Hey, someone has to pay for all those illegals, medical, dental, schooling, food, babies, etc, etc, etc...

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By Kelley R. Taylor

President Biden’s $7.3 trillion FY 2025 budget released March 11, proposes several tax changes aimed at wealthier taxpayers, including a minimum tax on billionaires, a near doubling of the capital gains tax rate, and an increased Medicare tax rate.

This budget proposal comes as the IRS says it has recently collected (through ramped-up enforcement) more than $500 million in unpaid taxes from delinquent millionaires and "wealthy tax cheats."

The White House says the President's budget, which also contains several tax breaks for those with lower and middle incomes, including new homebuyer tax credits, would reduce deficits by nearly $3 trillion over ten years.

Biden capital gains tax increase

The capital gains tax rate for long-term capital gains, assets held for more than one year, is at most 20%. Capital gains are the profits you make from selling or trading an asset. The tax rates that apply to a particular capital gain (i.e., capital gains tax rates) depend on the type of asset involved, your taxable income, and how long you held the property before it was sold.

Biden’s FY25 budget proposal would nearly double that capital gains tax rate to 39.6%. That proposed capital gains rate increase would apply to investors who make at least one million dollars a year.
'Carried interest loophole'

The Biden budget proposal also revives the debate over the so-called carried interest loophole. Currently, asset managers can treat certain compensation they receive as capital gains, which means that a significant portion of their income is taxed at a much lower rate than if it were treated as wages.

Under Biden’s budget proposal, that compensation would be treated as ordinary income for federal income tax purposes to end the carried interest loophole.
Medicare tax

President Biden is proposing a tax increase for people making more than $400,000 a year to help shore up the Medicare program. That income threshold would be based on wages, salary, and capital gains.

Biden's FY25 budget proposes to increase the Medicare tax rate to 5% from the current 3.8%.

According to federal data, more than 60 million people use Medicare, which provides health insurance for people over age 65.

The number of people using Medicare is expected to grow, which has caused concern over the long-term viability of Medicare and other programs like Social Security.

The White House says that this tax increase would extend the life of the Medicare Trust Fund by at least 25 years, without cutting benefits. However, like the capital gains tax proposal, the Medicare tax rate increase is not likely to find enough support to pass this year, given Congressional divides and the upcoming election.

Income tax rate

President Biden wants to increase the top income tax rate for wealthier taxpayers.

Under Biden’s budget proposal, taxpayers making $400,000 would be taxed at a top rate of 39.6%.

The current top tax rate, tied to inflation-adjusted tax brackets, is 37%.

The proposed tax rate change would reverse the so-called Trump tax cuts in the Tax Cuts and Jobs Act.