Looking forward now that it is 2025 most Texans will have the opportunity to file their federal income taxes online for free using a new website from the IRS. Some information calls it Free File and others call it Direct File. In either case Texans and those in several other states that do not have state income taxes will have the option to use the site to prepare and file their taxes for free. No need to visit an H&R Block office or use Turbo Tax and pay your hard earned money to file the simple form and get your income tax refund quickly. Of course the caveat is that 5 House Republicans from Texas joined 23 others in sending a letter to president-elect Donald Trump asking him to cancel the program as soon as he takes office. That’s certainly what Intuit, the makers of Turbo Tax, H&R Block, and the other corporations that make billions from average Americans using their products would like to happen. Intuit has been fighting to prevent this very scenario for 25 years and President Biden made it happen.
Beginning January 1, 2025 several aspects of the Inflation Reduction Act that Joe Biden ushered through congress a couple of years ago will take effect. Most notably the annual out-of-pocket cap on prescription drugs for Medicare Part D beneficiaries has been lowered to just $2,000. This is huge for our seniors and disabled. I know from personal experience how important this is. This change will save our household an average $500 per month compared to last year.
Medicare will begin negotiating drug prices with manufacturers for certain high-cost drugs, with some of these negotiated prices taking effect this year; saving our tax dollars for better purposes. Another cost saving measure from the bill taking effect this year is that pharmaceutical companies will be required to pay rebates to Medicare if they raise drug prices faster than inflation.
House Republicans have held floor votes more than two dozen times trying to repeal various aspects of the Inflation Reduction Act. The conservative Cato Institute urges Republicans to overturn the whole bill. Considering the influence that Elon Musk and pharmaceutical billionaire Vivek Ramaswamy have on Trump don’t be shocked if the Medicare Part D prescription cost out of pocket limit suddenly goes back up in a year or two.
Since Joe Biden took office enrollment in the Affordable Care Act Marketplace insurance plans has nearly doubled. Unfortunately a large fraction of the subsidies that make those insurance premiums affordable will expire at the end of 2025. Republicans are unlikely to renew the subsidies so even if they fail to pass their plan to repeal the Affordable Care Act, aka Obamacare, millions of Americans especially in Texas will lose their health insurance because they can no longer afford the premium.
The theme you should have noticed is that Democrats have worked hard to save average Americans money while Republicans are making efforts to undo those efforts in order to benefit a relative handful of rich people.