Democrats have also pointed to the massive untaxed wealth of people like Amazon.com Inc. founder Jeff Bezos who have built their fortune largely through company stock that grows in value without facing yearly taxes.

Wyden’s draft legislation would apply a new tax, beginning in 2022, for individuals with at least $1 billion in assets or $100 million annual income in three straight taxable years. It would apply to about 700 people, according to Wyden’s office.

It would create a “mark-to-market” system for taxing the gain or loss in value of stock, dividends and other tradable assets each year, according to a summary from Wyden’s office. At the end of the tax year, these assets would be subject to tax based on the change in their market value from the previous year. Any gain would then, in most cases, be subject to long-term capital gains tax of up to 23.8 percent tax rate under current law.

Capital losses

Under the proposal, a billionaire subject to the tax whose asset values take a dive during the year would have two options. They could choose to carry those losses forward to offset potential future mark-to-market gains, or carry them back to a year within the previous three to generate refunds for taxes paid on unrealized gains. Carrybacks could only offset prior mark-to-market tax, not taxes paid on other income.

For assets that aren’t traded on an exchange — such as real estate, closely held businesses, art or collectibles — an extra charge would apply when…

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