Trump's 2026 Plan To Cancel The Income Tax

President Trump just confirmed that he wants to get rid of your income tax. Take a listen. >> I believe the tariffs paid for by foreign countries will, like in the past, substantially replace the modern-day system of income tax, taking a great financial burden off the people that I love. >> This is very different than what we saw last year because the Trump tariffs in 2026 are very different than what they were in 2025. These new policies will impact your taxes, the economy, but also your investments. So, let me break this all down. Here's the agenda for today, and it feels nice to have my whiteboard back. I'm going to start by doing a brief overview on the new tariff plan for 2026. Then, I'm going to go over President Trump's new taxes and the new tax plan for 2026. And then I'm going to go over number three, how this is going to impact your investments and where the investment opportunities are. So, make sure you stick with me until the end. And if you are an investor and you've been feeling a little bit uneasy with all the craziness happening in the markets, I understand. And that's why on March 18th, 2026, I'm hosting a live free and virtual investor workshop where I'm going to be going over how you can capitalize on this volatility and how you can find better investment opportunities based off of research. So whether you're a 401k investor, you've been investing money yourself, or you've never invested money before, but you want to see how you can capitalize on opportunities, I invite you to join me on this workshop. I'm doing it twice on March 18th, once in the morning at 10:30 a.m. Eastern time, again in the evening at 8:00 PM Eastern time, and then when you actually show up live to my workshop, you are going to get access to a new book that my team wrote on how money has changed forever. Now, you have to actually show up to the workshop to get this digital copy emailed to you, but there's going to be a ton of value on March 18th. It's free. So, if you're an investor, I invite you to join me on this workshop. I have the link for you down in the description below. Now, let's talk about tariffs because President Trump says that our economy used to rely on tariff revenue, not income taxes. And that's true. Let's take a look at how taxes used to look in the early 1900s. In the early 1900s, the number one driver of revenue for the United States government was tariffs. That's why we had very low income taxes. In 1913, when the income tax was first passed, this is how it looked. It was a 0% income tax rate for all income under $3,000. Then you paid a 1% income tax on income that you earned over $3,000. And the top tax rate was 7% which you paid on every dollar that you earned above $500,000. Now remember this is back in 1913. So if you adjust this for inflation, what this translates to today is that you don't pay any taxes on money that you earn under $100,000. You only pay a 1% income tax on money that you earn over $100,000 a year. And then if you make over $16 million a year, then your income tax is 7% because again, the government was subsidizing these income taxes with tariff taxes. But the economy was also different in the early 1900s because the government spending wasn't happening the way that was happening today. So let's take a look at what's going on today with tariffs because it was around this time that the government slowly started to move away from tariff revenue and relying more on income tax revenue. Last year, President Trump passed new tariffs in a way that we haven't seen in many decades. and it shook up the economy. It shook up the stock market and many people didn't know how it would work. Fast forward to today and the Supreme Court said that these tariffs that President Trump passed are not constitutional. So, President Trump passed these sweeping tariffs on countries from around the world in 2025. Then the Supreme Court said that the law that President Trump used to pass these tariffs don't allow him to do that. So, all these tariffs were cancelled. And then immediately after that, President Trump said, "I'm going to use a different law and now I'm going to pass a global 15% tariff on all countries from around the world." The idea being, according to President Trump, if we can collect more tariff taxes, then you don't have to pay any income taxes. Now, I'm going to dive into the actual validity of that in just a second. But as a licensed attorney who is not your attorney, I can tell you that taxes are a big expense because there are many different types of taxes that you pay. For example, when you go to work and get paid, you have to pay the income tax. But on top of the income tax, you're also going to be paying these payroll taxes. That's your Medicare and Social Security taxes. Then on top of that, you have to pay sales taxes. You go into the store, you buy something, there's a sales tax. Then you have to pay a property tax. You go and buy a house, then you have to pay property taxes every single year. Then you have capital gains taxes. If you take your money and you buy a stock and you sell it for big profit in a few years, well, now you have to pay a capital gains tax on top of that. Then you have these tariff taxes which if you buy something for a foreign country, you have to pay a tax on that as well. The goal for President Trump is to use these tariff taxes to offset these income taxes. Again, I'm going to talk a little bit more about the viability of that in just a second. Then you have corporate taxes. If you are a corporation and you make a money before any owner can take money out, the corporation has to pay taxes before the owners do. Then you have to think about estate taxes. If you die with a lot of assets and you pass these assets on, well, now you have to pay this estate tax, otherwise