After failing to fulfill campaign promises to repeal the Affordable Care Act over summer, Republicans hungry for a legislative victory in the first year of Donald Trump’s presidency are looking to pass the first major overhaul of the tax code since 1986.

A major federal tax code revision promises to be the dominant battle in Washington D.C. throughout the end of the year, and it’s a must-win for Republicans eager to prove they can govern before entering an election year with Democrats hot on their heels. Nevada Sen. Dean Heller — up for re-election in 2018 in one of the most competitive Senate seats nationwide — has been aggressively promoting the effort on Twitter as a way to put money in hard-working Nevadans’ pockets, and he has speculated that failure to pass some sort of a tax bill will result in doom for the party.

Though no actual tax “reform” bill has emerged yet, congressional and White House leaders released a nine-page document in late September laying out broad policy goals for a tax bill, including a streamlined tax bracket structure and a reduction in the corporate tax rate as a way to prevent businesses from reincorporating in more favorable tax climates overseas.

And the Republican-controlled Congress has been taking steps to prepare for a vote on tax reform — the House is planning this week to vote on a Senate-backed budget resolution paving the way for a special legislative “budget reconciliation” process. That means Republicans can pass bills on a simple majority vote and avoid the hangups associated with the normal legislative process.

“This is a revolutionary change, and the biggest winners will be the everyday American workers as jobs start pouring into our country, as companies start competing for American labor and as wages start going up at levels that you haven’t seen in many years,” Trump told a crowd in Indiana while announcing the broad framework of the tax plan in late September.

Trump has promoted the plan as the “biggest (tax) cuts ever in the history of this country,” but questions remain before a tax reform package can be passed: Can Republicans identify spending cuts to make up for the expected losses in revenue, or will party members be forced to swallow a massive increase to the federal deficit?

And though many of the exact details of the plan have yet to be revealed, critics have already projected the tax plan will provide a disproportionate benefit to the wealthiest Americans and say predictions that it will unleash economic growth rely on trickle-down theory that has failed to deliver on its promises in past administrations.

Administration officials have attempted to sell the tax plan as a boon for the middle class — the White House’s Council of Economic Advisers estimated that cutting the corporate tax rate down from 35 to 20 percent would “very conservatively” result in a $4,000 increase in average household income. Other economists, including former Council of Economic Advisers Chairman Jason Furman, have criticized that figure as overly generous and based on a “flawed analysis.”

But figuring out what exactly is going on with tax reform can be difficult, especially for Nevadans not used to the obscure parliamentary procedures being used to advance it or unfamiliar with how exactly it affects them.

Here’s a look at what the tax proposal would do, how it would move through Congress and what Nevada’s congressional delegation has to say about the proposal.

NUTS AND BOLTS

The bill aims to simplify the tax code with the idea that people would be able file their income taxes on a postcard. It would reduce the number of tax brackets from seven to three or four, although it isn’t clear which incomes would fit in which brackets.

Currently, income above $418,000 a year is taxed at 39.6 percent. Reports indicate it will be reduced to 35 percent, though Trump has reportedly said the number is open to negotiation. Axios also reported that the tax rate may not be reduced at all for income above $1 million a year.

The plan would cut the corporate tax rate from 35 percent to 20 percent, different from the 15 percent rate Trump promised on the campaign trail. It also establishes a top tax rate for pass-through businesses (a different type of corporate structure used by partnerships or sole proprietorships) at 25 percent.

It calls for doubling the standard deduction -- the dollar amount by which tax filers can reduce their taxable income figure -- that’s used by most average Americans. The current rate is $6,350 for singles and $12,700 for married couples.

It would also repeal the “estate tax,” which applies to multimillion-dollar estates being passed along as an inheritance. The tax hits inherited assets totaling $5.49 million or more in 2017, affecting 5,400 households nationwide and only 50 in Nevada.

The plan also repeals the alternative minimum tax — a levy designed to prevent high-income earners from not paying their fair share by exploiting various tax breaks — and eliminates most itemized deductions outside of those for mortgage interest and charitable contributions.

And it would raise the tax credit offered for each child, leaving the $1,000 current deduction in place while increasing the income levels where the credit tapers off. It also creates a nonrefundable $500 credit for non-child dependents, such as the elderly.

Questions remain about how to offset those cuts. Some of the biggest of the 1.3 trillion in tax breaks the government currently offers each year are ones for employer-paid health insurance, contributions to retirement plans and interest on a home mortgage -- all of which would be painful to reduce or remove.

One route is eliminating a widely used federal deduction for state and local taxes (also known as the SALT deduction), but GOP House members who come from high-tax states strongly oppose it.

Another possibility was limiting the amount of money people can save in their 401(k) retirement accounts. That money is not taxed until retirement, and it means the government gave up $82.7 billion in potential revenue in the most recent fiscal year.

But Trump said in a tweet on Monday that that was a no-go, adding that “this has always been a great and popular middle class tax break that works, and it stays!” Some 54 million U.S. workers participate in 401(k) accounts, representing an estimated $5.1 trillion in assets.

Failure to make up the reduction in revenue through spending cuts likely means a massive addition to the federal deficit, a prospect that has angered fiscal hawks such as retiring Tennessee Republican Sen. Bob Corker, who pledged not to vote for a tax plan “adding one penny to the deficit.”

The conservative-leaning Tax Foundation estimates that the plan would reduce federal revenues over the next decade by between $2.6 trillion and $3.9 trillion even factoring in expected economic growth and a larger tax base. The variance comes because there’s not much specificity on how a small business “pass-through” tax rate would work.

The group concludes that “these changes in the incentives to work and invest would increase the U.S. economy’s size in the long run, boost wages, and result in more full-time equivalent jobs.”

