Intuit Academy Tax Practice Exam 2025 - Free Tax Practice Questions and Study Guide

The Tax Cuts and Jobs Act (TCJA), which was enacted in December 2017, primarily affects tax rates and deductions, making significant changes to the U.S. tax code. One of the most notable changes was the reduction of the corporate tax rate from a maximum of 35% to 21%, which aimed to stimulate economic growth. Additionally, the TCJA altered individual income tax rates by lowering them for many taxpayers and adjusting the income brackets.

This legislation also updated various deductions, including increasing the standard deduction while limiting or eliminating certain itemized deductions. For example, the cap on state and local tax deductions (SALT) significantly impacted taxpayers in states with high income and property taxes, demonstrating how the TCJA restructured not only tax rates but also the framework within which taxpayers could claim deductions.

In contrast, healthcare costs and benefits are primarily addressed through legislation like the Affordable Care Act, while state tax regulations are determined by individual state governments and not directly altered by the TCJA. Lastly, Social Security benefits remain largely unaffected by this tax reform, as they are typically governed by different laws and funding mechanisms. Therefore, the overall impact of the Tax Cuts and Jobs Act centers on how it transformed tax rates and deductions across various individual and corporate tax