Temporary policy creates uncertainty for taxpayers and scheduling more expirations will add to the already-expiring provisions under the Tax Cuts and Jobs Act (TCJA) of 2017.
Clifton Painter is a 2021 summer intern with the Tax Foundation’s Center for Federal Tax Policy.
Reviewing the sources of personal income shows that the personal income tax is largely a tax on labor, primarily because our personal income is mostly derived from labor. However, varied sources of capital income also play a role in American incomes. While capital income sources are small compared to labor income, they are still significant and need to be accounted for, both by policymakers trying to collect revenue efficiently and by those attempting to understand the distribution of personal income.
August 15th was the deadline to take advantage of the premium tax credits originally provided in the Affordable Care Act and recently expanded in the American Rescue Plan. Future extensions may provide longer-lasting benefits, although the extensions may create trade-offs for consumer choice and program costs.
Tackling climate change and shifting the economy towards renewable energy has been a key part of the Biden administration’s agenda. However, this effort must first confront an overly complicated and non-neutral tax code, particularly in how it treats nuclear energy, for the White House to reach its ambitious goals.
President Biden’s proposal to tax capital gains at higher, ordinary income tax rates would lead the U.S. to have the highest top marginal tax rate on capital gains in the OECD.