In less than thirty days we will elect the next President of the United States solidifying a leader for the next four years. A very popular statement is that each “election has consequences.” A not so common question asked that you should consider is, what are the proposed financial policies of each candidate and how will they impact your pocket book? Here is a look at some of the financial proposals.
When you hear corporate taxes, don’t just think about large corporations. You should also consider small and medium businesses. In short, if you start or have a small business the Trump administration wants to make the corporate tax cuts permanent. The corporate tax rate has been cut from 35% to 21%.
The Biden administration proposes to increase the corporate or business tax rate from 21% to 28% an increase of 7%. That said, the tax cuts made did not benefit real estate firms for example which would bode well for those kinds of businesses under a Biden administration. If you are thinking of entrepreneurship and are looking to start your own business, taxes may impact your vote.
The Biden administration wants to expand Social Security benefits for low income beneficiaries and gradually increase benefits for Seniors starting at age 78. Seniors who are 82 years and older would also receive a 5 percent increase in their Social Security benefits. Why does that matter to you? If you are a care giver for a parent or loved one these increases would decrease your out of pocket expenses and help improve your loved one’s quality of life. Contrastingly, the Trump administration has provided no specific proposals to sure up social security and addresses these issues.
Personal Income Taxes
The Biden administration has proposed a series of tax cuts for low and medium income families starting with no increase in the income tax rates for those earning $400,000.00 or less. They have also proposed a $5,000.00 tax credit if you are a care giver.
Another proposal is that if your student loan is forgiven such amounts will be excluded from your income taxes. The current law is that if your student loan is forgiven then you are required to pay taxes on the amount forgiven. Under the Biden proposal, you pay no taxes.
As you vote this election cycle be sure to educate yourself on how each candidate’s economic proposals could impact your pocket book.