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[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2912 Introduced in House (IH)]
<DOC>
119th CONGRESS
1st Session
H. R. 2912
To amend the Internal Revenue Code of 1986 to establish a wealth tax,
and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
April 14, 2025
Ms. Lee of Pennsylvania (for herself, Ms. Tlaib, Mr. Nadler, Mr. Frost,
Ms. Norton, Ms. Dean of Pennsylvania, Mrs. Ramirez, Mr. Huffman, Mrs.
Foushee, and Mrs. Watson Coleman) introduced the following bill; which
was referred to the Committee on Ways and Means
_______________________________________________________________________
A BILL
To amend the Internal Revenue Code of 1986 to establish a wealth tax,
and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Oligarch Act of 2025''.
SEC. 2. IMPOSITION OF WEALTH TAX.
(a) In General.--The Internal Revenue Code of 1986 is amended by
inserting after subtitle B the following new subtitle:
``Subtitle B-1--Wealth Tax
``Chapter 18--Determination of Wealth Tax
``CHAPTER 18--DETERMINATION OF WEALTH TAX
``Sec. 2901. Imposition of tax.
``Sec. 2902. Net value of taxable assets.
``Sec. 2903. Special rules.
``Sec. 2904. Information reporting.
``Sec. 2905. Enforcement.
``SEC. 2901. IMPOSITION OF TAX.
``(a) In General.--In the case of any applicable taxpayer, a tax is
hereby imposed on the net value of all taxable assets of the taxpayer
on the last day of any calendar year.
``(b) Computation of Tax.--
``(1) Individuals.--In the case of an individual, the tax
imposed by this section shall be equal to the sum of--
``(A) 2 percent of so much of the net value of all
taxable assets of the taxpayer as exceed the threshold
amount but do not exceed the product of 10 multiplied
by threshold amount,
``(B) 4 percent of so much of the net value of all
taxable assets of the taxpayer as exceed the product of
10 multiplied by the threshold amount but do not exceed
the product of 100 multiplied by the threshold amount,
``(C) 6 percent of so much of the net value of all
taxable assets of the taxpayer as exceed the product of
100 multiplied by the threshold amount but do not
exceed the product of 1,000 multiplied by the threshold
amount, plus
``(D) 8 percent of so much of the net value of all
taxable assets of the taxpayer as exceed the product of
1,000 multiplied by the threshold amount.
``(2) Trusts.--In the case of a trust, the tax imposed by
this section shall be equal to 8 percent of so much of the net
value of all taxable assets of the taxpayer as exceed the
threshold amount.
``(c) Applicable Taxpayer.--
``(1) In general.--The term `applicable taxpayer' means any
individual or any trust (other than a trust described in
section 401(a) and exempt from tax under section 501(a)).
``(2) Treatment of married individuals.--For purposes of
this section, individuals who are married (as defined in
section 7703) shall be treated as one applicable taxpayer.
``(d) Threshold Amount.--For purposes of this section, the term
`threshold amount' means the amount that is the product of 1,000
multiplied by the greater of--
``(1) $50,000, or
``(2) the applicable median household wealth.
``(e) Applicable Median Household Wealth.--The Secretary shall
annually determine the median household wealth with respect to the
United States for purposes of this section.
``(f) Application to Trusts.--
``(1) Attribution of assets in trust.--In determining the
assets of a taxpayer for purposes of subsection (a):
``(A) Grantor trust.--In the case of a grantor
trust, the grantor shall be treated as holding all the
assets of the trust.
``(B) Beneficiary trust.--In the case of a
beneficiary trust, each beneficiary of the trust shall
be treated as holding a fraction of the assets of the
trust in proportion to such beneficiary's interest in
such trust.
``(2) Property of trusts.--Any asset treated as held by a
grantor or beneficiary under paragraph (1) shall not be treated
as held by the trust for purposes of this section.
``(3) Trusts relating to common beneficiaries.--Trusts
benefitting substantially the same beneficiaries shall be
treated as a single applicable taxpayer for purposes of this
section.
``(4) Definitions.--For purposes of this section:
``(A) Grantor trust.--The term `grantor trust'
means a trust in which a taxpayer is treated as owning
an asset of the trust under subpart E of part I of
subchapter J of chapter 1.
