Presidential Candidate Tax Policies

​With the election season upon us, we figure we’d give you a brief layout of what the individual candidates have said will be their tax policy. There’s no personal opinion here…so please refrain from responding with political fireworks!

Tax Rates

• Trump: add a 10 percent middle-class tax cut (lowering 22% bracket to 15%). Extend Tax Cuts and Jobs Act (TCJA) tax rates that sunset after 2025
• Biden: raise top marginal tax rate to pre-TCJA rate of 39.6% for top income earners, increase corporate tax rate, as well as reinstitute payroll tax on those earning > $400k

 
Capital Gains

• Trump: reduce the capital gains tax rate and index capital gains for inflation
• Biden: remove preferential treatment for capital gains for income over $1mm (would be taxed as ordinary income)

 
Deductions

• Trump: extend current higher standard deduction amounts that sunset after 2025
• Biden: limit itemized deductions for higher earners and phase out the 20% business deduction for high earners

 
Tax Credits

• Trump: extend current $2,000 child tax credits (CTC) that sunset after 2025
• Biden: raise CTC to $8,000 for one child and $16,000 for two or more for taxpayers with income up to $125,000…then phase it out above that threshold…also expand earned income tax credit and provide refundable credit for first-time homebuyers of up to $15,000, as well as adding a renter’s tax credit for low-income individuals

Education

• Trump: add scholarship credit, providing up to $5 billion in tax credits for individual and corporate donations to non-profit scholarship-granting organizations
• Biden: exclude forgiven student loan debt from taxable income

Estate and Gift Tax

• Trump: extend current higher estate and gift tax exemption amount that sunset after 2025
• Biden: eliminate stepped-up basis on transfers of property at death

 
There are additional measures each candidate has indicated will be a part of their plan, but the above gives you a high-level view of main items.