Biden's proposed 'death tax' will hit New York harder than other states

For the first time in the United States, the White House's proposed tax bill treats inheritance as a capital gain event and proposes to tax this gain. The details were told by the publication New York Post.

If the project is approved, this "Death tax" it will be impossible to avoid, as well as death itself. This tax poses serious harm to New Yorkers - their tax burden will be much higher than in other states.

According to the president's proposal, any heirs to the property will pay capital gains tax on this property: roughly speaking, on the difference in price between the moment the property is purchased by those who left the inheritance, and the moment of inheritance.

It is proposed to establish the rate of such a tax at 39,6%. This tax will be in addition to federal, state, and New York City taxes. Thus, the total tax rate for the richest New Yorkers, if they inherit any assets, will be 78,9%. This is significantly higher than the current total tax burden for New Yorkers - 49,6%.

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A Biden spokesman confirmed that the wealthiest residents of the "blue states" (where the Democrats are in power) can face an incredibly high tax burden. However, the reform will provide for the protection of family businesses and farms when transferred to heirs who will continue to run the business.

However, this rule, while aimed at the wealthy, can apply to anyone who has inherited more than $ 1 million. And those who are at the bottom of the tax scale can pay for it.

At the same time, some tax experts warn that this measure may not bring the desired effect, and it remains to be seen whether New York will really generate large revenues from this tax.

Given that New Yorkers can save up to 14 percent on taxes by moving to Florida, for example, it is possible that many will move south at an advanced age.