An increase in income tax rate means you'll pay a higher percentage of your income to the government. This directly reduces your disposable income, the money you have left after taxes for spending or saving. This can make it harder to afford basic necessities, save for retirement, or invest in your future.
President-elect Donald Trump declared victory overnight after convincing wins in Georgia, North Carolina and Pennsylvania; further electoral gains this morning could preview a true red wave this cycle, pending results in additional House races.
Senate Republicans secured a clear majority, successfully defending incumbents and gaining at least three additional seats with victories in Montana, Ohio and West Virginia. Several key Senate races that will determine Republicans’ final margin of control in the chamber remain too close to call this morning.
As expected, it may take days or weeks to officially determine control of the House next session. The fate of the House will determine the full slate of powers available to Republicans—chief among them: whether they can use budget reconciliation to enact legislation next year. Budget reconciliation is an invaluable tool, and its viability is particularly compelling as Washington prepares for expansive negotiations on tax policy, including the expiring provisions of the Tax Cuts and Jobs Act. Governing dynamics will differ notably in a Republican trifecta scenario versus continued divided government, but the incoming administration is expected to move swiftly to freeze and potentially rollback various Biden-era rulemakings regardless of congressional makeup.
While Republican control of the Senate is assured, the conference must convene next week to decide on a new era of leadership in the chamber. Longtime party leader Mitch McConnell (R-KY) will pass the baton to a successor—and soon-to-be majority leader—determined by his members. In any scenario, the Senate agenda will feature a steady stream agency appointees and judicial nominees, mixed with proposals that aim to reduce federal spending, roll back regulatory burdens, enhance border security and curb the influence of China, among other priorities. A Republican House would coalesce around similar policy goals, but a Democratic House could focus heavily on oversight of the new administration.
As ever, Brownstein maintains strong ties to leaders on both sides of the aisle and the incoming administration, with multiple Trump administration officials among our ranks. Please read on, by clicking below, for key race results and our analysis of the lame duck session and leadership in the 119th Congress.
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