The Advisors' Blog

President Biden unveiled his 2023 budget proposal in late March – and John blogged over on TheCorporateCounsel.net about the proposed buyback restrictions & its potential impact on corporate buyback practices. A Meridian memo highlights two other proposed legislative topics under the proposal for companies to be cognizant of:

– Millionaire/Billionaire Individual Income Tax – 20% minimum individual income tax would be imposed on income of households with a net worth of more than $100 million (determined as assets minus liabilities). In addition, the 20% tax would be imposed on unrealized gains (including ordinary gains) of such households. Payments of the minimum tax would be treated as a prepayment available to be credited against subsequent taxes on realized capital gains to avoid taxing the same amount of gain more than once. The proposal would be effective for taxable years beginning after December 31, 2022.

– Increase in Top Marginal Individual and Corporate Income Tax Rates – Top marginal income tax rates for individuals and corporations would be 39.6% (up from 37%) and 28% (up from 21%), respectively. The top marginal individual income tax rate would apply to taxable income over $450,000 for married individuals filing a joint return, and $400,000 for unmarried individuals. After 2023, the thresholds would be indexed for inflation. The proposals would be effective for taxable years beginning after December 31, 2022.

– Emily Sacks-Wilner