known as a death tax. You have state and local taxes. If you live in a place like New York, California, you have to think about state taxes, city taxes, and then you have the other tax. I just kind of group everything else together here because otherwise this video would go on forever just talking about different types of taxes. But these could be things like toll taxes, cigarette taxes, alcohol taxes, and everything else thrown right into here. So, President Trump says that his goal is to collect more of these tariff taxes right here. That way, it can offset this income tax. Well, let's do some math to see if this is actually possible before we get into the new tax changes that we're about to see in 2026 with President Trump's new tax plan. In 2025, the United States government collected around 5.25 trillion in taxes from all the different types of taxes that they collect. But they didn't just spend this $5.25 25 trillion in 2025. The United States government spent around $7 trillion, which means they spent almost $2 trillion that they didn't have. But I'm going to talk more about that spending in just a minute. But to really understand if President Trump can get rid of the IRS or get rid of the income tax, we have to compare apples to apples and understand how much money did we generate from the income tax specifically versus the tariff tax in 2025. And in 2025, we collected about $2.65 65 trillion in income taxes because it was the largest driver of revenue for the United States government. And then we generated something around, and I'm going to round up here, $200 billion in tariff taxes, which means the tariff tax is off by around a factor of 10 to be able to replace the income tax. Now, what does it mean in practicality? The tariff tax that we had in 2025 is not going to be able to replace the income tax. The math just doesn't make any sense. But if we do raise tariff taxes from 15% to 150%. Now we can think about replacing the income tax with tariff taxes, but it doesn't look like that's happening. But regardless of whether the tariff tax can replace the income tax or not, President Trump is already making drastic tax changes. In 2025, President Trump signed the One Big Beautiful Bill Act. in 2026. This act is the first year that it's a full year of this act being live. So, let's take a look at some of the big changes with the new tax plan in 2026 because this is impacting everybody because if you make money, you have to think about taxes. Now, to understand the new tax laws in 2026, we have to understand what taxes were like in 2025. And in 2025, taxes looked like this. If you were a single filer, and I rounded some of these numbers just for simplicity, you pay 10% in income taxes for every dollar that you earned between 0 to $11,925. Then for every dollar that you earned between 11,925 up to 48,475, you pay 12% of the money in taxes. You pay 22% of every dollar that you earn between 48,000 to $103,000 in taxes. You pay 24% in every dollar that you earned between $103,000 to $197,000. You paid 32% of your money in taxes for every dollar that you earn from $197,000 to a4 million. You paid 35% of your money in taxes. For every dollar that you earn above a4 million up to $626,000 and then you paid 37% of your money in taxes for every dollar that you earned above $626,000. Again, this is your federal income tax, not your state taxes. Well, in 2026, the original plan was for taxes to go up for pretty much everybody because these are what's called the lower tax rates because President Trump signed the tax law back in 2017 2018 which lowered tax rates, but the lower tax rate was going to expire on December 31st, 2025. So when President Trump signed this new tax law in 2025 that extended these tax cuts, that means taxes actually fell in 2026 instead of going up for most people. So here's what the new tax brackets look like in 2026. Under this new One Big Beautiful Bill Act, you can essentially make more money to qualify for the same tax bracket. So, what that means is now if you make up to $12,400, you'll pay 10% of the money in taxes. For every dollar that you earn between $12,400 to $50,400, you're going to put 12% of that money in taxes. You're going to pay 22% for every dollar that you earn between $50,000 to $105,000. You're going to pay 24% of your money in taxes. For every dollar that you earn between $105,000 to $211,000, you're going to pay 32% of your money in taxes. For every dollar that you earn between $211,000 to $256,000. And then you're going to pay 35% of your money in taxes for every dollar that you earn between $256,000 to $640,000. And then if you make over $640,000, you're going to pay 37% of that money in taxes. For every dollar that you earn above $640,600, but we're also seeing a change on your investment tax rates and what you have to pay taxes on. So, let me break down your investment tax rates and some of the things that you no longer have to pay taxes on in 2026. This is what tax rates look like when you earn your money as an investor. Look at how much simpler this is compared to your income taxes where you have to actually go to work to earn that money. And look at how much less you can pay in taxes here as well. Because what it said at 2025 is you're going to pay 0 in taxes for every dollar that you earn between 0 to $48,350. Then you're going to pay 15% of your money in taxes between 48,000 to $533,000. And then the top tax rate is 20% for every dollar you earn above $533,000. Well, this got a little bit of a makeover in 2026 as well. Take a look. Just like with your income tax rates, taxes actually went down for investors as well because now you're going to pay $0 in taxes up to $49,450. You're going to pay 15% of your money in taxes between $49,450 to $545,000. And then you're going to pay a top tax rate of 20% above $545,000. Which is