Member-only story
What’s Going on With Biden’s Capital Gains Tax?
What it is, why it matters, and what the future holds.
The last major piece of legislation presented by the Biden Administration at the end of its first 100 days is the the American Family Plan, a $1.8 trillion set of policies aimed at supporting families through tax cuts, direct payments, grants, etc.
These programs are projected to by funded by enhanced IRS enforcement and an increase on the capital gains tax. It is the second item that this article will be addressing.
What is the Capital Gains Tax?
To answer that question, we need to define capital gains.
From NerdWallet,
Capital gains are the profits from the sale of an asset — shares of stock, a piece of land, a business — and generally are considered taxable income.
There are actually two types of capital gains: short term and long term.
From the Tax Policy Center,
Capital gains and losses are classified as long term if the asset was held for more than one year, and short term if held for a year or less.
Short-term capital gains are taxed as ordinary income at rates up to 37 percent; long-term gains are taxed at lower rates…