WHO PAYS TAXES

Individual income tax accounts for about 48 percent of the federal government’s revenue, or nearly $1.7 trillion a year. Corporate taxes provide about 9 percent of the revenue, and the rest comes from a smattering of other levies, including gas and alcohol taxes and payroll taxes designed to pay for Social Security and Medicaid.

But a significant portion of Americans don’t pay income taxes at all because they make too little money. The Pew Research Center found that people with incomes below $30,000 filed almost 44 percent of all tax returns and only paid 1.4 percent of federal income tax; two-thirds of those paid nothing at all.  

Poorer Americans benefit from the earned income tax credit, a “refundable” credit that pays out cash to people with low-earning jobs and favors people caring for children. Families with one child can receive up to $3,400 from the credit, while families with three or more children can receive up to $6,318. Childless adults get a maximum of $510 a year.

The tiny fraction of people who make $2 million a year or more a year pay an “effective tax rate” of 27.5 percent, while those who make less than $30,000 a year pay an effective tax rate of 4.9 percent, according to Pew.

The left-leaning Urban Institute and Brookings Institution's Tax Policy Center concludes that almost all the benefits of the plan accrue to the wealthy. While its analysis found that most people would see their after-tax incomes grow, it said the bottom 95 percent of earners would see an increase between 0.5 and 1.2 percent while the top 1 percent would see an average after-tax income increase of 8.5 percent.

The group used static scoring instead of the White House-preferred “dynamic scoring,” which assumes economic growth will drive tax collections higher.

POLITICAL IMPLICATIONS

In light of their failure to repeal Obamacare, Republicans see passing the tax bill as vital to their success in the upcoming election cycle. Trump reiterated this to House lawmakers on Sunday, according to a GOP aide familiar with the conversation who spoke to The Associated Press.

The success of a tax reform measure is also important to Heller, the senior Nevada Republican senator who’s facing tough challenges ahead of his 2018 re-election campaign.

Heller has promoted tax reform incessantly on social media and said that the Republican Party is “doomed” if a tax reform plan doesn’t pass by the end of the year. He said in a September interview with Nevada Newsmakers that he supports the administration’s plan to reduce the corporate tax rate down by more than half, to 15 percent; the current framework only pares it to 20 percent.

“The reality of the situation maybe will be something a little bit different," Heller said. "But as far as I'm concerned, getting that tax rate as low as possible and as aggressive as we can is key to getting this done."

Danny Tarkanian, a candidate who’s run numerous times and is a primary opponent against Heller, said in an email release last week that he supported the president’s tax plan and would be “closely monitoring” how Heller votes.

Democrats have by-and-large rejected any Republican-backed plans to modify the tax code as sops to the wealthy. Catherine Cortez Masto, the junior Nevada Democratic senator, called for a bipartisan buy-in on tax reform when the general framework was first introduced.

“I am reviewing this plan but cannot support legislation that would be a windfall for the wealthiest Americans and special interests, increases the deficit, and refuses to make the necessary investments in the future of our working families and our country,” she said in a late September statement.

Nevada’s House Democrats have also largely panned the proposed tax code changes — Rep. Dina Titus said in August that the plan “rigs the system to benefit the wealthy,” while fellow Rep. Jacky Rosen — who’s running against Heller in the 2018 Senate race — tweeted Friday that she’s “against any plan that benefits billionaires at the expense of middle class.”

THE PROCESS

Republicans are hoping to use the budget reconciliation process — most recently used in the unsuccessful efforts over the summer to replace the Affordable Care Act — to pave the way for tax code reform.

Created in 1974 and used about 20 times since 1980 on various high-profile bills, budget reconciliation is a special legislative process that allows for the rapid consideration (no filibusters and limited amendments) on various tax, spending and debt limit legislation. Bills are approved on a simple majority vote as opposed the usual 60-vote threshold in the Senate.

The reconciliation process has typically been used as a way to decrease deficits, though on occasion it’s been used in ways that increase the deficit — most notably the George W. Bush-backed tax cuts in the early 2000s.

To get to reconciliation, congressional leaders first need to pass an annual budget resolution that includes “reconciliation directives,” or instructions for the desired committees. But there are a few catches with the procedure — reconciliation can only be used once for increasing or decreasing spending, revenue or debt limits by specified amounts over a set amount of time once per year, and it typically only captures entitlement spending areas including Medicare, Medicaid, federal employee retirement, food assistance and farm aid programs — but not Social Security.

Though the fiscal new year began on Oct. 1, Congress is just now taking up a federal budget resolution. The federal government’s bills are being paid through a continuing resolution passed in September that funds the government through December.

Though the budget resolution outlines “aspirational,” non-binding cuts of roughly $1.5 trillion over the next decade to achieve a balanced budget by 2027, the cuts themselves aren’t backed up by actual legislation. Corker called the budget resolution “meaningless” outside its ability to open the reconciliation process to a tax reform.

Senate Republicans did just that last week, approving a budget resolution allowing for as much as $1.5 trillion to be added to the deficit over the next ten years. Reconciliation instructions don’t detail exactly what legislative changes will be needed to accomplish the requirements outside a $1 billion cut from the Senate’s Natural Resources Committee.

The House has passed a different budget, although that chamber’s Republican leaders indicated they would bring the Senate’s budget up for a vote later this week. Though the House is also required to pass reconciliation bills, the process is more useful in the Senate where it can be used to overcome filibusters and other delaying tactics from the minority party.

Once the budget resolution is passed, the budget committees in the House and Senate take up the proposals, and bundle any measures originating in different committees before sending the full reconciliation bill to the floor. Like any other bill, a conference committee is used to settle any differences between the Senate and House version of the bills before — if approved — sending it to the president’s desk.

The Senate’s budget blueprint sets a Nov. 13 deadline for a reconciliation tax bill to pass.