A Closer Look At Trump’s Proposed Childcare Plan

 

So much negative has been spouted by Democrats and their Republican allies about Trump’s Childcare Proposal, that I decided it was worth a closer look directly from his online site not third or fourth hand. I am sick and tired of the “Never Trump” spin when we have not been given the facts as he has proposed them and a chance to exam those points.

No one single proposition by any candidate can be precise or specific without first walking in the shoes of the position to be elected to by the public. That said, looking at proposals gives people a better understanding of the views and possible changes a candidate may make once in office. It also helps to highlight the general trend for that candidate on specific issues which the citizens believe are important. More than one candidate has been voted into office on their stance which appealed to the public. Yet, they have not or tried but failed to deliver the goods which the public saw as reasons to vote for them.

All any of us can do is research their words and if in print review their proposals for ourselves. 

 

Proposals Contained In Mr. Trump Child Care Plan

PROPOSAL: The Trump plan will rewrite the tax code to allow working parents to deduct from their income taxes child care expenses for up to four children and elderly dependents.

The deduction is available for taxpayers who take the standard deduction as well as itemize deductions, and will be capped at the average cost of care for the state of residence. Individuals earning more than $250,000 (or $500,000 if filing jointly) will not be eligible for the deduction. For a family earning $70,000 per year in the 12 percent tax bracket with $7,000 in child care expenses, the deduction would reduce taxes by $840 per year.

The plan will offer child care spending rebates to lower-income taxpayers through the existing Earned Income Tax Credit (EITC). This could mean almost $1,200 per year per eligible family.
Mr. Trump’s plan will ensure stay-at-home parents will receive the same tax deduction as working parents, offering compensation for the job they’re already doing, and allowing them to choose the child care scenario that’s in their best interest.

Tax Policy Center  explained the 2013  tax system subsidizes child care expenses and the key elements for those interested.  In that explanation is the following statement which is relevant to what is the core issue addressed by Mr. Trump.  

“The credit is nonrefundable so it can only be used to offset income taxes owed—in other words, any excess credit beyond taxes owed is forfeited. As a result, low-income families who owe little or no income tax get little benefit from the credit.

Some families with children will not benefit because they do not have child care expenses or, in the case of married couples, only one partner works or goes to school.

PROPOSAL: The Trump plan would create new Dependent Care Savings Accounts (DCSAs) so that families can set aside extra money to foster their children’s development and offset elder care for their parents or adult dependents.

These new accounts are available to everyone, and allow both tax-deductible contributions and tax-free appreciation year-to-year-unlike current law Dependent Care Flexible Spending Accounts (FSAs), which are available only if it is offered by an employer and does not allow balances to accumulate.

When established for a minor, funds from a DCSA can be applied to traditional child care, after-school enrichment programs and school tuition-contributing to school choice. To help lower-income parents, the government will match half of the first $1,000 deposited per year.
When established for an elderly dependent, a DCSA can cover a variety of services, including in-home nursing and long-term care.

According to the 2013 tax information from  Tax Policy Center an EMPLOYER EXCLUSION: FLEXIBLE SPENDING ACCOUNTS code already exists.  From personal experience, I know that some and in particular one large US company has been using this system voluntarily or by law since 2005 that I am familiar with.  The federal government adopted the Federal Flexible Benefits Plan (“FedFlex”) under the cafeteria plan. Some well-known companies have also been using this concept for many years with success.  In other words this is nothing new but would be percolated down for all just in a more formalized government assistance way if I understand this proposal correctly.  So those stressing out on this CHILL OUT.  Many companies who have long term experience this kind of flexible account have found ways to make this work.   At least now perhaps those workers shut out from this option before may finally be allowed to have a perk.

PROPOSAL: Mr. Trump’s plan will provide regulatory reform to promote new family-based and community-based solutions, and also add incentives for employers to provide child care at the workplace.

The ability to set aside funds will be particularly helpful to women, low-income workers and minorities, who are statistically more likely to reduce time working outside the home in order to provide unpaid care.

The president already offered up something on this line back in 2010.  I do not recall a mighty uproar by liberals on this so why would liberals decide this is nasty issue now? You can’t have it both ways.

