UNBIASED - October 23, 2024: IRS Releases 2025 Inflation-Related Tax Adjustments, DoD to Turn Over Arlington National Cemetery Incident Report, GA Supreme Court Blocks New Election Rules, and More.

Episode Date: October 23, 2024

Welcome back to UNBIASED. In today's episode: IRS Releases 2025 Tax Adjustments to Account for Inflation (0:38) Dept. of Defense Ordered to Turn Over Incident Report from Arlington National Cemetery Involving Trump's Campaign (6:28) Georgia Supreme Court Blocks New State Election Rules (8:57) Quick Hitters: FAA Finalizes Regulations for New 'Air-Taxi' Aircraft, Boeing Posts Biggest Quarterly Loss Since 2020, Safety Alert Issued over McDonald's Menu Item, North Korea Sends Troops to Russia, Apple and Goldman Sachs Ordered to Pay $89M, Harris to Appear for CNN Town Hall, Trump to Appear on The Rogan Experience (10:20) Daily Critical Thinking Exercise (13:30) Listen/Watch this episode AD-FREE on Patreon. Watch this episode on YouTube. Follow Jordan on Instagram and TikTok. All sources for this episode can be found here.  Learn more about your ad choices. Visit podcastchoices.com/adchoices

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listen, share the show with your friends, and if you're watching on YouTube, please go ahead and hit that thumbs up button and subscribe to the channel if you're not already. Thank you very much in advance. Today we are covering everything from air taxis to new 2025 tax adjustments to court orders. So without further ado, let's get into today's stories. The IRS has announced the tax changes for tax year 2025, which include adjustments to income tax brackets, standard deductions, and capital gains rates to account for inflation. Now, before we get into the changes, there are a couple of important notes to make here. Number one, these changes are something the IRS does every fall to account for inflation in the upcoming year. Two, these updates will affect tax year 2025, which means we will see the effects when filing our taxes in 2026. And three, we spoke

a lot about the Tax Cuts and Jobs Act of 2017 when I did the special report on each candidate's policies. And as we know, that is expiring in 2025. And each candidate has their own stance on what changes they'll make once it expires. The Tax Cuts and Jobs Act is not to be confused with what we're seeing here today from the IRS. What we're seeing today are changes to existing income tax brackets, deduction amounts, etc. to account for inflation. What the Tax Cuts and Jobs Act did is it modified tax brackets and cut rates, not because of inflation, just because of economic policy. And then finally, the fourth note is because these new changes reflect inflation and because inflation is cooling to its lowest level in three years,

the bracket adjustments are actually smaller for this upcoming year compared to recent years. This year, the adjustment is about a 2.8% increase, whereas in 2024, we saw a 5.4% increase, and in 2023, we saw a 7% increase. What this means is that for tax year 2025, the annual income thresholds will rise by about 2.8% from tax year 2024. So with that said, let's walk through some of these inflation-related changes. Let's start with income taxes. Again, the rates will stay the same as they are now, so the top bracket will stay at a 37% tax rate. But in tax year 2025, this top bracket will apply to single filers earning over $626,350 or married couples filing jointly with income over $751,600. Currently, this top bracket

applies to single filers earning over roughly $609,000, married couples earning over roughly $731,000. So it's about a $17,000 increase for single filers and about a $20,000 income increase for married couples filing jointly. Similar changes take effect for each of the seven brackets, and as you move down the brackets, the changes get smaller and smaller. Those in the lowest bracket at a tax rate of 10% will see the smallest increase, which is about $325 for single filers and about $650 for couples filing jointly. So now maybe what I was saying earlier makes a bit more sense. It's not the rate that's changing, but rather what incomes qualify for which rates. Also, it's worth mentioning before we move on to standard deductions that here in the United States, we have progressive taxation, meaning

