The Truth About Trump Economic Policies & Your Wallet

In 2024, more than 68% of Americans cited economic issues as the most important cause when casting their vote. So, what’s the real difference between the Trump economy vs. Biden economy?

While the reality of Trump’s plans remains unclear, the President-elect has made many promises on the campaign trail that could impact your wallet in 2025, especially with support from a Republican-dominated House and Senate.

Here’s what you need to know:

Potential Expansion Of Child Tax Credits

Although the child tax credit expansion, which initially occurred during Trump’s first term in the white house, is set to expire in 2025, he has indicated that he plans to continue this support for working parents.

Trump’s running mate, future Vice President JD Vance, has even suggested that the administration could increase the tax credit up to $5,000, but no official terms have been offered by the Trump tax plan.

More Tax Breaks For Top Earners

The Trump tax plan has long promised to cut taxes for working Americans, but most of those breaks will only be available to the top 5% of earners. Based on Trump’s previous tax plan in 2016, his latest iteration is expected to reduce costs for some Americans, particularly those who earn more than $450,000.

In contrast, middle-class families may still experience some tax relief averaging around $1,000 yearly, or 1.3% of their income.

No More Student Loan Debt Forgiveness

One popular program on the chopping block in the Trump economic plan is Biden’s student loan forgiveness initiative.

Although Trump has not mentioned any specific plans to address student loan costs incurred by millions of Americans, Republicans have successfully fought to block programs that would forgive these debts, which could lead to more financial strain for working Americans with college degrees.

Uncertainty For The Affordable Care Act

Despite assertions that Trump and his allies will overturn the Affordable Care Act (ACA), the truth is that the President-elect has not offered any specific healthcare plans.

Instead, he has stated that he plans to increase competition amongst providers and keep overall costs low, but this aspect of the Trump economic plan remains uncertain.

The Continuation of Inflation & Cost of Living

As evidenced by exit polls in the 2024 election, rising costs and inflation have placed immense stress on working Americans. Although Trump has promised to reduce the costs of common goods and essentials, his economic plan could lead to the opposite.

For instance, Trump’s plan to implement tariffs on imported goods could lead to significantly higher costs for most Americans. Not to mention concerts over proposed mass deportations, which some experts suggest could result in a labor shortage in the agricultural industry.

While the Trump economic plan is still a work in progress, IRS Fresh Start is here to keep you informed with tips and resources on how to navigate these changes with confidence.