Will there be a new wealth tax under Biden?
An article by the Wall Street Journal from March 14 reports that Treasury Secretary Janet Yellen said “the Biden administration hasn’t decided whether to pursue a wealth tax, but will likely issue proposals to address the swelling federal budget deficit.”
Levying a tax on the super wealthy in the United States could fall under the campaign promises that the president ran on, which include higher taxes on corporate profits, capital gains and dividends.
Regardless of your personal stance on politics, if you have any stocks, bonds or other assets that have appreciated, you should be paying attention to what may happen in the near future.
Taxes on wealth could affect investors
President Biden and congressional Democrats have been eyeing a higher tax on high-income earners in the United States. Biden’s tax plan includes raising taxes on Americans earning more than $400,000 and increasing levies for millionaires and billionaires.
Additionally, Biden’s tax plan also includes taxing long-term capital gains at the same rate as wages for households that earn more than $1 million per year. This would raise the taxes on investment earnings from 20% to the same 39.9% rate that wealthy Americans pay on wage taxes under Biden’s tax plan.
These changes may not directly affect you if you do not fall under any of these wealth categories. However, there could be ripple effects felt across the market that may alter everyone’s investment strategies in the years to come. If you are not already working with a financial planner, now is a good time to look for one who can help you prepare for the upcoming changes in the fiduciary landscape.
Talk to a ProVise CFP® professional about how to prepare for Biden’s wealth tax
At ProVise Management Group, our CERTIFIED FINANCIAL PLANNER™ professionals can get to know you and your current financial circumstances, goals, risk tolerance and personal values to help you develop a plan that works for you. We can also create a written plan for you at a fiduciary standard of care. All our written plans come with an unconditional money-back guarantee. If you are unhappy with your written plan, you can return it to us, and we will refund 100% of the fee paid.
Are you ready to talk to a professional about getting the most out of your money under Biden’s tax plan? Contact ProVise today to schedule a complimentary consultation.