your tax rates increase as you earn more money. Tax brackets represent the percentage you'll pay in taxes on each portion of your income. So if your income rises to a higher tax bracket, you only pay that higher rate on the portion above the threshold for that bracket, not on everything you earn. Now let's talk about standard deductions. So the standard deduction reduces a taxpayer's taxable income and it ensures that only households with income above certain thresholds will owe any income tax. When you file your taxes, you can either list all of your eligible expenses, itemized deductions, or take the standard deduction. In tax year 2025, we'll see a slight increase with the standard deduction. So in tax year 2025, single filers will be able to claim $15,000, which is a $400 increase

from the current tax year. And the standard deduction for married couples filing jointly will rise to $15,000, which is a $400 increase from the current tax year. And the standard deduction for married couples filing jointly will rise to $30,000, which is an $800 increase from the current tax year. Finally, heads of households will see their deduction rise to $22,500 in tax year 2025, which is an increase of $600. Moving on to capital gains tax rates, these will also be slightly adjusted. Single filers with income up to $48,350 and married couples earning up to $96,700 will qualify for the 0% rate on long-term capital gains. So this is up about $1,300 and $2,700 respectively. And then we also see a similar change for the 15% long-term capital gains tax rate. There are quite a few other changes as well. These are in areas like foreign income,

gifts, medical savings accounts, etc. So if you're interested in seeing those changes, I do have the IRS's press release linked in the sources section of this episode. Now for a couple of things that won't change despite inflation. And the reason these things aren't changing is because of that Tax Cuts and Jobs Act of 2017. For one, personal exemptions. So personal exemptions for tax year 2025 will remain at zero as in tax year 2024. And this is because a provision in the Tax Cuts and Jobs Act called for the elimination of personal exemptions. Also, itemized deductions. There is no limitation on itemized deductions for tax year 2025, as is in tax year 2024. This is because the limitation on itemized deductions was eliminated as part of that Tax Cuts and Jobs Act. So as mentioned,

these changes will take effect in tax year 2025, which means we will experience the change when we go to file in 2026. And again, whatever changes are made following the expiration of the Tax Cuts and Jobs Act, we'll see those changes take effect in tax year 2026, which we would experience when we file in 2027. And those changes, again, would be more centered around rate changes rather than the changes we talked about today that are inflation related. In some other news, a federal judge has ordered the Department of Defense to turn over records related to former President Trump's recent visit to Arlington National Cemetery. I originally covered the Arlington visit controversy back in August.

Specifically, that's my August 29th episode if you're interested in getting caught up. But just as a quick recap, Trump visited Arlington National Cemetery to commemorate the third anniversary of the soldiers who died in the withdrawal from Afghanistan. Following the ceremony, Trump went to the grave sites of some of the soldiers in an area of the cemetery known as Section 60. Section 60 is a portion of the cemetery that is mainly reserved for deceased veterans of the wars in Iraq and Afghanistan. While in Section 60, an altercation of sorts took place, and that altercation seemingly stemmed from photos and videos being taken of Trump by Trump's staff. Per cemetery rules, only cemetery staff are allowed to take pictures and videos in section 60. Now, the details around

that altercation are not well known. A cemetery employee said there was a verbal and physical altercation between one of the cemetery employees and a member of Trump's staff, whereas Trump's campaign says it was just a verbal altercation, there was nothing physical about it. Trump's campaign did say it would release a video that would exonerate its employees, but that video was never released. So the relevancy of this ruling from the federal judge is that now, once the DOD turns over the records related to that visit, we will get some clarity as to what happened. As far as how we got to this point, that being the judge ordering the release of these records, this order actually stems from a lawsuit filed by American Oversight. American Oversight is a

nonpartisan watchdog group that advocates for the release of government records. In the United States, we have something called FOIA, or the Freedom of Information Act. And that law gives the American public the right to request records from federal agencies, specifically federal agencies. So FOIA does not apply to records held by Congress, the courts, or state and local government agencies, just federal agencies. So American Oversight filed this FOIA lawsuit against the DOD to obtain the incident report that was filed following the incident at the cemetery, and the court has now ordered its release. Once we have access to that report, I will be sure

