Last Updated Apr 25, 2019 9:07 PM EDT
Coronado, Calif. — Many Americans were shocked by theirthis month. The new law was especially costly for our nation's Gold Star families, who saw the taxes owed on their survivor benefits skyrocket.
Theresa Jones has been a single mom to Anthony and Hunter for almost six years. Her husband Landon, a Navy chopper pilot, died in the Red Sea during Operation Enduring Freedom in 2013.
It's been a challenge for Jones, especially financially. They've been able to stay afloat because of the survivor benefits they receive, aid that came with an unexpected surprise at tax time.
"When I saw that tax bill I was shocked at how much these boys owed on benefits that were given to them," Jones said.
The boys each received about $15,000 in survivor benefits last year. Jones was hit with a tax bill of $5,400 for them, up from $1,100 from the previous year.
"That's how they have a roof over their head. That's how they have food in their mouths. That's why the lights are on right now. That's how we survive every month," Jones said.
Because a surviving spouse can't receive both Veteran Affairs and Defense Department benefits simultaneously in full, Gold Star parents often sign the taxable DOD benefits over to their children. But the new tax law lumps Gold Star children into a bracket known as the "kiddie tax" at 37 percent, much higher than their previous tax rate.
"We got lumped into that and somebody had said to me, 'Welcome to the top four percent.' I said, 'My 5-year-old is not top four percent,'" Jones said.
The Treasury Department says it is "evaluating what can be done to solve this issue."
Besides her most important job as mom, Jones works part time and is going to school. With the new tax burden, something will have to give. She hopes it won't be her home.
"For the boys, it's all they've known and I would hate to take that away from them. They've already had so much taken away from them," she said.