Thought I would share these here in case you haven't seen them. I've bolded the ones that might directly impact the lolpoors on this board.
You are rich if you make $400k.
Individual Income Tax Proposals
Retirement Proposals
Transfer Tax Proposals
Business Proposals
You are rich if you make $400k.
Individual Income Tax Proposals
- Impose a 25% minimum tax on the total income, including unrealized capital gains, of taxpayers with over $100 million in wealth.
- Increase the top marginal tax rate from 37% to 39.6% for single taxpayers with taxable income over $400,000 and married taxpayers filing a joint return (MFJ) with taxable income over $450,000.
- Increase the top long-term capital gains rate from 20% to 39.6% for taxpayers with taxable income over $1 million.
- Increase the .9% Medicare surtax to 2.1% on earnings over $400,000.
- Increase the Net Investment Income Tax rate from 3.8% to 5% for taxpayers with over $400,000 of income.
- Apply the Net Investment Income Tax to pass-through business income not subject to self-employment tax for taxpayers making over $400,000 ($200,000 for married filing separate (MFS)).
- Increase the child tax credit from $2,000 to $3,600 per child under the age of 6 and $3,000 per child aged 6-17, make the credit fully refundable, and reinstate monthly payments of the credit.
- Make the income exclusion for student loan forgiveness permanent.
- Provide a refundable credit to qualified home sellers and first-time homebuyers of up to $10,000. The credit would start to phase out if the individual's modified adjusted gross income (AGI) exceeds $100,000 ($50,000 for MFS).
- Limit the gain that a taxpayer can defer in a 1031 exchange of real estate to $500,000 per taxpayer per year ($1 million for MFJ).
- Tax any gain recognized upon the disposition of depreciable real property which is attributable to depreciation as ordinary income, rather than the 25% long-term capital gain rate which is generally applied under current law. This provision would only apply to depreciation claimed after the effective date of this provision, and it would only apply to taxpayers with an AGI of $400,000 or more ($200,000 MFS).
- Tax income from carried interests in investment partnerships held by individuals with total income in excess of $400,000 at ordinary tax rates.
- Make the excess business loss limitation permanent.
- Adopt rules to limit the tax benefits of private placement life insurance and annuity contracts, including taxing the death benefit as ordinary income to the extent the investment value of the contract exceeds the investment in the contract, treating any distribution to a policyholder or beneficiary as coming from the income of the policy first, and imposing an additional 10% tax on any taxable distributions.
- Apply the wash sale rule to digital assets and transactions by related parties.
- Repeal expensing of intangible drilling costs and the exclusion from the passive loss rules for working interests in oil and gas properties, in addition to changing a number of other rules relating to oil and gas interests.
Retirement Proposals
- Prohibit high-income taxpayers2 from rolling over or transferring funds from a non-Roth employer-sponsored plan or traditional IRA into a Roth IRA - this would kill the Backdoor Roth option.
- Require high-income taxpayers with over $10 million cumulatively in all of their tax-favored retirement accounts to distribute 50% of that excess balance, with additional distribution requirements imposed if their aggregate retirement account balances exceed $20 million.
Transfer Tax Proposals
- Treat transfers of appreciated property by gift or at death as taxable dispositions, subject to a $5 million per-donor lifetime exclusion and unlimited marital and charitable exclusions.
- Treat distributions of appreciated property by a non-grantor trust as taxable dispositions, in addition to requiring trusts, partnerships, and other non-corporate entities to recognize unrealized gain from property that has not been involved in a taxable transaction within the prior 90 years.
- Treat sales and exchanges between a grantor and an irrevocable grantor trust as taxable transactions.
- Classify unreimbursed income taxes paid by the grantor on the income of an irrevocable grantor trust as a gift.
- Treat loans made by a trust to a beneficiary of the trust as a distribution for income and generation skipping transfer (GST) tax purposes.
- Treat the repayment of loans made by a trust to the deemed owner of the trust as an additional contribution for GST tax purposes.
- Impose a $50,000 per year cap on the total transfers to most trusts that can qualify for the annual exclusion, regardless of the number of donees involved. The proposal would also lift the present-interest requirement for these transfers. This $50,000 aggregate annual cap would be in addition to the current $18,000 per donee annual cap.
- Change GRAT rules, including imposing a 10-year minimum term, prohibiting a non-taxable substitution of assets, and requiring the remainder interest to have a minimum value equal to the greater of 25% of the value of the assets transferred to the GRAT or $500,000.
- Limit the beneficiaries eligible to receive GST tax-free distributions from a GST-exempt trust to only the transferor's grandchildren or younger beneficiaries who were alive at the creation of the trust, or to more remote descendants who benefit from a taxable termination while a grandchild or other descendant living at the creation of the trust is still alive.
- Restrict the use of valuation discounts on transfers of real estate, non-publicly traded entities, and other hard-to-value assets.
Business Proposals
- Increase the corporate income tax rate from 21% to 28%.
- Increase the rate of the corporate alternative minimum tax imposed on large corporations (generally, over $1 billion of average adjusted financial statement income) from 15% to 21%.
- Increase the excise tax on stock buybacks from 1% to 4%.
- Reform a number of international tax rules.
