Trump vs. Biden Again in 2024? What That Could Mean for Your Taxes
President Joe Biden and former President Donald Trump have earned their parties’ presidential nominations and are headed for a rematch in November. There’s a lot at stake this election, and both nominees have big plans for the nation’s tax system.
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U.S. taxpayers could potentially see some significant changes that will be decided by the outcome of the 2024 election. Here’s a closer look at Trump’s and Biden’s tax policies and what’s at stake.
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Donald Trump’s Tax Proposals
The tax cuts included in the 2017 Tax Cuts and Jobs Act are due to expire by the end of 2025. In a private speech to donors, Trump said his policies include “extending the Trump tax cuts” if he is elected, according to a Trump campaign official and as reported by NBC News.
Per Reuters, the Republican presidential candidate has also indicated to advisers he’s open to the idea of a new middle-class tax cut if elected, according to two people familiar with the discussions. Recent conversations also suggest that his economic advisers are seeking a payroll tax cut and possibly discussing an increase in the standard deduction on year-end tax returns, as well as reducing the marginal income tax rate for middle-income households. As of yet, no commitments have been made.
Here are some of Trump’s proposed tax policies made publicly available and tracked by the Tax Foundation.
Business Taxes
Maintain the 21% corporate income tax rate.
Excise Tax
Make the estate tax cuts from the 2017 Tax Cuts and Jobs Act permanent.
Individual Income Tax
Make the individual income tax cuts from the 2017 Tax Cuts and Jobs Act permanent.
Tariffs and Trade
Levy a universal baseline tariff on all U.S. imports.
Levy a 60% tariff on all U.S. imports from China.
Joe Biden’s Tax Proposals
Biden has vowed to make the tax code fairer, promising to make “big corporations and the very wealthy finally pay their fair share,” according to NBC News. The publication also noted that he supports a corporate rate hike from 21% to 28% and said that “nobody earning less than $400,000 will pay an additional penny in federal taxes.”
Here are some of Biden’s proposed tax policies made publicly available and tracked by the Tax Foundation.
Business Taxes
Increase the corporate income tax rate from 21% to 28%.
Capital Gains and Dividend Taxes
Tax long-term capital gains and qualified dividends at ordinary income tax rates for taxable income above $1 million.
Tax unrealized capital gains at death above a $5 million exemption ($10 million for joint filers).
Tax carried interest as ordinary income.
Levy a minimum effective tax rate of 20% on unrealized capital gains for households with net wealth above $100 million.
Credits, Deductions and Exemptions
Make the child tax credit (CTC) fully refundable on a permanent basis.
Increase the CTC to $3,600 for young children and $3,000 for older children and make it fully refundable in addition to other changes on a temporary basis.
Increase the earned income tax credit for workers with qualifying children on a permanent basis.
Expand premium tax cuts on a permanent basis.
Estate and Wealth Taxes
Strengthen current rules.
Excise Taxes
Increase the stock buyback excise tax to 4%.
Individual Income Taxes
Increase the net investment income tax and Medicare tax to 5% of income above $400,000.
Increase the top individual income tax rate to 39.6% on income above $400,000 ($450,000 for joint filers).
Extend the expiring individual income tax changes from the 2017 Tax Cuts and Jobs Act for taxpayers earning under $400,000.
Tariffs and Trade
Triple current tariffs on steel and aluminum imports from China.
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