Several new tax breaks were signed into law this year by President Donald Trump that could help spark an economic boom, and with it, a Republican victory in the upcoming midterms.
These new rules were enacted through the “Big Beautiful Bill,” which the commander-in-chief heavily lobbied for, and will be available to people filing their taxes from 2026-2028.
First, Trump’s proposal of no tax on tips and overtime is sure to provide economic relief. The maximum deduction for tips is now $25,000, and the maximum deduction for overtime will be $12,500.
This will likely be very popular with middle-class earners. Nurses, trade workers, service industry employees, and others whose votes are crucial to Republican success will have more money in their pockets.
Another important voting bloc is seniors over 65, especially those who are in need of financial assistance. They are also set to benefit from the new deductions.
“Effective for 2025 through 2028, individuals who are age 65 and older may claim an additional deduction of $6,000,” the IRS website reads. “This new deduction is in addition to the current additional standard deduction for seniors under existing law.”
One policy that will impact voters across the entire political spectrum is having “no tax on car loan interest.”
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“Individuals may deduct interest paid on a loan used to purchase a qualified vehicle, provided the vehicle is purchased for personal use and meets other eligibility criteria,” according to the IRS.
The maximum annual deduction is $10,000 and will begin phasing out for taxpayers with modified adjusted gross income over $100,000 ($200,000 for joint filers).
In order to qualify for the deduction, the interest must be paid on a loan that originated after Dec. 31, 2024, and the car must be for personal use only.
It cannot be a used car, and the location of the automobile’s final assembly must be in America.
If you combine these reforms with Trump’s focus on energy, lower gas prices, inflation reduction, falling interest rates, and potential tariff revenue — you get a recipe for economic success that could help Republicans defy midterm history, and retain both chambers of Congress.
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