2024 Election: Trump Vs Harris Tax Plan, How it Could Affect You?

Could the 2024 presidential election completely wreck your taxes? The stakes couldn't be higher, and the consequences could be even bigger. Whether you're rooting for Kamala Harris or Donald Trump, their tax plans are set to make waves that could seriously shake up your finances. We're talking about changes that could hit your paycheck, investments, and even the cost of everyday goods and services. Let’s break it all down and help you understand how this could affect your money.

What’s at Stake with Kamala Harris’s Tax Plan?

Kamala Harris has a bold plan. She wants higher taxes on the wealthy and big corporations to help fund expanded social programs and reduce income inequality. So, if you're making over $400,000 a year, you’re looking at higher taxes. She also wants to raise the corporate tax rate from 21% to 28%, reversing part of Trump’s 2017 tax cuts. Additionally, she’s pushing for a top individual income tax rate of 39.6% for high-income earners, up from the current 37%.

Harris's Tax Plan: Capital Gains

But that’s not all. Kamala Harris wants to tax long-term capital gains and qualified dividends at ordinary income tax rates (as high as 39.6%) for anyone earning over a million dollars. Right now, those are taxed at 0%, 15%, or 20%, depending on your income. Another part of her plan is a new minimum tax of 20% on households with a net worth over $100 million, including unrealized capital gains. Some folks worry this tax could eventually affect everyday people, but I just don’t see that happening. The burden of calculating those unrealized gains each year would be a huge headache for most people.

However, Kamala’s tax plan isn’t just about higher taxes. She’s also proposing to expand tax credits for working families, like the child tax credit and the earned income tax credit. In many ways, she’s continuing along with President Joe Biden’s tax plan but adding her own twist.

Donald Trump’s Tax Plan: What You Need to Know

Now let’s dive into Donald Trump’s tax plan. Trump wants to keep his 2017 tax cuts intact, and I think they were great. Those cuts lowered tax rates across the board and increased the standard deduction, which benefited a lot of middle-income households. I hope those cuts become permanent. But Trump isn’t stopping there.

Donald Trump: More Tax Cuts

He’s floated the idea of cutting the corporate tax rate even further, potentially down to 15%. This could be a huge win for businesses, especially small and mid-sized companies. However, critics argue that lower corporate taxes might mean the government has less money to spend on essential services like infrastructure and education. Personally, I think the government already has enough of our tax money.

Harris and Trump on "Taxes On Tips"

One thing both Trump and Harris agree on is eliminating taxes on tips. Currently, tips are considered taxable income, so getting rid of that tax could be a big win for service workers. It means they get to keep more of what they earn, and it could simplify tax reporting for millions of workers.

The Reality of Changing Tax Policy

It’s important to remember that while the President has a lot of influence over tax policy, they don’t have the final say. Any changes to tax law have to go through Congress, which means the House of Representatives and the Senate vote on it before it reaches the President’s desk for approval. Campaign promises can sound great, but these policies go through a long process before they become law.

Conclusion:

So, what does this all mean for you? Well, it depends on who wins the 2024 election and how much of their tax plans make it through Congress. Whether you’re looking at higher taxes or lower taxes, this election is set to have a big impact on your wallet. But remember, tax policy isn’t set in stone. It’s a collaborative process involving many people, not just the President.

If you're wondering about my thoughts on Project 2025, think it's a little far-fetched. Trump said he has nothing to do with it, and I'm not worried about it. The idea of simplifying the tax system to a two-tier tax system sounds good in theory, but when you start thinking about how it would actually work, well, it feels pretty unrealistic. Personally, I wouldn't lose sleep over it.

Agree? Disagree? Let me know your thoughts on my YouTube video comment section. Thanks for reading and see you in the next blog post!