The Poynter Institute Menu Donate State Editions * California * Florida * Iowa * Michigan * New Hampshire * New York * North Carolina * Pennsylvania * Texas * West Virginia * Wisconsin Issues * All Issues * Online hoaxes * Coronavirus * Health Care * Immigration * Extremism * Taxes * Marijuana * Environment * Crime * Guns * Foreign Policy * LGBTQ+ People * Joe Biden * Kamala Harris * Donald Trump * Mitch McConnell * Hakeem Jeffries * Ron DeSantis Media * PunditFact * Tucker Carlson * Sean Hannity * Rachel Maddow * Bloggers * PolitiFact Videos Campaigns * 2024 Elections Truth-o-Meter * True * Mostly True * Half True * Mostly False * False * Pants on Fire Promises * Biden Promise Tracker * Trump-O-Meter * Obameter * Latest Promises About Us * Our Process * Our Staff * En Español * Who pays for PolitiFact? * Advertise with Us * Suggest a Fact-check * Corrections and Updates * Newsletters Donate #### Follow us The Facts Newsletter Sign up English Español ### Get PolitiFact in your inbox. * Weekly Email Newsletter * Daily Email Newsletter Your Email Address Sign Up ![](\\" ![](\\" Drew Ferguson stated on November 5, 2017 in an email to a constituent: Under the House Republican tax proposal, \"the average family of four earning median income ($59,000/year) will receive an additional $1,182 in their pocket every year.\" ![\\"true\\"](\\" half-true/6479cbc723379f0ee49c269b0b9790b7.jpg.\\") ![\\"half- true\\"](\\" true.jpg\\") * Georgia * Taxes * Drew Ferguson ![\\"Louis](\\" By Louis Jacobson November 6, 2017 # Georgia congressman says GOP tax bill will save typical family $1,182. Will it? House Republicans have touted their tax bill as a plus for typical American families. In a constituent email forwarded to us by a reader, Georgia Rep. Drew Ferguson wrote, \"This week the House released our tax reform legislation to help American families and level the playing field for the American worker. With this plan, the average family of four earning median income ($59,000/year) will receive an additional $1,182 in their pocket every year. Who wouldn\'t want American families to have more money in their pockets?\" ![](\\" The statement is exaggerating how long the average family of four will enjoy those tax savings. How the House Republican math works Ferguson’s office said that he had been citing comment from House Speaker Paul Ryan, whose office told us in a related check that the speaker had been referring to a House Ways and Means Committee analysis. That analysis calculated several scenarios for how the proposal’s changes could affect different types of taxpayers. The key elements of the Ways and Means calculation involved tax brackets, the standard deduction and the child tax credit. Currently, there are seven brackets; these would be consolidated into four -- 12 percent, 25 percent, 35 percent, and 39.6 percent. In the meantime, the standard deduction would be raised from $12,000 to $24,000. And the child tax credit would be increased from $1,000 to $1,600, bolstered by a new $300 credit for parents and other dependents. The example refers to a \"family of four making $59,000 per year.\" Here’s the scenario outlined in the House’s fact sheet, using the fictional example of \"Steve and Melinda\" with two middle school-aged children: \"As a result of lower tax rates, a significantly larger standard deduction, and an enhanced Child Tax Credit and Family Flexibility Credit, Steve and Melinda will pay over $1,182 less in taxes than last year, reducing their total tax bill from $1,582 to only $400. \"That’s more money they can use for whatever is important to them, whether it’s paying bills, purchasing a new refrigerator, or putting away savings for the future.\" The Ways and Means Committee told PolitiFact that they chose a household income of $59,000 because it’s the median household income nationally. For that amount of income, a family today would get $12,700 from the standard deduction, $16,200 in personal exemptions, leaving $30,100 in taxable income. Of that, $18,650 would be taxed at 10 percent and $11,450 would be taxed at 15 percent, meaning the preliminary tax liability would be $3,582.50. That would be adjusted with $2,000 in child tax credits, producing a final tax liability of $1,582.50. Under the new tax bill, the family would take a larger $24,000 standard deduction (the proposal eliminates personal exemptions), leaving $35,000 in taxable income. At the 12 percent rate, that would mean $4,200 in preliminary liability. This would be offset by $3,200 in child tax credits and $600 in family credits, leaving a final tax liability of $400. That’s a $1,182.50 tax cut. So Ferguson has some mathematical detail to back up the figure. But that’s not the end of the story. Here are the two clearest caveats. #### Featured Fact-check ![](\\" ![](\\" Donald Trump stated on August 23, 2024 in a speech in Las Vegas “Kamala cast the tiebreaking vote to hire 87,000 new IRS agents to go after your tip income.” ![\\"true\\"](\\" false/33efdb6633e5e2fdc2d4e2f63383a1e0.jpg.