As the 2024 U.S. presidential election approaches, respective tax policy has emerged as a common theme in the campaigns of former President Donald Trump and Vice President Kamala Harris. While these early outlines provide insight into the potential direction each candidate may pursue, it is vital to note the proposals remain relatively vague and are likely to undergo further changes as the campaign progresses. It is also uncertain which proposals would garner enough support to pass through the new Congress, which will convene in January 2025. The evolving political landscape will play a significant role in shaping the final legislation.
We recognize that tax policy developments are of great interest to you, particularly regarding their potential impact on your future tax planning and strategies. We will closely monitor each candidate's positions, which reflect broader economic priorities. Below is a comparison of their current tax proposals.
Donald Trump’s Tax Plan
Tax Cuts for Individuals and Businesses: Trump aims to extend the Tax Cuts and Jobs Act (TCJA) provisions that significantly reduced individual tax rates and lowered the corporate tax rate to 21 percent. His plan focuses on making these tax cuts permanent.
Child Tax Credit Expansion: Trump proposes to increase the child tax credit, though specific amounts have not been detailed.
No Tax on Tips: Trump proposes to eliminate tax on tips for hospitality employees.
Deregulation and Simplification: Central to Trump’s tax plan is reducing regulations to foster a more business-friendly environment.
Repatriation of Foreign Earnings: Trump advocates for a tax incentive to encourage U.S. companies to repatriate overseas profits, bringing capital back to the domestic economy.
Kamala Harris’s Tax Plan
Increased Taxes on the Wealthy: Harris supports raising taxes on individuals earning over $400,000 annually and restoring the top tax rate to 39.6 percent.
Corporate Tax Increase: Harris proposes increasing the corporate tax rate from 21 percent to 28 percent to ensure corporations contribute a fair share to federal revenue.
No Tax on Tips: Harris proposes to eliminate tax on tips for hospitality employees.
Expanded Tax Credits and Benefits: Her plan expands the Earned Income Tax Credit (EITC) and restores the child tax credit, with additional benefits for new parents and first-time homebuyers.
Billionaire Tax: Her plan creates a 25 percent minimum tax for individuals with over $100,000,000 in assets.
Tax Proposal Implications and Considerations
As these proposals continue to evolve and face scrutiny in the upcoming election, it remains crucial for individuals and businesses to stay informed about potential changes that may impact their tax situations. It is worth noting that tax proposals from the campaign trail often undergo significant revision before becoming law.
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