FoxnewsThe Trump administration is aiming to introduce another middle-class tax cut before the November election, and the package could include a measure that would give larger tax breaks to certain retirement savings.
The administration is considering including a proposal known as USA accounts – which would combine and simplify all existing savings accounts that give tax breaks (401(k)s, IRAs), a senior administration official told FOX Business on Friday. There may be limits, however, as to how large the tax break could extend through these vehicles.
The idea is popular among lawmakers on Capitol Hill, according to the same official, who cautions that no final decisions have been made.
The idea of a Universal Savings Account has been floated by Republicans before, under the guise that contributions would be taxed but earnings would grow tax-free and would be easier to withdraw than a traditional retirement account.
In November, when asked about speculation that the White House was contemplating a 15 percent tax rate for the middle class, Kudlow told CNBC during an interview that it sounded like “a pretty good idea.”
There are currently seven tax brackets, with rates ranging from 10 percent to 37 percent. While some middle-class Americans may already be paying a 12 percent rate, others are paying 22 percent or 24 percent – which means a potential cut to a 15 percent rate would save them a lot of money.
does not do anything for me as I am already below the 15% tax rate