``(B) Beneficiary trust.--The term `beneficiary
trust' means any trust that is not a grantor trust.
``(g) Regulations.--The Secretary shall issue such regulations or
other guidance as may be necessary or appropriate to carry out the
purposes of this section, including--
``(1) regulations establishing a process by which a
beneficiary may demonstrate the portion of such beneficiary's
interest in a trust, and
``(2) regulations for determining the appropriate
attribution of assets in a trust for purposes of subsection
(e)(1) in the case of a trust with multiple grantors.
``SEC. 2902. NET VALUE OF TAXABLE ASSETS.
``(a) In General.--For purposes of this subtitle, the term `net
value of all taxable assets' means, as of any date, the excess of--
``(1) the value of all property of the taxpayer (other than
property excluded under subsection (b)), real or personal,
tangible or intangible, wherever situated, over
``(2) any debts (including any debts secured by property
excluded under subsection (b)) owed by the taxpayer.
``(b) Exclusion for Certain Assets Under $50,000.--Property of the
taxpayer shall not be taken into account under subsection (a) if such
property--
``(1) has a value of $50,000 or less (determined without
regard to any debt owed by the taxpayer with respect to such
property),
``(2) is tangible personal property, and
``(3) is not property--
``(A) which is used in a trade or business of the
taxpayer,
``(B) in connection with which a deduction is
allowable under section 212, or
``(C) which is a collectible as defined in section
408(m), a boat, an aircraft, a mobile home, a trailer,
a vehicle, or an antique or other asset that maintains
or increases its value over time (within the meaning of
section 5.02(2) of Revenue Procedure 2018-08).
``(c) Rules for Determining Property of the Taxpayer.--For purposes
of this subtitle:
``(1) Property included in estate.--Any property that would
be included in the estate of the taxpayer if the taxpayer died
shall be treated as property of the taxpayer.
``(2) Inclusion of certain gifts.--Any property transferred
by the taxpayer after the date of the enactment of this
chapter, to an individual who is a member of the family of the
taxpayer (as determined under section 267(c)(4)) and has not
attained the age of 18 shall be treated as property of the
taxpayer for any calendar year before the year in which such
individual attains the age of 18.
``(d) Establishment of Valuation Rules.--Not later than 12 months
after the date of the enactment of this section, the Secretary shall
establish rules and methods for determining the value of any asset for
purposes of this subtitle, including rules for the valuation of assets
that are not publicly traded or that do not have a readily
ascertainable value. Such rules and methods--
``(1) may utilize retrospective and prospective formulaic
valuation methods not currently in use by the Secretary,
``(2) may require the use of formulaic valuation approaches
for designated assets, including formulaic approaches based on
proxies for determining presumptive valuations, formulaic
approaches based on prospective adjustments from purchase
prices or other prior events, or formulaic approaches based on
retrospectively adding deferral charges based on eventual sale
prices or other specified later events indicative of valuation,
and
``(3) may address the use of valuation discounts.
``SEC. 2903. SPECIAL RULES.
``(a) Deceased Individuals.--
``(1) In general.--In the case of any individual who dies
during a calendar year and who is not married on the date of
such individual's death--
``(A) section 2901 shall be applied by substituting
`the date of the applicable taxpayer's death' for `the
last day of any calendar year', and
``(B) the amount of the tax imposed under such
section shall be reduced by an amount which bears the
same ratio to such amount (determined without regard to
this subsection) as--
``(i) the number of days in the calendar
year after the date of the individual's death,
bears to
``(ii) 365.
``(2) Coordination with estate tax.--For purposes of
section 2053, the tax imposed by this section for the year of
the decedent's death shall be considered to have been imposed
before such death.
``(b) Application to Non-Residents.--In the case of any nonresident
alien individual, this subtitle shall apply only to the property of
such individual which is situated in the United States (determined
under rules similar to the rules under subchapter B of chapter 11).
``(c) Application to Covered Expatriates.--In the case of an
individual who is a covered expatriate (as defined in section 877A),
section 2901(a) shall be applied as if the calendar year ended on the
day before the expatriation.
``SEC. 2904. INFORMATION REPORTING.
