BlumShapiro Blog Looking Ahead to 2021 - Is a Federal Tax Increase in the New Year Likely?

President-elect Joe Biden will take office on January 20 and the new Congress will convene on January 3. President-elect Biden has stated he wants to raise taxes on high-income households and corporations. For corporations, he would propose an increase in the federal tax rate from 21% to 28%. Further, corporations would be subject to a new minimum tax and increased taxes on foreign income. For high net worth individuals, the new administration would propose an increase in the top tax rate to 39.6% from 37%, create new limits on deductions, and impose the 12.4% Social Security payroll tax on wages above $400,000. Capital gains currently taxed at 23.8% would be taxed at 39.6% for taxpayers with over $1,000,000 of income. Higher income owners of pass-through businesses such as S-corporations and partnerships would lose the benefit of the 20% Qualified Business...