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Key Reform in Build Back Better Act Would Close Loophole Used by the Rich To Avoid Funding Healthcare
• By Joe Hughes
The proposal in the Democrats’ Build Back Better proposal applies the 3.8 percent Net Investment Income Tax to all profit distributions from partnerships and S-corporations so that this income of wealthy pass-through business owners no longer escapes.
Tax Credit Reforms in Build Back Better Would Benefit a Diverse Group of Families
• By Aidan Davis
The CTC and EITC provisions would have a particularly profound effect on the poorest 20 percent of Americans, who all will have incomes of less than $22,000 in 2022. Taken together, the EITC and CTC changes would lift the average income of these households by more than 10 percent.
Report Illustrates How 70 Corporations Could Be Affected by Minimum Tax Proposal in the Build Back Better Act
• By Matthew Gardner
Amazon, Bank of America, Facebook, FedEx, General Motors, Google, Netflix, PayPal, T-Mobile and Verizon are just a few of the 70 corporations that would have paid more taxes under the Democrats’ proposed Corporate Profits Minimum Tax (CPMT) if it had been in effect in 2020 according to a new report from Sen. Elizabeth Warren’s office with estimates verified by the Institute on Taxation and Economic Policy.
Democrats Seek to Eliminate the Stock Buyback Advantage
• By Joe Hughes
An important reform in the bill before Congress would tax stock buybacks in a way that is more comparable to how dividends are taxed. Corporations would be required to pay a tax equal to 1 percent of their stock repurchases, ensuring that profits shifted to shareholders in this way are subject to some federal tax.
Senators Menendez and Sanders Show the Way Forward on the SALT Cap
• By Steve Wamhoff
Amending the Build Back Better bill to fully repeal the SALT cap would mean that the richest 1 percent could pay less in personal income taxes than they do now, which goes against everything President Biden has said for the past year as he promoted this legislation.
America’s Richest Would Finally Pay Taxes on Most of Their Income Under Wyden’s Billionaires Income Tax
• By Steve Wamhoff
While the Ways and Means bill includes many helpful tax reforms, people like Jeff Bezos and Elon Musk would still pay an effective tax rate of zero percent on most of their income if it was enacted without this change. Sen. Wyden’s proposal would finally end this injustice.
Senate Democrats’ Corporate Minimum Tax Could Address the Worst Corporate Tax Dodging
• By Steve Wamhoff
There is no reason corporations reporting hundreds of millions, but not billions, of dollars in profits to their shareholders should be allowed to avoid paying taxes. Nonetheless, the corporate minimum tax is a huge step forward and a valuable component of the Build Back Better plan.
Federal Tax Reform Would be a Step in the Right Direction for Millennials of Color
• By Brakeyshia Samms
Currently, millennials of color are worse off than their parents when it comes to wealth expectations. So, if one of the goals of federal policymakers is to reduce racial income and wealth disparities, the proposals outlined are a good start. Tax reforms included in the budget package making its way through Congress would help by boosting incomes and making raising children more affordable—two things that would help millennials of color thrive in today’s economy.
The Role of Census Data in Policy and Racial Equity
• By Emma Sifre
The Census has changed the way it asks questions in the past and can choose to do so again in the future. As the Biden administration makes data a central part of its plan to achieve greater racial equity, it has an opportunity to implement research-backed changes that will improve our understanding of race and ethnicity in the United States, and in turn, our ability to draw meaningful conclusions about how our tax laws impact…
Limiting Tax Breaks for Capital Gains Would Mitigate the Racial Wealth Gap
• By Joe Hughes
The racial wealth and income gaps are the results of centuries of government policies favoring the accumulation of wealth among white communities while marginalizing communities of color. Policy solutions that are race-forward, meaning they remedy past and ongoing racial inequities, can also address broader social inequities.
State Income Tax Reform Can Bring Us Closer to Racial Equity
• By Carl Davis, ITEP Staff, Marco Guzman
To pave the way for a more racially equitable future, states must move away from poorly designed, regressive policies that solidify the vast inequalities that exist today.
The Billionaires’ Income Tax Is the Latest Proposal to Reform How We Tax Capital Gains
• By Steve Wamhoff
When people first hear about proposals to tax unrealized capital gains, they often ask, “Is this income, and if so, should we tax it?” The answers to those questions are “yes” and “yes, when we are talking about the very rich.”
Reforming Federal Capital Gains Taxes Would Benefit States, Too
• By Carl Davis
Congress’s action or inaction on federal tax changes under consideration in the Build Back Better plan could have important implications for states on many fronts. One critical area of note is at the foundation of income tax law: setting the definition of income that most states will use in administering their own income taxes.