``(a) In General.--Not later than 12 months after the date of the
enactment of this section, the Secretary shall by regulation require
the reporting of any information concerning the net value of assets
appropriate to enforce the tax imposed by this chapter.
``(b) Method of Reporting.--The Secretary shall, where appropriate,
require the reporting made under subsection (a) to be made as a part of
existing income reporting requirements (including requirements under
chapter 4 (relating to taxes to enforce reporting on certain foreign
accounts)).
``(c) Responsibility for Reporting.--The Secretary may impose
reporting obligations by reference to the ownership, control,
management, claim to income from, or other relationship to assets and
liabilities for purposes of administering the tax imposed by this
section and may impose such obligations on financial institutions,
business entities, or other persons, including requiring business
entities to provide estimates of the value of the entity itself.
``SEC. 2905. ENFORCEMENT.
``The Secretary shall annually audit not less than 30 percent of
taxpayers required to pay the tax imposed under this chapter.''.
(b) No Deduction From Income Taxes.--Section 275 of such Code is
amended by inserting after paragraph (6) the following new paragraph:
``(7) Taxes imposed by chapter 18.''.
(c) Extension of Time for Payment of Tax.--
(1) In general.--Section 6161(a) of such Code is amended by
adding at the end the following new paragraph:
``(3) Wealth tax.--
``(A) In general.--In the case of an applicable
taxpayer described in subparagraph (B), the Secretary
may extend the time for payment of the tax imposed
under chapter 18 for a reasonable period not to exceed
5 years from the date fixed for the payment thereof.
``(B) Taxpayers described.--An applicable taxpayer
is described in this subparagraph if such the Secretary
determines--
``(i) the applicable taxpayer has severe
liquidity constraints, or
``(ii) immediate payment would cause undue
hardship on an ongoing enterprise.
``(C) Applicable taxpayer.--For purposes of this
paragraph, the term `applicable taxpayer' has the
meaning given such term in section 2901.''.
(2) Rules.--Not later than 12 months after the date of the
enactment of this Act, the Secretary of the Treasury (or the
Secretary's delegate) shall establish rules for the application
of the amendments made by paragraph (1).
(d) Application of Accuracy Related Penalties.--
(1) In general.--Section 6662(b) of such Code is amended by
inserting after paragraph (10) the following new paragraph:
``(11) Any substantial wealth tax valuation
understatement.''.
(2) Substantial wealth tax understatement.--Section 6662 of
such Code is amended by adding at the end the following new
subsection:
``(m) Application to Substantial Wealth Tax Valuation
Understatement.--
``(1) Substantial wealth tax valuation understatement
defined.--
``(A) In general.--For purposes of this section,
there is a substantial wealth tax valuation
understatement if the value of any property claimed on
any return of tax is 65 percent or less of the amount
determined to be the correct amount of such valuation.
``(B) Limitation.--No penalty shall be imposed by
reason of subsection (b)(11) unless the portion of the
underpayment attributable to substantial wealth tax
valuation understatements for the calendar year exceeds
$5,000.
``(2) Increased penalty.--
``(A) In general.--In the case of any portion of an
underpayment which is attributable to one or more
substantial wealth tax valuation understatement,
subsection (a) shall be applied--
``(i) in the case of a substantial wealth
tax valuation understatement which is a gross
wealth tax valuation misstatement, by
substituting `50 percent' for `20 percent', and
``(ii) in any other case, by substituting
`30 percent' for `20 percent'.
``(B) Gross wealth tax valuation misstatement.--For
purposes of subparagraph (A), the term `gross wealth
tax valuation misstatement' means a substantial wealth
tax valuation understatement, as determined under
paragraph (1) by substituting `40 percent' for `65
percent'.''.
(e) Exemption of Tax-Exempt Entities.--Section 501(a) of such Code
is amended by inserting ``and subtitle B-1'' after ``this subtitle''.
(f) Clerical Amendment.--The table of subtitles of such Code is
amended by inserting after the item relating to subtitle B the
following new item:
``Subtitle B-1--Wealth Tax''.
(g) Effective Date.--The amendments made by this section shall
apply to calendar years beginning after the date of the enactment of
this Act.
<all>
Introduced in House
Introduced in House
Referred to the House Committee on Ways and Means.
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