[Congressional Bills 118th Congress]
[From the U.S. Government Publishing Office]
[H.R. 4919 Introduced in House (IH)]

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118th CONGRESS
  1st Session
                                H. R. 4919

 To amend the Internal Revenue Code of 1986 to establish a wealth tax, 
                        and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             July 26, 2023

Ms. Lee of California (for herself, Ms. Lee of Pennsylvania, Ms. Tlaib, 
Mr. Bowman, Mr. Garcia of Illinois, Mr. Grijalva, Mr. Nadler, Ms. Omar, 
   Mr. Huffman, Mrs. Watson Coleman, and Mr. Raskin) 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 2023''.

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 house hold 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 
        adding at the end the following new paragraph:
            ``(10) 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 imposed by subtitle B-1 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)(10) 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.
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