Analyses of Biden’s Tax Proposals

On the campaign trail and since taking office, President Joe Biden has proposed a significant number of changes to the tax code, including higher taxes for corporations and those earning more than $400,000 per year, as well as increased refundable tax credits for lower- and middle-income households.

The Tax Policy Center has studied and modeled the fiscal impact of many of these tax provisions related to Biden’s campaign tax plan, the recently-enacted American Rescue Plan, and the American Jobs Plan and American Families Plan. As the debate over these tax proposals continues, below are a collection of TPC resources explaining how businesses and individuals could be impacted. You can also click here for a full list of tax proposals introduced before and since the start of the Biden administration.

Repeal Portions of the 2017 Tax Cuts and Jobs Act

Proposal: Repeal the individual income tax cuts from the Tax Cuts and Jobs Act for people with income above $400,000

Expand the Earned Income Tax Credit

Proposal: Increase credit amount for workers without qualifying children and extend eligibility to childless workers age 65 and older

Expand the Child Tax Credit

Proposal: Temporarily expand the child tax credit to increase the maximum amount to $3,600 for each child under the age of 6 and $3,000 for each child ages 5 through 17, make the credit fully refundable, and allow people to receive a portion of the credit each month

Limit Itemized Deductions

Proposal: Cap itemized deductions at 28 percent of value for taxpayers with over $400,000 of income

First-Time Homebuyers and Renters Credit

Proposal: Create a refundable tax credit of up to $15,000 for down payments available to first-time home buyers and make available $5 billion annually for a refundable renter’s tax credit

Increase Capital Gains Taxes

Proposal: Tax capital gains at the same rate as ordinary income for taxpayers with over $1 million in income and tax assets still held by taxpayers when they die

Raise Corporate Taxes

Proposal: Increase the top corporate income tax rate to 28 percent and impose a 15 percent minimum tax on companies’ book income (with a credit for taxes paid to other countries)

Minimum Tax on Foreign Corporate Earnings

Proposal: Replace the TCJA’s Global Intangible Low-Tax Income (GILTI) tax with a country-by-country minimum tax on the earnings of foreign subsidiaries of US multinationals at a rate of 21 percent

Increase Tax Compliance

Proposal: Increase reporting requirements for account flows from investment earnings and business activity, increase IRS funding by $80 billion over ten years for auditing high-income taxpayers, large businesses, and estates and computer modernization

American Rescue Plan

Enacted March 2021: Provided $1.9 trillion in COVID relief, including unemployment benefits, rebate checks, state and local government aid, and a temporary expansion of the child and earned income tax credits

Last updatedMay 26, 2021