By Fatma Younis
With polls suggesting Democrats could flip at least one chamber in the upcoming midterm elections, historical precedent shows that changes in congressional control have led to significant tax legislation affecting taxpayers.
1994: Republicans Gain Control
Republicans captured the House and Senate for the first time in four decades, leading to bipartisan negotiations with President Bill Clinton. The Taxpayer Relief Act of 1997 created the Roth IRA, Child Tax Credit, lifetime learning credit, and cut the top capital gains rate from 28% to 20%. The Tax Foundation estimated $95.3 billion in taxpayer savings over five years.
2006: Democrats Take Congress
Democrats won both chambers for the first time since 1992. In 2007, President George W. Bush signed the Fair Minimum Wage Act, raising the federal minimum wage from $5.15 to $7.25 over two years. The bill included tax incentives for small businesses, a key condition for Republican support.
2010: Republicans Win House
Republicans seized the House midway through Barack Obama's first term, sparking budget battles. The resulting Tax Relief, Unemployment Insurance Reauthorization and Job Creation Act of 2010 extended Bush-era tax cuts and unemployment benefits. Later, the American Taxpayer Relief Act of 2012 made many of those cuts permanent for lower- and moderate-income earners.
2018: Democrats Capture House
Democrats won the House during Donald Trump's first term, blocking further Republican tax cuts. They protected individual provisions of the 2017 Tax Cuts and Jobs Act and helped pass the bipartisan SECURE Act of 2019, which expanded retirement savings access.
