What a Harris Presidency Could Mean for the Wealthy
America is home to nearly 22 million millionaires, according to Statista. That’s the most of any country by far. By comparison, No. 2 China has just over 6 million. That means 6.6% of the U.S. population is a member of the two-comma club — and they’re not the richest by far.
According to a report by investment firm Henley & Partners, New York City, the San Francisco Bay Area and Los Angeles have a higher concentration of centi-millionaires — those with $100 million fortunes or more — than all the other cities in the world. The same trio of cities takes the top three spots for the most billionaires.
America is the home turf of the world’s wealthiest people, and in a few months, a new president will have a lot of sway over the future of their fortunes. Here’s what they can expect if Vice President Kamala Harris emerges victorious in November.
Check Out: Kamala Harris’ Platform: How Her Plan for Social Security and Medicare Could Impact Your Finances
Read Next: 7 Reasons You Must Speak to a Financial Advisor To Boost Your Savings in 2024
This Rich, but Mostly the Ultra-Rich, Could Face a New Tax Landscape
If you’re rich, the IRS is the most consequential organization in the federal government, and Harris has consistently said that America’s tax code is packed with too many loopholes and breaks for the wealthy — and that she’ll change that if she wins.
“Higher taxes, especially on capital gains and estate taxes, seem probable to fund new social programs,” said Vonda Copeland, CPIA, CWCU and founder of Copeland Insurance.
The Tax Foundation, a research, data and analysis organization billed as “the world’s leading nonpartisan tax policy 501(c)(3) nonprofit,” outlined the fundamentals of Harris’s tax policy and how it differs from the Biden administration’s current framework.
Here’s how Harris’s tax proposals could impact the wealthy.
Vice President Harris’s Past Tax Proposals
Starting with her failed 2020 presidential run, Harris has made several of her key tax policy ideas well known.
Raising the highest marginal income tax rate on the top 1% from 37% back to 39.6%.
Instituting a 4% “income-based premium” on households earning more than $100,000 a year to pay for “Medicare for All.”
Raising capital gains tax rates to ordinary income tax rates, though it is unclear if Harris would do so only for the wealthy.
Raising the corporate income tax rate to 35% from 21%.
Broadly expanding the estate tax.
Imposing a transaction tax at a rate of 0.002% for derivative transactions, 0.1% for bond trades and 0.2% for stock trades.
Learn More: 5 Presidents Who Raised Taxes the Most, and 5 Who Lowered Them
How Her Tax Proposals Differ From President Biden’s
Although Harris is the No. 2 in the Biden administration, her ideas aren’t always in line with the current White House’s 2025 budget proposal.
Harris prefers a 35% corporate tax rate compared to the 28% Biden proposed.
Biden’s 2025 budget would apply the ordinary income tax rate to capital gains on people making at least $1 million. Harris has indicated that she’ll tax capital gains as regular income, too, but she hasn’t clarified whether she would apply it to high earners only or to everyone.
Harris wants a transaction tax on trades, including stocks, bonds and derivatives, while Biden has made no such proposal.
Biden does not support Medicare for All and vowed not to raise taxes on incomes under $400,000. Harris supports such a plan funded by tax hikes on anyone making six figures.
Many Will Scramble To Tie Up Loose Ends While They Still Can
Cynthia Hernandez is the managing attorney for Hernandez Family Law & Mediation. She previously clerked for the Department of Financial Services in Tallahassee in the insurance regulation division and is admitted to practice in several states and U.S. District Courts.
She expects a flurry of activity from wealthy households feeling pressured to take advantage of favorable tax and regulatory structures that Harris would likely target while they still have the chance.
“Family law attorneys often see high-net-worth clients adjusting estate and trust plans in anticipation of policy changes that could impact wealth transfer and estate taxes,” she said. “There may be a rush to finalize divorce agreements and property settlements before the election to take advantage of current tax rates and codes.”
Harris or No Harris, the Rich Will Probably Fare Just Fine
The rich — and certainly the ultra-rich — have the resources and connections to hire teams of dedicated professionals who excel at guarding and maintaining fortunes, including the best and brightest wealth managers, investment advisors, tax attorneys and even family offices, which are teams of professionals that work full-time exclusively for a single client or family.
“The truly wealthy are often able to take advantage of sophisticated tax planning to minimize increases,” said Hernandez.
According to Forbes, here are some of the asset classes, financial services, products and tactics that the wealthy leverage to stay rich and get richer, no matter which person or party is in power:
Real estate holdings
Bank and taxable investment accounts
Trusts and offshore trusts
Comprehensive strategic planning
Complex insurance coverage
Retirement accounts
Tradable securities
Business interests
Personal property and valuables
Liquidity — most millionaires keep a little more than 10% of their investable assets as cash
Estate planning
Continuous learning
Editor’s note on election coverage: GOBankingRates is nonpartisan and strives to cover all aspects of the economy objectively and present balanced reports on politically focused finance stories. You can find more coverage of this topic on GOBankingRates.com.
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