What Could a Gingrich Presidency Mean For Your Finances?

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As President Obama looks increasingly vulnerable, former House Speaker Newt Gingrich has emerged as the latest frontrunner for the GOP’s presidential nomination. Many political observers attribute this to his status as the party’s idea man who promises fundamental change. Here are some of those ideas and how they could directly affect your wallet:

1) Make the Bush tax cuts permanent. If nothing changes, the Bush tax cuts are scheduled to expire at the end of 2012, increasing tax rates on almost everyone who pays taxes (maybe that’s what the Mayan’s meant by the end of the world). While Obama would let the cuts expire for the top two tax brackets, Gingrich, like all the GOP candidates, would make them all permanent.

2) Eliminate the estate tax. Part of the Bush tax cuts was the elimination of the estate tax in 2010. While the estate tax sprung back to life in 2011 for estates over $5 million (and over $1 million starting in 2013), Gingrich also joins the other Republicans in wanting to repeal it altogether.

3) End the capital gains tax. This has long been a Republican policy goal. If you think this is likely to happen, you may want to postpone selling taxable investments and use your retirement accounts to re-balance. But if you’re wrong, the capital gains tax for most taxpayers is currently scheduled to increase from 15 to 20% in you guessed it…2013.

4) Cut the corporate income tax. Gingrich would also cut the top corporate income tax rate to 12.5% and allow for 100% expensing of investment in new equipment. Companies could pass the tax savings on directly to shareholders in the form of higher dividends or stock buybacks or potentially increase profits by expanding the company or cutting prices to be more competitive. This would actually benefit more people since most Americans own stock through mutual funds in their retirement plans, which aren’t affected by the capital gains tax.

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 Read More at Forbes By Erik Carter, Forbes