PROPOSAL: The Trump plan will guarantee six weeks of paid maternity leave by amending the existing unemployment insurance (UI) that companies are to 

The benefit would apply only when employers don’t offer paid maternity leave, and would be paid for by offsetting reductions in the program so that taxes are not raised. This enhancement will triple the average paid leave received by new mothers.

This appears online under Growing Family Benefits in 2013 – Collecting Unemployment During Maternity Leave.  Meaning this is not a new idea but maybe will provide a better solution.

 

Frequently Asked Questions About The Trump Child Care Plan


Q: How Will The Plan Be Paid For?

  • The child care plan is part of the comprehensive tax, trade, energy and regulation reform plan proposed by Donald Trump at the Detroit Economic Club. More details about his tax plan will be discussed later this week at the New York Economic Club. The child care plan itself can more than be offset by additional growth. About two-thirds of the entire Trump tax reform program will offset by the increases in economic activity that accompany pro-growth tax reform, better trade deals, regulatory and immigration reform, and unleashing American energy. The remaining one-third will be offset by minor changes in the current trajectory of spending for federal agency operations, excluding Defense, Veterans, Social Security and Medicare.


Q: Will The Benefits Already Provided For Child Care Expenses, Like The Dependent Care Flexible Spending Account And Child Tax Credit, Be Eliminated Under The Trump Plan?

  • No, the benefits provided by the Trump child care plan are in addition to the benefits available under current law. Current programs do not serve the large numbers of families that would benefit from the Trump plan, but if a family finds that it benefits more from existing programs, they would still be available. The only restriction would be that the same child care spending cannot be used for multiple benefits programs—no double-dipping.


Q: Will Same-Sex Couples Receive The Benefits?

  • The benefits would be available in the same way that the IRS currently recognizes same-sex couples: if the marriage is recognized under state law, then it is recognized under federal law.


Q: Will The Maternity Leave Policy Cause Employers To View Women As Less Desirable Employees Because Of Paid Leave?

  • No. The cost to an employer of hiring should not be affected by this fully-offset policy, so the employer should not view hiring women as adding to their costs of Unemployment Insurance. Further, employers in a competitive marketplace should not eliminate existing maternity care benefits to instead take advantage of the UI system. The UI benefit would only equal what would be paid to a laid-off employee, which is much less than a workers’ regular paycheck. This should prevent abuse while providing a safety net for the sake of the health of mother and child.

–00–

So what I am seeing in media is nothing more than smoke and mirrors as usual.  Don’t you guys know how to think for yourselves before you start ranting — oops sorry considering who you are enslaved to.  As for RINOS simply sit down and figure it out for yourselves.  Your buddies across the aisle are going to get you all branded with that same hot iron.

–Uriel–

About Uriel

Retired educator and constitutionalist
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7 Responses to A Closer Look At Trump’s Proposed Childcare Plan

  1. vonmesser says:

    Shared.

  2. Good answers here, Uriel. I don’t know yet if this is a good plan or not, but it sure makes it harder for detractors to keep accusing the Trump campaign of being short on details or waging a war on women.

    • Uriel says:

      They definitely can’t argue facts since WE can hold their feet to the fire! Go team. Keep them in check by showing them the truth.

      Enterprise had the employee thing going in 2005. I don’t know about others but there is precedent BEFORE the snake got in office.

      Thanks

  3. Hardnox says:

    Good post. Thanks for expounding on my quicky post yesterday.

    Personally, I am against any and all entitlements since none are Constitutional. That said, that’s not the world we live in right now. Charity begins at home. Boot the illegals, all of them. Stop welfare and social security fraud. Eliminate foreign aid to countries that hate us. Eliminate government waste. Eliminate departments. Purge the government rolls. Rebuild the economy and put money in people’s pockets. There will be plenty to assist American families.

    Asking companies to foot the bill for 6 weeks maternity leave is a bit much. The choice to have a child is a personal choice. Why is that a government mandate to businesses? That’s not good, nor is it legal.

    A tax credit is ok in my view. If anyone disagrees then I ask why have a mortgage interest deduction?

    • Uriel says:

      Actually with the Employee Flexible Plan, the employees pay into a fund under which payments are made on a variety of issues. If there was an administered plan which young parents regardless of company set up funds toward pregnant and leave employers might kick in a small percentage but ultimately the couple would foot most of the bill. It is already done for health, day care, and other issues paid into and used during a one year term only. I honestly don’t see how the employer would suffer.