\\") ![\\"false\\"](\\" false.jpg\\") By Amy Sherman • August 28, 2024 Reduction of itemized deductions The GOP bill eliminates or shrinks a number of widely used itemized deductions, and those factors aren’t taken into account in the figure Ryan cited. The deductions eliminated or pared back in the bill include the mortgage interest deduction (for future mortgages, it would be capped at half its previous maximum); the state and local tax deduction (only $10,000 in property tax deductions would be allowed); the medical expense deduction; the casualty loss deduction; and the student loan interest deduction. Exchanging these changes for a higher standard deduction may benefit many taxpayers, particularly those who choose not to itemize today. For households earning around $59,000 a year, more taxpayers do take the standard deduction than take itemized deductions -- but a significant minority, about one-third, do itemize. For many itemizing taxpayers, those deductions are important -- and under the tax bill, they’re likely to end up worse off if the bill is passed as is, even with the higher standard deduction. For this type of taxpayer, the loss of even one of those deductions could conceivably wipe out that $1,182 gain for certain types of families. This specific amount of tax savings is good for just the first year Ferguson’s statement explicitly said that the $1,182 income boost would happen \"every year.\" The problem is that the benefits of the tax proposal shrink, slowly but surely, over the next decade for this family. \"The tax cut definitely dissipates over time,\" David Kamin, a tax and budget specialist at the New York University law school, told PolitiFact. Kamin cited a combination of factors, including the sunsetting of the $300 per parent tax credit; the lack of inflation adjustments for the child tax credit, which effectively replace personal exemptions that were indexed to inflation; and the new use of an inflation adjustment measure known as chained CPI, which grows more slowly than the yardstick in current use. According to Kamin’s calculations, the initial tax cut for the family making $59,000 becomes a $500 tax increase by 2024 compared to the status quo. Here’s the graph he put together: ![](\\" The way Ferguson described the cut was actually stronger than Ryan’s tax cut of \"$1,182 a year.\" Amy Timmerman, Ferguson’s communications director, said that \"the congressman misspoke last week when he cited Speaker Ryan’s example.\" Our ruling Ferguson said that under the House Republican tax proposal, \"the average family of four earning median income ($59,000/year) will receive an additional $1,182 in their pocket every year.\" This is based on a plausible and transparent calculation, but Ferguson glossed over some context. The calculation doesn’t factor in several itemized deductions that would disappear under the proposal and that could have a significant impact on at least some \"typical\" families around that income level. And the statement is misleading when it says the family will save $1,182 \"every year,\" since that’s the case in the first year only; after that, the benefit starts to shrink and eventually turns into a tax hike. We rate the statement Half True. EDITORS\' NOTE, Nov. 6, 2017: We updated this story to remove a reference to an analysis by the Tax Policy Center of the tax plan. That plan is now under review by TPC and the organization asked journalists to refrain from quoting the report until it is revised. Share the Facts 2017-11-06 22:16:07 UTC PolitiFact ![\\"PolitiFact\\"](\\" logo-big.jpg\\"/) 4 1 7 ![\\"PolitiFact](\\" halftrue.jpg\\") PolitiFact Rating: Half True Under the House Republican tax proposal, \"the average family of four earning median income ($59,000/year) will receive an additional $1,182 in their pocket every year.\" Drew Ferguson U.S. Representative, R-Ga. ![](\\" a constituent email Sunday, November 5, 2017 2017-11-05 Read More info #### Read About Our Process The Principles of the Truth-O-Meter ### Our Sources Drew Ferguson, constituent email, Nov. 5, 2017 Urban Institute-Brookings Institution Tax Policy Center, \"What Are Itemized Deductions?\" Jan. 27, 2017 Urban Institute-Brookings Institution Tax Policy Center, \"Preliminary Distributional Analysis of the \'Tax Cuts and Jobs Act\'\" Nov. 6, 2017 PolitiFact, \"Would the House GOP tax plan save a typical family $1,182?\" Nov. 3, 2017 PolitiFact, \"Why you should be skeptical of the Trump White House\'s promised $4,000 \'raise,\' \" Oct. 26, 2017 CNBC, \"Speaker Ryan on tax reform: Typical family of four will save $1,182,\" Nov. 2, 2017 House Ways and Means Committee, \"Taxpayer Examples: How the Tax Cuts and Jobs Act Helps Americans of All Walks of Life,\" Nov. 2, 2017 David Kamin, \"How a Tax Cut Turns Into a Tax Increase,\" Nov. 2, 2017 Vox.com, \"The House Republican tax bill, explained,\" Nov. 2, 2017 Email interview with Lily Batchelder, public policy professor at New York University law school, Nov. 2, 2017 Email interview with David Kamin, tax and budget specialist at the New York University law school, Nov. 2, 2017 Email interview with Amy Timmerman, communications director to Drew Ferguson, Nov. 6, 2017 ## 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Under the House Republican tax proposal the average family of four earning median income 59000year will receive an additional 1182 in their pocket every year