Bill > S2845

This bill, known as the Billionaires Income Tax Act, aims to fundamentally change how high-net-worth individuals and entities are taxed by eliminating tax deferral strategies. The legislation would require billionaires to pay taxes annually on their assets' appreciation, closing loopholes that currently allow wealthy individuals to avoid taxation through strategies like "buy, borrow, die." Specifically, the bill introduces a mark-to-market taxation system for applicable taxpayers (defined as individuals with annual income over $100 million or assets exceeding $1 billion) that would require them to recognize gains on tradable assets annually, even if those assets are not sold. The bill also targets other tax avoidance mechanisms, such as deferring compensation, transferring appreciated assets to heirs tax-free, and using complex financial instruments like private placement life insurance contracts. Additionally, the legislation imposes new reporting requirements and special tax calculations for applicable taxpayers, with provisions that would apply to various types of assets, entities, and financial arrangements. The bill would take effect for taxable years beginning after December 31, 2025, and is designed to ensure that billionaires pay taxes more consistently and comprehensively, similar to how working-class individuals are taxed on their income.

Budget and Finance

https://www.congress.gov/bill/119th-congress/senate-bill/2845/all-info