Republicans lay groundwork for 'total tax cliff' at end of Trump's term

[progree]

8. Half of the bill's passthrough deduction alone, worth $200 B in 2022 alone, went to the top 1 percent

The last 2 paragraph of your OP link
https://thehill.com/business/5344999-republicans-tax-cliff-trump/

. . . Despite locking in lower tax rates for lower earners, forecasts project the House-passed tax bill will benefit higher earners more and will redistribute wealth from the bottom to the top of the income spectrum.

Half of the bill’s passthrough deduction alone, which was worth more than $200 billion in 2022, went to the top 1 percent of taxpayers by adjusted gross income, according to the JCT.

emphasis added

Somehow I missed hearing about or knowing about the "passthrough deduction" all these years

From an AI summary from Google search (sorry)

The "passthrough deduction" in the Trump tax cuts, also known as the Section 199A deduction or Qualified Business Income (QBI) deduction, is a tax break established by the Tax Cuts and Jobs Act (TCJA) of 2017. It allows eligible taxpayers to deduct up to 20% of their qualified business income (QBI).

The deduction applies to owners of pass-through businesses like sole proprietorships, partnerships, S corporations, and some trusts and estates. Qualified Business Income (QBI) is generally the net income from a U.S. business, excluding wages, capital gains, dividends, and interest income.

Eligible taxpayers can deduct up to 20% of their QBI, subject to income limitations. This deduction is taken after calculating adjusted gross income (AGI) and applies whether itemizing deductions or taking the standard deduction.

. . .
The QBI deduction is scheduled to expire on December 31, 2025, unless Congress extends it.

The deduction was intended to provide tax relief for pass-through business owners, making their tax rates more comparable to the corporate tax rates under the TCJA. . . .

Well, that's interesting. I've been benefiting for from a QBI deduction in the past few years, according to TurboTax (based on mutual fund holdings) and never knew what it was about, well now I know. It's also a deduction that one can take even if using the standard deduction (as I do). It was a small deduction like $126 (20% of $630), which at my 27% effective federal marginal tax rate saved me $34 in taxes. Not a big chunk of the $200 B that the top 1% got.

(My 27% effective federal marginal rate comes from the sum of my 12% marginal tax rate from the tables plus 15%, because an increase in my AGI increases the amount of my capital gains subject to the 15% capital gains tax. An example of how the marginal tax rate that one gets from the tax tables and the media is misleading.

Another example for many seniors is that an increase in AGI results in more of their Social Security benefits being taxed, jacking up their actual marginal tax rate by 1.5 times or 1.85 times.