Biden’s plan to raise revenue by increasing taxes may penalize couples, according to Fox Business.
Biden plans to increase taxes on higher-income individuals and households.
Families earning up to $400,000 would not be the target of the tax hike.
White House press secretary Jen Psaki said the threshold would also be $400,000 for individual filers.
When asked for clarification Jen Psaki gave the same answer.
Individuals that earn a lesser amount could be affected if they are part of a couple filing jointly that reports a cumulative income of $400,000 or more.
“It’s a significant disadvantage to married couples,” Timothy McGrath said. “It’s another marriage penalty, and this is nothing new in the tax system. [There are] all sorts of tax marriage penalties right now.”
“Two individuals can make just under $400,000 and not be in the top tax bracket,” McGrath explained.
Do You Like This Artice? Give Us Feedback 👇
Two individuals earning $200,000, who are filing jointly, would be.
“He’s going to have a plan to pay for it. I’m sure that if there are proposals out there that are different from his in terms of what they will cover, we’ll have that discussion,” Psaki said.
“But he also believes that we have an opportunity to rebalance, to take to address our tax code that is out of date and add some could pay more in our country that are not currently.”
From Fox Business:
That means some individuals may wind up being hit with the tax hike because they are filing jointly – whereas, if they filed as individually, they would not be above the specified threshold.
What would make this provision significant, McGrath noted, is that the proposed income threshold has the potential to affect a lot of households.
Under the proposal, the top rate would increase to 39.6% from 37%.
The White House indicated that the president is open to negotiating his tax proposals as part of a broader discussion with Congress on paying for his infrastructure proposal.
In addition to raising income taxes on the wealthiest individuals and households, the administration has floated raising the corporate tax rate to 28% from 21%.
Psaki said on Monday that the White House had not seen evidence from economists that the increase was likely to be a drag on growth, but once again indicated Biden was open to hearing revenue-raising suggestions from Congress.