Tax regulations likely influence many of your business decisions—how to structure your enterprise, where to establish operations, expansion plans and workplace policies, to name a few. Below is a high-level comparison of the proposed tax policies of President Trump and former Vice President Joe Biden that could affect businesses and business owners.

Note: The Tax Cuts and Jobs Act (TCJA) of 2017 included many of President Trump’s tax initiatives—some of which are set to expire in 2025. If re-elected, his primary tax objective will likely be to make these provisions permanent. As such, President Trump hasn’t introduced many new proposals as part of his re-election campaign. But he has offered ideas on several tax topics, which we’ve incorporated into the chart. More information about his policies may be released at a later date.

Additionally, the information in this chart is current as of of the date it was written and and is subject to change without notice. There are no guarantees that any of the proposals will be enacted into law regardless of the election outcome.

President Trump
Current Tax Law
Former Vice President
Joe Biden
  Corporate Tax Rate  
Maintain current rules 21% tax rate

No alternative minimum tax

Raise rate to 28%

Restore alternative minimum tax on corporations with book profits of $100 million or more

  Qualified Business Income Deduction
(Section 199A deduction)
Extend current deduction limits set to expire under TCJA 20% of eligible taxpayer’s qualified business income plus 20% of qualified real estate investment trust dividends and qualified publicly traded partnership income Phase out the deduction for taxpayers with more than $400,000 in income
  Business Tax Deductions & Depreciation  
Extend the 100% bonus depreciation

Maintain the deduction for research and development expiring in 2021

Create new deductions for small businesses, restaurants and the tourism industry

100% bonus depreciation for qualified property acquired and put in service between September 27, 2017 and December 31, 2022

Residential rental property depreciable over 27 1/2 years

Commercial and industrial property depreciable over 39 years

Increase the depreciable life of rental real estate

Eliminate like-kind exchanges for real estate under Internal Revenue Code Section 1031

Create incentives to encourage Opportunity Zone Funds to partner with nonprofit and community organizations

  Retirement Plans  
No proposed changes to 401(k) plans Pretax participant contributions that are taxable upon withdrawal

Tax-deductible employer contributions

Replace the upfront tax breaks with flat-tax credits (referred to as “equalizing” 401(k) plans)

Expand access to automatic 401(k) plans for individuals not currently covered by a plan at work

  Social Security Payroll Taxes  
Forgive 100% of Social Security payroll
taxes deferred from September 1, 2020 to
December 31, 2020
12.4% tax that is split between employers and employees

No Social Security payroll taxes on wages above $137,700

Subject wages below $137,700 and above $400,000 to Social Security payroll taxes
  Energy Tax Incentives  
No proposed changes to the incentives Tax credits for oil and “green” energy (solar, wind) production Repeal fossil fuel subsidies

Expand incentives for residential and commercial energy efficiency

  International Taxation  
No proposed changes to the current rules Deferral of taxes of offshore subsidiary profits until the funds are repatriated Repeal TCJA incentives for multinational companies

Claw-back public investments and tax benefits when a company closes U.S. locations and moves operations overseas

Planning for Year-End and 2021

Our tax planning specialists and business advisory group have extensive knowledge of federal and state tax laws. They can help you evaluate your current business strategy and create a plan that can be “switched on” if any of the above proposals come to fruition.

Please read important disclosures here.