. So the overwhelming majority of people who go through background checks are law-abiding gun owners. Too many states are failing to put criminal and mental health records into the system – and it should go without saying that a system’s only going to be as effective as the records that are put into it.
The right of self-defense doesn’t stop at the end of your driveway. A concealed carry permit should be valid in all 50 states. A driver’s license works in every state, so it’s common sense that a concealed carry permit should work in every state.
Banning our military from carrying firearms on bases and at recruiting centers is ridiculous. We train our military how to safely and responsibly use firearms, but our current policies leave them defenseless. We need to allow them to defend themselves.