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Some of these rules include requiring additional steps and inquiry into election results before certifying them, adding identification steps to the absentee ballot process, requiring officials to hand count the number of ballots at each polling place on election day, and increasing security at election sites, such as expanding the number of areas that poll watchers can access and after-hour video surveillance of drop boxes at early voting locations. However, given the timing and substance of these rules, they were challenged. And about a week ago, a lower court in Georgia struck down the rules, finding that they are, quote, illegal, unconstitutional, and void, end quote. From there, state and national Republicans appealed the

ruling directly to the Georgia Supreme Court and asked for one, an expedited appeal, and two, that the Georgia Supreme Court allow the rules to remain in place while their appeal is pending. However, yesterday, the Georgia Supreme Court unanimously denied both of these requests. That means that the appeal will now proceed normally, unexpedited, and the rules will remain blocked until a final decision from the court is rendered. Moving on to some quick hitters, the Federal Aviation Administration has released 880 pages of finalized special regulations for a new type of aircraft that the FAA is calling the powered lift or an air taxi. The final rule contains special regulations as to the training protocols and certification process for pilots of these air

taxis, operational requirements for the new aircraft, and other regulations necessary to integrate this powered lift into the national airspace system. These half-airplane, half-helicopter air taxis will act like helicopters during takeoff, change modes to act more like an airplane during a flight, and then switch back to helicopter mode for landing. One aviation company, Joby Aviation of California, is hoping to bring this type of aircraft to market by 2025. However, it's worth noting that Joby's model aircraft has yet to be certified by the FAA to carry passengers. Boeing posted a $6 billion quarterly loss today, which is its biggest quarterly loss since 2020 when the pandemic

shut down air travel. And while the loss was expected, Boeing's CEO, who took over in August, says the company needs to repair its broken culture, shrink itself, and improve execution on new plane varieties. The CDC has issued a safety alert over McDonald's Quarter Pounder after one person died and 49 others have become sick across at least 10 states. The CDC says that so far it appears the onions used as toppings on the burgers are the likeliest source of the E. coli outbreak. McDonald says it has stopped using these onions and quarter pound beef patties in the affected states. The Secretary of Defense here in the United States confirmed the deployment of North Korean troops to Russia, saying in part, quote,

we are seeing evidence that there are North Korean troops that have gone to Russia. What exactly they're doing is left to be seen, end quote. Today, the United States was expected to release intelligence showing thousands of North Korean troops moving by ship to training areas in eastern Russia. And this confirmation from the United States comes after Ukraine and South Korea said that North Korea had deployed thousands of troops to Russia to help Russia fight the Ukrainians. The United States Consumer and Financial Protection Bureau ordered Goldman Sachs and Apple to pay a combined total of $89 million and temporarily banned Goldman from launching new credit cards due to the company's mishandling of their Apple Card partnership.

The CFPB said Apple neglected to send tens of thousands of Apple Card disputes to Goldman Sachs. And when Apple did inform Goldman of the disputes, Goldman failed to follow federal requirements for investigating disputes. The CFPB also found that the company's misled customers about interest-free payment plans for Apple products. And finally, a couple of campaign and appearance updates. VP Harris will be sitting down for a CNN town hall tonight at 9 p.m. Eastern time, and Trump will be sitting down on the Joe Rogan Experience podcast on Friday. That's just in case you're interested in tuning into either of those. And now it's time for some critical thinking this segment we all love so much we're keeping it

relatively easy and light today i guess remember my goal is just to get you thinking sometimes less thinking sometimes more thinking but always thinking we spoke a few minutes ago about georgia's new election rules that were enacted by the state election board and then subsequently blocked by the courts so i have a couple of questions for you here. Number one, do you think that there should be a time limit on when election rules can be passed? In other words, should rules have to be passed by X number of days or weeks or months, whatever, before an election? And why or why not? And then question number two is, do you think courts should have a say in election rules? And this answer might be an easy yes or an easy no for you, but what I want you to do is try to come up

with an argument for yes and no. No and yes. Even if you feel strongly about one answer or the other, even if your argument is really weak for one side, try it out. That is what I have for you today. Thank you so much for being here. Have a fantastic night and I will talk to you tomorrow.