Democrats Propose Mark-to-Market Tax And Increased Audits On High-Net-Worth Individuals

CW
Cadwalader, Wickersham & Taft LLP

Contributor

Cadwalader, established in 1792, serves a diverse client base, including many of the world's leading financial institutions, funds and corporations. With offices in the United States and Europe, Cadwalader offers legal representation in antitrust, banking, corporate finance, corporate governance, executive compensation, financial restructuring, intellectual property, litigation, mergers and acquisitions, private equity, private wealth, real estate, regulation, securitization, structured finance, tax and white collar defense.
Democrats at both the federal and state levels are proposing a "mark-to-market" tax and legislation that would mandate more audits on high-income taxpayers.
United Kingdom Tax

Democrats at both the federal and state levels are proposing a “mark-to-market” tax and legislation that would mandate more audits on high-income taxpayers.

  • A proposed federal bill would impose an annual tax on any unrealized gain on tradeable assets (e.g., stocks and bonds) for taxpayers with over $1 million in income or $10 million in assets. The bill also would impose a “look-back” charge on these taxpayers' gains from the sale of non-tradeable assets (e.g., business interests and real estate). A similar New York state bill would apply to residents with over $1 billion in net assets.
  • Proposed legislation also would increase the number of audits conducted on high-net-worth individuals, from less than 0.1% (in 2018) to upwards of 20% of individuals with incomes over $1 million and a third of individuals with incomes over $5 million, by 2025.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

Mondaq uses cookies on this website. By using our website you agree to our use of cookies as set out in our Privacy Policy.

Learn More