President’s budget contains many tax proposals
President Joe Biden’s administration unveiled its proposed budget for fiscal year 2022 on Friday. Treasury says the $6 trillion proposed budget focuses on infrastructure, clean energy, and research and development, and among its many provisions are a host of proposed tax changes affecting individuals and corporations.
One set of tax and revenue proposals, named the American Families Plan, would increase taxes on high-income individuals, make permanent various recent tax credit expansions, further limit like-kind exchanges, and address various tax administration issues, including regulation of paid tax return preparers.
Other proposals are grouped under the name American Jobs Plan, and they include a variety of corporate tax changes, including raising the corporate tax rate and imposing a minimum tax on corporations, tax incentives to support housing and infrastructure, and clean energy incentives.
Along with the proposed budget, Treasury released its General Explanations of the Administration’s FY2022 Revenue Proposals (Greenbook), which explains the budget’s revenue proposals. In a prepared statement, Treasury Secretary Janet Yellen described the budget’s tax proposals as “fair and efficient tax reform.”
The proposed budget would make three changes to the taxation of high-income individuals:
Other proposed changes include:
To improve compliance and tax administration, the budget proposes:
The proposed budget calls for the following corporate tax changes:
To support housing and infrastructure, the budget proposes:
In the area of clean energy, the budget proposes:
— Alistair M. Nevius, J.D., (Alistair.Nevius@aicpa-cima.com) is the JofA’s editor-in-chief, tax.
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