Current law: The top marginal tax rate is 37% for income over $518,400 for individuals and $622,050 for married couples filing jointly.
Rates are scheduled to increase to pre-Tax Cuts and Jobs Act of 2017 (TCJA) amounts after 2025.
Donald Trump: Enact a 10% middle-class tax cut, which reportedly could include lowering the 22% marginal tax rate to 15%. For 2020, the 22% marginal tax rate applies to income over $40,125 for individuals and $80,250 for married couples filing jointly.
Extend the individual rates enacted by the TCJA that are scheduled to expire after 2025.
Joe Biden: Raise the top marginal tax rate to the pre-TCJA rate of 39.6% for income over $400,000.
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Capital gains
Current law: The top tax rate for capital gains and qualified dividends is 20% for income over $441,450 for individuals and $496,600 for married couples filing jointly. In addition, there is a 3.8% net investment income tax.
Donald Trump: Index capital gains for inflation.
Reduce the capital gains tax rate.
Enact a capital gains tax holiday that eliminates capital gains taxes for a yet-to-be-identified period.
Joe Biden: Remove the preference for capital gains and qualified dividends for income over $1 million by taxing them at ordinary rates.
The net investment income tax remains.
In next blogpost, we will compare their plans on Deductions and Tax Credits.