Kerra Bolton

Sat, Jun 14, 2025, 4:00 AM3 min read

President Donald Trump’s proposed tax initiatives promise lower rates, fewer deductions, and big shifts in how income is taxed. However, the real question for everyday Americans is simple: Will I come out ahead or lose money?

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Here are four types of people who will lose and make money due to Trump’s new tax initiatives.

The proposed plan would cut the top individual tax rate from 37% to 30%, significantly reducing tax liability for households earning over $400,000.

“Wealthy individuals will likely seize the opportunity of idle capital gains, given their new ability to offset this with additional depreciation,” said Hector Castaneda, certified public accountant (CPA) and principal at Castaneda CPA & Associates.

“Additionally, removing the SALT deduction cap would likely nudge the wealthy towards second homes or moving to income-tax states and spending less because philanthropy will become a little less attractive (at least from a financial perspective).”

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If passed, Trump’s plan would expand the Child Tax Credit from $2,000 to $2,500 per child. While most families with children are expected to benefit, middle-income households are anticipated to gain the most, with average credits approaching $3,000.

While the tax credit could help offset the rising cost of living, education and childcare expenses for most middle-class families, low-income families may not receive the full benefit. In addition, if funding for programs such as SNAP, childcare subsidies or Medicaid is cut to offset tax breaks, lower-income parents and children could end up worse off overall.

“Major cuts to SNAP and Medicaid will negatively impact child health outcomes, educational achievement and overall well-being,” said researchers in a report for Georgetown Law School’s Center on Poverty and Inequality.

Pass-through businesses could see a lower flat tax or expanded deductions, especially if Trump’s proposal to cap business takes 15% to 20% passes.

Entrepreneurs and gig workers using LLC structures may benefit from an expanded Qualified Business Income (QBI) deduction, streamlined tax reporting and potentially reduced tax rates. These provisions are designed to reward small businesses and self-employment.