Not only are many voters considering the candidates’ positions on issues like foreign policy, healthcare, and climate change as the presidential election of 2024 draws near, but they are also considering how the candidates’ tax policies might affect their financial situation.
The contrast between the two top candidates, former President Trump vs. Harris, is striking. Sanders is the president of the United States. To better prepare yourself for changes that could have a substantial impact on your finances, it is helpful to have a solid understanding of their tax ideas and future policy alterations.
How to Fix Trump vs. Harris Tax Plans 2024
Both former President Trump vs. Harris have announced their respective economic agendas, and both contenders for the presidency have called for reforms to the tax system that might have an impact on millions of people in the United States.
Taxes are going to be a fundamental concern for the next president. If Congress does not take action, the billions of dollars in tax reductions that President Trump enacted through the Tax Cuts and Jobs Act, also known as the TCJA, will expire after the year 2025. The Tax Foundation estimates that if extensions are not granted, more than sixty per cent of taxpayers will be subject to higher taxes in the year 2026.
Several provisions are set to expire, some of which include a reduction in the federal income tax rates, an increase in the basic deduction, an expansion of the child tax credit, and more generous exemptions from the estate and gift tax.
According to a news statement issued by the campaign on Monday, Trump intends to maintain the tax cuts that were created for individuals and businesses as a result of the Tax Cuts and Jobs Act (TCJA).
At a counter-event to the Democratic National Convention that took place on Monday in York, Pennsylvania, he did a brief presentation on his tax program. In the course of that address, he committed to provide “significant tax reductions for companies and families.”
Harris has not directly addressed the TCJA extensions throughout her campaign for the 2024 election. Lael Brainard, who serves as the senior economic counsellor to President Joe Biden, advocated for partial extensions in May.
“Achieving a fairer tax system also means that we cannot extend the expiring tax cuts that President Trump has enacted for individuals with incomes that are greater than $400,000,” Brainard added.
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Overview of How to Fix Trump vs. Harris Tax Plans 2024
| Title | Trump vs. Harris: Here is how the election could affect your taxes |
| Governing Body | The United States of America Government |
| Applicable in | The United States of America |
| Category | Finance |
Proposed increases in taxation; Detailed information
A commitment to addressing the budget deficit and the proposal of steps to increase revenue have both been made by both candidates. However, modifications to the tax code need to be authorized by Congress, which may prove to be difficult depending on who controls the House and the Senate in the future.
On Monday, the Harris campaign said that she would work to raise the corporation tax rate to 28%, which would be a rise from the 21% rate that was permanently implemented as a result of the Tax Cuts and Jobs Act (TCJA). The Committee for a Responsible Federal Budget has estimated that the strategy has the potential to bring about a reduction of one trillion dollars in the deficit over ten years.
During this time, President Trump has advocated for blanket tariffs, which are taxes that are imposed on items that are imported.
Based on the findings of the Tax Policy Center, the proposed baseline 10% tariff and 60% levy on Chinese goods by President Trump has the potential to cut the average after-tax income of households in the United States by almost $1,800 in the year 2025.
During his appearance on Monday, President Trump disproved the claim that tariffs will result in increased costs for consumers in the United States. One of his statements was, “It’s a tax on a foreign country.”
The Best Deals and Expert Advice for Managing Changes in Taxes
- Preparedness for Possible Alterations to Taxes in Advance
Given the possibility of large shifts in tax policy, it is necessary to make preparations in advance. When it comes to people, this entails analyzing their present tax situation and gaining an understanding of how the proposed changes would influence their financial condition.
To determine how the various candidates’ ideas would impact your tax liabilities and to devise measures for optimizing your tax position, you might want to think about seeking the advice of a tax professional.
- The Optimization of Tax Credits and Deductions
Maintaining the highest possible deductions and credits will continue to be essential, regardless of which candidate becomes victorious. Keep track of costs that are deductible and investigate the credits that are available to you to lower your taxable income.
There is a possibility that you will be eligible for additional credits for families if Harris’s plan is implemented. On the other hand, if Trump’s proposal is successful, you should concentrate on methods that are in line with the possibility of changes in tax rates and deductions.
Checking the Facts: What Is Real and What Is Not Actual?
The Process of Assessing Tax Claims
It is crucial to differentiate between fact and fiction while analyzing the tax ideas proposed by Trump and Harris. There are a variety of assertions that both candidates have made on the potential economic effects of their respective plans.
Economists, for example, have argued over Trump’s claim that lowering corporation taxes will result in the creation of new jobs, but there is conflicting evidence regarding the consequences that this will have in the long run.
In a similar vein, Harris’s assertions that additional money can be generated by imposing greater taxes on the wealthy and businesses are predicated on assumptions regarding the behaviour of the economy and the capacity to close loopholes.
A Comprehension of the Effects in the Real World
It is also essential to take into consideration the repercussions that these regulations will have in the real world. The consequences of tax policy can be complicated and diverse depending on a wide range of circumstances, such as the state of the economy and the specifics of the legislation and regulations. When looking for proper information, it is important to avoid oversimplified assertions and instead look for credible sources.
Future updates
There is the potential for changes to be made to tax policies as a result of legislative processes and economic conditions.
After the election, you should continue to keep an eye on the developments in tax legislation to keep yourself informed about how the policies of the new administration might affect your taxes. If any changes occur, updates and guidance on how to navigate them can be obtained from reliable news sources, government websites, and financial advisors.
Final Thoughts:
As the election of 2024 draws near, voters are presented with a clear decision that might have significant repercussions for their finances, and it is the disparity between Trump’s and Harris’s tax ideas.
Understanding the suggestions made by each candidate is essential to making well-informed decisions and getting ready for any potential changes that may occur. This is true regardless of whether you stand to profit from reduced tax loads or face increasing tax responsibilities.
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In a political environment that is fraught with uncertainty, you can better understand the complexities of tax policy and manage your financial future if you stay informed and plan.
Riya Claire is the Editor-in-Chief of the East Hampton Chamber Portal. She holds a degree in Mass Communication, an MBA in Finance, and a diploma in HR, making her a versatile professional for an online portal