Working Americans Affordability Tax Credit Act

An eligible individual would receive a $4,200 credit for a tax year; on a joint return, the credit would be doubled if both spouses are eligible. The credit would shrink as modified adjusted gross income rises and reach zero at $100,000 for an individual or $200,000 on a joint return.

For people who meet the bill’s definition of an applicable taxpayer, gains or losses on tradable covered assets would generally be counted each year based on their fair market value. Applicable taxpayers generally must meet the bill’s income or asset test for each of the three preceding tax years; the tests include income above $100 million or covered assets above $1 billion, with lower thresholds for married people filing separately.

The bill would apply special rules to certain transfers of nontradable assets, pass-through entities, gifts, inheritances, and trusts. In some cases, a transfer would be treated as a sale at fair market value, and tax on a transfer could include an interest amount tied to earlier years.

Later sections address tax treatment of certain compensation, life insurance and annuity contracts, small-business stock, and qualified opportunity funds. The section headings also cover net investment tax, expatriates, like-kind exchanges, stock transfers, and applicable trusts; details for those provisions are not included here.