Millionaires Surtax Act
- Bill Number
- H.R. 8294
- Origin Chamber
- House
- Congress
- 119th Congress, Session 2
- Policy Area
- Taxation
- Status
- Introduced
- Latest Action
- 2026-04-15: Referred to the House Committee on Ways and Means.
- Last Updated
- 2026-04-27T22:32:21Z
AI-Generated Summary
Purpose
The Millionaires Surtax Act (H.R. 8294) aims to raise additional tax revenue by imposing a new surtax—an extra tax on top of regular income taxes—on very high-income individuals, excluding corporations.
Key Provisions
- Surtax Rate and Thresholds:
- 10% surtax on modified adjusted gross income (MAGI)—a measure of total income after specific deductions, like certain investment interest expenses—above $2,000,000 for most taxpayers.
- Threshold drops to $1,000,000 for single filers, head of household, or surviving spouses (not married filing jointly).
- Special Rules:
- Nonresident aliens: Only applies to U.S.-source income already taxed under existing rules.
- U.S. citizens/residents abroad: Threshold reduced by amounts excluded for foreign earned income.
- Charitable trusts: Fully exempt if dedicated to charitable purposes.
- The surtax does not count as a regular income tax for calculating tax credits or the Alternative Minimum Tax (AMT, a parallel tax system to ensure high earners pay a minimum).
- Effective Date: Applies to tax years starting after December 31, 2026.
- Adds new Section 59B and Part VIII to the Internal Revenue Code (the main U.S. tax law).
Significant Changes to Existing Law
- Introduces an entirely new surtax mechanism in the tax code, separate from standard income tax rates.
- Explicitly excludes it from being treated as a "rate change" under Section 15 (which handles inflation adjustments for tax rates).
- Does not alter corporate taxes or existing individual tax brackets.
Potential Impacts
- Government Agencies: Increases IRS workload for enforcement and revenue collection; boosts federal revenue, potentially funding government programs (exact amount unspecified).
- Citizens: Raises taxes for high earners (e.g., adding up to 10% on income over thresholds), but no direct impact on lower/middle-income taxpayers.
- International Relations: Minor effects via rules for nonresidents and expats, aligning with existing foreign income exclusions.
Main Stakeholders Affected
- High-income individuals (earning over $1M–$2M annually, depending on filing status)—primary taxpayers hit by the surtax.
- Internal Revenue Service (IRS): Responsible for implementation and audits.
- Federal government: Gains revenue.
- Charitable organizations and trusts: Protected from the tax.
- Nonresident aliens and U.S. expats: Adjusted rules to avoid double-taxation issues.
Notable Legal, Constitutional, or Political Implications
- Legal: Fits within Congress's broad power to levy income taxes (16th Amendment); special rules prevent interference with credits/AMT, ensuring clean integration into tax code.
- Constitutional: No apparent challenges, as it targets income progressively without distinguishing by source or citizenship in a discriminatory way.
- Political: Advances "tax the rich" policy by naming it "Millionaires Surtax"; introduced by Democrats, likely to spark debate on wealth inequality vs. economic incentives for high earners.
This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.
Sponsor
Rep. Beyer, Donald S. [D-VA-8]
Cosponsors (8)
Rep. Cohen, Steve [D-TN-9], Rep. Deluzio, Christopher R. [D-PA-17], Del. Norton, Eleanor Holmes [D-DC-At Large], Rep. Tlaib, Rashida [D-MI-12], Rep. Davis, Danny K. [D-IL-7], Rep. Panetta, Jimmy [D-CA-19], Rep. Sánchez, Linda T. [D-CA-38], Rep. García, Jesús G. "Chuy" [D-IL-4]
Recent Actions
- 2026-04-15: Referred to the House Committee on Ways and Means.
- 2026-04-15: Introduced in House
- 2026-04-15: Introduced in House
Bill Versions
- Millionaires Surtax Act — issued 2026-04-15 — PDF (4 pages)