Even with votes still being recounted, it seems likely that the Biden administration will take over the White House in January. Many Americans wonder what this will mean for their taxes in 2021.
First, the good news is that tax liability you might face this coming spring is based on your 2020 financial picture and 2020 tax laws, so even if the laws significantly changed, you would not see major changes in your liability until tax season 2022. However, if potential changes in tax laws under the new administration might impact you, it is important to plan ahead to limit your future liability as much as possible.
Whether or not new complicated tax legislation will pass through Congress and the White House next year remains to be seen. This will especially depend on the control of the Senate when those elections are final. The information we have comes from the tax plans proposed by President-elect Biden and the Democratic Party platform released in 2020.
Some possible changes include:
- Reducing estate tax exemptions by half
- Increasing tax rates for filers earning more than $400,000 annually
- Increasing corporate taxes
If you are a business owner, have an estate worth more than $5.8 million, or have income exceeding the $400,000 threshold, new tax legislation could result in an increase in taxes for you. It is always wise to have tax and legal professionals on hand to help you plan for the future and the potential tax changes it might bring.
Consult with Tax Lawyers in San Francisco for Assistance
If you need tax and legal advice, planning assistance, or have other concerns, please reach out to SF Tax Counsel. Call 415.318.3990 or contact us online to schedule an appointment with our legal team and learn how a San Francisco tax attorney can assist in your situation.