Second Trump Presidency Will Impact Payroll

Donald Trump was the 45th president of the United States from 2017 to 2021. With his election win on November 5, 2024, Trump will become the nation’s 47th president with JD Vance as vice president.

The second Trump administration promises to bring sweeping changes to federal laws and policies concerning taxes and more. Some of these initiatives will have a significant impact on the payroll profession. Here are some general highlights of what may be in store for payroll.

Taxation Issues

The Trump-Vance campaign promised to cut taxes. The campaign's tax proposals included:

• Making the tax cuts in the Tax Cuts and Jobs Act enacted during the first Trump administration permanent
• Eliminating taxes on tips for restaurant and hospitality workers
• Increasing the child tax credit from $2,000 to $5,000

Wage and Hour Issues

It is unclear whether President-elect Trump would increase the federal minimum wage of $7.25 an hour. He has stated that it might be considered in a second administration but also expressed preference for states determining the issue.

Health Care

During the first Trump administration, an attempt was made to repeal the Affordable Care Act (ACA). During President Trump’s second term, there may be additional attempts to fully repeal the ACA or make significant changes.

Immigration Issues

The platform of the new administration has a number of priorities on immigration. Implementing these priorities is likely to involve heightened compliance enforcement, including an increase in the number of Form I-9, Employment Eligibility Verification, audits.

Artificial Intelligence (AI)

The first Trump administration issued Executive Order 13859 in 2019 that was strongly supportive of artificial intelligence (AI) and the need to maintain American leadership in the field. It is reasonable to expect further support for AI development.

To learn more about federal and state laws, regulations, and information to keep your company's payroll operations in compliance, check out Payroll Source Plus!

Edward Kowalski, Esq., is Senior Manager of Payroll Information Resources, for PayrollOrg.