James F. McDonough
Of Counsel
732-568-8360 jmcdonough@sh-law.comFirm Insights
Clinton Offers Capital Gains Tax Increase
Author: James F. McDonough
Date: August 13, 2015
Key Contacts
Back
Presidential contender, Hillary Clinton, announced a proposal for capital gains tax reform. In the plan, capital gains taxes will be increased for assets held for less than six years by top-bracket investors.
The proposed capital gains tax increase
As part of her proposal, the top-ranking tax rate will be 43.8 percent for assets held less than one year, an increase from 39.6 percent. This rate will then be placed on a sliding scale until assets are held for a minimum of six years. These rates will include 39.6 percent from one to two years, 36 percent from two to three years, 32 percent from three to four years, 28 percent from four to five years and 24 percent from five to six years. Following this six-year mark, shareholders will be subject to a 20 percent capital gains tax rate.
This represents a significant increase from current tax rates, as only assets held for under one year are subject to the 39.6 percent tax rate, with each subsequent year at the 20 percent rate. This includes a 3.8 percent tax on net investment income as part of the Affordable Care Act.
The goal of the capital gains tax increase
According to Clinton’s plan, the capital gains tax increase will stimulate long-term economic growth by changing the current tax code. This proposal also calls for a limit on subsidies into high performing industries as well as significant limitations on “hit and run” activist shareholders.
Clinton explained that the objective of the proposed tax increase is to fight short-term profits in capital markets. Citing a recent FactSet survey, Clinton stated that companies in the Standard & Poor’s 500 stock market index spent $566 billion to buy back shares in 2014, representing an $86 billion increase from 2013, the highest since the recession.
Potential impact on profits
Under Clinton’s proposal, shareholders would keep 56.6 percent on the additional dollar amount of the profit, as opposed to the current 80 percent. According to a CNBC report, this would mean shareholders at the top tax scale would be subject to the 43.8 percent rate as well as the 35 percent corporate tax rate.
However, according to the proposal, Clinton also included a capital gains tax break for long-term investments for start-up companies and struggling industries.
- Practices: Tax and Trusts & Estates, Sophisticated Estate Planning & Wealth Preservation
- Locations: Red Bank, NJ, New York City, Little Falls, NJ
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Related Posts
See all
Buying Commercial Property in New Jersey: Legal Guide for Small Businesses
Small businesses considering buying commercial property in New Jersey must evaluate a range of legal, financial, and operational factors. While ownership can offer long-term value and control, it also introduces significant risks if not properly structured. This guide outlines key considerations to help New Jersey business owners make informed decisions, minimize legal exposure, and successfully […]
Author: Robert L. Baker, Jr.
The SEC’s Latest Guidance on Applying Federal Securities Laws to Tokenized Securities
On January 28, 2026, staff of the U.S. Securities and Exchange Commission’s Divisions of Corporation Finance, Investment Management, and Trading and Markets issued a joint statement clarifying how existing federal securities laws apply to tokenized securities. The SEC’s “Statement on Tokenized Securities” does not establish new law, but it does provide greater clarity on the […]
Author: Dan Brecher
Common Legal Mistakes NYC and New Jersey Business Owners Make
Operating a business in the New Jersey and New York City metropolitan region offers incredible opportunities, but it also requires navigating a dense and highly regulated legal environment. From entity formation to regulatory compliance, seemingly minor legal oversights can expose business owners to significant risk. In our work with businesses throughout the region, our attorneys […]
Author: Dan Brecher
What Founders Can Learn From Start-up Suits
High-profile founder litigation is more than just a media spectacle. For startup founders, these cases underscore the legal and structural risks that can arise when rapid growth outpaces formal oversight. While launching a new company can be both an exciting and deeply rewarding endeavor, founders must be mindful that it also comes with significant risks. […]
Author: Dan Brecher
Corporate Governance Reviews: A Practical Guide for New Jersey Companies
Every New Jersey company should periodically evaluate its governance framework. Strong corporate governance protects directors and officers, builds investor confidence, reduces litigation exposure, and positions a company for sustainable growth. The first quarter of the year is a great time to evaluate your corporate governance practices and perform any routine maintenance needed to keep that […]
Author: Ken Hollenbeck
What to Do After Being Served with a Lawsuit: Steps to Protect Your Legal Rights
Being served with a lawsuit is one of the most stressful legal events a business or individual can face. Whether the claim involves a contract dispute, an employment matter, an intellectual property issue, or another legal challenge, the actions you take in the first few days can significantly shape the outcome of your case. Acting […]
Author: Robert E. Levy
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Sign up to get the latest from our attorneys!
Explore What Matters Most to You.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.