IRS data from 2017 to 2022 show the Tax Cuts and Jobs Act (TCJA) reduced the average amount of personal income taxes paid by all income brackets, with lower- and middle-income Americans benefiting the most
Though all filers received income tax reductions, working-class Americans received substantially higher tax rate cuts than higher-income filers
Higher-income earners shouldered a greater percentage of the tax burden from 2018-2022 compared to 2017, indicating the TCJA made the tax code more progressive
ARLINGTON HEIGHTS, IL (April 8, 2025) – Since its passage in 2017, the Tax Cuts and Jobs Act (TCJA) has faced persistent criticism for allegedly favoring the wealthy at the expense of working families. However, a new study from The Heartland Institute proves the exact opposite is true.
In 2021, The Heartland Institute released a policy brief that studied the effects of the TCJA on personal income taxes by comparing Internal Revenue Service (IRS) data from 2018 against data from 2017. The 2021 analysis found that while the TCJA led to tax savings for all income brackets, lower- and middle-income filers received disproportionately larger average effective income tax rate cuts compared to their wealthier counterparts—the reverse of what critics claim. The study also found that higher-income earners paid a larger share of the total tax burden in 2018 than they did in 2017, suggesting the tax code became slightly more progressive.
With Congress on the cusp of deliberating whether to renew the TCJA’s tax cuts, which are currently set to expire at the end of 2025, Heartland has published an update of its 2021 report to provide policymakers and the public with accurate information on the true effects of the TCJA.
Heartland’s new study, titled “Tax Cuts & Jobs Act: An Updated Study on the Effects of the Tax Cuts and Jobs Act on U.S. Personal Income Taxes,” includes IRS data from 2017 through 2022, the last year for which data is currently available. Because the new study analyzes four additional years of data compared to the 2021 study, it provides a more comprehensive picture of the TCJA’s effects and ensures 2018 was not an outlier.
Heartland’s 2025 study provides ironclad confirmation of the initial findings from its 2021 report. From 2019 to 2022, lower- and middle-income filers continued to experience greater tax rate cuts, while wealthier Americans took on a greater percentage of the overall tax burden, providing further evidence of the TCJA’s progressive effects.
For example, filers in the “$40,000 under $50,000” bracket paid an average of nearly 19 percent less in income taxes in 2022 than the average filer in the same income bracket in 2017.
Filers in the “$50,000 under $75,000” bracket paid 16.58 percent less, and filers in the “$75,000 under $100,000” bracket paid nearly 11 percent less.
Higher-income earners received much lower average tax rate cuts. For example, the “$5,000,000 under $10,000,000” bracket paid only 2.3 percent less in 2022 compared to 2017. Each of the five income brackets containing filers who made more than $1 million in 2022 received tax rate cuts of less than 6 percent. This is less than one-third of the percentage cuts received by filers in the “$40,000 under $50,000” bracket.
As further evidence of the TCJA’s progressive nature, in 2022, every income bracket earning less than $200,000 paid a smallershare of the overall tax burden than they did in 2017. On the other hand, every income bracket above $200,000 paid a greatershare of the overall tax burden.
Moreover, Heartland’s study finds that tens of millions of working-class filers have enjoyed total tax savings of at least $6,000 since the TCJA’s passage. For example, the study estimates that filers in the “$75,000 under $100,000” bracket have saved an average of more than $6,300 since 2018, while filers in the “$100,000 under $200,000” bracket have saved nearly $13,500.
Additionally, the TCJA may have had a positive impact on economic mobility. For example, in 2019, the “$100,000 under $200,000” bracket included approximately 2 million more filers than it did in 2017.
Lastly, as Heartland’s study references, it is worth noting that despite the claims of many of the TCJA’s critics—who have said the TCJA would decrease federal tax revenues and balloon the deficit—total individual income tax revenues have increased since the TCJA was signed into law. According to IRS data, total individual income tax revenues were $1.6 trillion in 2017. Though there was a slight decrease in income tax revenue in 2018, revenues rose in the years that followed. By 2022, total individual income tax revenues exceeded $2.13 trillion.
As lawmakers weigh the future of the Tax Cuts and Jobs Act’s provisions, Heartland’s study provides critical evidence that the law’s primary beneficiaries have been America’s working families—not the wealthy elite.
The following statements by authors of the policy study from The Heartland Institute – a free-market think tank – may be used for attribution. For more comments, refer to the contact information below. To book a Heartland guest on your program, please contact Director of Communications Jim Lakely at [email protected] and 312/377-4000 or (cell) 312/731-9364.
“The Tax Cuts and Jobs Act has become one of the most misunderstood economic policies in modern American history. Opponents have spent years misleading the public, claiming the law was designed to benefit billionaires at the expense of ordinary Americans.
“As our analysis of IRS data proves, those critics were wrong. The TCJA delivered the largest tax rate cuts to working-class Americans and made the tax code more progressive by increasing the share of income taxes paid by the wealthy. That’s not a partisan opinion—it’s the story told by the IRS’s own numbers. If Congress fails to extend these tax cuts, it won’t be the millionaires who suffer most. It will be the families living paycheck to paycheck.”
Justin Haskins
Senior Fellow, Glenn C. Haskins Emerging Issues Center
The Heartland Institute
[email protected]
“The Tax Cuts and Jobs Act has done the exact opposite of what Democrats and leftists said it would do. Based on indisputable evidence, the TCJA has been a boon to hardworking Americans. As the IRS data show, in the years since the TCJA became law, households on the lower end of the income spectrum received the largest percentage cuts and now pay less of the total tax burden. While it is true that those on the higher end of the income spectrum also received rate cuts, it is vital to note that they now pay more, not less, of the total burden.”
Chris Talgo
Editorial Director
The Heartland Institute
[email protected]
“Despite the widespread narrative that the tax cuts included in the Tax Cuts and Jobs Act disproportionately favor the wealthy, our analysis of hard IRS data tells a very different story. The evidence overwhelmingly indicates that lower- and middle-income households have received the largest tax cuts as a percentage of income, while higher earners actually took on a greater share of the overall tax burden.
“As Congress debates the future of the TCJA, it is critical to separate misinformed rhetoric from reality. The data is clear: extending the TCJA’s personal income tax provisions would continue to benefit all Americans, with a disproportionately positive impact on working class Americans. If the TCJA’s provisions are not extended, those who can least afford the resulting tax rate hikes will suffer the most, with many paying thousands of dollars per year in additional taxes.”
Jack McPherrin
Research Fellow, Glenn C. Haskins Emerging Issues Center
Research Editor
The Heartland InstituteResearch Fellow, Glenn C. Haskins Emerging Issues Center
[email protected]
The Heartland Institute is a national nonprofit organization founded in 1984 and headquartered in Arlington Heights, Illinois. Its mission is to discover, develop, and promote free-market solutions to social and economic problems. For more information, visit our website or call 312/377-4000.
