HBK Outlines Tax-Related Policies of Biden Administration
YOUNGSTOWN, Ohio – With the House of Representatives set to vote on a new $1.9 trillion coronavirus relief bill Friday, HBK CPAs & Consultants has provided an outline of the expected tax policies of the Biden administration
While the relief bill will provide immediate support in the form of expansions to the Child and Earned Income tax credits, the administration is likely looking at changes to the Tax Cuts and Jobs Act, passed in 2017, write Sarah Gaymon and Cassandra Baubie of HBK’s Tax Advisory Group.
“Many of Biden’s policy positions before the election were centered around the reversal or elimination of various TCJA provisions,” they write. “If Biden’s proposals gain momentum, it is possible that there will be a repeal of TCJA sections that benefit high-income filers, generally resulting in increased taxes for individuals earning over $400,000.”
President Joe Biden has also signaled support for increasing the corporate tax rate to 28% – or to the pre-Tax Cuts and Jobs Act rate of 35% – and a 15% minimum tax on book income of entities reporting net income above $100 million but not owing U.S. income tax.
He has also proposed raising the tax rates on ordinary income, capital gains and dividends, as well as phasing out deductions for pass-through business income.
Among the other proposals are increasing the top income tax rate for income over $400,000 to 39.6%, eliminating preferential treatment for real estate entities, expanding Social Security tax to those making over $400,000 and decreasing the gift, estate and generation-skipping transfer tax.
“It is important to note that no detailed tax policy beyond the COVID-19 relief package has been formally announced,” Gaymon and Baubie write. “More information on President Biden’s proposals may be available when his first budget provisions are sent to Congress.”
Source: HBK CPAs & Consultants
Published by The Business Journal, Youngstown, Ohio.