With the November elections fast approaching, the proposed tax plans of each presidential candidate are emerging more clearly. As with any tax proposal, one person alone generally doesn’t seal the deal. The makeup of Congress plays a large role in a future tax landscape, and control of the House of Representatives and Senate are up for grabs this fall as well. 

A comparison of each presidential candidate’s major tax proposals is summarized in the chart (below). Note that Harris' proposals do not include all of President Biden’s FY 2025 budget proposals, though she has previously shown support.

In short, Vice President Kamala Harris would increase taxes on corporations and individuals earning more than $400,000, continuing a Biden administration promise not to raise taxes for those under that threshold. She would also provide enhanced tax credits for those with children and low-income individuals, as well as substantial affordable housing initiatives. Harris also focuses on incentivizing small businesses and skilled trade work.

Former President Donald Trump would lower the corporate tax rate and make permanent most of the temporary individual provisions from the Tax Cuts and Jobs Act, with the exception of the $10,000 state and local tax cap. He has also floated exempting tipped income, overtime pay, and Social Security benefits from income tax. In addition, Trump would impose hefty tariffs on all imports and significantly increase existing import tariffs on China.

Keep in mind that the presidential candidates' proposals may never become law. After all, hundreds of formal bills are introduced each year without moving forward. Even so, many find value in considering future possibilities when planning and stay aware of ideas being discussed by our nation’s leaders.

2025 Tax Overhaul Potential

In tandem with presidential tax plans, there are discussions surrounding extenders and bipartisan initiatives. Several attempts have been made in the past few years to repeal or postpone mandatory research expense capitalization, reinstate bonus depreciation, and implement an increased child tax credit, among other things. However, negotiations have ultimately fizzed each time, somewhat due to congressional members vying for another tax overhaul that could include extending the TCJA’s temporary provisions  slated to sunset after 2025. The November elections will no doubt be a main contributor to future tax policy. 

Please reach out to your RubinBrown representative with any questions or concerns regarding how these proposals may impact your unique tax situation. 

Published: 10/30/2024

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