Battle of the Tax Plans Unveiling the Stark Differences Between Presidential Candidates' Proposals

Who are you going to vote for in November? Although taxes may not be the sole item leading to your decision of who to vote for in the Fall elections, it is one of many factors to consider. A Tax Olympics is brewing in D.C. as the two parties jockey for votes. Here is a summary of their presumed tax positions based on what little information is currently available.  It is presented in table format so their probable positions can be compared directly.

TAX CUTS & JOBS ACT

The Tax Cuts and Jobs Act (TCJA), signed into law by then-President Donald Trump, became effective on January 1, 2018. This was the most significant tax legislation in 30 years and impacted both businesses and individuals. However, nearly all its provisions were temporary, with most expiring after 2025. Congress made most of the changes temporary to limit the impact on the federal budget.   

The TCJA slashed the corporate tax rate to benefit mostly higher-earning shareholders. It reduced the alternative minimum tax (AMT) and approximately doubled the estate tax exemption. It also provided a 20% deduction for pass-through business income. These and other key provisions of the TCJA are outlined in the following table.

As noted earlier, Harris wants to repeal TCJA, while Trump has indicated that he would extend it.

Once individual tax cuts expire after 2025, the Tax Policy Center estimates that 53.4% of taxpayers will face a tax increase: 69.7% of those in the middle quintile will pay more, compared to 8% of the highest-earning 0.1%.

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