The election year reigns as one of uncertainty. Clients worldwide, on both sides of the fence, are battling to quantify the impact of this year’s presidential election. As a trusted advisor, Cassady Schiller remains independent from discussing political parties. However, we thought it’d be helpful to break down the tax implications of each candidate’s platform. Courtesy of TaxFoundation.Org, a government website dedicated to informing Americans with tax news, information, and current events, Cassady Schiller presents the following facts regarding our country’s major-party platforms.
Personal Income Tax
Hillary Clinton poses few changes to individual income tax rates in her platform. Current tax brackets are expected to remain the same. However, for those earning an income over $5 million, a surtax would be administered at a rate of 4%. On the contrary, Donald Trump has proposed an elimination of the 3.8% net investment income tax. While the candidates appear socially divided, there are minimal distinctions in their personal income tax planning strategies.
Donald Trump favors an elimination of estate tax for all Americans. On the contrary, Hillary Clinton proposes an increase in the top estate tax rate, in accordance with the “Buffet Rule,” to 45% for estates excluding $3.5 million. It is important to note the estate tax currently exempts individual’s estate up to $5.3 million ($10.6 million for those married filing jointly) and taxes at a rate of approximately 40% on those estates exceeding the limit1.
Donald Trump has proposed a reduction in the corporate tax maximum rate to 15%. The current top tax bracket for corporations is 35%. Hillary Clinton has not provided a platform for corporate tax reform1.
To some surprise, the candidates appear relatively close on financial issues. Many experts believe stability is the most important component for economic growth. However, due to the uncertainty and vagueness of both candidates’ plans, many questions remain open for public speculation.
Both plans fail to present a solution to mitigate the growing national debt problem. Under both plans, interest rates are expected to remain low. Neither candidate has proposed any significant distinguishing factors differentiating themselves from one another. As your trusted tax advisors, we will not point you in one direction or the other, but simply arm you with facts.
As your trusted financial advisor, we hope to hear from you soon!