President Biden’s proposal to boost the top U.S. income-tax rate won’t affect individuals or joint-filing couples with incomes below $400,000 — but could impact couples who together exceed that threshold even if their individual salaries do not, White House Press Secretary Jen Psaki said.
Biden’s American Families Plan, released Wednesday, included a bump in the top tax rate to 39.6%, from 37%, “applying only to those within the top 1%,” but didn’t specify thresholds for different types of filers. The administration has consistently said no one making less than $400,000 would be affected by tax hikes.
“People file as married couples, they file as individuals, and his promise to the American people is that people who are in the 99% of people who are making less than that are not going to have their taxes go up,” Psaki said on CNN on Thursday. Asked whether there’s a threshold for families at $400,000, she responded, “That’s right, and individuals.”
Axios reported earlier that the proposed 39.6% rate — the same top rate that existed before former President Trump’s 2017 tax cuts — would apply to families with taxable income above $509,300, and for individuals above $452,700.
Biden’s proposal to raise capital gains taxes on investments profits would hit many business owners, not just ultra-wealthy investors.
Under current tax brackets, singles earning $523,601 and up or couples making $628,301 or more pay the top 37% marginal rate.
