A bill which would dramatically increase estate taxes has been introduced by Senator Bernie Sanders (I-VT). S. 309 is titled the “For the 99.8 Percent Act.”
Sen. Sanders asserts that “only 0.2% of Americans” have estates that are valued over $3.5 million. In response, he introduced S. 309 stating he felt that “from a moral, economic, and political perspective, our nation will not thrive when so few have so much and so many have so little.”
Under tax reform enacted in 2017, the first $11.4 million per person and $22.8 per couple would be exempt from the federal estate tax. The portion above those levels is subject to a 40 percent tax rate. That provision will expire at the end of 2025 and will revert to its pre-reform levels of $5 million per person adjusted for cost of living increases if it is not extended or changed.
S. 309 would make the following changes to the 40 percent estate tax rate:
• 45 percent on the value of an estate between $3.5 million and $10 million
• 50 percent on the value of an estate between $10 million and $50 million
• 55 percent on the value of an estate in excess of $50 million
• 77 percent on the value of an estate in excess of $1 billion.
Only Sen. Kirsten Gillibrand (D-NY) has cosponsored S. 309 and it currently has no companion bill in the House.
Meanwhile, the Senate Republican leadership introduced S. 215, the Death Tax Repeal Act, to repeal estate taxes outright. That bill has 32 cosponsors in the Senate and three similar bills have been introduced in the House.
Like S. 309, S. 215 has little chance of becoming law given the current split control of Congress. However, the situation may change after the 2020 elections.