where you can really see that our tax system incentivizes you to be an investor instead of just earning money as an employee. Even though we're never taught how to actually become investors, which is why again on March 18th, I have my live investor workshop where I'll be showing you how you can get started as an investor based off of research. I'm going to show you a bunch of research that my firm has done. That way you can identify investment opportunities before they hit the headlines. But let's keep going forward on what are some of the things that you no longer have to pay taxes on in 2026 before we get into how this is going to change investments. Change number one is tip income. You no longer have to pay taxes on tips up to $25,000 if you make under $150,000 a year. And just a heads up, this is not permanent. It's only going to last through 2028. Number two, you no longer have to pay taxes on overtime income up to the first $12,500 a year if you were a single tax filer. up to $25,000 a year if you're married filing jointly. But this is assuming that you make under $150,000 a year as a single tax filer or $300,000 a year married filing jointly. Number three, again a very new one, is you can deduct car loan interest payments up to $10,000 a year. This is a way for the Trump administration to encourage people to buy cars, but more specifically, this car has to be assembled in the United States. And then if you do that and you finance this car, you can deduct up to $10,000 a year on your car interest, but you have to make under $100,000 a year as a single tax filer or $200,000 a year maring filing jointly to qualify for this car loan interest deduction. Number four, this new tax bill extends and expands the standard deduction from $14,600 a year as a single tax filer to now $15,750 a year as a single tax filer. If you're maring filing jointly, just double these numbers, which means that the average person now qualifies for a larger standard deduction. And you get this without doing anything. Number five, and another brand new one, is if you are a senior over the age of 65 and you make under $75,000 a year, you get to qualify for an additional $6,000 bonus. Now, it starts to phase out after $75,000 a year, and it fully phases out after $175,000 a year. But if you're over the age of 65, there's an additional bonus you get to qualify for. And then finally are business meals. And I want to highlight this one because this is actually a little bit different that businesses can no longer write off business meals and beverages the way that they used to. So if a company was buying you a lot of lunches and dinners before in 2025, they used to be able to get tax write offs for that. Starting in 2026, it's not so easy to get those tax write offs for those meals and beverages provided to employees. So now we talked about how tariffs have changed over the last 100 or so years. We talked about what's happened with tariffs in 2025 to 2026. We talked about how President Trump is changing the taxes in 2026 under his new one big beautiful bill act and what to expect in 2026. Now let's talk about what this actually means for your investments because as an investor taxes change the economy and they change investment opportunities as well. And I want to break this investment section up into three parts. Number one, I want to talk about corporate taxes. And then I want to talk about how tax-free investing is changing in 2026. And then I want to talk about investment opportunities and where investments are going to move in 2026 based off of tax rates based off of history. So let's start by talking about corporate tax rates because one thing that also happened with this one big beautiful bill act is that corporate tax rates stayed the same instead of going up. So, I talked about this a minute ago that if you are a corporation, you have to pay taxes as the corporation before you as the owner of the corporation can actually pull any money out. So, this is you right here. From my male followers, I drew a mustache. In my native language, Punjabi, I call it a much. From my female followers, I drew a braid. In my native language, Punjabi, we call it a gut. So, you own this corporation right here. Now, if this corporation hypothetically makes $100,000 of profit, the corporate tax rate today based off the new One Big Beautiful Bill Act in 2026 is 21%. If this One Big Beautiful Bill Act did not get passed, it was going to go up to 35%. But because of this new tax bill, it is staying at 21% in 2026, which means the corporation made $100,000 in profit. And then this corporation is going to pay 21% of that in taxes, which means this corporation is going to be left with $79,000. Now, you as the owner of the corporation haven't had the opportunity to pull any money out yet because you still have to pay these corporate taxes before you put any money out. And then if you pull this money out into your personal bank account, now you're going to pay taxes again because now you have an income. This money was the corporation's income and now once it goes into your personal bank account, now you have to pay your personal income taxes because this is your personal income. This is why corporations are known as a double tax. It's a double taxation because the corporation pays a tax and then you as the owner of the corporation pay a tax as well. So what does this mean? Well, in general, if corporations have more money because if they don't have to pay this money in taxes, they have more money in their pocket which in theory they can use to hire more employees. They can use that money to invest in more growth. They can use that money to open more departments or invest in more technology. That's the theory. And the reason why I say theory is because that's exactly what happens to some corporations, but other corporations don't do that. So, it just depends on the corporation. Certain corporations will create more jobs when they have more money. Other corporations just won't depending on who's leading the corporation and their goals. Now, let's talk about tax-free investing, how that's changing in 2026. In 2026, you can invest more money into your IRA, HSA, 401k, 403b, or SE IRA and continue to fall within the limits because this new tax plan also expanded how much money you can invest every single year. So, the IRA went up from $7,000 in 2025 to 7,500 limit in 2026. The HSA went from $4,300 to $4,400. 