Millionaires Could See Upcoming Tax Hike

If the 2017 tax reform legislation's modified tax brackets are not extended beyond the end of 2025, the top income tax rate would revert to the 39.6% rate for the highest income levels. In an effort to find ways to reduce the cost of those extensions, Republican members of the Senate Finance Committee have confirmed discussions over increasing the tax rate on income above $1 million to 39.6% – the highest income tax bracket prior to passage of the 2017 tax reform package. According to some members, the rationale behind increasing the rate from 37% and 39.6% is to provide funding to support increasing the child tax credit. While it remains to be seen whether the tax hike will make it into the budget reconciliation package, many in the GOP have expressed that the costs of extending the tax reform bill will have to be offset in one way or another. For more information on the current federal income tax brackets, visit Tax Facts Online. Read More: Link to Q753.