There’s a fake “analysis” by an Obama shill named Lily Batchelder going around that Trump’s tax plan and child care deductions will raise taxes for middle class people, including single mothers. But the analysis is based on two massive lies:
- That no working parents use child care in the United States.
- That the cost of child care is cheaper than all the reports from Washington Post, Vox, many others and again, GOVERNMENT DATA.
This is complete nonsense, based upon data from a variety of government sources, collected at http://www.childstats.gov. At worst, 1 in 30 parents are bringing a child or children to work with them. The rest have their children in a variety of child care arrangements, usually relatives or center-based care, but with a substantial share using nannies, babysitters and the like. 97% of working parents use child care in the United States.
As far as the second lie goes, Batchelder grudgingly estimates child care costs at a much lower number than government and other sources do, as shown below.
She claims all her assumptions are “reasonable” or “conservative”, but since they are based on massive lies, this is prima facie yet another complete lie. Her assumptions are neither reasonable, rational or conservative. The statement that the deduction is for a specific number of children suggests that it is a deduction per child, with the average cost of care calculated for each single child and added up for the first four children in a household. There’s also the FACT that Trump’s plan mentions that the $500 top-ups for EITC-eligible parents are per child, so the deductions appear across the board to be per child up to four children.
Let’s view Batchelder’s examples through a more fact-based, real-world lens, with deductions per child, and assuming that nearly all households use child care or have a relative providing care at home as a grandparent or SAHP.
Her two big examples are a single parent making $75,000 per year with two school-aged children who has no child care costs and a married couple with two children making $50,000 per year with $8000 in childcare costs. Some key points about those fake examples:
- Batchelder’s single parent makes TRIPLE THE MEDIAN INCOME of single parents in most states, including most high-income states. So this is a very fake example of a single parent.
- At triple the median income of a real single parent household, Batchelder’s single parent “reasonably” can be assumed to live somewhere with high earning potential like New York. (Hey, that 75k is almost exactly triple the median income of single parents in New York! Wow!)
- The cost of school-age before/aftercare (AKA “child care for school-age children”) in New York is about $8000 per year, per child. Not total, which is what Batchelder uses to shoehorn Trump’s plan into a Narrative of “higher taxes for hard working single mommas”. But a single parent making that kind of money is “reasonably” and “conservatively” likely to be paying a lot more than $8000 per year in child care costs.
- Meanwhile, Batchelder’s married couple makes far less than the median income of married couples in most states and is EITC eligible (barely). Funny how that works. Further, even her torturing of math for muh Narrative still doesn’t hide that this near-poor married couple owes nothing EITHER WAY. Her only rebuttal is that the new tax refund this family gets isn’t big enough, not that they pay more tax!
- But at $50,000 per year for two married parents (her example does not state if both or just one is working), they are “reasonably” likely to be using grandma for child care or Mom is staying home. In which case Batchelder’s torturing of the data is in vain, because this household can deduct whatever the average cost is in their state times two. Since she doesn’t specify those kids are school-aged, that household can deduct the much higher typical cost for two children of preschool or infant age, which ranges from $14,000 annually in the South to $22,000 in the Northeast and $18,000 in the Midwest and West.
- “Conservatively” and “reasonably” assuming the married couple lives in the Midwest and Mom stays home with the two kids under 5, Batchelder’s $8000 estimate is simply too low, nowhere near the cap allowed.
Trump’s tax plan changes the above-the-line deductions to a flat number of $15,000 for singles and $30,000 for marrieds filing jointly and eliminates both personal exemptions head of household as a tax status, along with condensing tax brackets down to three. This is the source of a lot of whining around the internets about losing the Head of Household tax status. But given the high cost of child care, the above-the-line deduction is more than adequate to replace it.
For the $75,000 parent, this changes their pre-child care taxable income from $53, 550 to $60,000. But that parent can deduct up to $16,000 above the line rather than $8000, so they end up with $44,000 left over, and under the new brackets, they obviously pay less than under current law. Definite savings. Instead of the lie that the $75,000 single parent would pay $1640 more in taxes, they would actually pay $4125 instead of the current $5685, a savings of over $1500. Under Trump’s new tax plan, even a high-income single parent making $75,000 per year with two school-aged children can see a tax savings of 30%.
Meanwhile, that $50,000 earning married household whose details are much more blurry would see a much larger refund than they already are eligible for, since they could claim up to $18,000 above the line after their $30,000 deduction and $2,000 in child credits and EITC credit. So we would be paying married people to have slightly more children at the margins, since having a third child would still benefit this household by adding another $9000 of deduction, which we can’t make assumptions about, because at just two children, they have $0 in taxable income after child credit, standard deduction and imputed child care deduction for the SAHM.
In short, Trump’s tax plan is sketched out and low on nitpicky details. But a reasonable, realistic set of assumptions shows that it’s a very generous plan with a very pro-natalist, pro-family, pro-woman setup.