401k went from $23,500 to $24,500. And the SE IRA went from $70,000 to $72,000. Why does this matter? Because the stock market depends on supply and demand. When you think about what moves a stock up or down, there's a lot of factors. You can say a company's profit and how much money it's going to make in the future, which is all true. But ultimately, the price of any asset, stocks, real estate, gold, does not matter. It depends on supply and demand. If there are more buyers than sellers, that pushes the stock up. If there are more sellers and buyers, that pulls the stock down. So, if there's more money to go into these tax-free retirement accounts, that means more money can go into the stock market, which can help boost stocks, which might have you wondering, well, okay, Daspit, if we're seeing these big changes in taxes and taxes are being cut, is that going to lead to a higher stock market or a lower stock market? And let's take a look at history because while history doesn't exactly repeat itself, it does ride. In the last 50 years, we have seen 10 major tax changes. In the last 50 years, we've seen about six major tax cuts and four major tax hikes. Now the question is during these tax cuts and tax hikes that we've seen over the last 50 years, what happened to the stock market? Well, during these six major tax cuts, five of these six saw the stock market go up during the next 12 to 24 months. The only exception here was 2018 during President Trump's last term when these tax cuts were passed because there was a lot of tariff and trade stuff going on during 2018 as well. But five out of six led to the stock market going up. Then there were four major tax hikes. Four major tax hike periods that we saw over the last 50 or so years. And all four of these tax hike cycles, we saw the stock market go up as well. What does that tell us? The stock market doesn't exactly move based off of what's happening with taxes. In general, the stock market goes up. The stock market generally goes up when you have a Republican in the White House. It generally goes up when you have a Democrat in the White House. It generally goes up when taxes get cut. It generally goes up when taxes get hiked, which means it pays to be an investor. Now, this doesn't mean that markets always go up. I mean, we've seen 16 recessions over the last 100 years. We've seen 25 market crashes over the last 100 years, but over the long term, we have seen markets go up. So, when you think about investing your money, don't invest your money based off of taxes. Don't invest your money based off of news and speculation. Invest your money because you want to own good investments for the long term because ultimately that has been proven through the test of time as a way to build wealth no matter what's happening on the government side of things. If you want to be an investor, that's what it's about. That we can work to accumulate good assets and actually build wealth because this system that we live in rewards investors. We talked about this during the tax part of this discussion. You pay lower taxes when you make money as an investor versus just an employee. I'm not saying you shouldn't be an employee. I'm saying you have to be an investor as well that we can win in this economic system. Again, that's why on March 18th, I'm hosting a live free and virtual investor workshop which you can register for with the link down in the description because we're seeing a lot of changes happen in our economy and these changes create investment opportunities for those that are financially savvy. So, I hope to see you on March 18th. So, we started this video talking about tariffs 100 plus years ago. Then we talked about the 2025 tariffs compared to the 2026 tariffs and we talked about how likely it is or not is for tariff revenue to replace income tax revenue. But despite that, we talked about then the new tax changes that we are seeing in 2026 under President Trump's new tax plan. And then we wrapped it up by talking about how investments are going to change in 2026. We talked about corporate taxes and now corporations will be paying less money in taxes than what would have happened if this tax plan did not get passed. So, what does that mean? Corporations will have more money. Some of these corporations will be able to hire more employees because they have to pay less money in taxes. We talked about how there's a growth of tax-free investments with the HSA, the 401k, the IRA, the SE IRA, and then we wrapped it up talking about how investments generally go up whether taxes are going up and down, which is why it's so important for you to be an investor. If you got value out of this video, the best thank you is a referral. So, if you could please share this video with a friend, family member, colleague, or fellow investor, that way we can continue to spread this type of financial education. Thank you. The government has quietly started to stimulate markets again, and most people are not paying attention. How do I know? Because on February 5th, 2026, the Treasury Department announced that the Federal Reserve Bank has pumped $90 billion to stabilize markets so far, and they have no plans of slowing down.

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