New ITEP Report Examines the Tax Changes in the House Ways and Means Build Back Better Bill
• By Steve Wamhoff
The vast majority of these tax increases would be paid by the richest 1 percent of Americans and foreign investors. The bill’s most significant tax cuts -- expansions of the Child Tax Credit (CTC) and Earned Income Tax Credit (EITC) -- would more than offset the tax increases for the average taxpayer in all income groups except for the richest 5 percent.
House Ways and Means Provisions to Raise Revenue Would Significantly Improve Our Tax System But Fall Short of the President’s Plan
• By Steve Wamhoff
High-income people and corporations would pay more than they do today, which is a monumental change. But some wealthy billionaires like Jeff Bezos would continue to pay an effective rate of zero percent on most of their income, and American corporations would still have some incentives to shift profits offshore.
New Census Data Highlight Need for Permanent Child Tax Credit Expansion
• By Neva Butkus
The status quo was a choice, but the Census data released today shows that different policy choices can create drastically different outcomes for children and families. It is time for our state and federal legislators to put people first when it comes to recovery.
A Data-Driven Case for the CTC Expansion in the Ways & Means Committee’s Recent Proposal
• By Aidan Davis
The move toward permanent full refundability and inclusion of all immigrant children are crucial components of the future of the CTC. Together they will help ensure that the credit reaches the children most in need, making a vital dent in our nation’s unacceptably high rate of child poverty.
Extending Federal EITC Enhancements Would Bolster the Effects of State-Level Credits
• By Aidan Davis
The EITC expansion targets workers without children in the home. In 2022 it would provide a $12.4 billion boost, benefiting 19.5 million workers who on average would receive an income boost of $730 dollars.
Child Tax Credit Expansion Acknowledges There Is More We Can Do for Children
• By Aidan Davis
For the next six months, low-, middle- and upper-middle-income families with children are eligible to receive part of their 2021 Child Tax Credit (CTC) in advanced monthly payments. More than putting money in people’s pockets, this policy recognizes “the dignity of working-class families and middle-class families,” as President Biden said last week.
Opposition to Biden’s Tax Plan Has Nothing to Do with Small Businesses or Family Farms
• By Steve Wamhoff
Special interests lobbying against President Joe Biden’s tax agenda claim that his proposed corporate income tax rate hike will harm small businesses and that his proposed capital gains tax reforms will hurt family farms. Both claims are absurd attempts by powerful interests to pretend they are defending the little guy.
Washington Post Confirms that Corporations Are Bolder than Ever in Claiming Dubious Tax Breaks
• By Steve Wamhoff
IRS budget cuts starting in 2010 have forced the agency to reduce its audit rate for corporations with $20 billion or more in assets from 98 percent to 50 percent. The Washington Post found that during the decade, the amount of “uncertain tax benefits” claimed by corporations increased 43 percent, from $164 billion in 2010 to $235 billion in 2020.
Experts Weigh in on the Payoffs of Advanced Child Tax Credit Payments
• By Jenice R. Robinson
During a Tuesday webinar (The Child Tax Credit in Practice: What We Know about the Payoffs of Payments) hosted by ITEP and the Economic Security Project, panelists explained why the expanded Child Tax Credit is a transformative policy that should be extended beyond 2021. They highlighted tax policy and anti-poverty research and discussed lessons learned from demonstration projects that have provided a guaranteed income to low-income families.
Congress Should Follow States’ Lead on Inclusive Economic Recovery
• By Meg Wiehe
President Joe Biden's American Families and Jobs plans intend to “build back better” and create a more inclusive economy. To fully live up to this ideal, the final plan must include undocumented people and their families.
When Tax Breaks for Retirement Savings Enrich the Already Rich
• By Steve Wamhoff
Members of Congress frequently claim they want to make it easier for working people to scrape together enough savings to have some financial security in retirement. But lawmakers’ preferred method to (ostensibly) achieve this goal is through tax breaks that have allowed the tech mogul Peter Thiel to avoid taxes on $5 billion. This is just one of the eye-popping revelations in the latest expose from ProPublica.
Child Tax Credit Is a Critical Component of Biden Administration’s Recovery Package
• By Aidan Davis
Nearly one in seven children in the United States live in poverty and about 6 percent of all children live in deep poverty. President Joe Biden’s American Families Plan would tackle child poverty in an immediate, meaningful way. It is expected to extend the one-year Child Tax Credit (CTC) enhancements included in the March 2021 American Rescue Plan (ARP) through 2025. Next year alone, this would provide around a $110 billion collective income boost to…
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