Harrington Breaks Down Tax Reform Prospects in Wake of Budget Passage

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"We've been working on this all year" Ryan said at a Reuters Newsmaker event Wednesday morning, adding House lawmakers spent time on the front end to get on the same page as the Senate and the White House.

Sen. Tammy Baldwin, D-Madison, said in a statement that "the idea from Republicans to make it more expensive for Wisconsinites to save for retirement as a way to help pay for tax cuts for the top one percent is a bad deal".

The 216-212 vote permits Republicans to begin work on a follow-up $1.5 trillion tax cut and move it through Congress without fear of blocking tactics by Democrats. "We'll lose the House, probably lose ground in the Senate and President Trump has got a profile different from the party - there's kinda two or three different Republican Parties now, I guess".

There are plenty of other potential pitfalls, too: Politico's Brian Faler lays out five other potential sticking points, including changes being considered to the tax treatment of 401 (k) accounts and the unpredictability of independent-minded senators - and, of course, President Trump himself. The Urban Institute, a left-leaning think tank, concluded that 70 percent of the retirement tax benefits from defined contribution plans like 401 (k) s go the highest 20 percent of earners.

"He'd like to raise the limits so people can save more in those plans". Members from New York, New Jersey and other high-tax states are concerned about a provision in the GOP tax reform framework that would eliminate the ability to deduct state and local taxes.

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"These tax cuts will not create an economic boom, but will instead lead to a higher concentration of wealth among the rich, while dramatically increasing deficits and debt", said Rep. John Yarmuth, D-Ky.

But Republican lawmakers from higher-tax states such as NY are resistant to that idea. Besides voters, the 401 (k) is also beloved by the puissant financial services industry because it increases the amount of money they get to manage and collect fees on. One of them is Rep. Peter T. King from NY. "That will not last them in retirement", Brady said.

Brady was expected to introduce tax overhaul legislation next week, as Trump has long promised. Whether more revenues to bring members on board will be needed and where they'll come from is still an open question.

With Republican leaders battling to show themselves as true standard bearers for the middle class, eyeing next year's midterm elections that are deemed essential to retaining their majority, the 401 (k) issue has become a flashpoint. "Passing tax reform is critical, but we must stop spending more money than we take in". Jeff Flake, to quiet life outside of elected politics, the defection on such a large bill by 20 Republicans is a cause for celebration for Democrats and a warning sign to Republicans that some in their party may have the guts to just say no to a president and party that wants to upend the nation for the sake of upending establishment politics.

Even after Trump's tweet, multiple reports have indicated GOP congressional leaders continue to mull such changes as a means to help offset tax revenue lost through proposed tax cuts for businesses and individuals.