Biden Proposes Major Increase in Capital Gains Tax Rate for 2025 Budget

President Biden’s budget proposal for 2025 includes a substantial increase in the top capital gains tax rate to 44.6%, potentially exceeding 50% in some states. This proposal raises concerns about the lack of inflation indexing and the impact on businesses, investors, and families. The proposed rate in the U.S. would be more than double that of China, raising questions about competitiveness. Additionally, Biden’s plan to eliminate stepped-up basis could result in mandatory capital gains taxes during wealth transfers.