The Ultra-Millionaire Tax Act is a proposed federal wealth tax that would charge households an annual 2% on net worth above $50 million and 3% on net worth above $1 billion. Senator Elizabeth Warren and Representatives Pramila Jayapal and Brendan Boyle reintroduced the bill in March 2026 as S.4246 in the Senate and H.R.8085 in the House. Both versions sit in committee, and no version introduced since 2021 has advanced further.1Congress.gov. H.R.8085 – Ultra-Millionaire Tax Act of 2026 Sponsors project it would raise roughly $2 trillion over ten years.
Who Would Pay
The tax reaches only households and trusts with total net worth above $50 million. Every dollar below that line is untaxed. Sponsors describe the affected group as about 100,000 households, a fraction of one percent of American families.
Married couples count as a single taxpayer. Their combined assets share one $50 million threshold rather than getting a separate exemption per spouse.2Congress.gov. S.4246 – Ultra-Millionaire Tax Act of 2026 Trusts and similar legal structures are looked through so the underlying wealth is attributed to the real owner, and the bill specifically addresses nongrantor multibeneficiary trusts to prevent layering.
How the Rates Work
The base rate is 2% per year on the slice of net worth between $50 million and $1 billion. A household worth $80 million would owe 2% on the $30 million above the threshold, or $600,000 for the year.3Congresswoman Pramila Jayapal. Jayapal, Warren, Boyle, 45+ Lawmakers Renew Push for Wealth Tax on Ultra-Millionaires and Billionaires
Wealth above $1 billion is taxed at 3%, which is the 2% base plus a 1% billionaire surtax. Someone worth $1.5 billion would pay 2% on the $950 million between $50 million and $1 billion, plus 3% on the $500 million above $1 billion.3Congresswoman Pramila Jayapal. Jayapal, Warren, Boyle, 45+ Lawmakers Renew Push for Wealth Tax on Ultra-Millionaires and Billionaires
The bill contains a conditional rate increase that is often misreported. The top rate rises from 3% to 6% only if Congress separately enacts a universal single-payer healthcare program that prohibits private insurers from offering duplicate coverage. Absent that specific law, the 6% rate never activates. It is not triggered by recessions, deficits, or emergency spending.4Congress.gov. H.R.8085 – Ultra-Millionaire Tax Act of 2026
What Counts Toward Your Net Worth
Real estate, publicly traded stocks and bonds, ownership stakes in private companies, cash, and trust assets all count. Debts reduce the total. A person holding $70 million in assets against $25 million in loans has a net worth of $45 million and falls below the threshold.
A narrow carve-out excludes tangible personal property worth $50,000 or less, but only if the item is not used in a business, is not a collectible, and is not a boat, aircraft, vehicle, or antique that appreciates. An ordinary family car under $50,000 could qualify. A vintage sports car or yacht would not.4Congress.gov. H.R.8085 – Ultra-Millionaire Tax Act of 2026
Qualified retirement trusts that are already tax-exempt, such as 401(k) plans, are not treated as separate taxable entities under the bill’s trust rules. Their value still counts, however, when calculating whether a household crosses the $50 million line.4Congress.gov. H.R.8085 – Ultra-Millionaire Tax Act of 2026
Valuing Hard-To-Price Assets
Publicly traded securities carry daily market prices, so valuing them is straightforward. Private companies, commercial real estate, fine art, and similar holdings are the hard cases. The bill directs the IRS to develop expanded valuation rules and gives it new tools to assess property that does not trade in an open market.5Senator Elizabeth Warren. Warren, Jayapal, Boyle Introduce Ultra-Millionaire Tax on Fortunes Over 50 Million Valuations must reflect fair market value and would be updated annually, with systematic third-party reporting used to cross-check self-reported figures.
Because wealth does not always come with cash on hand, the bill lets taxpayers defer payment for up to five years, with interest accruing on the unpaid balance. The IRS is also directed to write additional rules for cases where deferral is needed to avoid damaging an ongoing business.6Elizabeth Warren. Ultra-Millionaire Tax
Audits, Penalties, and the Exit Tax
The bill funds $100 billion in IRS infrastructure, covering hiring, training, IT, and the systems needed for wealth-based reporting and audits.5Senator Elizabeth Warren. Warren, Jayapal, Boyle Introduce Ultra-Millionaire Tax on Fortunes Over 50 Million It also requires the IRS to audit at least 30% of taxpayers subject to the wealth tax each year, which would be a substantial jump from current audit rates for high-net-worth filers.7Senator Elizabeth Warren. Ultra-Millionaire Tax Act of 2026
The strongest anti-avoidance provision targets renunciation of citizenship. A U.S. citizen who expatriates to escape the tax faces a one-time exit tax of 40% on net worth above $50 million. Someone worth $200 million would owe $60 million on the way out.7Senator Elizabeth Warren. Ultra-Millionaire Tax Act of 2026 The bill also funds specialized teams to track offshore accounts and foreign real estate.
Projected Revenue
The Penn Wharton Budget Model estimated that the 2021 version of the bill would raise about $2.1 trillion over ten years under conventional scoring, or roughly $2.4 trillion when factoring in enhanced IRS enforcement. Dynamic scoring that incorporates macroeconomic feedback brought the figure closer to $2 trillion.8Wharton Budget Model. Budgetary and Economic Effects of Senator Elizabeth Warrens Wealth Tax Legislation The 2026 version uses the same rate structure, though updated wealth data could shift the number in either direction. Critics argue that actual collections would fall short because wealthy taxpayers would restructure holdings, relocate assets, or contest valuations.
Can Congress Constitutionally Do This?
Whether a federal wealth tax is constitutional is genuinely unsettled. Article I, Section 9 requires that “direct taxes” be apportioned among the states based on population: “No Capitation, or other direct, Tax shall be laid, unless in Proportion to the Census.”9Congress.gov. Article 1 Section 9 Clause 4 Apportioning a wealth tax by population is essentially impossible, because wealthy households cluster in a few states and each state’s rate would have to swing wildly to hit its population share.
The Sixteenth Amendment lifted the apportionment requirement for income taxes in 1913, but a wealth tax reaches what a person owns, not what they earn. Opponents call it a direct tax on property that must be apportioned. Supporters argue the historical meaning of “direct tax” was never settled.
The Supreme Court’s 2024 decision in Moore v. United States did not resolve the question. The Court upheld the Mandatory Repatriation Tax but explicitly stated that “our analysis today does not address the distinct issues that would be raised by taxes on holdings, wealth, or net worth,” and declined to decide whether realization of income is constitutionally required.10Supreme Court of the United States. Moore v. United States If the Ultra-Millionaire Tax Act became law, a constitutional challenge would follow, and the outcome is unpredictable.
Where the Bill Stands
Warren and Jayapal first introduced the Ultra-Millionaire Tax Act in March 2021.11Congresswoman Pramila Jayapal. Jayapal and Warren Introduce Wealth Tax on Fortunes Over 50 Million It was reintroduced in the 118th Congress and again in March 2026 in the 119th Congress, with Representative Boyle joining as a lead House sponsor. The House version was referred to the Ways and Means Committee, where it remains. No version has advanced past committee, and near-term passage is unlikely. The proposal continues to shape debate about how the federal government taxes extreme wealth.