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      • Proposed US Infra Bill Will Not...
      World

      Proposed US Infra Bill Will Not Impose 61 Per Cent Tax On Deceased People

      Proposed US infrastructure bill will tax all individual assets at 61 per cent after a person dies.

      By - AFP |
      Published -  16 Oct 2021 2:43 PM IST
    • Boomlive
      Proposed US Infra Bill Will Not Impose 61 Per Cent Tax On Deceased People

      Facebook posts claim that the US infrastructure bill being considered by Congress includes a provision taxing all individual assets at 61 per cent after a person dies. This is false; experts say the bill contains no such measure, and while President Joe Biden proposed an increase to taxes after death earlier this year, it only applied to the wealthy and is not included in the current legislation being considered.

      Also Read: Staff Shortage, Not Vaccine Strike, Caused Flight Cancelations in US

      "How Many Citizens Are Actually Aware Under Part 2 Of The Infrastructure Bill, Upon Death The Entire Value Of Your Accumulated Wealth & Estate Will Be Taxed At 61%..?" says an October 8, 2021 Facebook post.


      Screenshot of a Facebook post, taken on October 13, 2021

      More examples of the claim appeared on Facebook here, here and here.

      After passing the Senate, the $1.2 trillion infrastructure bill stalled in the House of Representatives, with deep divisions within the Democratic Party threatening Biden's agenda.

      Urban-Brookings Tax Policy Center's Howard Gleckman called the tax claim "another unfounded internet rumor."

      Gleckman, a senior fellow at the think tank, explained that the draft legislation of the Build Back Better Act -- not the infrastructure bill -- "would lower the estate and gift tax exemption from about $11 million to $6.020 million ($12.040 for a couple). Estates valued at less than that amount would owe no federal tax."

      Neither the infrastructure bill (HR 3684) nor the Build Back Better bill (HR 5376) have become law, and both are subject to future changes.

      Also Read: Posts Falsely Claim California Ports Backlog Has Been Done Intentionally

      Tax Foundation senior policy analyst Garrett Watson pointed to an April 29 report he co-authored, which found that Biden's two major tax increases proposed in his American Families Plan add up to a "61 percent tax on the wealth of high-earning taxpayers."

      "However, taxpayers who have lower levels of wealth would not be subject to one or both of the estate tax and taxing unrealized capital gains at death. Only unrealized gains over $1 million ($2 million for joint filers) would be subject to that tax, and the estate tax kicks in over $11.7 million," he said.

      "The 61 percent effective tax rate would not apply to taxpayers writ-large."

      But Biden's suggested tax increases did not make it into the Build Back Better tax proposals, meaning "this proposal may not make it to the final package. The Senate Finance Committee has not yet released their own tax proposals, though, so it could still be included later on," Watson said.

      Even if it were to be added into the law, estate and financial planning attorney Leon LaBrecque explained that the tax hike would only affect "a small number of higher income/higher wealth folks."

      LaBrecque, who also chairs the Michigan Association of Certified Public Accountants special task force on new tax legislation, added: "All is in flux, but the direction of the proposals is away from the huge tax increase."

      Scott Swartz, a tax attorney and instructor at John Carroll University's Boler College of Business, also addressed the social media claims: "There is no such tax in the infrastructure bill. There's different levels of inaccuracy here."

      The current estate tax top rate is 40 percent above the $11.7 million exemption level for 2021 according to the Internal Revenue Service. That means fewer than 0.1 percent of estates are subject to this tax, according to the Tax Policy Center's estimate.

      The closest proposals to what the posts describe is Senator Bernie Sanders' For the 99.5 Percent Act, or Elizabeth Warren's Ultra-Millionaire Tax Act, Swartz said.

      "But none of those have gone anywhere, they're just sitting in committee."

      Also Read: Global Facebook Outage Was Not Caused By Chinese Teen Hacker

      AFP Fact Check previously debunked another inaccurate claim about a tax measure in the infrastructure bill here.

      (Except for the headline, this story has not been edited by BOOM staff and is published from a syndicated feed.)

      Tags

      US Economy
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      Claim :   US infrastructure bill includes a provision taxing all individual assets at 61 per cent after a person dies.
      Claimed By :  Posts on Facebook
      Fact Check :  False
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