Which income brackets receive the largest tax cuts under the 2025 Working Families Tax Cut Act?
Executive summary
The One Big Beautiful Bill (aka the Working Families Tax Cut Act) was marketed as delivering the largest tax cuts to middle‑income households — the Ways and Means Committee asserts an average $1,300 cut and that households under $100,000 get at least a 12% cut [1] [2]. Independent and progressive analysts dispute that framing, citing CBO and other nonpartisan work that the largest dollar cuts go to high‑income households — for example, the Guardian cites a CBO figure of a $13,622 cut for the top 10% (p1_s5; [4] contains tracking context).
1. “Working families” claim: middle incomes get the biggest boost
Republican House sources and Ways and Means releases present the law as targeted to working and middle‑class families: they say the “typical family” gets up to $10,900 in additional take‑home pay and that households earning less than $100,000 receive at least a 12% tax cut; Ways and Means also touted an average $1,300 tax cut for working families relative to current law [2] [1]. The House messaging cites specific examples — e.g., avoiding a $1,700 tax hike for a median family of four — to support the claim that middle incomes receive the largest benefit in percentage terms [1] [2].
2. Independent analysts: big winners are the wealthy in dollar terms
Non‑partisan and progressive outlets report a different distribution. The Guardian, citing the Congressional Budget Office, reports that the top 10% receive roughly a $13,622 average tax cut — a magnitude far larger than the average gains reported for lower income groups [3]. The Tax Policy Center and CBO are tracking the bill’s provisions and note that many TCJA features are extended; context from those trackers underscores that extending broad rate cuts and permanent preferential treatment tends to concentrate large dollar benefits at higher incomes [4].
3. How “largest” is being measured — percent change vs. dollars vs. incidence
Partisan and neutral sources use different metrics. Ways and Means emphasizes percent changes and “largest changes in after‑tax income” for the middle 60% in the near term, which can show middle incomes getting the biggest proportional gains [5]. By contrast, opponents and some independent analysts focus on absolute dollar gains, where the very wealthy receive the largest nominal tax reductions [3] [6]. Both presentations are factually supported by different studies cited by the parties: Ways and Means cites a Tax Foundation study for middle‑income percentage gains, while other outlets cite CBO or CBO‑referenced analyses for dollar‑value gains to high earners [5] [3].
4. Key provisions that shape the distribution
The law keeps many TCJA elements — lower statutory rates, a higher standard deduction, and expanded Child Tax Credit rules — and makes some permanent changes that disproportionately affect higher incomes in dollars while helping many middle earners in percentages [7] [4] [8]. The bill also includes targeted items like expanding the Child Tax Credit and exempting certain tip/overtime income for some workers, which produce small nominal gains for low‑income households but larger absolute gains for the wealthy through sustained rate cuts and corporate tax policy carryovers [7] [8] [3].
5. Critics’ broader economic and distributional concerns
Progressive organizations warn that the net effect will favor the wealthy and leave working families worse off when accounting for offsets (tariffs, spending cuts, expiration of other supports). The Center for American Progress and CBPP argue that middle and lower incomes could face net losses in real purchasing power or much smaller gains after policy interactions, and CBPP documents that by 2027 average families under $50,000 get only about $250 while millionaires get six‑figure breaks [9] [6]. The Economic Policy Institute also flags long‑term fiscal damage and regressive outcomes if corporate and wealthy tax rates remain low [10].
6. What the available sources do not settle
Available sources do not mention a single unified, peer‑reviewed distributional table from CBO or Treasury in this packet that breaks out exact average tax cut by every income percentile for 2025 versus later years; instead we have competing summaries and selected figures cited by partisan actors and media [1] [3] [5] [4]. Analysts differ on whether to include temporary provisions, tariff offsets, or later phase‑outs when declaring “largest” beneficiaries, and the sources provided reflect those methodological differences [4] [9].
Bottom line: Republicans and Ways and Means frame the Working Families Tax Cut Act as largest for the middle 60% in percentage terms and advertise average boosts like $1,300 or claims of 12% cuts for under‑$100k households [1] [2] [5]. Independent reporting and CBO‑cited figures show the largest absolute dollar cuts accrue to the top decile and especially the top 1%, with top‑end households seeing vastly larger dollar reductions [3] [6]. Which claim is “true” depends on whether you measure by percent change, dollar amount, or net effect after related policies — the sources supplied demonstrate all three narratives are being advanced.