Corey Rosen, Scott Rodrick
Biden Tax Plan Would Spur Sales to Employee Stock Ownership Plans (ESOPs)
The tax provisions of the Biden administration’s American Families Plan would provide a substantial, if unintentional, boost to employee stock ownership plans (ESOPs). The proposal would significantly increase capital gains taxes for wealthy individuals, marginally increase the top individual tax rate, and increase the top marginal corporate tax from 21% to 28%. Additionally, the step-up in basis at death would be removed. Whether the changes are good economic policy or not, or are likely to pass in any form, will be hotly debated. But their impact on ESOPs could be dramatic.
